November 30, 2008

Obama's upcoming buzzphrase: "human infrastructure"

Establishment media are starting to notice that Obama's plan to add 2.5 million public works jobs in "infrastructure" in 24 months seems implausible. The LA Times observes:

One detail of the recovery plan that may not emerge until closer to Inauguration Day is how the money will be disbursed for infrastructure projects. Such undertakings often require long lead times to prepare engineering studies and environmental surveys and address other technical issues, possibly delaying their stimulative effect.

You don't say?

Consider the Big Dig in the heart of Blue State America, Boston. This 3.5 mile freeway tunnel was conceived in the 1970s, officially proposed in 1982, got federal funding in 1987, and the first dirt was turned in 1991. By the end of 2003 it was more or less usable and by the end of 2004, it was reportedly 95% finished. Then, it started leaking.

It supposedly cost about $14 or $15 billion (assuming it's done, which it probably isn't), up from an initial estimate of $4 billion in today's dollars.

Now, here's an interesting number: at its peak, the Big Dig employed about 5,000 construction workers. That's a lot of construction workers relative to most big projects. But it's a tiny number compared to Obama's 2.5 million number. So, Obama is proposing, in effect, to have 500 Big Digs going full blast in 24 months.

Even assuming away the lead time issue, just notice from the Big Dig that infrastructure is a very, very expensive way to create jobs. This isn't 1935. Public works workers need more than just shovels. The capital requirements for infrastructure jobs are enormous.

The next thing the media are going to notice about infrastructure projects is that they and the rest of Obama's base don't actually want jobs operating, say, a jackhammer. If a journalist gets laid off by his newspaper, is he going to want Obama to give him a jackhammer job? Of course not. He's going to want Obama to get him a job where he sits at a desk with a computer and a phone in an air-conditioned office.

In fact, Obama's people don't want anybody operating a noisy, smelly jackhammer anywhere near them. It's not that they're against infrastructure per se. Indeed, they would like infrastructure to have been built, but Obama People are going to oppose via lawsuits the actual building of infrastructure anywhere close to them, with its attendant racket, odors, and traffic jams. Not in my back yard!

In contrast to infrastructure jobs, Obama will eventually realize, makework office jobs are relatively cheap and easy to create. To employ people to administer programs aimed at, say, enhancing outcomes among our troubled youths, you don't need an environmental impact statement. You don't need to buy a bulldozer for a new worker, just a computer, a desk, and a chair. (Eventually, you'll need guys with jackhammers to come build another office building for all the new staffers, but you can squeeze them in for awhile.) And every bureaucracy already has lots of existing plans on file to hire more staffers to help them do whatever it is they do.

And Obama's kind of people like office jobs administering social work programs a lot more than they like jackhammer jobs. So, it's a win-win proposition!

Therefore, expect to hear the term "human infrastructure" a lot this winter as the Obama Administration starts to realize that actual infrastructure projects aren't going to make much of a dent in the unemployment rate before the 2010 elections, but hiring a ton of people to staff, say, innovative programs to foster excellence in public schools are an easy way to provide jobs for the boys (and girls).

My published articles are archived at iSteve.com -- Steve Sailer

My book is now for sale

My book, America's Half-Blood Prince: Barack Obama's "Story of Race and Inheritance," is now for sale here for $29.95 plus S & H. You can read about it in my new VDARE.com column here.

My published articles are archived at iSteve.com -- Steve Sailer

November 28, 2008

"Terrorists Strike in Indian City"

That was the rather long and uninformative headline a few days ago in the local newspaper. They couldn't say "Terrorists Strike in Mumbai" because few of the local rag's readers know in what country "Mumbai" is. Readers have heard of "Bombay." They've eaten at Bombay Bicycle Club restaurants and they've bought end tables from Bombay Co. Furniture stores, so they mostly know Bombay is a city in India. But, Mumbai they don't know from Kolkata or Chennai. So, the headline writer has to refer to "Indian City" because the English-language media recently stopped using the place name that has been used in English for centuries.

The effect, of course, is what normally happens when names are changed. The Name Game just makes most people more ignorant (while giving a few people another reason to self-congratulate over their superior sensitivity). Older Americans who grew up hearing about Bombay can't understand today's news; and younger Americans who are growing up hearing about Mumbai won't be able to understand all the books in the library that refer to Bombay.

Fortunately, there's a double standard that prevents the media from junking Anglicized spellings of places in the white world. We're in no danger that "Florence" or "Germany" will disappear from the AP stylebook to be replaced by baffling references to "Firenze" and "Deutschland."

My published articles are archived at iSteve.com -- Steve Sailer

November 26, 2008

"Wall∙E" -- Now on DVD

Here's my full review from The American Conservative of the Pixar film:

Despite its misanthropy, the superbly crafted dystopian science fiction film "Wall∙E" will be the ninth straight movie from Pixar Animation Studios, going back to 1995's "Toy Story," to earn at least $162 million at the American box office.

"Wall∙E" is stronger on execution than originality. Writer-director Andrew Stanton ("Finding Nemo") sets loose a squatter version of the cute robot from the 1986 comedy "Short Circuit" in the dysgenic consumerist wasteland of Mike Judge's suppressed 2006 satire "Idiocracy."

ndeed, Stanton's vision of a smoggy, trash-strewn Earth resembles a big budget remake of Judge's cult classic. With its ostensibly environmentalist message, however, "Wall∙E" won't suffer the fate of Judge's politically radioactive story about the long-run consequences of low fertility among the high IQ.

In 2110, the monolithic corporate monopolist Buy 'n' Large uses the jingle "Too much garbage in your face? There's plenty of space out in space" to induce humanity to abandon the planet. All humans set sail on a luxury cruise aboard a colossal spaceship, leaving Earth temporarily to a race of trash-compactor automatons ("Waste Allocation Load Lifter ∙ Earth-class") programmed to build towering ziggurats out of cubes of compressed junk. The detritus of consumerism proves too much, though, and Earth remains a lifeless ruin.

Now, 700 years later, just one Wall∙E is still puttering along, alone except for his pet cockroach. This curious little robot brings home and carefully sorts elegiac objects that catch his fancy, such as a Rubik's Cube. The Aspergery Wall∙E can't decide whether a plastic spork belongs with his spoons or his forks, so he deposits it exactly between the two piles. His prized possession is a videotape of "Hello Dolly," which he watches repeatedly, wishing he had somebody to hold hands with.

The first half of "Wall∙E" contains almost no dialogue. This is not unprecedented in a kid's movie -- the staggeringly gorgeous 1979 hit "The Black Stallion" was similar. Stanton feels that audiences want to work for their entertainment, so he has high expectations for what they can handle. Restricting verbiage prods him to new levels of inventiveness in conveying emotion visually, in devising what his mentor, the screenwriting guru Robert McKee (played by Brian Cox in "Adaptation") calls "worlds we’ve never seen but a humanity we all recognize."

Reviewers rave over how Stanton gets us to recognize emotions in a machine. Still, although Pixar is immensely skillful, people naturally perceive personality in anything self-activated. My wife, for instance, fusses maternally over her Roomba robot vacuum cleaner, grooming it lovingly when its sprockets clog, which is often. She treats it as if he (we instantly decided Roomba is a boy) is a dutiful, though inept, family retainer.

"Wall∙E" doesn't actually peddle an environmentalist message. The real fear it plays upon is not that we'll run out of room to dump our trash outdoors. After all, Los Angeles County alone has enough cubic miles of uninhabited canyons to hold the world's trash. The 1990's media panic about a purported landfill shortage was launched by trash-hauling companies desiring higher fees. Instead, "Wall∙E" describes a more pressing modern American fear -- that we'll run out of room indoors to store all the crud we keep buying. Today's eco-mania, in contrast, is about saving the Earth through shopping -- not less often, but more fashionably.

Wall∙E's lonely vigil is interrupted when an automated spaceship touches down to unload a beautiful futuristic robot named Eve, who occasionally giggles like a Japanese schoolgirl. Her mission is to search for any signs of plant life on Earth, in the hopes that humans can then begin to recolonize the planet. She first tries to fry Wall∙E with her laser, then ignores him when she determines he's mineral not vegetable. He finally wins her approbation by handing her the only plant growing on Earth.

The movie acts out a classic nerd's fantasy -- to be left alone with cool stuff … except for a sleek girlfriend. (And if she's a Japanese robot, so much the cooler.)

Then the rocket returns to haul Eve back to the spaceliner, and the smitten Wall∙E hitches a ride. Onboard, "Wall∙E" turns into a different, more cartoonish movie, with a cruder look and a frenetically unexciting chase scene. It's still "Idiocratic," though -- in 700 years, humans have devolved into boneless wonders, obese blobs who never look up from their screens. But how much fiction is there in this science fiction?

Rated G.

My published articles are archived at iSteve.com -- Steve Sailer

Tom Daschle to be "Health Czar"

I'm not one of these history experts who reads books and stuff, but I have a vague impression that this whole "Czar" thing didn't work out so hot over in Russia (it was Russia, right?) So, how come Presidents are always appointing somebody to be Czar of this or that? Also, my general recollection going back to the first Energy Czar in about 1973 was that none of these Beltway Czars ever solved anything. So, as a public service to the Obama Administration, here are a list of fresher sounding job titles that they could use for Daschle in place of the shopworn and obviously doomed to failure term Health Czar:

Health Shogun
Health Generalissimo
Health Pharaoh
Health Duce
Health Shahinshah
Health Mikado
Health Grand Vizier
Health Master and Commander
Health Nabob
Health Warlord
Health Fuhrer
Health Khan
Health Big Brother
Health Doge
Health Galactic Overlord
Health Potentate
Health Übermensch
Health Grand Turk
Health Humongous
Health Rajah
Health Paterfamilias
Health Kaiser
Health Kahuna
Health Kommandant
Health Big Man
Health Ayatollah of Rockandrollah
Health Cacique
Health Imperator
Health Poobah
Health El Supremo
Health Commissar
Health Patroon
Health Capo di Tutti Capi
Health El Guapo

First Lady Omarosa

One of the zanier con jobs that Barack Obama got away with is positioning Michelle Obama as the epitome of unambitious maternal femininity rather than as the second coming of Hillary Clinton. Here's an October 5 Lynn Sweet blog item from the Chicago Sun-Times that I (and everybody else) totally missed, which contains an excerpt from the upcoming biography of Michelle Obama, "Michelle," by Washington Post Magazine writer Liza Mundy. It tells of her few years at the high-paying Sidley Austin corporate law firm, where she was employed before quitting to work as a fixer for the Daley Machine.

"But Michelle could also frustrate her supervisors. Quincy White, the partner who helped recruit Michelle and who headed the marketing group, remembers finding her a challenge to manage. White, who is now retired from the firm, says he gave her the most interesting work he could find, in part because he wanted to see her advance, but also because she seemed perennially dissatisfied.

She was, White recalls, "quite possibly the most ambitious associate that I've ever seen." She wanted significant responsibility right away and was not afraid to object if she wasn't getting what she felt she deserved, he says.

At big firms, much of the work that falls to young associates involves detail and tedium. There were all sorts of arcane but important rules about what could and could not be said or done in product advertisements, and in the marketing group, all the associates, not just the new ones, reviewed scripts for TV commercials to make sure they conformed. As far as associate work goes, it could have been worse -- "Advertising is a little sexier than spending a full year reading depositions in an antitrust law suit or reviewing documents for a big merger," says White -- but it was monotonous and relatively low-level.

Too monotonous for Michelle, who, White says, complained that the work he gave her was unsatisfactory. He says he gave her the Coors beer ads, which he considered one of the more glamorous assignments they had. Even then, he says, "she at one point went over my head and complained [to human resources] that I wasn't giving her enough interesting stuff, and the person came down to my office and said, 'Basically she's complaining that she's being treated like she's a second-year associate,' and we agreed that she was a second-year associate. I had eight or nine other associates, and I couldn't start treating one of them a lot better."

White says he talked to Michelle about her expectations, but the problem could not be resolved because the work was what it was. He is not sure any work he had would have satisfied her. "I couldn't give her something that would meet her sense of ambition to change the world."

"Not many people went over my head," says White. It was an unusual move for a young associate to make, and he believes it was consistent with her personality. She "wanted something that pushed her harder. Waiting five to seven years to make partner was a good career move for me but not for [her]. There are too many other opportunities out there that mature faster than that."

Abner Mikva, a former congressman and federal judge who is close to the Obamas and was an early mentor to Barack, finds that account of Michelle's 20-something impatience amusing. "It doesn't surprise me at all," he says."

So, it turns out that Michelle is exactly how you expected her to be. The Power of Stereotypes is validated once again!

By the way, it apparently took Michelle two tries to pass the easy Illinois Bar Exam (81% pass rate), because she wasn't admitted to the Illinois Bar until almost a year after her graduation from Harvard Law School, while her smart husband was admitted to the Illinois Bar only a half year after graduation.

My published articles are archived at iSteve.com -- Steve Sailer

Reid says Obama and McCain will impose amnesty

Here's the Detroit Free Press's interview with Senate Majority Leader Harry Reid (D-NV) (via KausFiles):

Q: With more Democrats in the Senate and the House and a Democrat in the White House, how do you see congressional efforts playing out on such issues as health care and immigration?

A: On immigration, there's been an agreement between (President-elect Barack) Obama and (Arizona Republican Sen. John) McCain to move forward on that. ... We'll do that. We have to get this economy stuff figured out first, so I think we'll have a shot at doing something on health care in the next Congress for sure.

Q: Will there be as much of a fight on immigration as last time?

A: We've got McCain and we've got a few others. I don't expect much of a fight at all. Now health care is going to be difficult. That's a very complicated issue. We debated at great length immigration. People understand the issues very well. We have not debated health care, so that's going to take a lot more time to do

What to make of this?

- A couple of years ago, a technician who deals with Senators daily told me Reid is pretty ga-ga most of the time, perhaps from his amateur boxing days, so he may be just rambling. But everybody else seems to think he's totally on top of the things, so what do I know?

- Or, it's true. If so, why would Obama and the Democrats want to walk into their Stalingrad, trying to shove amnesty through in the teeth of unemployment rocketing upwards? If Bush couldn't pass it during the phony prosperity of the Housing Bubble, how is going to pass during the Crash? And as a higher priority than health care? Are they nuts?

Well, one possibility is that the Democrats don't get how the politics of economic collapse work when it comes to immigration. It's not as if they've allowed themselves a free, wide-ranging, penetrating debate on the subject of immigration. Most Democrats are superstitious ignoramuses on the topic, intellectually emasculated by political correctness.

Another possibility is that far-seeing Democrats are thinking: Now or Never for amnesty. They've been saying for years: "You can't deport 12 million people." Well, unless the U.S. government does something quick to stop the illegal aliens from leaving, quite a few million illegals are going to self-deport themselves over the next few years because it's a lot cheaper to be unemployed in sunny Mexico than in, say, Denver.

A few sharp cookies on the Democratic side may realize they'll be waving adios to part of their Permanent Majority unless they "put them on a path to citizenship" early in 2009 while the media's chant of "Obey Giant Obama" hasn't yet worn thin and before the public has a chance to realize just how deep this recession will be. Then the illegals will be free to go home but they'll also be free to come back to the U.S. legally when the economy picks up in 2015 or whenever. But if they vamoose before the Democrats get a chance to put them on the path to citizenship, then, when the Border Wall and E-Verify are finally working, the Democrats could find themselves bereft of millions of votes a couple of decades down the road. So, Obama has to work his bipartisan magic with McCain NOW. The media will wet themselves with delight in forgiving McCain for his rampant racism in putting up token opposition to The One.

My published articles are archived at iSteve.com -- Steve Sailer

The Ads McCain Wouldn't Run

From Time, "The Anti-Obama Ad Campaign that Never Happened:"

"My favorite ad of the campaign was as simple as it could be," [McCain advertising director Fred] Davis said. "And it started out something like, 'Long before the world knew of John McCain or Barack Obama, one of them spent five years in a hellhole because he refused early release to honor his fellow prisoners, while the other one wouldn't walk out of a church after 20 years of the guy spewing hatred towards America.' And the last line was, 'Character matters, especially when no one is listening.' " The ad never ran, however, because McCain ruled the topic of the Rev. Jeremiah Wright, the preacher of Obama's Chicago church, out of bounds shortly after he locked up the Republican nomination.

Good advertising men are almost always mischiefmakers at heart, the sort who don't mind a little confrontation and who revel in a bit of controversy. And so Davis is wistful at the missed opportunities of the McCain campaign. "I made a list once, which no one will ever see, of all the reasons that my hands were tied on this campaign," he says. "And I've never had a list this long." One of his biggest struggles, Davis says, was to come up with negative spots against a historic, groundbreaking candidate without stepping on taboos. "One of the big hands that I felt was tied behind my back was [that] so many things — like [Obama's record on] crime — you would logically do were perceived as 'Oh, we can't do that. That was playing the race card,' " he says, adding that the campaign created a whole series of crime attacks against Obama that were never aired. "Reverend Wright? 'Oh, can't do that; they'll say we are playing the race card.' [William] Ayers? For the longest time, 'Oh, can't do that. We're playing the race card.' "

Davis says that concern about race played a major role in the entire aesthetic of McCain's ads. The photographs of Obama that the ads used, for instance, which often showed Obama elongated and smiling, were carefully selected, he recalls. "We chose them with only one thing in mind, and that is to not make them bad pictures because bad pictures would be seen as racist," Davis says. "How many shots in their ads did they use a John McCain [photo] looking decent and smiling?" He says the campaign also agonized over the music in the ads, paying special care not to play drum-heavy tracks that could be seen as an African tribal reference. "We were held to a totally different standard," he says.

Nevertheless, the McCain campaign was unable to escape the charge that it was playing the race card. An Associated Press analysis called the campaign's invocations of the once violent 1960s radical Ayers "racially tinged" because they evoked the word terrorist. McCain was also accused of playing on race for running an ad that highlighted Obama's relationship with Franklin Raines, a former executive at Fannie Mae who is black. Says Davis: "I never saw anybody play the race card but the Obama campaign."

Well, imagine that! McCain castrated his own campaign, and yet the media still worked themselves into a hate-filled frenzy about Republican racists. Who could have guessed that would happen?

Also, I realize McCain is a "straight-shooter" and all that, but just maybe McCain should have mentioned to GOP voters during the primaries that if Obama ended up his opponent, he intended to more or less throw the election. I mean, I understand the voters are supposed to be kept in the dark as much as possible, but perhaps he could have let slip that he was going to take a dive in the general election, and just wanted the nomination to stroke his vanity.

My published articles are archived at iSteve.com -- Steve Sailer

Bush and Obama Tell Unemployed Illegal Aliens: "Go home."

Just kidding. (You didn't fall for that, did you?)

My published articles are archived at iSteve.com -- Steve Sailer

November 25, 2008

The Frustrations of Big Manitude

Theodore Dalrymple once pointed out that being a Big Man in Africa isn't as sweet a deal as you might think.

Imagine you get out of school, get your first decent job, and your own apartment. You decide to celebrate by inviting four relatives to your place for Thanksgiving Dinner. A year later, you get a promotion so you start thinking about where you'll take your first vacation. But on Thanksgiving Day, instead of just four relatives showing up, eight show up. You mention to your nearest and dearest that you only bought enough food for four guests. They say in loud voices for the more distant relatives to hear, "Oh, we are so proud you are getting to be a Big Man and have offered to go to the store to buy more food!"

And so it goes. Next year it's 16 relatives, and a half dozen of them need to crash at your place and need you to drive them to the airport. You try to hint to your mom that it's getting to be a little much, but she makes it clear that any slacking on your part would bring shame to all your loved ones. So, each year you get a promotion and the number of relatives you must feed and entertain and find jobs for and bail out of jail and generally subsidize keeps growing with every increase in your income.

It's kind of like what Anthony Quinn says as Auda Bin Tayi in "Lawrence of Arabia:"

I carry twenty-three great wounds, all got in battle. Seventy-five men have I killed with my own hands in battle. I scatter, I burn my enemies' tents. I take away their flocks and herds. The Turks pay me a golden treasure, yet I am poor! Because I am a river to my people!

Here's Edmund Sanders in the LA Times on the multitudinous Obamas:
Reporting from Nyangoma-Kogelo, Kenya — For about 400 people in western Kenya who can call the next U.S. president "part of the family," being an Obama has a whole new meaning.

The modest family compound here has been inundated by hordes of visitors, from reporters and local politicians to ordinary Kenyans looking for help in getting U.S. visas, scholarships, jobs or cash. Family matriarch Sarah Onyango, step-grandmother of President-elect Barack Obama, is treated like a rock star wherever she goes.

The Kenyan government, which once ostracized Obama's father, is falling over itself to attend to the family. There's a new road, 24-hour police security and an electricity line -- the first in the village. It was installed hours after U.S. election results were announced, bypassing neighbors who have been waiting years for a connection.

"Dealing with all this," Said Obama, the president-elect's uncle, said with a sigh, "it's been like a full-time job."

In U.S. politics, presidential relatives are always something of a wild card, often the subject of curiosity or controversy. But the Obamas of Kenya promise to be a First Family like none America has seen.

Here in sleepy Nyangoma-Kogelo, the Obamas are widely admired as the richest family in a town of about 2,000, successful farmers who have always helped neighbors in need, and flirted with the political elite when Obama's Harvard-educated father rose to a prominent government post.

But while they're at the top of the social ladder at home, the international spotlight has cast the family in an unfamiliar role: as poor relations who suddenly appear to have hit it big. Overnight, they've gone from Kennedys to Clampetts.

It's true, by U.S. standards many of the family members are relatively poor, living in mud-brick homes with no running water or, until recently, electricity. A few have tried to cash in on Obama's success by selling their stories. ...

Onyango, who until the recent flurry of attention still worked in the fields tending her crops, said she hoped life would return to normal. "We don't feel that we should or ought to be treated differently," she said....

For the family, of course, there have also been other fringe benefits to their fame. In addition to the security and infrastructure improvements, family members are fielding various offers for jobs, partnerships and endorsement deals.

Said Obama, who struggled for more than a decade amid Kenya's chronic unemployment to find full-time work, admits he probably owes his current job as a mechanic at a factory co-owned by the prime minister's family to his relationship with Obama.

"The Obama name is now a powerful key to open doors," he said. "But the family is wary. I don't want to exploit my relationship with Barack."

Other family members have been more assertive. Malik Obama, the eldest half-brother, has asked reporters seeking interviews to first make donations to his "Barack H. Obama Foundation," which he said funds school uniforms and community projects.

When the election results were announced, Malik Obama held a separate news conference after being nudged out of the family's official briefing.

"The children used to be close," said Charles Oluoch, a cousin. "But with the election, everyone is fighting to be closest to the president." ...

In a 2006 interview with The Times, Obama acknowledged the expectations of his large family in Kenya, some of whom he has never met.

"Everyone in the village feels related," he said. "Some family members are very close; others I feel less close to."

Oluoch, who lives with about 200 other Obamas in a second ancestral village 100 miles away called Kobama, complained that the Kogelo wing is getting all the attention and investment. In Kobama, they recently spruced up the gravestone of Obama's great-grandfather and are preserving a mud hut "where the president once slept" as a potential tourist attraction.

He said the Obamas have a proud history of producing prosperous leaders with a knack for breaking down racial barriers.

Obama's grandfather Hussein Onyango Obama befriended white settlers when others feared the strangers as "unclean." After serving with the British army in Tanzania during World War I, he learned English, adopted Western dress and eventually worked as a cook in colonialists' homes.

"At first, everyone in the village feared him, but eventually they came to admire him because he could talk to a white person," said Alfred Obama, 76, a nephew of Onyango who lives in Kobama.

Over the years, he introduced many European customs to the village, such as eating on plates with utensils, planting trees, deep-frying food and maintaining an immaculate home.

Although Onyango was standoffish, his second wife, Sarah, was outgoing and down-to-earth. ...

On trips home to his village, usually in a fancy car, Obama Sr. always brought cabbages and potatoes for every household. He found government jobs for numerous villagers.

But the family's political rise was short-lived. By the early 1970s, the elder Obama's tendency to criticize his superiors and a worsening alcohol problem led to a career spiral that left him dejected and broke. As a Luo, he found himself the victim of rising tribalism as rival Kikuyus seized control of the government.

Old friends abandoned him. In 1982, Obama ran his car off the road after a night of drinking and was killed. He was 46.

Sarah Onyango worried about the family's future.

"She said, 'Now that this has happened to our son, what will happen us?'" according to Ndalo, the former housekeeper. "The family was very bitter about the way they were treated."

Obama's election brought a sense of vindication, friends and family members say, particularly as government officials have made the trek down the dirt road to the Obama compound to pay their respects. President Mwai Kibaki declared a national holiday in Obama's honor.

"The death was a great blow to the Obamas," Oluoch, the cousin, said. "We had no one else to be proud of. But 26 years later, God gave us another one."

More Canadian PC Wackiness

Following last week's news that one Canadian university is paying for spies to snoop on student mealtime conversations and turn them in more politically correct directions, we learn that Canadian students hardly need outside crimethink management. From Canada.com

Cystic fibrosis not 'inclusive' enough for Carleton students

OTTAWA - The Carleton University Students' Association has voted to drop a cystic fibrosis charity as the beneficiary of its annual Shinearama fundraiser, supporting a motion that argued the disease is not "inclusive" enough.

Cystic fibrosis "has been recently revealed to only affect white people, and primarily men" said the motion read Monday night to student councillors, who voted almost unanimously in favour of it. ...

During orientation week this year, Carleton students, who have raised about $1 million over the years, raised about $20,000, said foundation chief executive Cathleen Morrison, who was surprised and dismayed by the student association decision.

The rationale for dropping cystic fibrosis as the beneficiary is not correct, she said. CF is diagnosed just as often among girls as boys, although the health of girls deteriorates more rapidly, she said. It is commonly considered an illness that affects Caucasians, but that includes people from the Middle East, South America, North Africa and the Indian subcontinent.

"'Caucasian' as we understand it isn't just white people," said Morrison. "It includes people with a whole rainbow of skins."

My published articles are archived at iSteve.com -- Steve Sailer

Is what's good for Goldman Sachs good for America?

Treasury Secretary Hank Paulson (former Goldman Sachs CEO) has bailed out Citi-whatever, whose "consigliere" is former Treasury Secretary Robert Rubin, (a former co-CEO of Goldman Sachs) on terms that were described in the Washington Post as:

"It strikes me as unbelievably generous," said a former Fed official who has been in touch with Citigroup.

Commercial bank Citibank's merger with investment bank Salomon Smith Barney was illegal under the New Deal Glass-Steagall Act, but Rubin helped get it made legal in the late 1990s, just before quitting the Clinton cabinet and going to work there.

Meanwhile, AIG, a close associate of Goldman, is getting a rolling bailout that appears to be mounting to the sky.

Only one massive financial institution didn't get a bailout and been allowed to fail: the investment bank Lehman Brothers. After it went bankrupt, the economy fell off the edge of the world.

Is it just a coincidence that Lehman Brothers was a rival of Goldman Sachs?

Ironically, just as Rubin's reputation for genius is is being flushed away, three of his proteges -- Geinther, Summers, and Orzag -- are getting top economic jobs in the Obama Administration. Funny how that works...

For some long term perspective on a dress rehearsal for what's happening now on much more massive scale, here are John Brimelow's reviews from 2000-01 in VDARE.com of two books on the collapse of Long-Term Capital Management (LTCM) in 1998 (first and second):

LTCM was set up to profit from irrational disparities in valuation between similar financial assets, primarily bonds. The assumption that these occurred randomly in a normal distribution pattern had become an article of religious faith at U.S. Business Schools in the previous 20 years. Two of the progenitors of the view, Robert Merton of Harvard, and Myron Scholes of Stanford (and of the Black/Scholes option valuation model) were LTCM partners. (Fischer Black had had the judgment to die an untimely death previously.) Careful reading of their work reveals that they assumed continuous markets and stable volatility ranges (neither always present in reality) and they acknowledged but ignored the fact that probability distributions in financial markets often show "fat tails" -- in other words that extreme events occur far more frequently than a normal curve would predict. But they nonetheless built a "school" of like-minded thinkers and disciples. This group had become very influential on Wall Street by the late 90s.

Wall Street, in a sense, became a victim of the principal vice of the U.S. academic profession: the eagerness to set up introspective communities, dedicated to a dogma, which insulate themselves from fact-based criticism by exclusion and intimidation rather than argument. ...

Given that LTCM's "stunning losses betrayed the flaw at the very heart - the very brain - of modern finance" and that the concept it used "prevails at virtually every investment bank and trading desk," it is very strange to find Greenspan and Rubin (when Secretary of the Treasury) blocking all efforts to improve transparency and improve regulation even to the extent of forcing out the former CFTC head, Brooksley Born. ...

The saga of the Long Term Capital Management hedge fund - its rise, fall, and the peculiar circumstances surrounding its rescue in September 1998 - more and more appears paradigmatic of Clinton Era finance. Esoteric and secretive in action, operating through special relationships and understandings, involving greed and ambition on astonishingly uninhibited scale, and ultimately giving rise to suspicions of ominous fusion between private commercial objectives and the formulation of public policy, it lays out a pattern likely to become all too familiar as documentation of the period becomes more available.

November 24, 2008

The 700 Club

Nobody working for Obama seems to know how big his public works program will be, but the usual number you hear is around $700 billion.

You know where they got that number: from Hank Paulson's original bank bailout. You can imagine the rhetoric already: "If we can afford $700 billion for Wall Street, we can afford $700 billion to fill the potholes on Main Street!"

And how did Paulson come up with his $700 billion number? As far as I can tell, he basically had no clue. He just wanted a really big number "to restore confidence," but he probably didn't want one so big that you could round it up to "a trillion." Hence, $700 billion, our new national lucky number.

Update: A commenter points out that when Paulson left Goldman Sachs, he cashed in for $700 million, which might be how he came up with 700 as his favorite number.

My published articles are archived at iSteve.com -- Steve Sailer

The Secret History of the Bush-Rove Years, Cont. -- Part 27: How Faith-Based Initiatives Helped Blow Up the Housing Bubble

What just happened?

How did eight years of a supposedly "conservative" Administration get us to this point where the country feels like a tapped out Vegas binge gambler ejected from the plush casino into the harsh mid-morning light without even cabfare in his pocket?

We have a general framework for explaining it: Invade the World / Invite the World / In Hock to the World.

But, with some digging, the small pieces of the puzzle are starting to come into better focus.

For example, remember the big emphasis that Bush and Rove put on "faith-based initiatives" as a pillar of their "compassionate conservatism"? I wrote a few articles about that topic in late 2000, but it was hard to pay attention because it seemed so boring: the ACLU made the expected complaints, you heard the usual responses, yawn ...

What almost nobody noticed was how faith-based initiatives tied into the Bush-Rove jihad against down payments in the service of their goal of boosting minority homeownership by 5.5 million households.

Beowulf comments:

You just reminded me of something a real estate developer told me a couple of years ago... He built subdivisions in an urban (i.e. black) part of town and his marketing campaign involved putting ministers on commission.

They'd stand in the pulpit and declare that buying a home is the first step of fulfilling the American dream and their Christian duty. Every church member who bought a house, the minister got a check.

It was all legal, apparently, if the payments were structured as part of a downpayment assistance program. Legal, that is, until the IRS took the punchbowl away in 2006.

So, one of the things that pricked the Housing Bubble in 2006 was the IRS cracking down on this form of "charity."

Here's a cogent description of the scam from a recent press release by the apartment building lobby. Obviously, the people who rent out apartments are biased, but, at least they didn't plunge the world into economic chaos, so they've got that going for them:

Congress Should Protect Taxpayers and Retain the Ban on 'Charity' Downpayment Schemes

WASHINGTON, Sept. 16, 2008 /PRNewswire-USNewswire/ -- Congress should pause and carefully consider the consequences before it acts to overturn its recent ban of so-called "charity" downpayment assistance schemes, according to the National Multi Housing Council (NMHC) and the National Apartment Association (NAA).

Under these programs, a non-profit provides a downpayment to the buyer and is then reimbursed by the seller, often a home builder. In 2006, the IRS stripped several of these non-profits of their tax-exempt status, ruling that the programs benefit sellers more than buyers since sellers often raise their asking price to cover the amount they theoretically "donated."

"These circular funding programs come with good intentions but produce loans that are three times as likely to go into foreclosure and merely perpetuate the tragically failed policy of zero-downpayment lending that helped create the current foreclosure crisis," noted Jim Arbury, Senior Vice President for the NMHC/NAA Joint Legislative Program.

"Congress wisely banned these programs in the Housing Stimulus Bill that it passed in July," said Arbury. "Now it is considering stepping back and once again allowing them. This would be a mistake that would lure more individuals into unsustainable homeownership and put taxpayer dollars at risk."

"These loans skyrocketed from six percent of the Federal Housing Administration's mortgage originations in 2000 to approximately 30 percent as of 2004, and now threaten the financial viability of the FHA," said Arbury. "The FHA says it expects to lose $4.6 billion in 2008, an unanticipated loss it attributes largely to seller-financed downpayment mortgages."

"Today, the House Financial Services Committee will consider a bill (H.R. 6694) that would overturn the ban and purportedly protect the FHA by limiting the use of seller-financed downpayment assistance to households with credit scores above 620," explained Arbury. "Unfortunately, the wishful thinking that higher credit scores translate into lower default rates is not borne out by the facts. According to HUD data, even households with the highest credit scores required by the bill are twice as likely to default if they use downpayment assistance."

"This is why seller-funded downpayment assistance programs have come under fire from the IRS, the Government Accountability Office and HUD's Inspector General's Office," Arbury concluded. "For its own financial health, the FHA should not be forced to return to insuring loans that involve seller-funded downpayments."

My published articles are archived at iSteve.com -- Steve Sailer

The Politics of Public Works

A major goal of the Obama Administration will be to keep millions of illegal immigrants from going home, which would deprive the Democratic Party of large numbers of votes in coming decades from them (after they are put on "the path to citizenship") and, more importantly, their American-born (and thus birthright citizen) children. Spending hundreds of billions of the taxpayers' dollars to keep illegal immigrant construction workers previously employed putting up unneeded McMansions in exurban Las Vegas from leaving the U.S. is a small price to pay for future Democratic dominance.

A reader writes:
As you and I know, fully half of the illegal aliens work in construction and most of the rest work in the hospitality industry. When the housing (and commercial) construction collapsed last summer, we all knew it would not be long before the unemployed illegal aliens packed up and self-deport. (It actually costs a lot to live in the USA if you do not have a job.) Now Obama comes to the rescue! Before they can run out of money, they can go to work on the biggest public works project in American history. Will Americans be allowed to work too......sure!.....if they can speak Spanish, if they have several years of recent experience doing the same work. (This will guarantee that much of the stimulus will end up being paid to illegal aliens.) Naturally, the powers that be do not want their vast army of cheap construction workers to pack up and go home....besides ....there is a political payoff here for the support provided by Hispanics in the last election.

My published articles are archived at iSteve.com -- Steve Sailer

"Katyń"

In an essay entitled "Never Forget. You're Reminded" in today's New York Times, film critic A.O. Scott cautiously raises the question of why there will be, once again, so many Holocaust-related movies opening during the upcoming Academy Awards season:

The near-simultaneous appearance of all these movies is to some degree a coincidence, but it throws into relief the curious fact that early 21st-century culture, in Europe and America, on screen and in books, is intensely, perhaps morbidly preoccupied with the great political trauma of the mid-20th century.

The number of Holocaust-related memoirs, novels, documentaries and feature films in the past decade or so seems to defy quantification, and their proliferation raises some uncomfortable questions. Why are there so many?

Tough question ... Let me think about it... No, I'm drawing a blank. I'm as baffled as A.O. Scott is. I don't have a clue either why Hollywood keeps making movies about the Jewish Holocaust as opposed to, say, the Ukrainian Holocaust or the Gulag Archipelago. It's completely baffling.

Seriously, if you want your ancestors' suffering to be remembered, you've got to make the movie yourself. Here's my review of "Katyń" from The American Conservative:
It often seems as if humanity's seven decade struggle with Communism has disappeared down the memory hole. While Nazis in glistening black leather remain our culture's omnipresent exemplars of evil, Communists are apparently too dowdy to bother remembering.

A few filmmakers have begun to dissent, however. Florian Henckel von Donnersmarck's superb drama about the East German secret police, "The Lives of Others," won the 2006 Best Foreign Film Oscar and ran for a half year in American art houses.

In Warsaw on September 17, 2007, director Andrzej Wajda, recipient of a Lifetime Achievement Oscar, premiered "Katyń," his long-awaited epic about the 1940 Soviet decapitation of the Polish nation in which his cavalry officer father had perished. The 82-year-old cinema legend reminisced, "I can’t really talk about him, except to say that he was my ideal and that he died at the age when I needed him the most." The mass murder's cover-up then lasted a half century in Soviet-run Poland: not until 1989 was Wajda free to inscribe the year of his father's death on his tombstone.

A blockbuster in Poland, "Katyń" earned a Best Foreign Film nomination here. It hasn't, though, found an American distributor. Fortunately, you can buy the Polish DVD on eBay for $25. (Look for "English subtitles" and "Region Zero.")

"Katyń" begins September 17, 1939 as Polish civilians flee eastward over a bridge from the invading Germans -- only to collide with countrymen running westward from the Soviets, who, pursuant to August 1939's Hitler-Stalin pact, are now grabbing their share of Poland.

The overwhelmed Polish forces surrendered to their fellow Slavs, who sent most of the enlisted men home. When the wife of a captured captain locates him awaiting shipment east and begs him to escape with her, he responds, with that fatalistic sense of honor that is the outstanding feature of the Polish character, that his pledge binds him to his brother officers. "Katyń" follows the cavalry captain into a Soviet POW camp inside a defiled Orthodox church, and tells of the women who longed for him to come home and of the postwar hoax that covered up the atrocity.

Because all Polish college graduates were commissioned as reserve officers, the Communists found themselves in possession of Poland's natural leaders, the men who would not abide a Poland ruled by Soviet stooges. On March 5, 1940, Beria, boss of the NKVD secret police, sent Stalin a memo recommending extermination of the Polish POWs. The NKVD methodically shot 22,000 in the back of the head and dumped most of the bodies in trenches in the Katyń Forest.

In 1943, the German Army stumbled upon the mass grave. In perhaps the ultimate example of the pot calling the kettle black, Goebbels launched a propaganda campaign over the atrocity. In turn, Stalin used the outrage expressed by the legitimate Polish government-in-exile in London to accuse them of collaborating with the Nazis, justifying him in imposing his own Polish puppet regime.

FDR and Churchill acquiesced in the Soviet counterclaim that the Nazis had killed the Polish officers during their 1941 attack on Russia, making gravestones with a death date of "1940" politically incorrect in Poland until the fall of the Berlin Wall.

Of course, the Germans were doing the same in their half of Poland: "Katyń" depicts the Nazis arresting 144 college professors, including the captain's father, at Cracow's Jagiellonian University (incidentally, putting young Karol Wojtyła, the future Pope, out on the street).

Echoing Solzhenitsyn, Wajda extols remembrance: "The best remedy for political and social problems is to show them and to speak truly about them." In contrast, the Kremlin shut down its Katyń investigation in 2005 without prosecuting any perpetrators. KGB alumnus Vladimir Putin classified as secret 116 volumes of findings.

"Katyń" is an effective, moving film comparable to "The Pianist," the celebrated 2002 Holocaust film by Wajda's old colleague Roman Polanski. Americans will find "Katyń" more comprehensible on DVD than if it had run in the theatres. Wajda perfected his craft under Communist censorship, so his storytelling is implicit -- he assumes that his audience knows enough Polish history to fill in his gaps. Luckily, by pausing the DVD periodically to talk it over, we can sort out the large cast of rather similar-looking Poles and distinguish the slight differences in color of the Polish, Soviet, and German officers' greatcoats.

As Stalin noted, "A single death is a tragedy; a million deaths is a statistic." Thanks to "Katyń," the 22,000 aren't a statistics anymore.

The rating would be PG-13.

From out of The Memory Hole

Here is an informative June 24, 2002 article from Realty Times about Bush's plan to increase minority homeownership by 5.5 million households. This trade journal emphasized six years ago that the core of Bush's plan was raising the minority/low income quotas for Fannie Mae and Freddie Mac mortgage activity by a total of $440 billion. This is the kind of thing that gets lost in time because there's no partisan point to remembering it. Republican flacks want to blame Fannie Mae, but here's the Republican President leaning on Fannie Mae to increase its minority quota by $260 billion.

(By the way, do you ever get the feeling that historians will someday look back on the Bush-Obama years as a single era?)

When President Bush announced his Minority Homeownership plans last week in Atlanta, his top priorities were new federal programs: a $2.4 billion tax credit to facilitate home purchases by lower-income first-time buyers, and a $200 million national downpayment grant fund.


But none of the new federal programs--if passed by Congress--will come even close to achieving the 5.5 million-household increase in minority homeownership the President set as his target.

Instead, most of the heavy lifting was assigned to two mortgage market players that have sometimes come under fire from Bush administration officials and Congressional Republicans: Fannie Mae and Freddie Mac.

Fannie's and Freddie's commitments are the bedrock core of the President's ambitious plans--but didn't get the headlines. Fannie Mae agreed to increase its already substantial lending efforts to minority families by targeting another $260 billion of mortgage purchases to them during the next nine years. Freddie Mac agreed to buy an additional $180 billion in minority-household home loans during the same period.

Both corporations also announced specific plans to increase home purchases by African-Americans, Hispanics and immigrants. Fannie Mae, for example, pledged to create an entirely new mortgage product “designed to meet the unique needs of New Americans.” The new loan concept would include underwriting changes that remove some of the common barriers immigrants encounter here--denial of credit because of inadequate or short credit histories, reliance on communal funds for downpayment money, and language and cultural issues. Fannie also promised to establish 100 “outreach partnerships” with predominantly-minority churches, mosques and “other faith-based institutions” to fund mortgages for their congregations.

Besides its $180 billion mortgage purchase commitment, Freddie Mac gave President Bush a promise to implement a 25-point program aimed at increasing minority homeownership. Some of the points were cutting-edge. For example, as part of an effort to remove the fear of financial loss from first-time minority home buyers, Freddie committed itself to “explor(e) the viability of equity assurance products to protect home values in economically distressed areas.”

Pressed for details on “equity assurance” by RealtyTimes, Freddie Mac vice president Craig S. Nickerson said the idea is still at an embryonic stage, but might involve limited guarantees or insurance coverage to protect buyers from the possibility of loss of their initial equity stakes should property values in their neighborhoods decline.

Some “urban neighborhoods get passed over (by potential buyers) because of fears of where the market might go,” said Nickerson. Freddie's effort would be to examine “whether we can create structures to minimize (buyers') downside risks”--whether through some form of new equity-preservation insurance, public-private “rainy day” funds, or federal assistance targeted to backstop values in predominantly minority neighborhoods.

Also on Freddie's 25-point to-do list: “cross-border credit” efforts that would allow immigrants' credit files from their home countries to be acceptable to U.S. lenders; “automating non-traditional credit,” where minority borrowers have no or minimal existing bank or credit reference but do have rental and utility payment histories; and a variety of new “downpayment assistance” plans to put cash in the hands of first-time buyers.

Published: June 24, 2002

Also, I'm starting to realize that Bush's "faith-based initiatives" were not irrelevant to the mortgage meltdown. I don't have anything close to a full grasp of the story yet, but there's definitely a story there.

My published articles are archived at iSteve.com -- Steve Sailer

November 23, 2008

Learning from the New Deal

Here's an excerpt from my new VDARE.com column:

The real issue posed by Obama’s massive public works proposal: will he follow the precedent set by the New Deal’s Works Progress Administration (WPA) in limiting employment on his public works projects to United States citizens?

The WPA started in 1935, a period when there was little immigration because of the 1921-5 cut-off and the Depression. When the economy turned down again in 1937, the Democrat-dominated Congress restricted it to American citizens (n.b. citizens, not even legal residents):

"In 1937 Congress, following a trend already established by the states, declared that all programs of the Works Progress Administration (WPA) would be closed to aliens. The "citizens-only" policy of the WPA extended even to companies that fulfilled government contracts; corporations such as General Motors fired those whom they perceived as foreigners to keep from losing lucrative government business."

Otherwise, Obama’s public works spending will merely draw in millions of foreigners, just as the late Housing Bubble did. ...

Moreover, during the Housing Bubble, blue-collar Americans in dying cities like Detroit and Cleveland largely missed out on the chance to move to places like Las Vegas for construction jobs—the illegal aliens would work for less.

During the Bubble, huge sums of money flowed out of the United States as remittances. The Washington Post reported in 2006 at the peak of the Bubble:

"A report released yesterday by the Inter-American Development Bank estimates that immigrants living in the United States will send $45 billion to family members this year ..."

Remittances to Latin America shot up during the Housing Bubble, both because so many immigrants were employed in construction, and because so many took out dubious mortgages that they have since defaulted upon.

Remittances finally started falling early this year. The Dallas News reported:

"Other Mexican officials said the decline is a reflection of the worsening U.S. economy, particularly in the area of construction. The U.S. construction industry accounts for about 20 percent of jobs for Mexicans living in the country, according to the [Mexican] central bank."

These remittances deprived the American economy of the celebrated Keynesian "multiplier effect" on construction spending that you will hear so much about from the Obama administration this week as they rationalize their spending plan. ...

What you likely won’t hear from Obama, however, is that if you pay an American to fill potholes, he’ll spend the money in America, where other Americans will then spend it some more. If you pay a Mexican, however, he’ll send a lot of the money back to Mexico.

Mexico, with its population of 110 million (just counting those still resident within its borders), is unquestionably going to go in the tank economically in 2009 because it depends upon remittances, oil, and American tourists. So if Obama fails to close his infrastructure jobs to non-citizens, there will be another rush to America by unemployed Mexicans.

Obviously, the highest priority way to reduce unemployment in the United States is to encourage non-citizens to go home, as America did during the Great Depression. (There was actually net emigration in the 1930s.)

[More]

I'd like to thank commenter StephenT, among others, for the idea.

My published articles are archived at iSteve.com -- Steve Sailer

Israel's evolution

Takuan Seiyo has an interesting article in VDARE.com on Israel's cultural evolution due to lower birthrates among Ashkenazi Jews compared to Oriental Jews. Israel, which was long a major force in classical music (which is perhaps the most straightforward measure of civilizational level), is slowly becoming another Middle Eastern country culturally.

You can see something similar happening in Beverly Hills, where the population remains heavily Jewish, but is changing from Ashkenazi to Persian and other Oriental Jews: clever, energetic people, but not terribly interested in European high culture.

I'll probably miss Eli Broad when he's gone.

My published articles are archived at iSteve.com -- Steve Sailer

By the way ...

You hear a lot of debate about whether or not it's possible for this economic downturn to be as deep as the Great Depression.

I'm just wondering: Why does everybody assume that the Great Depression marks the all-time rock-bottom worst that human economic history will ever witness?

My published articles are archived at iSteve.com -- Steve Sailer

Media ignoring Bush's jihad against down payments

I keep reading articles trying to explain the mortgage meltdown, but the mainstream media's coverage almost utterly ignores George W. Bush's war on down payments in his effort to boost minority homeownership by 5.5 million. On Google News, the only reference over the last month to Bush's 5.5 million household goal are columns by Rod Dreher and Ross Douthat, both of whom no doubt heard about it from me.

It's like that Star Trek episode where an evil computer takes over, but Kirk and Spock make it overload its circuits by posing logical conundrums for it to figure out like:

The next thing I will say is a lie.

The last thing I said is the truth.

Or maybe not exactly that (it's been 40 years since I watched that episode), but close.

Anyway, in regard to Bush's plan to expand minority homeownership by debauching traditonal credit standards, the media reason (read with Stephen Hawking-style computer accent):

Bush is evil.

Minorities are good.

DOES NOT COMPUTE.

Best not to think about it or smoke will come out of our brains. Let us never mention it again.

I did notice that James Bovard figured out what was going on over three years ago in a June 11, 2005 column for Lew Rockwell entitled "Bush Profiteering from Housing Defaults." It also explains what the Nehemiah Corp. is up to:

President Bush is determined to end the prejudice against people who want to buy a home but don’t have any money. Since he became president the U.S. Department of Housing and Urban Development has spent more than $120 billion. HUD public-housing projects continue to devastate poor neighborhoods. HUD largesse to local governments continues to finance the confiscation and demolition of private homes, and HUD programs continue to spur fraud and corruption around the nation.

Bush has done almost nothing to reduce HUD’s damage to America. Instead, he is devoting himself to expanding home giveaways. He proclaimed on June 16, 2003,

Homeownership is more than just a symbol of the American dream; it is an important part of our way of life. Core American values of individuality, thrift, responsibility, and self-reliance are embodied in homeownership.

In Bush’s eyes, self-reliance is so wonderful that the government should subsidize it.

Bush could be exposing taxpayers to tens of billions of dollars of losses, luring thousands of low- and moderate-income people to the heartbreak of losing their first house, and risking wrecking entire neighborhoods. Bush’s housing initiatives – especially his “American Dream Down Payment Act” to give free down payments to selected home buyers – were key planks in his reelection campaign. He is also pushing Congress to enact a law to permit the feds to give zero-down-payment mortgages.

The Bush “Dream Act” and the zero-down-payment plan are modeled after “down-payment assistance programs” that have proliferated in recent years. These programs, often engineered by nonprofit groups, routinely involve a home builder giving a “gift” to the nonprofit, which provides a home buyer with money for the down payment. The price of the house is sometimes increased by the same amount as the builder’s “gift.” Almost all the mortgages created with down-payment assistance end up being underwritten or guaranteed by either the Federal Housing Administration (FHA) or Ginnie Mae (the Government National Mortgage Association).

Free down payments carry catastrophic risks. The default rate on mortgages from the largest down-payment-assistance organization, Nehemiah Corp., is 25 times higher than the nationwide mortgage-delinquency rate, according to the HUD inspector general. The default rate on Nehemiah mortgages quadrupled between 1999 and 2002, reaching almost 20 percent. The I.G. warned that permitting the Federal Housing Administration to insure mortgages made with gifts from down-payment organizations is “endangering the FHA insurance pool.” HUD currently has no idea how many of the loans that the FHA is underwriting are closed with down-payment gifts.

Bush began pushing his American Dream Down Payment plan in 2002. The administration’s rhetoric echoed the 1968 Housing Act, which nullified state and local restrictions on where blacks and other groups could live. A June 17, 2002, White House Fact Sheet declared that Bush’s agenda

will help tear down the barriers to homeownership that stand in the way of our nation’s African-American, Hispanic, and other minority families by providing down-payment assistance. The single biggest barrier to home-ownership is accumulating funds for a down payment.

The Bush administration sounded as if requiring down payments is the new version of Jim Crow laws.

My published articles are archived at iSteve.com -- Steve Sailer

November 22, 2008

Fiscal Stimulus II

Obama says today in his weekly Youtube message:

I have already directed my economic team to come up with an Economic Recovery Plan that will mean 2.5 million more jobs by January of 2011 – a plan big enough to meet the challenges we face that I intend to sign soon after taking office. We’ll be working out the details in the weeks ahead, but it will be a two-year, nationwide effort to jumpstart job creation in America and lay the foundation for a strong and growing economy. We’ll put people back to work rebuilding our crumbling roads and bridges, modernizing schools that are failing our children, and building wind farms and solar panels; fuel-efficient cars and the alternative energy technologies that can free us from our dependence on foreign oil and keep our economy competitive in the years ahead.

How much of this can actually be done in 24 months?

It's crucial to understand that this isn't December 8, 1941 anymore. The people who voted for Obama have spent decades making it extremely difficult to do quickly anything physical. For example, California governor Arnold Schwarzenegger sponsored a bunch of bond initiatives that passed in 2006. But, I am told by a Sacramento insider, that, two years later, no dirt has been turned. I'm sure that a lot of environmental scientists, lawyers, and administrators have been pulling down paychecks, but in the physical world, nothing has happened in 24 months.

So, let's look at Obama's suggestions one by one:

Yes, we can quickly put people to work "rebuilding crumbling roads and bridges." There aren't, as far as I know, big environmental impact snags with resurfacing existing freeways. There's this one lane in particular that every time I drive it takes a day off the life of my car. Of course, all this would just make driving more enjoyable so it's the opposite of the "green" philosophy of the rest of Obama's thinking.

What about "modernizing schools that are failing our children"? First of all, there's little relationship between physically spiffy schools and non-failing schools. Los Angeles has spent something like $24 billion on school construction and remodeling in recent years with no clear return on the money. For example, the brand new, state of the art East Valley High School that opened in the San Fernando Valley a couple of years ago can't get enough students to fill it because it's overrun by gangs. Parents are lying about where they live in order to get their kids into the two pre-WWII high schools in the neighborhood because they are terrified of the brand new one. Here are the three comments about East Valley that I found on a website:

Although the students underneath me have similar beliefs about the school, I feeel that the school is a work in progress. It could be better but at the moment it is unorganized and undergoing many stumbling blocks. I feel that we need help from other schools and officials to make it better.

Posted by a student on 11/09/07

I am a student at east valley high school in north hollywood california. I never feel safe at this school. The teachers have no authority over their classrooms, or students...... I'm definetly not graduating from a school like this.

Posted by a student on 11/06/07

I find some of the teachers top rated, committed and have great teaching. However, the school culture is a mess...tagging everywhere and the principal seems not to care about all these.

Further, most of LA's school projects took many years to get off the ground. Construction of the 2500 student Belmont Learning Center near downtown LA that just opened was a notorious 20-year nightmare. From Wikipedia:

The project to build the school began in 1988. The site of the school had previously been used for industrial purposes, and a concern of soil contamination was confirmed during development in 1999. This resulted in a temporary halt to construction.

In December 2000 Superintendent Roy Romer[5] saved the project and began reviewing private bids to address the additional issues at the site. In 2002, "An Alliance for a Better Community" was selected to finish the project.[citation needed]

Further complicating the development, in September 2002 an earthquake fault was detected on the northeast portion of the plot. The project was again temporarily suspended.[6]

In May 2003 the Los Angeles Unified School District voted to finish the school but with certain modifications: inclusion of a 10 to 12 acre (4 to 4.9 ha) park; a 500 seat learning academy; a library; an auditorium; and a parent center. Once completed, these changes resulted in one of the more luxurious schools of the urban sections of the district.[citation needed]

The total project cost was then estimated to be around US$300 million. A voter initiative bond called Measure K provided $3.3 billion of the construction funds, with city funds supplying the rest.[citation needed]

In December 2004, approximately 60 percent of the buildings were demolished because of the earthquake fault and then construction continued.

What about upgrading existing schools? Well, one obvious problem is that it's hard to employ a lot of construction workers on schools except during the summer vacation, unless the school is so empty that you can shut down part of it and turn it into a construction site. But, if so few students go to it, why bother?

How about "building wind farms and solar panels?" Once again, there giant environmental issues. Wind farms are not popular in California. Further, hooking remote wind farms into the electrical grid is not trivial.

Finally, "fuel-efficient cars and the alternative energy technologies that can free us from our dependence on foreign oil and keep our economy competitive in the years ahead" haven't gone through the formality of being invented yet.

So, what do I think Obama will actually do in the short term?

A lot of state and local governments will need bailing out, most notably California, to prevent massive layoffs of civil servants. I expect to see, in the spirit of bipartisanship upon which Obama campaigned, a summit meeting between President Obama and Governor Schwarzenegger in which Obama hands tens of billions to California to meet payroll and even hire some more paper pushers and social workers. That's what Obama's entire career has been devoted to: taking money from productive people and hiring people like himself to collect paychecks while failing to solve social problems. That's his base.

My published articles are archived at iSteve.com -- Steve Sailer

Fiscal Stimulus

Everybody is talking about "fiscal stimulus" and "infrastructure projects" (i.e., public works, like FDR's WPA). Larry Summers says that there is a "multiplier effect" and every dollar of government spending generates more dollars of overall economic activity in the American economy.

But nobody is talking about the obvious: Will the public works jobs be restricted to American citizens? To American citizens plus legal residents? Or will they just suck in more millions from south of the border as the Housing Bubble did, who will send tens of billions back home, depriving America of Larry's promised Multiplier Effect?

The real economic collapse is happening in the four sand states, California, Nevada, Arizona, and Florida. Sending billions to them for infrastructure projects would mean a large fraction of the public works payroll would go to illegal and legal aliens.

The one sure way to keep the unemployment rate in California (now 8.2%) from growing so fast is to have illegal immigrants go home. It's a lot cheaper for all concerned if ex-construction workers are unemployed in Mexico or Guatemala than if they are unemployed in California. But nobody is mentioning that.

Next, Obama's big goal is to set off an Alternative Energy Bubble to inflate the economy in time for the 2012 election. But, those kind of infrastructure projects (e.g., erecting a massive number of ugly windmills that chop migratory birds to shreds) take forever to get off the ground in Blue States due to environmental restrictions. In Red States, it's faster to get going. Will Obama want to send most of the money to Republican states? Or will he override the environmental dogmas of his base?

The kind of thing we can spend a lot of money on within 2009 are projects like freeway resurfacing -- exactly the opposite of what all the Save the World types who voted for Obama want.

My published articles are archived at iSteve.com -- Steve Sailer

November 21, 2008

Media-savvy Mormons push around naive Studio City folks

Here's a wonderfully clueless New York Times letter to the editor in response to that amusing NYT article "Mormons Tipped Scale in Ban on Gay Marriage" about how Mormons hijacked the gay marriage initiative in California. (By the way, gay marriage only got 48% in California, while Barack Obama got 61%. What fraction of that 13% of the Californian electorate who voted for Obama but not for gay marriage was Mormon? Eensy or teensy?)

To the Editor:

As a California resident who voted no on Proposition 8 [i.e., supported gay marriage], I am a little confused as to why money from outside the state is allowed to affect the outcome of our elections. If I wanted to live my life according to the rules of the Mormon Church, I would move to Utah.

Barbara Davilman
Studio City, Calif.

You have to feel sorry for the poor villagers of Studio City whose indigenous folkways are under constant mass media assault from all those rich city slickers in Provo. Mormons grow up knowing all about how to make snazzy TV commercials, while the innocent Studio Citians only learn from their elders how to communicate via smoke signals and notches carved in tree trunks by the side of the trail.

And nobody in Studio City would ever donate money to a political campaign taking place outside of the state.*

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* I'm kidding. I grew up in Studio City and had to put up with a lot of guff when I went to college in Texas about having a hometown called "Studio City," which I admit sounds like it was made up for parodistic purposes.

It was like the slums of Beverly Hills. The man across the street had a dozen Emmy awards in technical categories and another neighbor appeared in several hundred commercials.

My published articles are archived at iSteve.com -- Steve Sailer

Sidwell Friends School: Clinton Administration II Rolls On

I always thought that it was ironic that Barack Obama was running on "hope" and "change" because those two vague mantras are exactly what Bill Clinton ran on in 1992, what with being from Hope, Arkansas and all. (A couple of months after Clinton's election, I got an invitation to a marketing convention whose theme was "The Power of Change.") But the lack of "change" in the public facade of the nascent Obama Administration is getting pretty funny.

Obama's problem is that he's so inexperienced that he barely knows anybody other than a bunch of thuggish Chicago political operators like David Axelrod and Rahm Emanuel and a lot of unpresentable far leftists with whom he hung out in the 1980s and 1990s. So, for lack of a better idea, he's just plugging in Clinton Administration retreads in the top jobs. The "change" part applied to who gets to be President (and who will get the lower level jobs after the public loses interest).

Besides wooing Hillary Clinton for Secretary of State, the Obamas announced today that they were sending their daughters to Sidwell Friends School, the same pricey ($28,000+) school where the Clintons sent Chelsea. Although Michelle Obama claimed publicly that public schools were under consideration, she never bothered to tour any.

As I wrote in VDARE.com a couple of years ago:

In 1977, when Jimmy and Rosalyn Carter arrived in Washington D.C. from Georgia, they had to subject their daughter Amy to a D.C. public school to prove they weren't Southern racists.

But by 1993, when Billy and Hillary Clinton rolled into town from Arkansas, everybody who was anybody accepted that the D.C. public schools were awful (even if you had Secret Service bodyguards).

So when the Clintons enrolled Chelsea in an expensive Quaker private school, Sidwell Friends Academy, they didn't pay a political price for their hypocrisy.

Howard Kurtz wrote in the Columbia Journalism Review in 1994:

"Equally revealing was media response to the Clintons's announcement that they were sending their daughter, Chelsea, to Sidwell Friends, an $11,000-a-year private school in northwest Washington. When columnist Mark Shields praised Sidwell on The MacNeil/Lehrer NewsHour, he had to note that his children went there, as did Jim Lehrer's and Judy Woodruff's. Woodruff's husband, Al Hunt, made a similar disclosure while defending Clinton on Capital Gang. Carl Rowan touted Sidwell on Inside Washington, pointing out that his grandchildren attended the school. Howard Fineman, whose daughter was in kindergarten at Sidwell, said he "shamelessly lobbied" the Clintons to choose the school."

So don't worry about being duplicitous. Do what the Clintons and all those media liberals, white and black, did—put your children's welfare first!

But, don't you dare put the welfare of your fellow citizen's children ahead of those of people who want to sneak into our country.

By the way, all this talk about Hillary Clinton as Secretary of State reminds me of conversations that must go on these days when they're trying to cast superheroes' girlfriends in big Hollywood movies:

"How about Maggie Gyllenhaal?"

"She looks like a sad cartoon turtle. Why would the hero fall for her?"

"Okay, what about Kirsten Dunst?"

"Have you looked at her teeth?"

"Well, how about Katie Holmes?"

"Yeah, she looks okay. Let's give her agent a ... Oh, wait, no, this is too big a production to risk that her husband will stay out of the way. He's got too much energy. Better cross her off the list."

By the way, the rumor is that Bill Richardson, who had a couple of cabinet posts in the Clinton Administration (where his duties included considering Monica Lewinsky for a job) is in line for Secretary of Commerce. The reason Richardson is always up for Cabinet jobs is because he's 3/4th's Mexican (his grandfather was a raffish WASP from New England who fit in better in Latin America, where he had several families. His more straight-laced dad opened Citibank's Mexico City office long ago). So Democrats figure that appointing Richardson is a good way to pander to the the tsunami of Mexican voters that is always about to arrive.

The problem with Richardson as the perfect Hispandering Ploy is that unlike the Beltway political junkies who are always talking Richardson up, Mexicans don't pay much attention to politics, so most of them don't notice Richardson's 3/4 Mexicanness because he doesn't have a Spanish surname. So, it's a waste.

Moreover, when Richardson is actually indoors working, like he was when he spent months campaigning last year in Iowa and New Hampshire, his tan fades and then he just looks like another white guy with a WASP name, so even the few Mexican voters who watch the political news on TV won't notice they are being pandered to.

After Richardson dropped out of the Presidential race, he disappeared for a long time and suddenly re-emerged, presumably from some beach somewhere (Spring Break in Cancun?), looking like an Aztec sun god and sporting the goatee that makes him now look like the head of the nefarious villainous organization in a big budget action movie. So, unless Obama intends to let Richardson spend most of his time as Secretary of Commerce focusing on increasing American industry's sun tan lotion exports to Cabo San Lucas, he'll end up with just another paleface with an English name. (Actually, permanently stationing him in Cabo seems like an ideal use of Richardson's talents.)

My published articles are archived at iSteve.com -- Steve Sailer

Giant chicken skeleton artwork succeeds in repelling unenlightened public


Billionaire homebuilder Eli Broad and the other geniuses behind the Los Angeles Museum of Contemporary Art have finally achieved such sophistication in their artistic tastes that, according to a report this week in the LA Times, their museum is going broke.

My published articles are archived at iSteve.com -- Steve Sailer

The Vegas Decade

As I research the history of the mortgage meltdown, it's funny how often Las Vegas takes center stage. For example, here's a USA Today article from January 20, 2004:

Bush seeks to increase minority homeownership

In a bid to boost minority homeownership, President Bush will ask Congress for authority to eliminate the down-payment requirement for Federal Housing Administration loans.

In announcing the plan Monday at a home builders show in Las Vegas, Federal Housing Commissioner John Weicher called the proposal the "most significant FHA initiative in more than a decade." It would lead to 150,000 first-time owners annually, he said.

It's not the particular government program that's of major interest, it's the message the Bush Administration was sending. Federal regulators are supposed to take away the punchbowl when the party gets interesting, but announcing that the President hates down payments, that the Chief Executive feels that requiring people with bad credit to put money down on a house is UnAmerican and probably racist, at a homebuilder's convention in Las Vegas, well, I've exhausted all the punchbowl similes ... This is liking filling all the nasal decongestant inhalers at the Betty Ford Clinic with pure pharmaceutical cocaine.

The percentage of first-time homebuyers in California (Ground Zero of the disaster) who put no money down increased from 11% in 2002, when Bush first banged the anti-minority evils of down payments to 33% in 2004 to 41% in 2006. So, Bush certainly got what he repeatedly called for -- a big weakening in credit standards.

Nothing-down options are available on the private mortgage market, but, in general, they require the borrower to have pristine credit. Bush's proposed change would extend the nothing-down option to borrowers with blemished credit.

The FHA isn't a direct lender, but guarantees loan payments for mortgages on moderately priced owner-occupied property. The FHA guarantee now permits private lenders to finance as much as 97% of the purchase price of a home for millions of low- and middle-income borrowers.

In the proposal soon to be delivered to Congress, Bush would allow the FHA to guarantee loans for the full purchase price of the home, plus down-payment costs. As a practical matter, the FHA would guarantee mortgages as high as 103% of the value of the underlying property.

103% Loan-to-Value?

Sure, why not? What could possibly go wrong?

Weicher says the change is aimed at potential home buyers whose credit excludes them from the private mortgage market. Borrowers would need sufficient income to meet monthly payments. But, he said, the plan would eliminate the single largest impediment to homeownership for millions of households — lack of money for a down payment.

Well, lack of money for a down payment was supposed to be an impediment to homeownership.

The most recent government figures show a national home ownership rate of 68.4%, the highest ever. But less than half of black and Latino householders own the home in which they live. Bush has a goal of 5.5 million new minority homeowners this decade.

FHA loans carry higher risks of delinquency and foreclosure than do private mortgages, and the proposed change presumably will lead to greater losses to the government than the current program does.

Weicher said the added risk will be offset by higher fees charged to borrowers who opt to make no down payment.

On a $100,000 mortgage with an interest rate of about 6%, the nothing-down borrower could expect closing costs $750 higher than other FHA customers. Monthly house payments would be slightly higher.

Mortgage analyst Keith Gumbinger of financial publishers HSH Associates says the Bush plan "would fill at least a small niche in the mortgage market" — first-time buyers with somewhat impaired credit.

Affordable-housing advocate Scott Syphax, CEO of Nehemiah Corp., called the proposal "revolutionary." It marks the clearest official acknowledgment that millions of potential homeowners are being blocked by high down-payment costs, he says.

The Nehemiah Corp. describes itself as:

In 1994, Nehemiah Corporation of America (“Nehemiah”) was founded by a young African-American preacher with a $5,000 loan from a Baptist church in Sacramento, California. ... However, as its Vision Statement indicates, its charitable activities are more expansive than just down payment assistance, it also provides opportunities for economic empowerment and community revitalization.

Personally, I can't make sense out of what they do, but it seems like they do it on a pretty large scale. The point is that everybody who was anybody across the ideological board was for the steps that led to the mortgage meltdown.

My published articles are archived at iSteve.com -- Steve Sailer