Monday, September 22, 2008

CNN Poll: Obama Improves National Lead

A new CNN/Opinion Research Poll finds that by a 2-to-1 margin, Americans blame Republicans "for the financial crisis that has swept across the country the past few weeks -- one factor that may have contributed to an apparent increase in Barack Obama's edge over John McCain in the race for the White House."

Obama now leads McCain among likely voters, 51% to 47%.

On the Road: Grand Junction, Colorado. And the Odds Are...

Twelve to one.

For every twelve voters who you talk to at their doors, one voter goes and votes who would not otherwise have voted. If you're asking: "how can I be most effective in helping my candidate win the election?" then an organizer's answer is going to be: knock on doors.

Colorado National Monument

This figure, moreover, is a conservative estimate. When calculating the effects of actual treatment, we regarded any conversation with a member of the household as a "contact." Only about half of these conversations occurred directly with a subject in the treatment group; the remainder involved urging a housemate to vote and requesting that this message be passed along to the intended subject. Had we restricted the definition of contact to direct conversations with the subject, the apparent effects of canvassing would have been much greater.
Although the study aimed at local elections, the principle is sound. Face-to-face contact is the single most important effort a volunteer can contribute to his or her candidate.

Let's do a little math. 12 face-to-face contacts is one new voter who would not have otherwise voted that you personally generated. You just doubled your own vote by speaking at the door to twelve voters. Of course, then it comes down to contact rate -- how often is the person home that you're trying to reach. A very low contact rate is probably 10%, and that happens. A very high contact rate can be 50%. Average is in the 25% ballpark. On average, you'd have to knock on 48 doors to generate 12 face-to-face contacts and one additional vote. 48 doors is a pretty standard, approximate walk list.

So if you go out one four-hour walk shift every weekend between now and the election, you've generated -- on average -- six extra votes from people who would not otherwise have voted for your candidate.

Does it sound paltry? Does it sound difficult? It's what campaigns do. In the aggregate, all that effort is transformative. It is what wins -- or fails to win elections. Organizers face 50 walk-ins a day asking for yard signs, people who politely make excuses as to why this is all they can do. Perhaps for a small handful of these people that is even true. Then the organizer grinds it out seeking people who will fill a shift to go knock on some doors, because every organizer knows 12-to-1.

In Grand Junction yesterday, we spent time tagging along with Obama volunteers doing just that. It was hard going, as many folks weren't home. But the doors were knocked anyway. Just past noon, a gathering of 15-20 volunteers collected in the office to first share their personal stories of why they'd been moved to get involved, and then action strategy unfolded. Morning canvassers returned with their walk sheets, volunteers made calls, and new canvassers went out for an early afternoon shift.

In Glenwood Springs up the road an hour or so, we saw the process repeat. A volunteer named Barclay Lottimer raved about the Obama organizer there, whose program in Garfield County had generated 3,000 knocks the previous weekend and 2,500 knocks so far this weekend when we stopped midday. Garfield had at least 1,000 new Democratic registrants. Summit County has flipped its registration edge from R to D based on the voter reg work spearheaded by Obama's organizers and volunteers. Many Colorado analysts expect Colorado Springs and Boulder to roughly cancel each other out, Denver and suburbs to trend toward Obama, but will McCain hold down Obama's Western Slope gains enough to keep Colorado in the red column?

A note about the McCain campaign. We are working as hard as we can to cover the Republican side of the ground game everywhere we go. We always go to their offices and look for volunteers, organizers, anyone who can tell us what is happening on the ground. But in Colorado on Saturday and Sunday, we found every office but the Cortez office closed. The Durango office was closed on Saturday. The Grand Junction office was closed on Sunday. In Glenwood Springs, Eagle, and Dillon -- where we stopped in at busy Obama offices -- McCain and/or Republican Party offices were either closed or nonexistent.

What we believe is happening here is that the McCain campaign is relying on its highly microtargeted phone calling to run its ground operation on the Western Slope, and that toward the end it will beef up its western ground staff in must-win Colorado. We also infer that the McCain camp is skeptical of Obama's ability to improve on past Democratic performance on the Western Slope, otherwise they'd be working harder.

Paulson's Folly

The current Wall Street rescue plan has some serious failings. Will congressional Democrats (and Republicans) stand up to the treasury secretary?

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Paulson's Folly

Treasury Secretary Henry Paulson's $700 billion rescue plan puts the two presidential candidates in a curious position. One or both could end up voting against it, at odds with their respective parties.

There is a backlash among some rank-and-file members of both parties against giving Wall Street a blank check, even as most congressional leaders are reluctantly concluding that some kind of bailout is necessary to prevent a financial cataclysm. John McCain spent the week repositioning himself as a born-again populist, railing against Wall Street greed. And by Sunday afternoon, Barack Obama issued a tough set of principles for a bailout, including "No Blank Check for Wall Street"; help for homeowners; and an economic-stimulus plan for working families.

Thus, the stage is set for an epic game of chicken, against a very tight deadline. Will the Democrats insist on some serious help for Main Street and constraints on Wall Street as the price of a deal? Nothing would better highlight the differences between the two parties, or better strengthen Obama's hand. Or will Paulson reject anything other than his own approach -- possibly leaving both candidates to vote against the deal?

As Paulson testifies before key congressional committees Tuesday and Wednesday, and Democrats (and some Republicans) express indignation about the one-sided character of the deal, Wall Street could shudder -- leading Paulson to double down yet again and warn his critics that their hesitancy is leading the economy off a cliff. But there is more than one way to do this deal.

Paulson spent Sunday morning making the round of talk shows, insisting on a "clean" bill uncluttered by regulatory reforms, caps on executive windfalls, refinancing assistance for homeowners, or anything other than unprecedented authority for himself to relieve financial institutions of up to $700 billion in securities that nobody else wants to buy. Paulson spoke as if he had all the cards.

So the key question is what conditions congressional Democrats will extract in return, and whether they will have the political nerve to fight, especially if financial markets grow more panicky with each passing day. At this writing, Nancy Pelosi seems determined to insist on a second stimulus package on the order of $100 billion, including greater relief for homeowners, but there is growing sentiment for some kind of cap on executive pay as well as more assurance that taxpayers, one way or another, will get something back.

The Democrats will be joined by some odd bedfellows. Many leading Republicans in Congress are very skeptical of this deal -- though most want less bailout for Wall Street rather than more relief for Main Street. Rep. Jeb Hensarling, a Republican from Texas, told The Wall Street Journal that a number of Republican conservatives "may very well" oppose the plan. Rep. Mike Pence of Indiana said Friday, "Now's the time for us to be dealing with the root causes of this economic downturn and not simply opening the cash window at the Federal Reserve and writing one bailout check after another."

Speaking on CBS' "Face the Nation" Sunday morning, House Financial Services Committee Chairman Barney Frank said he would want to add several features to the Paulson plan, including relief for homeowners, a new stimulus package, and limits on CEO compensation. Said Frank, "It would be a grave mistake to say that we're going to buy up the bad debt that resulted from the bad decisions of these [private sector] people and then allow them to get millions of dollars on the way out. ... It's kind of hard to tell the average American that we're going to continue to have foreclosures that destabilize neighborhoods and deprive cities of revenues they need, but we're going to buy up the [banks'] bad paper."

The ranking Republican on the Senate Banking Committee, Richard Shelby, appearing with Frank, sounded if anything even more radical than Frank, accusing Paulson of "lurching from crisis to crisis" and helping Wall Street, but doing nothing for the homeowner. Shelby, whose support is crucial to the plan, later issued a written statement that he "remains at this point unconvinced" of the proposal's merits.

The deal proposed by Paulson is nothing short of outrageous. It includes no oversight of his own closed-door operations. It merely gives congressional blessing and funding to what he has already been doing, ad hoc. He plans to retain Wall Street firms as advisers to decide just how to cut deals to value and mop up Wall Street's dubious paper. There are to be no limits on executive compensation for the firms that get relief, and no equity share for the government in exchange for this massive infusion of capital. Both Obama and McCain have opposed the provision denying any judicial review of decisions made by Paulson -- a provision that evokes the Bush administration's suspension of normal constitutional safeguards in its conduct of foreign policy and national security.

Though the administration's line is that these securities are not trading because of a crisis of confidence, so many are ultimately backed by loans that will not be paid back that they will eventually be sold for a fraction of their face value. Firms that have marked these securities down or have otherwise gotten them off their books have valued them at around 30 cents on the dollar or less. If Paulson had proposed such a deal in his old job as CEO of Goldman Sachs -- putting $700 billion of the firm's capital at risk in exchange for junk bonds of unknown value -- he would have been fired in short order. But this is merely taxpayer money.

The differences between this proposed bailout and the three closest historical equivalents are immense. When the Reconstruction Finance Corporation of the 1930s pumped a total of $35 billion into U.S. corporations and financial institutions, there was close government supervision and quid pro quos at every step of the way. Much of the time, the RFC became a preferred shareholder and often appointed board members. The Home Owners Loan Corporation, which eventually refinanced one in five mortgage loans, did not operate to bail out banks but to save homeowners. And the Resolution Trust Corporation of the 1980s, created to mop up the damage of the first speculative mortgage meltdown, the savings and loan collapse, did not pump in money to rescue bad investments; it sorted out good assets from bad after the fact, and made sure to purge bad executives as well as bad loans. And all three of these historic cases of public recapitalization were done without suspending judicial review.

What should Congress demand in return for this deal?

  • Government equity in firms receiving assistance, in rough proportion to the amount of aid extended.
  • Limits on executive compensation paid by any firm receiving the public aid.
  • A recapture of the cost to the government, to be extracted from the firm's future profits.
  • A six-month sunset provision, so that the treasury secretary's bailout authority would expire by next April 1. Any extension would be conditional on across-the-board re-regulation of financial institutions of all types.
  • Creation of a small independent board, which must review and approve Paulson's proposed deals.
  • A narrower treatment of court challenges to Paulson's actions.
  • A parallel program to refinance sub-prime mortgage loans and to provide funding to municipalities and community-based nonprofits to acquire, restore, and repopulate foreclosed properties.
  • At least $200 billion of new economic stimulus, in the form of aid to states, cities, and towns, for infrastructure rebuilding, more generous unemployment compensation and retraining benefits.

For nearly three decades, conservative Republicans have insisted that the cupboard is bare when it comes to needed social outlay. Conservative Democrats have been hesitant to spend more than token amounts because of concern for the deficit. Now suddenly, spending that will increase the deficit by $700 billion is greased to slide through Congress in less than a week but only because the money is for Wall Street.

Paulson said Sunday that the two cases are not comparable. "This is different than spending money you know you're never going to get back," he told CBS' Bob Schieffer. "This is buying assets, holding assets, and then selling assets." But that is just nonsense. Investing public funds in college education, the health of children, public infrastructure, research and development, or energy independence is money that is far more likely to produce a good return than public investments in the toxic junk of Wall Street. If the economic emergency requires deficit spending, the benefits should be spread. No self-respecting legislator should vote for this lopsided plan in its present form, and a bracing debate should shed light on what the two parties really stand for.

When you think about it, Hank Paulson is about the last person in America who should be entrusted with this emergency infusion of public capital -- because his perspective is entirely that of the bankers who created the mess in the first place. Paulson is treating the U.S. Treasury as a branch office of Wall Street. When I was a proudly liberal graduate student, I used to snicker at my radical classmates who described the government, in Marxian cant, as the "executive committee of the ruling class." Well, there is no better description of the Treasury as operated by Hank Paulson.


Robert Kuttner is co-founder and co-editor of The American Prospect magazine, as well as a Distinguished Senior Fellow of the think tank Demos. He was a longtime columnist for Business Week, and continues to write columns in the Boston Globe. He is the author of Obama's Challenge and other books. For more read our "about the editors" page.


Posted by Mark

Last night Obama and McCain were interviewed on 60 Minutes. For those who missed it, each candidate was interviewed for about a half-hour. As expected, Obama spoke authoritatively on the economy and McCain was jittery. And as expected, McCain came to life when talking about the Surge, and Obama, while strong, didn't radiate with the same confidence. Apparently, in the battleground states, McCain is running lots of surge ads, even in the face of the economic crisis. As Obama aptly put it, "he has nothing else to say". So, of course.

Which brings me to a point: Back in 2000, I have a very clear recollection of a moment during one of the town hall style Bush/Gore debates: Bush walked out in front of his lecturn to address the audience. He spoke in code. He said: "I want to get this country ready for 21st century warfare." I remember it well, and I remember knowing at that moment that if he got elected we were going to war. 9/11 - which hadn't happened yet - made it easy for him. The code he spoke was intended for the defense and oil industry...and his base. In that hawk-patriot "speak", he sent them a very clear message. I might add that it's a similar code to the one Republican candidates often speak when they refer to appointing judges to the Supreme Court: You'll often hear them say they'll appoint judges who will "execute law with a strict adherence to the language of the constitution." As if one couldn't interpret the constitution based on their ideological leanings!

Last night, McCain spoke his variation of the code. Toward the end of the interview, in the best of Reaganesque backdrops, he told the story of a mother he'd met on the campaign trail. She gave him her son's dog tag and asked Mccain to do the right thing. And as he told the story, he pulled the dog tag from the envelope, and with tears in his eyes, said," that's what being the president is all about." That was code...easy to spot. Loud and clear he announced to the defense and oil industry, and his base, that he would "lead" by keeping the country - and taking the country - to war. It was as clear as day. The fact is, much like Bush, he doesn't know any other way to lead.

So, if we've really had enough, if we really can't stand it for another day, if we really believe in peace.....then we all have to do something more than we're presently doing!


When in a hurry, step #1 for changing the entire world is falling in love with it as it already is. And best of all, with this approach, there is no step # 2.

The Universe



Investigative journalist Greg Palast and cartoonist Ted Rall have created an illustrative series called "Vote Theft for Idiots" that details how Bush and the Republicans will easily steal the upcoming US election in November, 2008. You can download various sizes of the first page here you can watch the new film by Palast, "Free for All."
and at

Calling Paulson's Bluff

By Robert Kuttner, Co- Editor of The American Prospect;
From Today's Huffington Post

Treasury Secretary Hank Paulson spent the past two weeks playing a game of chicken with firms like Lehman Brothers and A.I.G. Now he is playing even higher-stakes chicken with Congress and the economy.

Paulson's storyline is that the credit markets are frozen, and unless Congress passes a "clean bill" -- his way -- disaster lies ahead. He spent a busy Sunday morning on the talk shows ducking questions on what would happen if Congress didn't act -- and what might still happen if it did.

One senior Congressional Democrat told me, "They have a gun to our heads." Paulson behaved as if he held all the cards, but in fact the Democrats have a lot of cards, too. The question is whether they have the nerve to challenge major flaws in Paulson's plan as a condition of enacting it.

Paulson also faces serious defections in Republican ranks, with several key senators and congressmen resisting a bailout of this scale. Sen. Richard Shelby, the ranking Republican on the Senate Banking Committee, speaking on CBS's Face the Nation, flatly blamed the crisis on greed and deregulation, and questioned the terms of Paulson's plan.

Paulson's bill would give him carte blanche to spend up to $700 billion over the next 24 months to buy toxic securities from financial firms. This presumably would "unclog" capital markets, the financial economy would begin functioning normally again, and then the government would recoup what it could.

The plan is outrageous on several levels. It demands nothing from these firms in return. It holds the Treasury Secretary accountable to no one. And it extends the most generous terms to Wall Street while offering nothing to Main Street.

House Financial Services Chairman Barney Frank, speaking Sunday morning on "Face the Nation," gave the flavor of what Democrats will demand, if they hang tough: An economic stimulus to go with the Wall Street bailout; more refinancing help for borrowers; and some limits on windfall gains to corporate executives. These provisions would improve the bill, and Democrats would win either way: if they were included, more help would be on the way to working families. If they lost, and the bill passed without these provisions, it would make crystal clear the difference between the parties.

Ideally, the Democrats should go even further.

The bailout bill should be explicitly tied to a commitment to re-regulate all types of financial institutions. The bill's authority should expire after six months, so that when the next Congress re-authorizes any bailout authority it would be combined with tough comprehensive regulation.

Any private company that sells assets to the Treasury should be subjected to stringent limits on executive windfalls.

The government should get an equity position in the firms it helps, proportional to the help that it gives.

Treasury should be authorized and directed to take controlling interest in some firms, and take over their management, if of course that provides the greatest potential savings to taxpayers. For example, when an FDIC-insured bank goes broke, the FDIC either merges it into a healthy bank, or takes it over and runs it for a time while it pays off depositors, to make sure that it is run properly. It does not just bail out the incumbent management that created, and profited from, the mess.

There should be a recapture provision, so that if firms end up profiting from this bailout, the government gets its money back.

Part of the $700 billion should be for mortgage refinancing, and authority for cities and towns to acquire foreclosed properties and put buyers and renters back in them.

The package should include at least $200 billion of new economic stimulus, in the form of aid to states, cities, and towns, for infrastructure rebuilding, more generous unemployment and retraining benefits, and green investment.

The Democratic leadership should force Republicans to take votes on provisions like these. The early signs were that they would be pushing hard for a two or three.

Yesterday, a key lobbyist for the financial services roundtable, Scott Talbott, warned, "We're opposed to adding provisions that will affect [or] undermine the deal substantively," The Roundtable's members are banks, securities firms and insurance companies, the prime beneficiaries of Paulson's proposed bailout. He warned that any effort to attach other provisions would be a deal breaker.

But excuse me, it is the financial industry that is coming hat-in-hand to the government, not vice versa. The industry has no leverage here, except to the extent that Congress lets itself be intimidated. Paulson is insisting on a "clean" bill, but as Barney Frank put it, helping Main Street as well as Wall street does not dirty the bill.

The two precedents for large scale bailouts, Franklin Roosevelt's Reconstruction Finance Corporation, and the Resolution Trust Corporation of the 1980s, gave government much more authority over the firms that it bailed out.

Paulson is playing this more as the investment banker that he used to be, than as a steward of the public interest. This is a dubious deal, with all the gain going to Wall Street and all the risk going to taxpayers. Congress should not be intimated by his threats to hold his breath and turn blue of he doesn't get his way.

Robert Kuttner, co-editor of The American Prospect and Distinguished Senior Fellow at Demos, has just published Obama's Challenge: America's Economic Crisis and the Power of a Transformative Presidency (Chelsea Green). He is blog

The Sweet Smell of Success: Coiffed and cutthroat, Sarah Palin gives us the story we’ve been looking for

Posted by Edward Kidder

By Gemma Sieff

Gemma Sieff is an assistant editor of Harper’s Magazine.

The Republicans have succeeded in pitting VP against P, inverting their ticket to leave McCain, with his cadaverously stiff bearing, and Biden, with his flaxen ducktail and car salesman’s smile, to stand aside and cluck mildly like chaperones while the younger candidates dance. What’s left is a fraught contest for prom queen.

Sarah Palin’s appeal does not inhere in the much-touted message that she’s Just Like You—it’s that she’s better, but not too much better, than you. She’s the popular girl, the barracuda with a pleasing face, who after ignoring you all year suddenly turns around and invites you to help her streamer the gymnasium and mix the punch. You’re floored! And fascinated. Maybe if you mimic how she does her hair (or invest in one of these, and copy her cute accessories), you’ll benefit from the spillover effects of her status. After all, she has filled her cabinet with her high school pals, and sycophants are welcome: be positive, prop her up, let her know how much she rocks. (Take a leaf from the book of Ivy Frye, a non-wonkish aide who wrote Palin this email.) Perhaps she’ll let you use the tanning bed she had installed in the governor’s mansion.

Luckily, Palin isn’t from Beverly Hills (or Beacon Hill). She’s from Alaska, and Alaskans, we are reminded, are familiar folks, only brawnier, earthier, fishier than the rest of us. They enact recognizable American traditions: Palin ably shoots and guts a moose, just as you hunt your humdrum deer (or shuffle around the supermarket). Todd Palin excels in Iron Dog snowmobile racing, the chillier version of NASCAR. She’s got a Fargo accent, only twangier; she’s a hockey—that’s Alaskan for “soccer”—mom. She out-Wild-Wests the ersatz Texan in Bush, confounds the Turner thesis (thereby allaying our end-of-empire frontier anxieties), and in this way inspires a particular kind of awe.

Barack Obama, in contrast, is less kookily endearing than simply foreign, and thus vaguely threatening. Witness Michelle Obama’s strenuous transformation to doting milquetoast; her favorite television show, as she told us recently, is The Brady Bunch. Nobody’s making luau jokes—it’s all about Kenya, Indonesia, and his Pantheresque pastor. As for achievement, Obama’s are so stellar and sure-footed as to inspire feelings of inadequacy. Without the leg-ups most presidential candidates take for granted—being wealthy, being WASPy, being white—and without much of a father, he did everything anyway, steadily bettering himself: Occidental College to Columbia to president of Harvard’s Law Review. His intelligence, his extemporaneous poise, and the sense that he has worked harder than many gifted people—all this conveys a success that’s earned and perfect, inaccessible, somehow intimidating.

Truly popular girls, on the other hand, aren’t perfect; they’d be “uppity” otherwise. Sarah Palin’s kids have problems? So do yours. Per Steve Schmidt’s exquisite double entendre, “life happens,” just like life has happened to you. But look at how she doesn’t let the knocks get her down. Maybe if you adopted some of her confidence, her unshakable (“You can’t blink,” Charlie) outlook, you’d improve your own lot. She gave her Wasilla hairdresser the same advice: stop whining about the beauty industry and “run for something!” You needn’t move to a big city where smug liberals drink $7 hemp-milk lattes, because it’s all about Attitude.

Americans like their success stories to stay local—that way we can identify the winner when she stops by the grocery store in her slightly newer car. We like to see evidence that They’re Just Like Us, fetching their dry-cleaning, pushing strollers of their peculiarly named children. With Obama and Palin, it boils down to basketball. Twenty-five years ago Sarah Palin led her high school team to the state championship by netting a critical free throw in the last moments of the game despite a cinematically broken ankle. As the underdog, Palin embodies wholesome teenage athleticism and sports movie cliché. Obama’s pinnacle basketball moment occurred just a few months ago, when he was visiting troops in Kuwait. Holding court on the court, he was tossed the ball, made a modest disclaimer, and swish—what The New Yorker called “the three-point shot heard round the world.”

The “elitism” with which he is so often charged is not about wealth or education, but about grace. It appears we like our leaders to rise to the occasion, like the limping Palin. Obama, on the other hand, keeps asking us to meet his standard, and perhaps all those elegant layups and lectures on American promise are too much for us to bear. One can only hope he starts smoking again.