Electricity & Lust

Select Thoughts on the US Election

Posted in Politics by Sam Unsted on September 16, 2008

I haven’t been as closely following the election since the exit of Hillary. In the run-up to the convention, little interesting happened on either side to peak my curiosity to start back up on the train but, and it’s been a fairly significant but, the last couple of weeks have finally provided some fuel for the fire and I’m starting to really begin to read and check up on the campaigns.

The first catalyst was Obama’s speech at the convention which was pretty great, if a little short on the substance that I would have wanted. If his was short on substance and heavy policy though, McCain’s was far worse. To have a vague chance of stopping Obama, McCain will have to stop trotting out Bush-era cliches and stop making Bush-era faux pas all over the shop and refocus. Either that, or apparently he can just select a woman from Alaska he’s only met once before and who has almost no relevant experience to be his running mate and the religious right will come a-running. I wouldn’t want to get focusing on the experience angle really, given that a) that’s precisely the argument used against Obama constantly and, b) it’s a ridiculous argument from all sides because almost no job can really prepare someone for the presidency of the most powerful nation on the planet.

I don’t like Palin. Not because she’s a woman, a mother, a Christian or even, subsequently a semi-creationist. Not because of her seemingly blighted and unattractive record in the past as regards her personal dealings. Not because she seems to have flip-flopped on a few points here and there to gain currency. Not because her daughter is the perfect argument against abstinence-only or because her baby-daddy is the perfect example of a teenage father. Not even because she said that she would have made her daughter keep the baby even if it was the product of a rape. I dislike and wouldn’t vote for her on these things but I don’t hate her. I hate her because John McCain’s picking her confirms his confidence in the utter stupidity of certain parts of the voting spectrum in the US, those who will vote for her no matter her policies or beliefs, her past or her record. Those who will vote for her because she is a woman. Interviews conducted outside the DNC indicated that a great deal of people still exist who think Hillary should be president and further more who will vote for McCain now because a female is on the ticket. Her presence on the ballot provides a truly terrible section of voting foolishness to be indulged and McCain’s confidence in this makes me sad, very sad indeed.

What may play now though is a return for fundamentals. The Washington Post wrote about this today and it seems like a strong argument. Given the shocking last week and a bit in the US banking and financial services market, it seems only right that focus should begin to shift away from the tabloid gossiping and shouting of Palin and the conventions and move over the fundamentals of election politics. The economy is likely to become central and no sooner has it than McCain has stuck his foot clean in it. Strong fundamentals? He comes out and praises the resiliency of the banking market, and then slightly alters it to cover his ass, after the following things have happened.

  1. Fannie Mae and Freddie Mac, the mortgage giants that guarantee somewhere in the region of $3tn of the US market, are essentially nationalised and taken under the control of the Federal Government. This effective nationalisation places the burden of these two institutions, seriously hammered by the crash of the US sub-prime market, on the taxpayer. When this happened in the UK with Northern Rock, heads rolled and Gordon Brown began his descent into being the most hated man in the country.
  2. Lehman Brothers, the fourth largest investment bank in Wall Street and an illustrious institution with a 150-year-plus history, declared bankruptcy on Monday morning. It had spent the entire past week trying to find rescue funding, eventually failing because Barclays pulled out of a buy because the government wouldn’t guarantee its liabilities. It’s bankruptcy filing has sent the FTSE and the Dow hurtling lower and today hammered shares in Asia too. It is the largest insolvency declaration ever. EVER.
  3. Merrill Lynch, another mega-investment bank, follows Lehman and Bear Stearns into finding rescue funding, selling to the Bank of America before speculators could bring it to its knees. Bank of America is paying $50bn to buy the bank and is now a super-size financial institution to rival Citigroup and HSBC. This is good in the sense that the bank has been bought and can’t help to further depress markets but it means Bank of America is now so flipping huge, it can’t really succeed.
  4. AIG, the US insurance giant long-troubled due to its place as a major insurer of financial products, went to the Fed for emergency funding. Subsequent reports are suggesting this isn’t going to work given the concerns raised by the major ratings agencies over the future of the company. If AIG collapses, which it really could, the US market will almost certainly fall into recession. The only hope now is that the two still-strong investment bank on Wall Street, Goldman Sachs and Morgan Stanley, will provide $75bn in emergency funding to the group.
Now if you consider all of these, and of course the inflationary pressures, the hammering taken by equities across the board and the volatility of oil prices, I don’t know how much optimism you can really have about the market. About the only folks who might well be able to find some solace in the crushing depression of the markets will be the chief executives who, although likely and deservedly heading for the chopping block, will probably see pay offs well into eight figures. If McCain feels like he wants to hold this optimism, he either knows something we don’t or knows nothing we do.
It would be wonderful if the election can now get back to the fundamentals. This will allow Joe Biden to start to flex his muscles on national security issues and allow Palin to make some terrible statements in more important stages than in the circus that surrounded her appointment. It will allow Obama to make some more great, true speeches about the issues that really face the country and maybe it will give McCain a chance to show us all the man that originally garnered so much praise as a progressive Republican. Maybe, if it really gets down to good, strong politics, we will get to see two strong candidates emerge and we can go into November without too much fear that the last eight years will be repeated.
Consider that for a moment. Consider the legacy of Bush and how badly the world cannot have that for another eight years. He will leave office with a quagmire war, a chunky deficit and a recessionary economy. We can’t have another Bush. So right now, we also can’t have a McCain.
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