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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?


To: Jim Willie CB who wrote (184347)3/30/2006 8:19:58 PM
From: stockman_scott  Read Replies (1) | Respond to of 281500
 
Bush's Card trick
_______________________________________________________________

Forget his meaningless staff switch. Bush is the most blinkered and rigid president since Depression-denying Herbert Hoover.

By Sidney Blumenthal
www.salon.com
Mar. 30, 2006

More senior White House aides have left as a result of criminal indictments in Bush's second term -- the vice president's chief of staff, the top administrator for federal procurement policy at the Office of Management and Budget and the director of domestic policy -- than through normal attrition. So when physically depleted chief of staff Andrew Card submitted his resignation after five years on the job it was treated in Washington as a seismic event. In a fit of wishful thinking, the Washington Post ran a front-page story on Wednesday headlined: "Card's Departure Seen as a Sign President Hears Words of Critics." Lacking earthly evidence, Card's quitting was read like wonder in the heavens. Unmentioned was Bush's frantically defiant appearance in the Rose Garden immediately after the Oval Office ceremony accepting Card's resignation. With his entire Cabinet arrayed behind him in a phalanx, flanked by Vice President Dick Cheney on one side and Secretary of Defense Donald Rumsfeld and Joint Chiefs of Staff chairman Gen. Peter Pace on the other, Bush insisted that he would stay the course in Iraq. "We're not going to lose our nerve," he proclaimed.

For months, Bush has been giving speeches declaring that unwavering support for his approach, whatever it is, will yield "victory." Once again, in the Rose Garden, he pledged he would not "retreat" before "the terrorists." His message remains the same as ever. "I mean," he said in a slightly exasperated tone during an interview with ABC News on Feb. 28, "my policy has not changed."

If anything, the replacement of Andrew Card with Joshua Bolten, his understudy, highlights Bush's steadfast refusal to make substantive changes not only in the personnel of de facto power, dominated by Cheney, but also in any of his ruinous policies. It is the opposite of a changing of the guard; rather, it is equivalent to promoting a younger butler to the presidential suite when the older one retires.

Card's neutered politics was his chief virtue. He was the last of the old Bush family retainers out of the New England tradition. I first met him in the mid-1970s in Boston, when he was a liberal Republican state representative. In 1980, he ran George H.W. Bush's primary campaign for president in Massachusetts against Ronald Reagan, when Bush ridiculed Reagan's "voodoo economics." Two years later, Card campaigned for the Republican nomination for governor but finished third, badly trailing a conservative upstart. Card was anathema to the right in the state. He then began his ascent in Washington, sponsored by Vice President Bush. First, he headed the intergovernmental affairs office in the Reagan White House. Once the senior Bush was elected president, Card was appointed his deputy chief of staff and then secretary of transportation. After Bush's defeat in 1992, that portfolio enabled Card to become the top lobbyist for the Automobile Manufacturers Association. With the return of another Bush to the White House, Card's family loyalty, Washington experience and bureaucratic proficiency made him a logical choice for George W. Bush's chief of staff.

His selection itself indicated Bush's view of the office. Some chiefs of staff are the most powerful figures next to the president, from Eisenhower's Sherman Adams to Reagan's James Baker. But the vice president occupies that role in the current Bush White House. Card had little influence over policy; he walked through the West Wing without leaving footprints. He was the chief of staff as efficient enabler. He survived because he put loyalty -- his loyalty to this Bush a continuation of his loyalty to the family -- above all. In a pinch, he even waited on tables.

Former Secretary of the Treasury Paul O'Neill, in his memoir, "The Price of Loyalty," recounts an anecdote that begins with President-elect [George W.] Bush interrupting O'Neill's discussion of policy: "'Where's lunch?' They'd ordered cheeseburgers, but after fifteen minutes, they had not arrived. 'Go get me Andy Card,' Bush said to one of the Secret Service agents … [Card was] solid and jovial, a man of solid, loyal character. Bush looked impatiently at Card, hard-eyed. 'You're the chief of staff. You think you're up to getting us some cheeseburgers?' Card nodded. No one laughed. He all but raced out of the room."

Joshua Bolten, the new chief of staff, is Card's Card. A banker at Goldman Sachs, he served as Card's deputy before his appointment as director of the Office of Management and Budget. In that position, Bolten constantly talked of progress and "improvement" in the deficit, paralleling Bush's proclamations about progress in Iraq. With each new budget, Bolten insisted the federal deficit was being lowered, and two years ago, he predicted it would be cut in half (from more than $500 billion) within five years. Now, Goldman Sachs, Bolten's former firm, projects about $5 trillion in deficits over the next 10 years. Bolten's budgets were dead on arrival, going from delivery to congressional offices to deposit in the circular file without even being used as doorstops. Proficient at crunching these fantasy numbers, he has proved himself as loyal as Card, and the natural factotum to succeed him. Once again, Bush is staying the course.

No evidence shakes, deters or changes Bush -- no intelligence report, criminal investigation or calamity. Like all failed presidents, Bush is a captive in an iron cage of his own making. The greater his frustration, the tighter he grips the bars. To locate any comparison for this degree of ideological and personal inertia and inability to adapt to reality, one must go back to Herbert Hoover's rigidity in the face of the Depression.

It was neither obvious nor foretold that Hoover would respond with blinders to the crisis that befell him. Hoover was considered the preeminent progressive of his age, the most capable man in the country. He was well educated as an engineer and scientist, was a self-made millionaire, having become wealthy in international mining and banking, and lived for years in London, one of the most cosmopolitan Americans of the time. After World War I, President Woodrow Wilson summoned him, based on his sterling reputation, to organize relief for Europe and Russia. His organizational skills and the scale of his humanitarian projects were unexcelled. Appointed secretary of commerce by President Warren G. Harding, his integrity was completely untouched by the scandals of that administration. Reappointed by the inactive and reclusive President Calvin Coolidge, Hoover turned his department into a dynamo of policy innovation. In 1928, nominated by virtual acclamation, campaigning for a "New Era" that would "abolish poverty," he was elected president in a landslide. Six months after his inauguration, the stock market crashed. He was "the greatest innocent bystander in American history," according to newspaper editor William Allen White.

Historians now agree that Hoover did take important steps to deal with the Depression, for example, creating the Home Loan Bank system and the Reconstruction Finance Corp., among other measures. However, it was all too little, too late. He clung desperately to an ideology of social Darwinism masquerading as laissez-faire individualism. And he came to regard change outside the narrow parameters of his vision as evil, threatening the self-reliant American character as he understood it. In the name of ideology, he vetoed public works and unemployment insurance.

Hoover repeatedly expressed his faith that the Depression was ending as though such faith itself were sufficient to restore the economy. On May 1, 1930, he said his policies had "succeeded to a remarkable degree" and "we have now passed the worst." A month later, he declared there was no need for further measures: "The depression is over." Later, after leaving the White House, his illusions persisted. "Many persons left their jobs for the more profitable one of selling apples," he wrote.

Hoover entered office with overwhelming one-party dominance over Congress. In the 71st Congress, the Republicans had a 100-seat majority over the Democrats in the House of Representatives and a 17-seat majority in the Senate. Two years later, in 1930, the Democrats controlled the House by six seats and the Senate was deadlocked.

In 1932, Hoover campaigned against the promise of the New Deal as something that "would destroy the very foundations of our American system." When he heard Hoover's remark, Franklin D. Roosevelt said: "I simply will not let Hoover question my Americanism."

Like Hoover, Bush builds walls of denial as the facts tumble down on his policies. And, like Hoover, who periodically proclaimed prosperity just around the corner, Bush almost daily announces progress in Iraq. Like Hoover, he sustains a Micawber-like optimism that something will turn up in the face of worsening conditions. Hoover's rigid approaches inspired a crisis of confidence. His inviolate integrity fostered greater frustration about him as his honesty turned into sanctimonious armor. He suffered a crisis of credibility because his statements were glaringly at odds with reality. But Hoover was not responsible for creating the Depression. And no one accused him of being a liar. Bush, by contrast, has created his crisis himself.

On the day after Bush made his brave statement in the Rose Garden about "nerve" against "the terrorists," his ambassador to Iraq, Zalmay Khalilzad, is reported to have observed that there have been more assassinations by Shiite militia than killings by the Sunni insurgency. Khalilzad also delivered a message to Shiite leaders that President Bush "doesn't want, doesn't support, doesn't accept" the man they had selected to be prime minister, Ibrahim al-Jaafari, and demanded that they depose him.

Thus regime change enters a new phase, though not in Washington.



To: Jim Willie CB who wrote (184347)3/30/2006 9:08:31 PM
From: geode00  Respond to of 281500
 
Which explains what is going on with the Katrina 'recovery' and Iraq.

Hmmm. Maybe the admin should just give it up and outsource both of them to India and China.



To: Jim Willie CB who wrote (184347)3/31/2006 8:04:37 AM
From: stockman_scott  Read Replies (2) | Respond to of 281500
 
Lost Highway - The foolish plan to sell American toll roads to foreign companies.

slate.com

By Daniel Gross

Posted Wednesday, March 29, 2006, at 4:56 PM ET

If a governor told you there were a way to spread pork, raise funds for infrastructure investment, promote jobs, avoid raising taxes, and put a dent in the trade deficit—all in one fell swoop—you might think he had a bridge to sell you. And you'd be right. Only in this case, it's a toll road. And instead of a sale, how about a long-term lease?

Earlier this month, in a triumph for Gov. Mitch Daniels, Indiana's House narrowly approved his proposal to lease the 157-mile Indiana Toll Road, which spans the northern part of the state, for $3.85 billion to a joint venture of Cintra, a Spanish company, and Australia's Macquarie Bank. The two companies have been active in the U.S. road business. In 2004, the two inked a 99-year lease for the 7.8-mile elevated Chicago Skyway. Last year, Macquarie completed its acquisition of the Dulles Greenway outside Washington, D.C. And Cintra, which manages toll roads in Europe and the Americas, is a strategic partner to the Texas state government in the planned Trans-Texas Corridor. There are likely more such deals to come.

For Daniels—who failed to live up to his nickname ("The Blade") when he served as director of the Office of Management and Budget in the first Bush administration—the 75-year lease is an elegant solution. The state needs billions of dollars to invest in new roads. Getting the cash upfront will allow Daniels to speed up construction on needed infrastructure projects, create new jobs, and fund his Clintonian Major Moves initiative. (Here's a list of projects to be funded and a fact sheet on the deal.) And by raising the cash from foreigners, he's doing his part to rein in the pernicious current-account deficit. "Too often in Indiana, we see Hoosier dollars and jobs leaving the state. Major Moves is an exciting opportunity to recapture U.S. dollars by attracting foreign investment, and use them to create jobs for Hoosiers," he said.

What's in it for the foreign companies? Huge potential profits. Gigantic, steady profits. Toll roads are an incredible asset class. They're often monopolies. They can support debt, since they provide a recurring guaranteed revenue stream that is likely to rise over time, as more people take to the roads and tolls increase. According to Cintra, the Indiana Toll Road generated $96 million in revenues in 2005, and Cintra expects a 12.5 percent internal rate of return on its investment. The heavy lifting has already been done: The state or federal governments have acquired the land and rights of way, built the roads and maintained them for years, and enacted toll increases. All the private companies have to do is deliver cash upfront, maintain the roads, and collect the windfall. The buyers can also increase their profits by making toll roads run more efficiently with technology. After assuming control of the Chicago Skyway, the Cintra-Macquarie consortium installed electronic toll equipment on some lanes. And by refinancing nimbly, companies can cash out. Last year—just seven months into its 99-year lease—Cintra announced that it had recovered 44 percent of its initial investment in the Chicago road through refinancing.

(So, why aren't American companies buying up our toll roads? Here's a theory.)

This easy money for foreigners makes the locals uneasy. In mid-March, the Indiana House approved the deal by a surprisingly slim margin. The Indiana scheme continues to engender local opposition. Last week, while participating in a panel discussion in South Bend, Ind., I got the sense that the toll lease made Hoosiers uneasy for reasons they couldn't quite articulate. It's not like the buyers could uproot the concrete and move it to Queensland, Australia, or Seville, Spain. The 400-page contract spells out in detail obligations of the consortium to invest in maintenance and safety and to keep a lid on toll rates. And unlike the Dubai ports case, it's hard to see how management of the toll road by a foreign entity could raise security threats.

I think the uneasiness has more to do with what it says about the peculiar fiscal climate in the United States. How is it that in the richest nation on the earth, localities simply don't have the cash to do necessary maintenance on basic infrastructure, the political will to raise such funds, or the competence to run such easily profitable operations? Why are they being forced to sell off long-term cash cows for short-term cash?

Leasing or selling a public asset is a classic one-shot—a short-term measure that bolsters the balance sheet today but that can't be repeated. While politicians like Daniels focus on getting through the next few fiscal years with minimum pain, foreign companies are thinking about how to get rich off of tolls for the next three-quarters of a century. From Gov. Daniels to his former boss, President Bush, there's a troubling unwillingness to align governmental resources with the express goals and responsibilities of government. At the federal level, we rely on China's central bank to buy our bonds and fund basic operations. As a result, our tax revenues wind up in Beijing—as interest payments. At the state level, Indiana is relying on foreign companies to lease public infrastructure like toll roads. And under these arrangements, tolls—taxes people pay for driving—are being paid to foreign shareholders of foreign companies.

Of course, by selling public infrastructure at high prices, state governments could be taking foreigners for a ride. The Japanese famously overpaid for Rockefeller Center, after all. It's possible that Indiana just ripped off the Spaniards and Aussies. But I doubt it.