“The Obama administration will formally declare Monday that carbon dioxide and other greenhouse gas emissions pose a danger to the public’s health and welfare, a move that lays the groundwork for an economy-wide carbon cap even if Congress fails to enact climate legislation.”

I guess it’s clear what approach obama wants to take.  However, I am not necessarily in  accordance with the solution to the current problem of climate change. i think that forcing people to act under restraints isn’t solving the underlying issue, which is a general disregard for the impact that our actions are taking on our environment. There needs to be a general change in the social mindset of the developed world: instead of maximizing our profits we should instead be concerned with maximizing our general standard of living, which goes beyond just at what point above the poverty line you live in.  The status of your environment is also a factor in your standard of living, and we have until recently been actively negatively detracting from this standard. Call me idealist or radical, but simply forcing people to obey an instated law isn’t going to solve the problem. The reason why laws are effective is because we recognize that those laws protect our concepts of what is good and fair; until people believe as a whole that this is the impetus for the law, we still have a long way to go.

click here to learn about obama’s war against the media. specifically, Fox.

Yet another store has fallen to the Wal-Marts of the world. But it’s okay, because these companies are marginally benefiting developing nations, right?

apparently obama bowing this deeply to the japanese emperor  is “treasonous”

check it out.

Cheney, on the other hand, was ever the patriot when he visited.

Clearly, it’s crucial moments like these that define a presidency.

Tell me something new. Everyone’s worrying about the dollar. The Dow Jones peaked last week, but are these numbers misleading? Cash for clunkers was a success — but is our economy really recovering at the rate that it should???

Bernanke is staying wary. We still have a long way to go. And I concur. We are by no means out of the woods. 

BUT….The Economist is telling us to take a breather. The dollar while weakening, is still solid, and is nowhere near losing its status as a reserve currency. As we’ve learned over the course of this term, in the global scheme of things, politics and economics are inextricably intertwined. The diminishing dollar is still associated with the powerhouse of the world…and that makes a huge difference. Questionable fiscal policies notwithstanding, no major currency is ready to fill the slot that the dollar is currently taking. Yes, we are in a tenuous position right now,  but we are still able to pull through. Making safer economic decisions does not translate into abandoning all previous practices. To quote The Hitchhiker’s Guide to the Galaxy (which is a great book/series that everyone should read at one point in their life), “DON’T PANIC.”

Here is the economist article.

Phillies fans need to stop whining. You guys knew that you would lose. Come on. I’m surprised it even went to six games.

Sincerely, 

the Yanks

*I promise my next post will actually be about IPE.*

Anyhoo, yesterday was election day, and a couple of  apparently key elections took place, most notably the virginia and new jersey gubernatorial elections. Both of these elections results in a win for the republican party. With the spots beign filled by McDonnell and Christie respectively (with Christie winning over Democratic incumbent John Corzine).  Whilst all the exit polls were trickling in and experts were weighing in on the events of the day, the question was asked: were these elections a referendum on Obama?

Both states in question voted for Obama in the national election; Virginia itself was a swing state and went blue for the first time in decades. As a result, it could be easy to see why people could come to assume that this was a direct response to Obama’s current sluggish progress to enact the reforms he pushed for in his campaign. But I personally think that statewide poliitcs is just that: statewide politics. The opposing (and losing) candidates were not particularly strong, and therefore it is not a surprise that they lost (even though i tend to lean towards the left, even I have to admit that Creigh Deeds’ campaign seem to not have a strong foundation, except for speaking out in disgust against McDonnell’s absurd thesis that was written 20 years ago).  This is really just an issue of local politics, except for our necessity to view it in the national scope of things. As a result, evaluating it as a national referendum becomes a self-fulfilling prophecy: by viewing it in those lens, it becomes so. Similar to aristotle viewing the virtue of the active condition as a force of habit , our continued evaluation of every political event as a litmus test of Obama’s performance will inevitably make it so. Obama is not our entire political system; there are multiple levels to politics, and I think we need to be reminded of those distinctions from time to time.

Krugman calculates that at the rate that we’re pushing growth, we have effectively curbed the tailspin that our economy was headed towards, but current growth isn’t steep enough to quell the significant unemployment rates that still plague our nations. In his words, we can’t afford not to throw more money into the situation. We need to spend more now on recovery to guarantee a stronger economy.

After today’s discussion, I can’t say that I fully agree with Krugman’s notion that we simply need to funnel more money into our struggling economy. Like we discussed in class, this money needs to be dealt with and distributed decisively. Arbitrary and inconclusive distribution of funds will ultimately, in my opinion, be largely inefficient and not do much for repairing the damage that our economy is struggling with. If we want to tackle unemployment, then we should make sure to focus our stimulus efforts on more job creation, or increased job security, or perhaps even subsidies to major corporations that suffered massive layoffs. Coupled with this allocation, increased regulation of where the funds are going and what results they are producing will be the only way we can evaluate what next steps we need to take to maintain growth and restabilize our currently volatile market.

Ultimately, I applaud Krugman in staying faithful to his argument time and time again: stick to textbook Keynesian economics and you can never go wrong. The problem with textbooks, though, is that they aren’t transient. You can’t just transplant the Keynesian approach to the Great Depression into our current crisis and hope it all works out. It requires adaptation and modification, or there will never be a consensus reached on the best way to approach the problem. 

Sidenote: check out this article from the onion if you want to see the wrong way to funnel money into our economy/infrastructure. i have  a feeling that even krugman would disagree with such an investment.

The European Union has been largely affected by the recent credit crunch and the subsequently collapsing export markets. Fiscal recklessness, lending increases and overwhelming external deficits, have left many of our member states in a vulnerable position. We are grappling with a steep recession; new members have seen their currencies plummet against the Euro. The close connections between banks and industry almost assure a broad and deep spread of the contagion. Recovery at this point remains uncertain and fragile. While most of our stronger member nations are fighting back by boosting fiscal spending, a large part of our newer and more developing members are struggling, especially in Eastern Europe. For them, the collapse of the export market cannot be remedied simply by higher public spending.

The underlying reason for Europe’s vulnerability is rooted not in the U.S. subprime, but instead in the importance of banks to the entire European economy. In the United States, the crisis might be contained within the financial and housing sectors alone, but links between banks and businesses are at the core of our economic system.

So how are we choosing to address this? Our response to stimulating economic recovery is swift and decisive. We have, first and foremost, established the European Economic Recovery Plan to restore confidence and bolster demand. The overall fiscal stimulus, including the effects of automatic stabilizers, amounts to 5% of our GDP. We have also initiated a series of reforms to promote faster and more efficient funding for economic recovery. These reforms will provide immediate funding for major projects, Smaller projects will be assisted through the elimination of red tape, accelerating payments, and the flat-rate or lump sum payments of their overhead costs. Financial engineering schemes that combine grants with European Investment Bank and European Bank for Reconstruction and Development loans to fund projects will be facilitated.

As a result, we have taken decisive action on multiple levels: not simply within the Commission, but also with the European Central Bank and the national governments, in an attempt maintain a flow of credit and maintain our savings. Ultimately, we are all working towards maintaining the single market and facilitating growth. We need to quell the increasing protectionist movement amongst the member states that threatens to tear our single currency to shreds. The problem is that we are not a country, and this crisis is stimulating nationalism, not consensus. We are being undermined by protectionist pressure from leaders with national constituencies and agendas.

Ultimately, we need to promote multilateral spending. We need to put faith in other markets besides our own.  We need to continue international trade; continued protectionism benefit no one, both within the EU and between other markets. We need to be able to reach across constituencies and work towards establishing a consensus.