Archive for February, 2009

Collins and Herbert

February 28, 2009

Ms. Collins, in “The Medium is the Soup Commercial,” says movies are awash with product placements, as are sports games and reality shows. In these financial times, will networks take things to a whole new level?  Mr. Herbert says it’s “Even Worse for Young Workers,” and that young people who remain unemployed for substantial periods of time will not only find it difficult to make up that ground, but could be lastingly scarred.  Here’s Ms. Collins:

Earlier this month, the ABC soap opera “One Life to Live” featured a scene in which Todd, the publisher of the local newspaper, and Tea, his lawyer, had a conversation about Todd’s legal problems, which ranged from being a murder suspect to being on trial for kidnapping.

Tea: I warmed up some soup for you. I don’t want you to go to the police station on an empty stomach.

(Already we are on new ground since characters in soap operas do not, as a rule, ever eat anything.)

Todd: What kind of soup is this?

Tea: It’s Campbell’s. It’s healthy, good for your heart.

Todd: (spooning away) Yeah, it’s good.

Before we go any further, let me just say that I understand soap operas are not high on your list of concerns, what with the economy flat-lining and all. However, the two things are somewhat related.

… Which I will explain after pointing out that I do not actually spend my afternoons watching “One Life to Live.” Do we have that clear? O.K., let’s move forward.

For some time now, characters in daytime dramas have been taking time from their normal activities, like having amnesia, to engage in animated discussions about the sponsors’ products. The ABC soap actors spent February talking about how Campbell’s soup and other assorted products are good for your heart. (And tasty, too!)

Lynn Leahey, the editorial director of Soap Opera Digest, pointed to an episode of “As the World Turns” in which Margo needed to get her hair fixed before a date with her husband (don’t ask) and reached for a bottle of Nice ’n Easy Root Touch-Up. “I feel like I took off 10 years in 10 minutes!” she exclaimed.

And here’s the thing. Viewers don’t complain. “Oh well… To keep the soaps on the air. To keep the actors paid,” wrote a philosophical e-mailer on a soap opera chat site.

Daytime dramas are swimming in choppy waters these days. Ratings are down. Shows are getting canceled. “They’re struggling to find a business model that works,” said Leahey, in a remark I have heard a time or two lately in other contexts.

So, the viewers acquiesce. In fact, for all the complaining about car bailouts and greedy bankers, people have become extremely tolerant of irritating behavior on the part of struggling corporations. Lines we never even bothered to think of as lines are being crossed. Last summer in Las Vegas, the anchors on the local Fox station started delivering the news with two prominently placed cups of McDonald’s iced coffee in front of them. A spokesperson called it a “nontraditional revenue source.” It’s only a matter of time before TV reporters conclude interviews with disaster victims by asking if they wouldn’t like a refreshing glass of V-8.

We have long since gotten used to the idea that movies are awash with product placements, that the basketball game we’re watching is part of, say, the Doritos Home Classic at the Dunkin’ Donuts Center. Reality shows on television exist in part to get ratings and in part to remind you that the “Top Chef” contestants are cooking on G.E. appliances.

Now, you have to wonder if the postcrash networks are going to be taking things to a whole new level. That soon, the painkiller-addicted Dr. House will be telling the hospital that he doesn’t need morphine now that he’s found Advil. All those forensic experts on prime-time crime shows will interrupt their investigations to discuss how the lab smells so fresh now that the janitor’s using Pine-Sol.

On “24,” Jack Bauer will not just drive a Hyundai sedan. After every chase he’ll turned to his terrified passenger and say: “Are those anti-lock breaks terrific, or what?”

We’ve been hearing about advertisers whose search for the missing customer led them to rent out space on people’s foreheads, or “cranial billboards.” And people, of course, are turning their heads over without a second thought. Tough economic times require tough measures. Unions have to give back benefits; investors have to forget about dividends. Anything that can be sold, will be.

In New York City, the sides of subway cars are now being covered with ads — the first touts a History Channel program with art and tag lines. Do you know how much blood and sweat the city dedicated to getting graffiti off the sides of the subways? But nobody’s complaining. The transit system is $1.4 billion in the hole. It’s the least of our worries.

And to tell you the truth, if the time comes when the assembled publishers of America determine that the only way to keep newspapers in operation is to have their employees wear jackets that say “I ♥ Kmart” on the back, I’m there.

Here’s Mr. Herbert:

The employment situation in the U.S. is, if anything, worse than most people realize. And huge numbers of young people, ages 16 to 30, are being beaten down in ways that could leave scars for a lifetime.

Much of the attention in this economic downturn has focused on the growing legions of men and women who are officially counted as unemployed. There are now more than 11 million of them.

But a better picture of the economic distress related to employment emerges when the number of jobless Americans is combined with two other categories of workers: the underemployed (those who are working part time, for example, because they can’t find full-time work) and the so-called labor force reserve, workers who have abandoned their job searches but who would work if employment became available.

This total pool of underutilized labor has now risen above 24 million, according to researchers at the Center for Labor Market Studies at Northeastern University in Boston. That total will only grow in the coming months.

The Obama administration has more than enough on its plate at the moment, but before long it will likely have to consider a range of additional strategies, beyond the recently passed stimulus package, for putting jobless Americans to work.

A comparison of the number of people being thrown out of work in this recession with that of the severe recession of 1981-82 will indicate why. The peak unemployment rate was higher in that earlier recession than today’s 7.6 percent, largely because the last big wave of the baby-boom generation was entering the job market in the early ’80s. Those boomers who couldn’t find work were officially counted as unemployed.

What is different and more frightening about the current downturn is the number of people actually losing their jobs — being laid off or fired. That number is dramatically, dangerously higher.

The government uses two different surveys to gauge employment data. The household survey, based on telephone interviews, showed that job losses in the 13 months that followed the beginning of the 1981-82 recession reached 1.53 million. In the first 13 months of this recession, the number of jobs lost, according to the household survey, has been a staggering 4 million.

The payroll survey, which is based on employment records, showed job losses of 1.7 million in the first 13 months of the earlier downturn compared with 3.5 million in the current recession.

Pick your poison. This is not the kind of downturn Americans are used to.

The ones who are being hit the hardest and will have the most difficult time recovering are America’s young workers. Nearly 2.2 million young people, ages 16 through 29, have already lost their jobs in this recession. This follows an already steep decline in employment opportunities for young workers over the past several years.

Good jobs were hard to find for most categories of workers during that period. One of the results has been that older men and women have been taking and holding onto jobs that in prior eras would have gone to young people.

“What we’ve seen over the past eight years, for young people under 30, is the largest age reversal with regard to jobs that we’ve ever had in our history,” said Andrew Sum, the director of the Center for Labor Market Studies. “The younger you are, the more you got pushed out of this labor market.”

There were not enough jobs to go around before the recession took hold. So the young, the poor and the poorly educated were already suffering. Now that pool of suffering is rapidly expanding.

This has ominous long-term implications for the country. The economy cannot perform well with such a large cohort of young people condemned to marginal economic status.

Young men and women who remain unemployed for substantial periods of time find it very difficult to make up that ground. They lose the experience and training they would have gained by working. Even if they eventually find employment, they tend to lag behind their peers when it comes to wages, promotions and job security.

Moreover, as the economy worsens, even the college educated are feeling the crunch.

According to a report by researchers working with Mr. Sum: “While young college graduates have fared the best in maintaining some type of employment, a growing fraction of them are becoming mal-employed, holding jobs in occupations that do not require much schooling beyond high school, often displacing their less-educated peers.”

Employment problems have festered in the United States for decades. The economy will never be brought to a state of health until those problems are more thoughtfully and more directly engaged. This will become more and more clear with each passing month of this hideous recession.

Bobo and Krugman

February 27, 2009

Bobo and Prof. Krugman are both discussing the budget.  (Bobo doesn’t learn, does he?  If I were going to be on the same editorial page with Paul Krugman I’d probably find something like the mating and nest-building habits of the tufted titmouse to write about…)  Bobo typed something called “The Uncertain Trumpet,” in which he says President Obama described in his speech the rot that is ingrained and pervasive in America, but what will he really do to change all that?  He finessed the whole Jindal fiasco by pretending it didn’t happen.  Prof. Krugman, in “Climate of Change,” says President Obama’s budget represents a huge break from policy trends. If he can get it through Congress, he will set America on a fundamentally new course.  Here’s Bobo:

On Tuesday night, President Obama talked about a national culture of irresponsibility. He talked about the way Americans have sacrificed the long term for the short term, spent more than they could afford, and how the country’s leaders have broken promises and delayed reform. Obama described a rot that was ingrained and pervasive.

On Thursday, he offered a budget of his own, and the question arises: Will he really change all that?

The answer is somewhat, but not enough. Obama’s budget is far more honest than the ones that preceded it. It imposes real pay-as-you-go rules on future outlays. Intellectually serious efforts are made to pay for at least half of the cost of health care reform.

But the ingrained habits are still there, and the rot is not expunged. Obama enthusiastically perpetuates the myth that the American people can have everything they want without a dose of shared sacrifice. They can have health care, education reform, even a cure for cancer, and 98 percent of them need pay nothing. The burdens of progress will be borne by the rich while everyone else can enjoy their tax cuts and go shopping.

Obama perpetuates base-line gimmickry. He claims to save hundreds of billions by drawing down forces in Iraq. But even the Bush administration was going to draw down. Obama is claiming bogus savings by not spending money that never would have been spent anyway.

Obama grades himself on a curve. He’s set a target of merely cutting the deficit in half from 2010 to 2013. But the red ink has quadrupled in one year. Cutting the deficit to still unsustainable levels as the economy recovers is about as challenging as riding a sled downhill.

The greatest shortcomings are sins of omission, not commission. If you watched Obama’s magnificent speech Tuesday night, you got the impression that he bestrides Washington like a colossus. He imposes his authority in ways large and small, purging old habits. In reality, the situation is messier. At times, there is a weird passivity emanating from the White House, a deference to the Washington establishment. Almost no sacred cows are cut from this budget. The president is now engaged in an argument with Democratic appropriators about whether to strike earmarks from the omnibus spending bill. He’s apparently getting rolled even on a matter as easy and clear-cut as this.

The bigger problem is health care. This is an issue where everybody wants benefits they don’t pay for, where perverse incentives have created an expensive system that doesn’t deliver results. This is an area where aggressive presidential leadership is mandatory.

Yet in no other area does the administration cede so much authority. The administration has over-learned the lessons of the Clinton-care fiasco. They’re not going to send up a detailed 1,400-page program. Fine. But they’re not pushing a plan at all.

Instead, replicating the model that did such harm to the stimulus package, they are merely outlining eight general principles and then sending the matter up to Capitol Hill. They vow to have a series of “conversations” and then presumably at some point some group of committee chairmen will write a bill or a bunch of bills.

The balance of power will be clear. The White House will have no dominating figure to ride herd day to day now that Tom Daschle is out of the picture. Instead, the same old chairmen habituated by the same old interest groups will dominate everything.

If Hillary Clinton were still in the Senate, at least there would be a focus. If Ted Kennedy were at full strength, the negotiations would be coherent. Instead, there will be a wide array of committee chairmen in the House and Senate scrambling for influence, maneuvering with and against each other through a Machiavellian process of secret negotiations and back-room deals.

Thursday, there was a weird burst of optimism in the halls of the Washington Establishment. Most members of Congress and lobbyists are delighted that the White House has surrendered so much authority to Capitol Hill. Everybody is working on a way to push their own particular vision of reform through the muddle.

There are good plans on offer, but it won’t take long for this to get ugly. We’ll either get an irresponsible bill produced by the Old Order or no bill at all. It could be that even with a thousand “conversations,” no consensus will automatically emerge from the hundreds of players who have produced the gridlock of the past 30 years.

Even though the budget is not all one would have hoped, I’d trust the folks in the Obama administration to craft a decent health care plan before I’d trust the Congressional Old Bulls. Obama blew a mighty trumpet Tuesday night, but after you blow the trumpet, you actually have to charge.

Here’s Prof. Krugman:

Elections have consequences. President Obama’s new budget represents a huge break, not just with the policies of the past eight years, but with policy trends over the past 30 years. If he can get anything like the plan he announced on Thursday through Congress, he will set America on a fundamentally new course.

The budget will, among other things, come as a huge relief to Democrats who were starting to feel a bit of postpartisan depression. The stimulus bill that Congress passed may have been too weak and too focused on tax cuts. The administration’s refusal to get tough on the banks may be deeply disappointing. But fears that Mr. Obama would sacrifice progressive priorities in his budget plans, and satisfy himself with fiddling around the edges of the tax system, have now been banished.

For this budget allocates $634 billion over the next decade for health reform. That’s not enough to pay for universal coverage, but it’s an impressive start. And Mr. Obama plans to pay for health reform, not just with higher taxes on the affluent, but by putting a halt to the creeping privatization of Medicare, eliminating overpayments to insurance companies.

On another front, it’s also heartening to see that the budget projects $645 billion in revenues from the sale of emission allowances. After years of denial and delay by its predecessor, the Obama administration is signaling that it’s ready to take on climate change.

And these new priorities are laid out in a document whose clarity and plausibility seem almost incredible to those of us who grew accustomed to reading Bush-era budgets, which insulted our intelligence on every page. This is budgeting we can believe in.

Many will ask whether Mr. Obama can actually pull off the deficit reduction he promises. Can he actually reduce the red ink from $1.75 trillion this year to less than a third as much in 2013? Yes, he can.

Right now the deficit is huge thanks to temporary factors (at least we hope they’re temporary): a severe economic slump is depressing revenues and large sums have to be allocated both to fiscal stimulus and to financial rescues.

But if and when the crisis passes, the budget picture should improve dramatically. Bear in mind that from 2005 to 2007, that is, in the three years before the crisis, the federal deficit averaged only $243 billion a year. Now, during those years, revenues were inflated, to some degree, by the housing bubble. But it’s also true that we were spending more than $100 billion a year in Iraq.

So if Mr. Obama gets us out of Iraq (without bogging us down in an equally expensive Afghan quagmire) and manages to engineer a solid economic recovery — two big ifs, to be sure — getting the deficit down to around $500 billion by 2013 shouldn’t be at all difficult.

But won’t the deficit be swollen by interest on the debt run-up over the next few years? Not as much as you might think. Interest rates on long-term government debt are less than 4 percent, so even a trillion dollars of additional debt adds less than $40 billion a year to future deficits. And those interest costs are fully reflected in the budget documents.

So we have good priorities and plausible projections. What’s not to like about this budget? Basically, the long run outlook remains worrying.

According to the Obama administration’s budget projections, the ratio of federal debt to G.D.P., a widely used measure of the government’s financial position, will soar over the next few years, then more or less stabilize. But this stability will be achieved at a debt-to-G.D.P. ratio of around 60 percent. That wouldn’t be an extremely high debt level by international standards, but it would be the deepest in debt America has been since the years immediately following World War II. And it would leave us with considerably reduced room for maneuver if another crisis comes along.

Furthermore, the Obama budget only tells us about the next 10 years. That’s an improvement on Bush-era budgets, which looked only 5 years ahead. But America’s really big fiscal problems lurk over that budget horizon: sooner or later we’re going to have to come to grips with the forces driving up long-run spending — above all, the ever-rising cost of health care.

And even if fundamental health care reform brings costs under control, I at least find it hard to see how the federal government can meet its long-term obligations without some tax increases on the middle class. Whatever politicians may say now, there’s probably a value-added tax in our future.

But I don’t blame Mr. Obama for leaving some big questions unanswered in this budget. There’s only so much long-run thinking the political system can handle in the midst of a severe crisis; he has probably taken on all he can, for now. And this budget looks very, very good.

Collins, Cohen and Kristof

February 26, 2009

Ms. Collins, in “The Dead Tree Theory,” says the stimulus money will be channeled through so many hands, it is inevitable there will be waste — like planting a dead tree. At which point, the Republicans will wave their withered branches.  Mr. Cohen, in “The Inner Life,” says perhaps the Age of Excess had to end before we could all turn inward just enough to rediscover the gold standard of the perfectly formed phrase, and make connections again.  Mr. Kristof, writing from Djabal Refugee Camp in Chad, gives us “Africa’s ‘Obama’ School.”  He says Darfur refugees hope that the Obama administration can help bring an end of the long slaughter in Sudan by backing an arrest warrant for the country’s president.  Here’s Ms. Collins:

Whenever a president gives a major address, like the one Barack Obama delivered to Congress this week, the opposition party delivers a rejoinder. Which American citizens always ignore. Louisiana Gov. Bobby Jindal’s speech was, therefore, a kind of triumph. So bad, people actually paid attention!

We will pass over Jindal’s delivery, which sounded a little like a junior high schooler’s entry into the Chamber of Commerce “I Speak for Fiscal Restraint” contest. The content was the thing: a message to the nation that the Republicans were not going to have anything important or useful to say about the current economic crisis.

Absent any deep thoughts, the Republicans are going to complain about waste. The high point of Jindal’s address came when he laced into “wasteful spending” in the stimulus bill, and used as an example a $140 million appropriation for keeping an eye on the volcanoes in places like Alaska, where one is currently rumbling.

“Instead of monitoring volcanoes, what Congress should be monitoring is the eruption of spending in Washington, D.C.,” Jindal claimed.

I don’t know about you, but my reaction was: Wow, what a great stimulus plan. The most wasteful thing in it is volcano monitoring.

Louisiana has gotten $130 billion in post-Katrina aid. How is it that the stars of the Republican austerity movement come from the states that suck up the most federal money? Taxpayers in New York send way more to Washington than they get back so more can go to places like Alaska and Louisiana. Which is fine, as long as we don’t have to hear their governors bragging about how the folks who elected them want to keep their tax money to themselves. Of course they do! That’s because they’re living off ours.

O.K., I’m done.

The Republicans can’t try to convince the country their ideas are better because of that intellectual bankruptcy problem. All they can do is make Barack Obama’s programs look feckless, plunging everyone into so much despair that by next summer the public will be ready to go live in caves and eat squirrel stew.

The waste argument is a perpetual winner because there will always be some. Years ago, when I was a reporter, I remember getting a call from a woman in the Bronx who was screaming: “They’re over on Moshulu Parkway planting dead trees!” Sure enough, a city work crew was digging holes along the side of the street and carefully sticking in brown and dried-up pieces of foliage. The men claimed the trees had simply lost their leaves for the winter — an explanation somewhat undermined by the fact that they were evergreens.

I’m telling you this because on Tuesday I was talking with a high-ranking Obama administration official about the stimulus plan. “There will be a dead tree planted, figuratively speaking,” he said somberly. “That will happen.”

How could it not? Much of the stimulus money is being channeled through state and local governments, through tens of thousands of governors, mayors, county executives, transportation commissioners, parks superintendents and so on. Try to imagine the person in that pyramid with the lowest I.Q., and you’ll understand that there’s a dead-tree planter hidden in there somewhere.

The White House is trying to overcome this problem with a Transparency and Accountability Board, overseen by Vice President Joe Biden. It is supposed to reassure the public that the stimulus money isn’t being wasted. But some people within the administration are arguing that that isn’t enough, that the government needs to bombard people with examples of what’s being done right — like holding big rallies for all the schoolteachers whose jobs are saved by the stimulus.

Or — and I swear to you this is a real idea — inventing a kind of stimulus logo, like the old National Recovery Administration blue eagle, that could be posted on every federally funded project, as one official explained, “to show the public exactly what we’re doing.”

Let us skip over the fact that the National Recovery Administration is best remembered as the part of the New Deal that didn’t work. Because we are instantly fascinated by the idea of designing that logo. How about:

Erp the Economic Recovery Portuguese Water Dog — Sasha and Malia’s incoming White House pet, setting a good example by taking on a second job to help support the family.

Isadore the Infrastructure Improvement Iguana

Arnie the Ant and Ginny the Grasshopper — Both wearing overalls and carrying shovels, symbols that troubled times fall equally hard on the party animals and the serious guys who saved their money and invested it with Bernie Madoff.

Petey the Penguin — Don’t want to go with another eagle. But everybody likes penguins. They march; they don’t fly into airplane engines …

Joe Biden — Dressed like a penguin.

Or, if all else fails, they could just get Bobby Jindal a prime-time program.

Here’s Mr. Cohen:

I was reading on the crowded subway when a distraught-looking woman stumbled into me.

“Please, please help me out,” she said. “Please. I’m trying to buy flowers for a funeral arrangement.”

She was African-American, middle-aged, wide-eyed. Her words were not addressed to me but to the whole subway car. The slightness of her build belied the strength of her voice. So many things are dying at the moment — an entire free-spending epoch is being laid to rest — that I wondered which particular burial she had in mind.

“My cousin was a good kid,” she said. “Please, please. For the funeral arrangement, I need flowers.”

People averted their eyes. Early-evening fatigued, city-churned, they did not want to hear talk of funerals, much less help pay for them. They were headed home to hear a new president diagnose the state of America. Some shook their heads, thinking, “She’s crazy!”

I returned to my reading, a profile of the British author Ian McEwan in The New Yorker. I admire McEwan, enjoy his novels, often read them in a sitting or two, but do not feel transported by him.

There is something too carefully plotted in his effects that precludes falling under his spell. His studied brilliance never quite attains greatness. Still, he takes a scalpel to sexual need and obsessive violence, the dark undertows of life, in ways that can be utterly compelling.

I read this phrase from McEwan — “Narrative tension is primarily about withholding information” — and nodded.

Having part of the picture incites an anxiety, the desire to see it whole, completed. I wondered who the stumbling subway woman’s cousin was, how “the kid” died, in a knife fight or from withering illness, what flower arrangement she had in mind (chrysanthemums? gladioli?) — or whether the whole story was made up, just a scam.

Piecing together fragments is what we do right now as we emerge from the Grand Illusion, a time when the human herd frolicked in limitless pastures to the seductive lilt of Ponzi promises.

We are trying to get our bearings, find out where the bottom is in order to put one foot in front of the other. Bernard Madoff’s investment firm did not buy any securities for clients in 13 years. And nobody noticed.

You couldn’t make this stuff up. It’s not only narrative tension that withheld information produces; it’s $50 billion going poof in the night.

As it happened, I’d been reading McEwan that morning on the late John Updike in The New York Review of Books: the profiled as profiler. He quotes Updike describing the facts of life as “unbearably heavy, weighted as they are with our personal death. Writing, in making the world light — in codifying, distorting, prettifying, verbalizing it — approaches blasphemy.”

But what beautiful, what necessary, blasphemy!

Perhaps the Age of Excess had to end before we could all turn inward just enough to rediscover the gold standard of the perfectly formed phrase, and make connections again. McEwan chooses a sentence from Updike’s “Couples” that could describe his own work: “Nature dangles sex to keep us walking toward the cliff.”

It dangles chance, too.

In the same New York Review was Anita Desai’s piece on Azar Nafisi, best known for her much-loved “Reading Lolita in Tehran.” I’d just returned from Tehran and devoured the review of Nafisi’s new book, “Things I’ve Been Silent About: Memories.”

“Reading Lolita” was precisely about turning inward, away from desperate events — in this case a revolution that had betrayed many of its protagonists, offering veils of repression rather than long-sought freedom — to the consolation of great Western literature. It was a book of passionate personal transcendence.

Nafisi’s new book is essentially a family memoir, but in the tumult of Iran, her story and the nation’s overlap. She alludes to the terrible misconceptions of Iranian democrats and leftists about Ayatollah Khomeini in the revolutionary fervor of 1979:

“Too arrogant to think of him as a threat and deliberately ignorant of his designs, we supported him. We welcomed the vehemence of Khomeini’s rants against imperialists and the Shah and were willing to overlook the fact that they were not delivered by a champion of freedom.”

This was truly a tragic illusion for which a heavy price has been paid by Iranians, their nation now scattered in a diaspora stretching from California to Australia. Many ache still for their homeland.

By comparison, the cost of American illusions pales. A decimated 401(k) is painful, but no exile. It is true, as President Obama said in his first address to a joint session of Congress: “We will rebuild; we will recover.” That, at least, is what American history suggests.

As the woman proceeded down the car, I could hear that phrase being repeated — “Please I’m trying to buy flowers for a funeral arrangement” — until at last it grew muffled in a kind of ruckus and a smooth-voiced recorded announcement overwhelmed it: “Courtesy is contagious. It begins with you.”

So does change from within.

Now here’s Mr. Kristof:

After Barack Obama was elected president in November, the Darfur refugees here were so thrilled that they erupted in spontaneous dancing and singing.

Soon afterward, the refugees renamed the School No. 1 in this dusty camp the Obama School. It’s a pathetic building of mud bricks with a tin roof, and the windows are holes in the walls, but it’s caulked with hope that President Obama may help end the long slaughter and instability in Sudan.

Soon we’ll see whether those hopes are justified. Next Wednesday, the International Criminal Court is expected to issue an arrest warrant for Sudan’s president, Omar Hassan al-Bashir, for crimes against humanity in Darfur.

That would be historic — the first time the court has called for the arrest of a sitting head of state. It would be the clearest assertion that in the 21st century, mass murder is no longer a ruler’s prerogative.

There has been concern that Mr. Bashir will lash out by expelling aid workers or that Sudan’s fragile north-south peace agreement will become unglued if Mr. Bashir is ousted. Those fears are overblown. Time and again, Mr. Bashir has responded to pressure and scrutiny by improving his behavior and increasing his cooperation with the United Nations and Western countries.

It’s true that the slogan “save Darfur” should be reconceived as “save Sudan.” North and South Sudan are probably on track to a resumption of their brutal civil war that killed two million people until a fragile peace in 2005. But while saving Sudan raises immensely knotty, difficult challenges, President Bashir is part of the problem, and accountability is part of the solution.

In any case, Luis Moreno-Ocampo, the Argentinian who is the chief prosecutor of the International Criminal Court, is right when he says: “The question is not what President Bashir will do. The question is what you will do.”

If Mr. Obama needs inspiration, he can look at France, for it has shown that outsiders can make a difference. When I was here in the Chad-Sudan border area in 2006, Sudanese-sponsored janjaweed militias were rampaging through black African villages in Chad, killing and raping. These days, overall security is hugely improved, largely because the French president, Nicolas Sarkozy, led a push to insert a European military force. It was a messy solution, for Chad is corrupt and autocratic, yet at least the skies are no longer thick with smoke from burning villages.

On that 2006 trip here, I met Abdullah Idris, a young farmer who had just had his eyes gouged out by the janjaweed. The mutilation broke my heart, especially when I saw Abdullah’s 5-year-old daughter looking at her dad’s face in revulsion, seeing a monster.

On this trip, I tracked down Abdullah and found him living with his family in a camp for displaced people. His daughter and wife lead him around, hand in hand. Security has improved enough that a few people are even returning to their villages from the camps.

Hats off to France! There are thousands of problems with the deployment, but it’s far better than standing by as militias gouge out men’s eyes.

Unfortunately, conditions are still desperate within Sudan’s borders. This week, news filtered out from Darfur that two more aid workers had been shot dead — on top of 11 killed and 4 more still missing in 2008. By the United Nations’ count, the number of violent attacks on aid workers almost doubled in 2008 compared with the previous year.

Yet there is a ray of hope: There are whispers in the dusty Sudanese capital, Khartoum, that other senior Sudanese leaders are thinking about pushing Mr. Bashir out of office if the arrest warrant is issued.

At the Obama School here in eastern Chad, the refugees are waiting to see if the school’s namesake will resolutely back up the International Criminal Court. I’m betting that he will. In the last Congress, three of the strongest advocates for the people of Darfur were Senators Barack Obama, Joseph Biden and Hillary Rodham Clinton, and one of Washington’s strongest advocates for action on Sudan was Susan Rice, who is now the ambassador to the United Nations. (She terrifies Sudanese officials; parachute her into Khartoum, and the entire Sudanese leadership might surrender.)

Meanwhile, the Obama administration is undertaking a review of the policy on Darfur, and it’s being co-led by Samantha Power, a White House aide whose superb book, “A Problem From Hell,” catalogs all the ways that American politicians have found excuses to avoid confronting past genocides.

The students at the Obama School have nothing to keep them going but hope. Let’s not disappoint them.

Dowd and Friedman

February 25, 2009

MoDo, who is in Los Angeles, asks:  “I Ponied Up for Sheryl Crow?”  She wonders why Northern Trust of Chicago, if it’s not solvent, is using her tax dollars to party at a golf tournament.  The Moustache of Wisdom, in “Paging Uncle Sam,” says at no time in the last 50 years has America ever felt weaker, and at no time in the last 50 years has the world ever seen America as more important.  Here’s MoDo:

Talk about being teed off.

The economy is croaking and bankers are still partying at a golf tournament here on our dime.

It’s a good argument for nationalization, or better yet, internationalization. Outsource the jobs of these perfidious, oblivious bank executives to Bangalore; Bollywood bashes have to cost less than Hollywood ones.

The entertainment Web site TMZ broke the story Tuesday that Northern Trust of Chicago, which got $1.5 billion in bailout money and then laid off 450 workers, flew hundreds of clients and employees to Los Angeles last week and treated them to four days of posh hotel rooms, salmon and filet mignon dinners, music concerts, a PGA golf tournament at the Riviera Country Club with Mercedes shuttle rides and Tiffany swag bags.

“A rep from the PGA told us Northern Trust wrote one big, fat check in order to sponsor the event,” TMZ reported.

Northern No Trust had a lavish dinner at the Ritz Carlton on Wednesday with a concert by Chicago (at a $100,000 fee); rented a private hangar at the Santa Monica Airport on Thursday for another big dinner with a gig by Earth, Wind & Fire, and closed down the House of Blues on Sunset Strip on Saturday (at a cost of $50,000) for a dinner and serenade by Sheryl Crow.

In the ignoble tradition of rockers who sing for huge sums to sketchy people when we’re not looking, Crow — in her stint as a federal employee — warbled these lyrics to the oblivious revelers:

“Slow down, you’re gonna crash,
Baby, you’re a-screaming it’s a blast, blast, blast
Look out babe, you’ve got your blinders on …
But there’s a new cat in town
He’s got high payin’ friends
Thinks he’s gonna change history.”

Northern Untrustworthy even offered junketeers the chance to attend a seminar on the credit crunch where they could no doubt learn that the U.S. government is just the latest way to finance your deals and keep your office swathed in $87,000 area rugs.

In what is now an established idiotic ritual of rationalization, the bank put out a letter noting that it “did not seek the government’s investment” even though it took it, and that it had raised $3 million for the Los Angeles Junior Chamber of Commerce Charity Foundation and other nonprofits. They riposted that they have a contract to do it every year for five years; but this isn’t every year.

The bank cloaks itself in a philanthropic glow while wasting our money, acting like the American Cancer Society when in fact it’s a cancer on American society.

It asserted that it earned an operating net income of $641 million last year and acted as though it did Americans a favor by taking federal cash.

I would ask Northern No Trust: If you’re totally solvent, why are you taking my tax dollars? If you’re not totally solvent, why are you giving my tax dollars to Sheryl Crow?

Coming in a moment when skeptical and angry Americans watched A.I.G., Citigroup, General Motors and Chrysler — firms that had already been given a federal steroid injection — get back in line for more billions, the golf scandal was just one more sign that the bailed-out rich are different from you and me: their appetites are unquenchable and their culture is uneducable.

President Obama served them notice on Tuesday night in his Congressional address, saying: “This time, C.E.O.’s won’t be able to use taxpayer money to pad their paychecks or buy fancy drapes or disappear on a private jet. Those days are over.”

But will they notice?

John “Antique Commode” Thain had to be ordered by a judge to tell Andrew Cuomo’s investigators which Merrill Lynch employees got those $3.6 billion in bonuses that Thain illicitly shoved through as his firm was failing and being taken over by Bank of America with the help of a $45 billion bailout. Kenneth Lewis, the Bank of America C.E.O., made the absurd assertion to Congress that his bank had “no authority” to stop the bonuses, even though he knew about them beforehand.

“They find out they’re $7 billion off on the estimate of losses for the fourth quarter and they never think maybe we should go back and adjust these bonuses?” Cuomo told me, as Thain was finally responding to investigators on Tuesday at the New York attorney general’s office. “He refused to answer questions on the basis that ‘the Bank of America didn’t want me to.’ You can take the Fifth Amendment or you can answer questions. But there’s no Bank of America privilege. The Bank of America doesn’t substitute for the Constitution. And who’s the Bank of America, by the way?”

He gets incensed about how ingrained, indoctrinated and insensitive the ex-masters of the universe are. “They think of themselves as kings and queens,” he said. And they’re not ready to abdicate.

Here’s Friedman, writing from Seoul:

It is very useful to come to Asia to be reminded about America’s standing in the world these days. For all the talk in recent years about America’s inevitable decline, all eyes are not now on Tokyo, Beijing, Brussels or Moscow — nor on any other pretenders to the world heavyweight crown. All eyes are on Washington to pull the world out of its economic tailspin. At no time in the last 50 years have we ever felt weaker, and at no time in the last 50 years has the world ever seen us as more important.

While it is true that since the end of the cold war global leaders and intellectuals often complained about a world of too much American power, one doesn’t hear much of that grumbling today when most people recognize that only an economically revitalized America has the power to prevent the world economy from going into a global depression. It was always easy to complain about a world of too much American power as long as you didn’t have to live in a world of too little American power. And right now, that is the danger: a world of too little American power.

Somewhere in the back of their minds, a lot of people seem to be realizing that the alternative to a U.S.-dominated world is not a world dominated by someone else or someone better. It is a leaderless world. Neither Russia nor China has the will or the way to provide the global public goods that America — at its best — consistently has. The European Union right now is so split that it cannot even agree on an effective stimulus package.

No wonder then that even though this economic crisis began in America, with American bad borrowing and bad lending practices, people have nevertheless fled to the U.S. dollar. Case in point: South Korea’s currency has lost roughly 40 percent against the dollar in just the last six months.

“No other country can substitute for the U.S.,” a senior Korean official remarked to me. “The U.S. is still No. 1 in military, No. 1 in economy, No. 1 in promoting human rights and No. 1 in idealism. Only the U.S. can lead the world. No other country can. China can’t. The E.U. is too divided, and Europe is militarily far behind the U.S. So it is only the United States … We have never had a more unipolar world than we have today.”

Yes, many Asians resent the fact that Americans scolded them about their banking crisis in the 1990s, and now we’ve made many of the same mistakes. But that schadenfreude doesn’t last long. In random conversations here in Seoul with Korean and Asian thinkers, journalists and business executives, I found people really worried: Could it be, they ask, that the Americans don’t know what they are doing, or, worse, that they know what they are doing but the problem is just so much bigger than anything we’ve ever seen?

This is a region where Western brands carry great weight, and for people to see giant U.S. financial brands like Citigroup and A.I.G. teetering is deeply unnerving.

The big trading nations, like South Korea, are particularly nervous that America will succumb to economic protectionism, which would undermine the global trading system.

“There is no one who can replace America. Without American leadership, there is no leadership,” said Lee Hong-koo, South Korea’s former ambassador to Washington. “That puts a tremendous burden on the American people to do something positive. You can’t be tempted by the usual nationalism. When things don’t go well, most people become nationalistic. And in the economic world, that is protectionism … We are pleased to see President Obama is not doing that. Americans, as a people, should realize how many hopes and expectations other people are putting on their shoulders.”

And that’s just on economics. President Obama’s first big security test could come here — and soon. North Korea has gotten crazier than ever; it has been made even poorer by the global economic crisis and by the withdrawal of aid by the new South Korean government. Now the North is threatening to test one of its Taepodong-2 long-range missiles, which may have the capacity to hit Hawaii, Alaska or beyond.

The North last tried such a test in 2006, but the rocket exploded 40 seconds after its launch. If the North does test such an intercontinental ballistic missile again, American forces will have to consider blowing it up on the launch pad or shooting it out of the sky. We never should have allowed the North to get a nuclear warhead; we certainly don’t want it testing a long-range missile that could deliver that nuclear warhead to our shores, or anywhere else.

Never more inward-looking, never more in demand: that’s America today. This moment recalls a point raised by the Johns Hopkins University foreign policy expert Michael Mandelbaum in his book, “The Case for Goliath.” When it comes to the way other countries view America’s pre-eminent role in the world, he wrote, “whatever its life span, three things can be safely predicted: they will not pay for it; they will continue to criticize it; and they will miss it when it is gone.”

Bobo and Herbert

February 24, 2009

Oh, jeez…  Bobo had to read Burke in college and we’re in for a lecture.  He gurgles on about “The Big Test,” and dithers that the Obama administration sees this economic crisis as an opportunity to expand its reach, but he fears that in trying to do everything at once, it will do nothing well.  He claims to be a huge admirer of President Obama…  When referring to himself he actually uses the phrase “my epistemological modesty.”  Don’t say I didn’t warn you.  Mr. Herbert isn’t feeling optimistic today.  He writes about “That Can’t-Do Spirit,” and says there is something weirdly self-defeating about needing to move beyond a deteriorating U.S. infrastructure, and being unable to do it because of the outmoded way of doing politics.  Here’s Bobo:

“We cannot successfully address any of our problems without addressing all of them.”

Barack Obama, Feb. 21, 2009

When I was a freshman in college, I was assigned “Reflections on the Revolution in France” by Edmund Burke. I loathed the book. Burke argued that each individual’s private stock of reason is small and that political decisions should be guided by the accumulated wisdom of the ages. Change is necessary, Burke continued, but it should be gradual, not disruptive. For a young democratic socialist, hoping to help begin the world anew, this seemed like a reactionary retreat into passivity.

Over the years, I have come to see that Burke had a point. The political history of the 20th century is the history of social-engineering projects executed by well-intentioned people that began well and ended badly. There were big errors like communism, but also lesser ones, like a Vietnam War designed by the best and the brightest, urban renewal efforts that decimated neighborhoods, welfare policies that had the unintended effect of weakening families and development programs that left a string of white elephant projects across the world.

These experiences drove me toward the crooked timber school of public philosophy: Michael Oakeshott, Isaiah Berlin, Edward Banfield, Reinhold Niebuhr, Friedrich Hayek, Clinton Rossiter and George Orwell. These writers — some left, some right — had a sense of epistemological modesty. They knew how little we can know. They understood that we are strangers to ourselves and society is an immeasurably complex organism. They tended to be skeptical of technocratic, rationalist planning and suspicious of schemes to reorganize society from the top down.

Before long, I was no longer a liberal. Liberals are more optimistic about the capacity of individual reason and the government’s ability to execute transformational change. They have more faith in the power of social science, macroeconomic models and 10-point programs.

Readers of this column know that I am a great admirer of Barack Obama and those around him. And yet the gap between my epistemological modesty and their liberal worldviews has been evident over the past few weeks. The people in the administration are surrounded by a galaxy of unknowns, and yet they see this economic crisis as an opportunity to expand their reach, to take bigger risks and, as Obama said on Saturday, to tackle every major problem at once.

President Obama has concentrated enormous power on a few aides in the West Wing of the White House. These aides are unrolling a rapid string of plans: to create three million jobs, to redesign the health care system, to save the auto industry, to revive the housing industry, to reinvent the energy sector, to revitalize the banks, to reform the schools — and to do it all while cutting the deficit in half.

If ever this kind of domestic revolution were possible, this is the time and these are the people to do it. The crisis demands a large response. The people around Obama are smart and sober. Their plans are bold but seem supple and chastened by a realistic sensibility.

Yet they set off my Burkean alarm bells. I fear that in trying to do everything at once, they will do nothing well. I fear that we have a group of people who haven’t even learned to use their new phone system trying to redesign half the U.S. economy. I fear they are going to try to undertake the biggest administrative challenge in American history while refusing to hire the people who can help the most: agency veterans who are registered lobbyists.

I worry that we’re operating far beyond our economic knowledge. Every time the administration releases an initiative, I read 20 different economists with 20 different opinions. I worry that we lack the political structures to regain fiscal control. Deficits are exploding, and the president clearly wants to restrain them. But there’s no evidence that Democrats and Republicans in Congress have the courage or the mutual trust required to share the blame when taxes have to rise and benefits have to be cut.

All in all, I can see why the markets are nervous and dropping. And it’s also clear that we’re on the cusp of the biggest political experiment of our lifetimes. If Obama is mostly successful, then the epistemological skepticism natural to conservatives will have been discredited. We will know that highly trained government experts are capable of quickly designing and executing top-down transformational change. If they mostly fail, then liberalism will suffer a grievous blow, and conservatives will be called upon to restore order and sanity.

It’ll be interesting to see who’s right. But I can’t even root for my own vindication. The costs are too high. I have to go to the keyboard each morning hoping Barack Obama is going to prove me wrong.

Listen up, Bobo you boob —  If you think Obama gives half a crap about what you think you’re delusional.  If your angst is so great consider that you don’t “have to go to the keyboard” each morning.  Do us all a favor and stop doing that.  Here’s Mr. Herbert:

In his first Inaugural Address, with the U.S. all but paralyzed by the Depression, Franklin Roosevelt declared that the nation’s greatest task was “to put people to work.”

Three-quarters of a century later, in the midst of perhaps the worst downturn since the Depression, that remains the biggest challenge.

The U.S. economy cannot work if ordinary men and women cannot find work. Let’s forget for a moment all the ritualized lingo about tax cuts, all the easy but uninformed talk about entitlement reform and all the empty rhetoric about balancing budgets that will never be truly balanced in our lifetimes.

What Americans need is new employment on a massive scale, and one of the most effective ways to get that started is to invest extraordinary amounts in the nation’s infrastructure, to rebuild America in a way that creates a world-class platform for a sustainable 21st-century economy.

President Obama’s stimulus package is just a first step in the government’s effort to stabilizing the hemorrhaging economy. It contains infrastructure spending, but nothing comparable to the vast amounts it will take to make the desperately needed improvements.

Funds spent on those improvements, which will have to be made sooner or later, are also cracker-jack investments in putting people to work. The idea that the government is spending trillions on wars, bank bailouts, tax cuts, and so on, while still neglecting its infrastructure needs — and at a time when Americans are desperate for jobs — is mind-boggling.

The financier Felix Rohatyn has been carrying the banner for infrastructure spending for the longest time. During an address in Washington over the weekend to a meeting of the National Governors Association, he emphasized the importance and long tradition of investing government revenue, with an eye to returns in the long run.

“From the Louisiana Purchase and the Erie Canal, through the creation of the Land Grant colleges, to the interstate highways and the G.I. Bill, government investment was pivotal,” he said.

His new book, “Bold Endeavors: How Our Government Built America, and Why It Must Rebuild Now,” opens with the stark phrase: “The nation is falling apart.”

Mr. Rohatyn goes on to write: “Three-quarters of the country’s public school buildings are outdated and inadequate. More than a quarter of the nation’s bridges are obsolete or deficient. It will take $11 billion annually to replace aging drinking water facilities. Half the locks on more than 12,000 miles of inland waterways are functionally obsolete.”

According to the American Society of Civil Engineers, an investment of $2.2 trillion from all sources over five years would be required to get the nation’s infrastructure into decent shape.

You might ask where that money would come from. Great question. How about an infrastructure bank?

The current economic crisis is the perfect time to decide that we need to change some of the tired old ways of doing the people’s business. Senator Chris Dodd of Connecticut has offered a bill that would create an infrastructure bank. It would be a bipartisan entity that would streamline the process of reviewing and authorizing major projects. It would provide federal investment capital for approved projects and use that money to leverage private investment.

President Obama supports the establishment of such a bank. When I asked him about it in an interview, he said, “The idea of an infrastructure bank, I think, makes sense.” But he suggested that there would be stiff resistance from lawmakers in both parties who are reluctant to give up their considerable influence over the selection and financing of lucrative infrastructure projects.

The president seemed optimistic about the prospects of moving ahead with some additional infrastructure spending, and he said he “would like to see some long-term reforms” in the way transportation money is spent. He acknowledged that the nation’s infrastructure “needs are massive, and we can’t do everything.”

But we could do a lot more. There is something weirdly self-defeating about having a need as clear-cut as the need to move beyond a deteriorating 20th-century physical plant, and being unable to do it because of the wasteful, inefficient and outmoded 20th-century way of doing politics and government.

In his address to the governors, Mr. Rohatyn noted that President Obama had asked Transportation Secretary Ray LaHood to come up with a plan for financing high-speed rail projects. He said he hoped that that would be a step toward the eventual establishment of an infrastructure bank.

Speaking about America’s competitors in the global economy, Mr. Rohatyn noted, among other things, that China was building 100 new airports and that Spanish trains traveling between Madrid and Barcelona can reach speeds of 300 miles per hour.

“We are falling behind on too many fronts,” he said.

Cohen and Krugman

February 23, 2009

Mr. Cohen is in Esfahan, Iran.  In “What Iran’s Jews Say” he says the reality of Iranian civility toward Jews tells us more about Iran — its sophistication and culture — than all the inflammatory rhetoric.  Mr. Krugman, in “Banking on the Brink,” asks why not just go ahead and nationalize? Remember, the longer we live with zombie banks, the harder it will be to end the economic crisis.  Here’s Mr. Cohen:

At Palestine Square, opposite a mosque called Al-Aqsa, is a synagogue where Jews of this ancient city gather at dawn. Over the entrance is a banner saying: “Congratulations on the 30th anniversary of the Islamic Revolution from the Jewish community of Esfahan.”

The Jews of Iran remove their shoes, wind leather straps around their arms to attach phylacteries and take their places. Soon the sinuous murmur of Hebrew prayer courses through the cluttered synagogue with its lovely rugs and unhappy plants. Soleiman Sedighpoor, an antiques dealer with a store full of treasures, leads the service from a podium under a chandelier.

I’d visited the bright-eyed Sedighpoor, 61, the previous day at his dusty little shop. He’d sold me, with some reluctance, a bracelet of mother-of-pearl adorned with Persian miniatures. “The father buys, the son sells,” he muttered, before inviting me to the service.

Accepting, I inquired how he felt about the chants of “Death to Israel” — “Marg bar Esraeel” — that punctuate life in Iran.

“Let them say ‘Death to Israel,’ ” he said. “I’ve been in this store 43 years and never had a problem. I’ve visited my relatives in Israel, but when I see something like the attack on Gaza, I demonstrate, too, as an Iranian.”

The Middle East is an uncomfortable neighborhood for minorities, people whose very existence rebukes warring labels of religious and national identity. Yet perhaps 25,000 Jews live on in Iran, the largest such community, along with Turkey’s, in the Muslim Middle East. There are more than a dozen synagogues in Tehran; here in Esfahan a handful caters to about 1,200 Jews, descendants of an almost 3,000-year-old community.

Over the decades since Israel’s creation in 1948, and the Islamic Revolution of 1979, the number of Iranian Jews has dwindled from about 100,000. But the exodus has been far less complete than from Arab countries, where some 800,000 Jews resided when modern Israel came into being.

In Algeria, Tunisia, Libya, Egypt and Iraq — countries where more than 485,000 Jews lived before 1948 — fewer than 2,000 remain. The Arab Jew has perished. The Persian Jew has fared better.

Of course, Israel’s unfinished cycle of wars has been with Arabs, not Persians, a fact that explains some of the discrepancy.

Still a mystery hovers over Iran’s Jews. It’s important to decide what’s more significant: the annihilationist anti-Israel ranting, the Holocaust denial and other Iranian provocations — or the fact of a Jewish community living, working and worshipping in relative tranquillity.

Perhaps I have a bias toward facts over words, but I say the reality of Iranian civility toward Jews tells us more about Iran — its sophistication and culture — than all the inflammatory rhetoric.

That may be because I’m a Jew and have seldom been treated with such consistent warmth as in Iran. Or perhaps I was impressed that the fury over Gaza, trumpeted on posters and Iranian TV, never spilled over into insults or violence toward Jews. Or perhaps it’s because I’m convinced the “Mad Mullah” caricature of Iran and likening of any compromise with it to Munich 1938 — a position popular in some American Jewish circles — is misleading and dangerous.

I know, if many Jews left Iran, it was for a reason. Hostility exists. The trumped-up charges of spying for Israel against a group of Shiraz Jews in 1999 showed the regime at its worst. Jews elect one representative to Parliament, but can vote for a Muslim if they prefer. A Muslim, however, cannot vote for a Jew.

Among minorities, the Bahai — seven of whom were arrested recently on charges of spying for Israel — have suffered brutally harsh treatment.

I asked Morris Motamed, once the Jewish member of the Majlis, if he felt he was used, an Iranian quisling. “I don’t,” he replied. “In fact I feel deep tolerance here toward Jews.” He said “Death to Israel” chants bother him, but went on to criticize the “double standards” that allow Israel, Pakistan and India to have a nuclear bomb, but not Iran.

Double standards don’t work anymore; the Middle East has become too sophisticated. One way to look at Iran’s scurrilous anti-Israel tirades is as a provocation to focus people on Israel’s bomb, its 41-year occupation of the West Bank, its Hamas denial, its repetitive use of overwhelming force. Iranian language can be vile, but any Middle East peace — and engagement with Tehran — will have to take account of these points.

Green Zoneism — the basing of Middle Eastern policy on the construction of imaginary worlds — has led nowhere.

Realism about Iran should take account of Esfehan’s ecumenical Palestine Square. At the synagogue, Benhur Shemian, 22, told me Gaza showed Israel’s government was “criminal,” but still he hoped for peace. At the Al-Aqsa mosque, Monteza Foroughi, 72, pointed to the synagogue and said: “They have their prophet; we have ours. And that’s fine.”

Here’s Mr. Krugman:

Comrade Greenspan wants us to seize the economy’s commanding heights.

O.K., not exactly. What Alan Greenspan, the former Federal Reserve chairman — and a staunch defender of free markets — actually said was, “It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring.” I agree.

The case for nationalization rests on three observations.

First, some major banks are dangerously close to the edge — in fact, they would have failed already if investors didn’t expect the government to rescue them if necessary.

Second, banks must be rescued. The collapse of Lehman Brothers almost destroyed the world financial system, and we can’t risk letting much bigger institutions like Citigroup or Bank of America implode.

Third, while banks must be rescued, the U.S. government can’t afford, fiscally or politically, to bestow huge gifts on bank shareholders.

Let’s be concrete here. There’s a reasonable chance — not a certainty — that Citi and BofA, together, will lose hundreds of billions over the next few years. And their capital, the excess of their assets over their liabilities, isn’t remotely large enough to cover those potential losses.

Arguably, the only reason they haven’t already failed is that the government is acting as a backstop, implicitly guaranteeing their obligations. But they’re zombie banks, unable to supply the credit the economy needs.

To end their zombiehood the banks need more capital. But they can’t raise more capital from private investors. So the government has to supply the necessary funds.

But here’s the thing: the funds needed to bring these banks fully back to life would greatly exceed what they’re currently worth. Citi and BofA have a combined market value of less than $30 billion, and even that value is mainly if not entirely based on the hope that stockholders will get a piece of a government handout. And if it’s basically putting up all the money, the government should get ownership in return.

Still, isn’t nationalization un-American? No, it’s as American as apple pie.

Lately the Federal Deposit Insurance Corporation has been seizing banks it deems insolvent at the rate of about two a week. When the F.D.I.C. seizes a bank, it takes over the bank’s bad assets, pays off some of its debt, and resells the cleaned-up institution to private investors. And that’s exactly what advocates of temporary nationalization want to see happen, not just to the small banks the F.D.I.C. has been seizing, but to major banks that are similarly insolvent.

The real question is why the Obama administration keeps coming up with proposals that sound like possible alternatives to nationalization, but turn out to involve huge handouts to bank stockholders.

For example, the administration initially floated the idea of offering banks guarantees against losses on troubled assets. This would have been a great deal for bank stockholders, not so much for the rest of us: heads they win, tails taxpayers lose.

Now the administration is talking about a “public-private partnership” to buy troubled assets from the banks, with the government lending money to private investors for that purpose. This would offer investors a one-way bet: if the assets rise in price, investors win; if they fall substantially, investors walk away and leave the government holding the bag. Again, heads they win, tails we lose.

Why not just go ahead and nationalize? Remember, the longer we live with zombie banks, the harder it will be to end the economic crisis.

How would nationalization take place? All the administration has to do is take its own planned “stress test” for major banks seriously, and not hide the results when a bank fails the test, making a takeover necessary. Yes, the whole thing would have a Claude Rains feel to it, as a government that has been propping up banks for months declares itself shocked, shocked at the miserable state of their balance sheets. But that’s O.K.

And once again, long-term government ownership isn’t the goal: like the small banks seized by the F.D.I.C. every week, major banks would be returned to private control as soon as possible. The finance blog Calculated Risk suggests that instead of calling the process nationalization, we should call it “preprivatization.”

The Obama administration, says Robert Gibbs, the White House spokesman, believes “that a privately held banking system is the correct way to go.” So do we all. But what we have now isn’t private enterprise, it’s lemon socialism: banks get the upside but taxpayers bear the risks. And it’s perpetuating zombie banks, blocking economic recovery.

What we want is a system in which banks own the downs as well as the ups. And the road to that system runs through nationalization.

The howling and screaming from the right wing will begin in 3…2…

Dowd, Friedman, Kristof and Rich

February 22, 2009

MoDo, in “Dark, Dark, Dark,” says we need leaders to help us through our crises, not provide us with crude evaluations of our character.  The Moustache of Wisdom gives us “Start Up the Risk-Takers,” in which he opines that precious public money should focus on investing in a new generation of innovative companies, not on bailing out the losers.  Mr. Kristof, in “Sisters, Victims, Heroes,” says that world leaders will have to summon some of the same moral courage that Darfuris show all the time if the slaughter in the region is to end.  Mr. Rich says “What We Don’t Know Will Hurt Us,” and that no one knows when there will be an end to the economic crisis, of course, but a bigger question may be whether we really want to know.  Here’s MoDo:

Barack Obama’s grandmother told him to smile more. Bill Clinton tells the new president to strut more.

As the country takes a bullet train to bankruptcy, the last Democratic president urged the current one to “embody” that old American spunk. That spirit of — as they sing in “Oklahoma” — “We know we belong to the land and the land we belong to is grand! A-YIP-I-O-EE-AY!”

“It’s worth reminding the American people that for more than 230 years everyone who bet against America lost money,” Clinton told Chris Cuomo on “Good Morning America.” “I just want him to embody that and to share that.”

It’s rich. The Man from Hope whose Missus castigated Candidate Obama for raising “false hopes” is now criticizing President Obama for not peddling more gauzy hope.

Instead, he implies, the president’s warnings of calamity, designed to gin up support for borrowing and printing trillions to shore up the sagging economy, might actually be dragging down our already sagging self-esteem.

Says the ever-helpful Bill: “I just want the American people to know that he’s confident that we are going to get out of this and he feels good about the long run.”

It’s hard to muster moxie with stocks shriveling, Chris Dodd talking nationalization, and Paul Volcker making Chicken Little sound cheery — “I don’t remember any time, maybe even in the Great Depression,” he said, “when things went down quite so fast, quite so uniformly around the world.”

With this economy, as William Goldman famously said of Hollywood, “Nobody knows anything.” The only thing to fear is … everything.

We dutifully cut back on Starbucks macchiatos, designer water and even Girl Scout cookies, but we keep hurtling down.

While W. and Dick conjured an alternative reality about Iraq, our avaricious bankers created an alternative reality about our financial system. Now our busted trust is not so easily fixed.

In an Associated Press article headlined “Obama Plans Eclipsing New Deal Spending,” the Rutgers University political science professor Ross Baker notes, “Not surprisingly, people are wary of some very expensive proposals with no guarantee of success or even a high probability of how well they’ll work.”

In The Times, Eric Dash reported that Wall Street is losing confidence in Washington’s vague and shifting plans, sending shares of bank companies plunging to new lows on Friday.

President Obama disdains sound bites, and he does not have Bill Clinton’s talent for reducing the abstruse to aperçus. We wanted someone smart to gather a bunch of smart people around him to get us out of this fix. But Mr. Obama’s egghead manner has failed to soothe a nation with the jits. Maybe he has been so intent on avoiding the stereotype of the Angry Black Man, as he wrote in his memoir, that it’s hard for him to connect with and articulate public anger about our diminishment.

Though he demonstrated in the campaign that he has a rare gift for inspiring the country with new belief in itself, Mr. Obama has not yet captured either the grit the moment requires or the fury it provokes. He has not explained in a compelling way why Americans who followed the rules need to sacrifice more to help those who flouted the rules.

That is why the CNBC reporter Rick Santelli struck a populist nerve with his screed about the unfairness of responsible homeowners picking up the tab for irresponsible homeowners — following the unfairness of taxpayers who are losing jobs, homes and savings propping up the exact same bankers and carmakers whose greed and myopia caused the economy to crash.

He spoke for those who want a pound of flesh. With the Wall Street bailout, Mr. Obama at least gave bankers a bit of the belt, and capped their pay. But homebuyers who wanted more than they could afford seem to be getting a free ride.

Yet Obama is oozing empathy compared with his attorney general, who last week called us “a nation of cowards” about race.

Eric Holder, who showed precious little bravery in standing up to Clinton on a pardon for the scoundrel Marc Rich, is wrong. We have just inaugurated a black president who installed a black attorney general.

We need leaders to help us through our crises, not provide us with crude evaluations of our character. And we don’t need sermons from liberal virtuecrats, anymore than from conservative virtuecrats.

In the middle of all the Heimlich maneuvers required now — for the economy, Iran, Pakistan, Afghanistan, health care, the environment and education — we don’t need a Jackson/Sharpton-style lecture on race. Barack Obama’s election was supposed to get us past that.

Besides, the president has other issues that demand his passion.

Here’s The Moustache of Wisdom:

Reading the news that General Motors and Chrysler are now lining up for another $20 billion or so in government aid — on top of the billions they’ve already received or requested — leaves me with the sick feeling that we are subsidizing the losers and for only one reason: because they claim that their funerals would cost more than keeping them on life support. Sorry, friends, but this is not the American way. Bailing out the losers is not how we got rich as a country, and it is not how we’ll get out of this crisis.

G.M. has become a giant wealth- destruction machine — possibly the biggest in history — and it is time that it and Chrysler were put into bankruptcy so they can truly start over under new management with new labor agreements and new visions. When it comes to helping companies, precious public money should focus on start-ups, not bailouts.

You want to spend $20 billion of taxpayer money creating jobs? Fine. Call up the top 20 venture capital firms in America, which are short of cash today because their partners — university endowments and pension funds — are tapped out, and make them this offer: The U.S. Treasury will give you each up to $1 billion to fund the best venture capital ideas that have come your way. If they go bust, we all lose. If any of them turns out to be the next Microsoft or Intel, taxpayers will give you 20 percent of the investors’ upside and keep 80 percent for themselves.

If we are going to be spending billions of taxpayer dollars, it can’t only be on office-decorating bankers, over-leveraged home speculators and auto executives who year after year spent more energy resisting changes and lobbying Washington than leading change and beating Toyota.

I’ve been traveling all across the country on a book tour, and every evening I return to my hotel with my pockets full of business cards from inventors in clean energy. Our country is still bursting with innovators looking for capital. So, let’s make sure all the losers clamoring for help don’t drown out the potential winners who could lift us out of this. Some of our best companies, such as Intel, were started in recessions, when necessity makes innovators even more inventive and risk-takers even more daring.

Yes, we have to shore up the banking system, which underpins everything; and finding a fair way to prevent hardworking people, who played by the rules, from losing their homes to foreclosure is both right and essential for stability.

But beyond that, let’s think, talk and plan in more aspirational ways. We’re down, but we’re not out. As we invest taxpayer money, let’s do it with an eye to starting a new generation of biotech, info-tech, nanotech and clean-tech companies, with real innovators, real 21st-century jobs and potentially real profits for taxpayers. Our motto should be, “Start-ups, not bailouts: nurture the next Google, don’t nurse the old G.M.’s.”

To be fair, the stimulus package that the Obama team and the Democrats in Congress recently passed — with virtually no Republican help — goes some way toward doing just that. Hat’s off for that. Now let’s do more.

The renewable-energy business — wind, solar and solar thermal — was almost dead in this country. Most new projects stopped last fall because they depended for their financing on selling their renewable energy tax credits to Wall Street firms. As those Wall Street firms went bust or suffered steep losses, they had no need for tax credits because they had no profits to offset. The stimulus package created a mechanism for renewable energy innovators to bypass Wall Street and monetize their tax credits directly through the U.S. Treasury, for any project that starts between now and the end of 2010.

The wind and solar industries in America “were dead in the fourth quarter,” said John Woolard, chief executive of BrightSource Energy, which builds and operates cutting-edge solar-thermal plants in the Mojave Desert. Almost five gigawatts of new solar-thermal projects — the equivalent of five big nuclear plants — at various stages of permitting were being held up because of a lack of financing.

“All of these projects will now go ahead,” said Woolard. “You are talking about thousands of jobs … We really got something right in this legislation.”

These jobs will be in engineering, constructing and operating huge solar systems and wind farms and manufacturing new photovoltaics. Together they will drive innovation in all these areas — and move wind and solar technology down the cost-volume learning curve so they can compete against fossil fuels and become export industries at the “ChinIndia price,” that is the price at which they can scale in China and India.

That is how taxpayer money should be used to stimulate: limited financing, for a limited time, targeted on an industry bristling with new technology start-ups that, with a little push from Uncle Sam, won’t just survive this crisis but help us thrive when it is over. We need, and the world needs, an America that is thriving not just surviving.

Here’s Mr. Kristof, writing from Goz Beida, Chad:

So I’m bunking with George Clooney in a little room in a guest house here in eastern Chad, near Darfur in Sudan. We each have a mattress on the floor, the “shower” is a rubber hose that doesn’t actually produce any water, and George’s side of the room has a big splotch of something that sure looks like blood.

He’s using me to learn more about Darfur, and I’m using him to ease you into a column about genocide. Manipulation all around — and, luckily, neither of us snores. (But stay tuned to this series for salacious gossip if he talks in his sleep.)

The slaughter in Darfur has continued for six years largely because world leaders have been complacent and preoccupied. In the coming weeks, the International Criminal Court is expected to issue an arrest warrant for Sudan’s president, Omar Hassan al-Bashir, for orchestrating the killings — and that will give the world a new opportunity to end the slaughter.

But to seize that opportunity, world leaders will have to summon some of the same moral courage that Darfuris show all the time.

Take Suad Ahmed, who is in the pantheon of my personal heroes. I introduced her to George in her little thatch hut.

Suad, 27, fled from Darfur to a refugee camp in Chad five years ago with her husband and beloved younger sister, Halima, who is now 12 — if she is still alive.

Then Sudan dispatched its janjaweed militias into Chad to slaughter members of black African tribes — applying to eastern Chad the same genocidal policies that had already gutted Darfur.

Shortly before I met Suad two years ago, she was out gathering firewood with Halima. A group of janjaweed fired into the air and yelled at them to stop.

Suad, who was married with two children and another on the way, ordered Halima to run back to camp. Then Suad made a decoy of herself and ran loudly in the opposite direction, making sure that the janjaweed saw her.

That night, after the janjaweed had left, the men from the camp found Suad semiconscious in the bush, brutally beaten and raped.

Suad refused medical treatment, for fear that word would get out that she had been raped, and she didn’t even tell her husband, instead saying that she had been robbed and beaten. Yet she revealed the full story to me and allowed me to use her name.

I grilled her to make absolutely sure she understood the dangers of publicity — from stigma and revenge — and finally asked her why she was willing to assume the risks. She replied simply, “This is the only way I have to fight genocide.”

Ever since, in a world that has proved so craven in the face of Sudan’s genocide, Suad’s courage has haunted me. Thus on this trip I tracked her down and introduced her to George and to Ann Curry of NBC News, who for years has borne powerful witness to the madness of Darfur.

Alas, Suad’s latest news isn’t good. Her back, injured in the beating, still pains her. She doesn’t dare go outside the camp to get firewood, so she must buy wood, which leaves the family poor and short of food. Her baby, Abdel Malik, whom she was carrying at the time of the rape, is one and a half years old and was just hospitalized for malnutrition.

The most heartbreaking news concerns Halima. Ten months ago, Halima decided to go back to Darfur to the camp where her parents were living. They had sent messages that they were sick, and that there were too many soldiers around for them to escape to Chad.

So Halima, at age 11, resolved to walk back through janjaweed lines into Darfur to rescue her parents and bring them to safety.

The girl disappeared into the desert.

“I haven’t heard from her since,” Suad said grimly. “I don’t know if she got there, or if she was killed on route.” Suad has spent a fair amount of money trying to call people in the camp to find out news of her sister and parents, but she has found out nothing. We tried with our satellite phones and couldn’t get through either.

This is my 10th trip to Darfur and the area around it, and people always ask how reporters and aid workers keep their sanity among such horrors. Yet the truth is that genocide spotlights not only the worst of humanity, but also the best — the courage and altruism of people like Suad and Halima.

So the most indelible memories I will take back from the region aren’t from my famous roommate on the mattress beside me, but from uncommon heroes like Suad and Halima. We can learn so much from them.

And now here’s Mr. Rich:

And so on the 29th day of his presidency, Barack Obama signed the stimulus bill. But the earth did not move. The Dow Jones fell almost 300 points. G.M. and Chrysler together asked taxpayers for another $21.6 billion and announced another 50,000 layoffs. The latest alleged mini-Madoff, R. Allen Stanford, was accused of an $8 billion fraud with 50,000 victims.

“I don’t want to pretend that today marks the end of our economic problems,” the president said on Tuesday at the signing ceremony in Denver. He added, hopefully: “But today does mark the beginning of the end.”

Does it?

No one knows, of course, but a bigger question may be whether we really want to know. One of the most persistent cultural tics of the early 21st century is Americans’ reluctance to absorb, let alone prepare for, bad news. We are plugged into more information sources than anyone could have imagined even 15 years ago. The cruel ambush of 9/11 supposedly “changed everything,” slapping us back to reality. Yet we are constantly shocked, shocked by the foreseeable. Obama’s toughest political problem may not be coping with the increasingly marginalized G.O.P. but with an America-in-denial that must hear warning signs repeatedly, for months and sometimes years, before believing the wolf is actually at the door.

This phenomenon could be seen in two TV exposés of the mortgage crisis broadcast on the eve of the stimulus signing. On Sunday, “60 Minutes” focused on the tawdry lending practices of Golden West Financial, built by Herb and Marion Sandler. On Monday, the CNBC documentary “House of Cards” served up another tranche of the subprime culture, typified by the now defunct company Quick Loan Funding and its huckster-in-chief, Daniel Sadek. Both reports were superbly done, but both could have been reruns.

The Sandlers and Sadek have been recurrently whipped at length in print and on television, as far back as 2007 in Sadek’s case (by Bloomberg); the Sandlers were even vilified in a “Saturday Night Live” sketch last October. But still the larger message may not be entirely sinking in. “House of Cards” was littered with come-on commercials, including one hawking “risk-free” foreign-currency trading — yet another variation on Quick Loan Funding, promising credulous Americans something for nothing.

This cultural pattern of denial is hardly limited to the economic crisis. Anyone with eyes could have seen that Sammy Sosa and Mark McGwire resembled Macy’s parade balloons in their 1998 home-run derby, but it took years for many fans (not to mention Major League Baseball) to accept the sorry truth. It wasn’t until the Joseph Wilson-Valerie Plame saga caught fire in summer 2003, months after “Mission Accomplished,” that we began to confront the reality that we had gone to war in Iraq over imaginary W.M.D. Weapons inspectors and even some journalists (especially at Knight-Ridder newspapers) had been telling us exactly that for almost a year.

The writer Mark Danner, who early on chronicled the Bush administration’s practice of torture for The New York Review of Books, reminded me last week that that story first began to emerge in December 2002. That’s when The Washington Post reported on the “stress and duress” tactics used to interrogate terrorism suspects. But while similar reports followed, the notion that torture was official American policy didn’t start to sink in until after the Abu Ghraib photos emerged in April 2004. Torture wasn’t routinely called “torture” in Beltway debate until late 2005, when John McCain began to press for legislation banning it.

Steroids, torture, lies from the White House, civil war in Iraq, even recession: that’s just a partial glossary of the bad-news vocabulary that some of the country, sometimes in tandem with a passive news media, resisted for months on end before bowing to the obvious or the inevitable. “The needle,” as Danner put it, gets “stuck in the groove.”

For all the gloomy headlines we’ve absorbed since the fall, we still can’t quite accept the full depth of our economic abyss either. Nicole Gelinas, a financial analyst at the conservative Manhattan Institute, sees denial at play over a wide swath of America, reaching from the loftiest economic strata of Wall Street to the foreclosure-decimated boom developments in the Sun Belt.

When we spoke last week, she talked of would-be bankers who, upon graduating, plan “to travel in Asia and teach English for a year” and then pick up where they left off. Such graduates are dreaming, Gelinas says, because the over-the-top Wall Street money culture of the credit bubble isn’t coming back for a very long time, if ever. As she observes, it took decades after the Great Depression — until the 1980s — for Wall Street to fully reclaim its old swagger. Not until then was there “a new group of people without massive psychological scarring” from the 1929 crash.

In states like Nevada, Florida and Arizona, Gelinas sees “huge neighborhoods that will become ghettos” as half their populations lose or abandon their homes, with an attendant collapse of public services and social order. “It will be like after Katrina,” she says, “but it’s no longer just the Lower Ninth Ward’s problem.” Writing in the current issue of The Atlantic, the urban theorist Richard Florida suggests we could be seeing “the end of a whole way of life.” The link between the American dream and home ownership, fostered by years of bipartisan public policy, may be irreparably broken.

Pity our new president. As he rolls out one recovery package after another, he can’t know for sure what will work. If he tells the whole story of what might be around the corner, he risks instilling fear itself among Americans who are already panicked. (Half the country, according to a new Associated Press poll, now fears unemployment.) But if the president airbrushes the picture too much, the country could be as angry about ensuing calamities as it was when the Bush administration’s repeated assertion of “success” in Iraq proved a sham. Managing America’s future shock is a task that will call for every last ounce of Obama’s brains, temperament and oratorical gifts.

The difficulty of walking this fine line can be seen in the drama surrounding the latest forbidden word to creep around the shadows for months before finally leaping into the open: nationalization. Until he started hedging a little last weekend, the president has pointedly said that nationalizing banks, while fine for Sweden, wouldn’t do in America, with its “different” (i.e., non-socialistic) culture and traditions. But the word nationalization, once mostly whispered by liberal economists, is now even being tossed around by Lindsey Graham and Alan Greenspan. It’s a clear indication that no one has a better idea.

The Obama White House may come up with euphemisms for nationalization (temporary receivership, anyone?). But whatever it’s called, what will it mean? The reason why the White House has been punting on the new installment of the bank rescue is not that the much-maligned Treasury secretary, Timothy Geithner, is incapable of getting his act together. What’s slowing the works are the huge political questions at stake, many of them with consequences potentially as toxic as the banks’ assets.

Will Obama concede aloud that some of our “too big to fail” banks have, in essence, already failed? If so, what will he do about it? What will it cost? And, most important, who will pay? No one knows the sum of the American banks’ losses, but the economist Nouriel Roubini, who has gotten much right about this crash, puts it at $1.8 trillion. That doesn’t count any defaults still to come on what had been considered “good” mortgages and myriad other debt, whether from auto loans or credit cards.

Americans are right to wonder why there has been scant punishment for the management and boards of bailed-out banks that recklessly sliced and diced all this debt into worthless gambling chips. They are also right to wonder why there is still little transparency in how TARP funds have been spent by these teetering institutions. If a CNBC commentator can stir up a populist dust storm by ranting that Obama’s new mortgage program (priced at $75 billion to $275 billion) is “promoting bad behavior,” imagine the tornado that would greet an even bigger bank bailout on top of the $700 billion already down the TARP drain.

Nationalization would likely mean wiping out the big banks’ managements and shareholders. It’s because that reckoning has mostly been avoided so far that those bankers may be the Americans in the greatest denial of all. Wall Street’s last barons still seem to believe that they can hang on to their old culture by scuttling corporate jets, rejecting bonuses or sounding contrite in public. Ask the former Citigroup wise man Robert Rubin how that strategy worked out.

We are now waiting to learn if Obama’s economic team, much of it drawn from the Wonderful World of Citi and Goldman Sachs, will have the will to make its own former cohort face the truth. But at a certain point, as in every other turn of our culture of denial, outside events will force the recognition of harsh realities. Nationalization, unmentionable only yesterday, has entered common usage not least because an even scarier word — depression — is next on America’s list to avoid.

Collins, Blow and Herbert

February 21, 2009

Ms. Collins in “Finance for Our Times,” says the government is just going to be a kind of helper, bringing the toxic asset buyers and sellers together, maybe creating some incentives to make the deals happen.  Mr. Blow, in “A Nation of Cowards?” says most whites harbor a hidden racial bias that many are unaware of and don’t consciously agree with. And getting them to talk frankly about race is still hard.  Mr. Herbert, in “The Invisible War,” says in the Democratic Republic of Congo, the brutal raping of women by soldiers and militias has pulled apart the entire society. And the world, for the most part, has remained indifferent.  Here’s Ms. Collins:

How do we feel about the Obama administration’s bank bailout plan?

Tough. The economic crisis is the most important current event there is. But when you see Alan Greenspan on TV announcing that he can’t quite get his head around collateralized debt obligations, there’s a definite temptation to throw in the towel and change the subject.

No, we’re made of stronger stuff. We’re citizens, darn it.

As we’re all supposed to know, the Obama plan revolves around the creation of a public-private investment fund to help the banks sell off their toxic assets.

The first important thing to point out is that the fund is not, under any circumstances, to be considered a bad bank. A bad bank is something created by a government to buy up toxic assets, cleaning out the financial system and then disposing of said assets for whatever the market will bear.

Which sounds … not irrational. But when you think of a bad bank, what do you imagine?

You walk into the lobby decorated with portraits of Bernie Madoff, past a row of tellers who are not giving out any money because they are all too busy planning to have octuplets or adopting a chimpanzee as a family member. The executive suite is empty because everybody has gone off on his or her own personal corporate jet. To lunch. Which would consist only of products made with peanut butter. And the bad bank would, of course, have a corporate softball team that was open only to employees who took steroids on a regular basis.

So, no bad banks. The government is just going to be a kind of helper, bringing the toxic asset buyers and sellers together, maybe creating some incentives to make the deals happen.

This is going to take some really powerful persuasion. We’re pretty sure that a bunch of foreclosed homes in Coral Gables have value, even if the water in their swimming pools has turned a disturbing shade of green. But they’re all scrambled in those financial instruments that Alan Greenspan can’t get a grip on.

One problem with the government plan is that nobody is ever going to have any confidence in a savior called “public-private investment fund.” The term aggregator bank has been floated around; the Treasury Department should consider stealing it, since it sounds like a kind of Transformer. In a crisis, Treasury Secretary Timothy Geithner could just yell “Aggregator, we need help!” And a normal-looking office building would instantly change into an enormous avenger who clumps down the street squashing the nasty little toxic assets that scurry around, making unpleasant squeaks.

If the banks and investors don’t get together and make deals, the Aggregator could always threaten to step on them.

Is any of this necessary? What if the government just decides to stay out of it? Why doesn’t Washington stick to putting people to work building unnecessary highways and wait for capitalism to right itself?

That’s a nonstarter because we’d wind up like Japan did in the ’90s, and nobody wants to be like Japan in the ’90s. It is true that we all wanted to be like Japan in the ’80s, in every possible way. But now, that is so over.

The financial community wants the government involved, but it hates, hates, hates the Obama approach. This is partly because the details are fuzzy and partly because it is not Wall Street’s own favored option, which involves giving the banks tons and tons and tons of money until there is so much cash sloshing around that the financial markets bob up and start to float.

We are trying not to get too fixated on the fairness aspects of the bailout. However, this approach seems to resemble a plan in which you fix a classroom that’s distracted by one disruptive pupil by sending said troublemaker to a private school in Lucerne equipped with an on-campus ski lift while the rest of the kids stay at Millard Fillmore Elementary, sharing textbooks.

Also, if you just prop up dead banks, they could turn into zombie banks. That is definitely something you want to avoid. Imagine walking down the street and there’s a zombie bank plunked on the corner, gazing emptily at the passing traffic and making strange grunting noises. Occasionally, it will snatch up some pedestrians and feed them to the toxic assets.

Instead of dancing around the problem, can’t we just have the government take over the impacted banks, hire all the unemployed bond traders to figure out how much the toxic assets are worth, dispose of them for whatever the market will bear and then sell the newly reconstituted banks back to private investors? That was Sweden’s approach, and it worked rather well.

The answer is that Americans will never do anything that Sweden does. Never have, never will. Don’t argue with me. It’s a rule.

Here’s Mr. Blow:

This began as a relatively quiet Black History Month. The biggest highlight was a 72-year-old former Klansman scratching “apologize to John Lewis for beating him up” off his bucket list.

Then came Attorney General Eric Holder’s scathing comments about America being “a nation of cowards” because we don’t have “frank” conversations about race. That got a lot of attention.

I take exception to Holder’s language, but not his line of reasoning. Calling people cowards is counterproductive. It turns the conversation into a confrontation — moving it beyond the breach of true dialogue and the pale of real understanding.

That said, frank conversations are always welcomed. But, before we start, it might be helpful to have a better understanding of the breadth and nature of racial bias.

According to an ABC News/Washington Post poll released last month, twice as many blacks as whites thought racism was a big problem in this country, while twice as many whites as blacks thought that blacks had achieved racial equality.

Furthermore, according to a 2003 Gallup poll, two in five of blacks said that they felt discriminated against at least once a month, and one in five felt discriminated against every day. But, a CNN poll from last January found that 72 percent of whites thought that blacks overestimated the amount of discrimination against them, while 82 percent of blacks thought that whites underestimated the amount of discrimination against blacks.

What explains this wide discrepancy? One factor could be that most whites harbor a hidden racial bias that many are unaware of and don’t consciously agree with.

Project Implicit, a virtual laboratory maintained by Harvard, the University of Washington and the University of Virginia, has administered hundreds of thousands of online tests designed to detect hidden racial biases. In tests taken from 2000 to 2006, they found that three-quarters of whites have an implicit pro-white/anti-black bias. (Blacks showed racial biases, too, but unlike whites, they split about evenly between pro-black and pro-white. And, blacks were the most likely of all races to exhibit no bias at all.) In addition, a 2006 study by Harvard researchers published in the journal Psychological Science used these tests to show how this implicit bias is present in white children as young as 6 years old, and how it stays constant into adulthood.

(You can take the test yourself.)

So why do so many people have this anti-black bias?

I called Brian Nosek, an associate professor in psychology at the University of Virginia and the director of Project Implicit, to find out. According to him, our brains automatically make associations based on our experiences and the information we receive, whether we consciously agree with those associations or not. He said that many egalitarian test-takers were shown to have an implicit anti-black bias, much to their chagrin. Professor Nosek took the test himself, and even he showed a pro-white/anti-black bias. Basically, our brains have a mind of their own.

This bias can seep into our everyday lives in insidious ways. For example, a paper presented at the annual meeting of the American Public Health Association in October found that many white doctors also had an implicit pro-white/anti-black bias, while black doctors showed almost no bias for one race or the other. The paper suggested that these biases may contribute to the unequal treatment of blacks, and that doctors may not even be conscious of it.

Can we eradicate this implicit bias? Maybe.

According to a Brown University and University of Victoria study that was published last month in the online journal PLoS One, researchers were able to ameliorate white’s racial biases by teaching them to distinguish black peoples’ faces from one another. Basically, seeing black people as individuals diminished white peoples’ discrimination. Imagine that.

Now that we know this, are we ready to talk? Maybe not yet. Talking frankly about race is still hard because it’s confusing and uncomfortable.

First, white people don’t want to be labeled as prejudiced, so they work hard around blacks not to appear so. A study conducted by researchers at Tufts University and Harvard Business School and published in the Journal of Personality and Social Psychology found that many whites — including those as young as 10 years old — are so worried about appearing prejudiced that they act colorblind around blacks, avoiding “talking about race, or even acknowledging racial difference,” even when race is germane. Interestingly, blacks thought that whites who did this were more prejudiced than those who didn’t.

Second, that work is exhausting. A 2007 study by researchers at Northwestern and Princeton that was published in the journal Current Directions in Psychological Science found that interracial interactions leave whites both “cognitively and emotionally” drained because they are trying not to be perceived as prejudiced.

The fear of offending isn’t necessarily cowardice, nor is a failure to acknowledge a bias that you don’t know that you have, but they are impediments. We have to forget about who’s a coward and who’s brave, about who feels offended and who gets blamed. Let’s focus on the facts, and let’s just talk.

Now here’s Mr. Herbert:

Perhaps we’ve heard so little about them because the crimes are so unspeakable, the evil so profound.

For years now, in the Democratic Republic of Congo, marauding bands of soldiers and militias have been waging a war of rape and destruction against women. This sustained campaign of mind-bending atrocities, mostly in the eastern part of the country, has been one of the strategic tools in a wider war that has continued, with varying degrees of intensity, since the 1990s. Millions have been killed.

Women and girls of all ages, from old women to very young children, have been gang-raped, and in many cases their sexual organs have been mutilated. The victims number in the hundreds of thousands. But the world, for the most part, has remained indifferent to their suffering.

“These women are raped in front of their husbands, in front of their children, in front of their parents, in front of their neighbors,” said Dr. Denis Mukwege, a gynecologist who runs a hospital in Bukavu that treats only the women who have sustained the most severe injuries.

In some cases, the rapists have violated their victims with loaded guns and pulled the triggers. Other women have had their organs deliberately destroyed by knives or other weapons. Sons have been forced at gunpoint to rape their mothers. Many women and girls have been abducted and sexually enslaved.

It is as if, in these particular instances, some window to what we think of as our common humanity had been closed. As The Times’s Jeffrey Gettleman, on assignment in Congo, wrote last fall:

“Many of these rapes have been marked by a level of brutality that is shocking even by the twisted standards of a place riven by civil war and haunted by warlords and drug-crazed child soldiers.”

Dr. Mukwege visited me at The Times last week. He was accompanied by the playwright, Eve Ensler, who has been passionate in her efforts to bring attention and assistance to the women of Congo.

I asked Dr. Mukwege to explain how it was in the strategic interest of the various armed groups to rape and otherwise brutalize women. He described some of the ramifications of such atrocities and the ways in which they undermine the entire society in which the women live.

“Once they have raped these women in such a public way,” he said, “sometimes maiming them, destroying their sexual organs — and with everybody watching — the women themselves are destroyed, or virtually destroyed. They are traumatized and humiliated on every level, physical and psychological. That’s the first consequence.

“The second consequence is that the whole family and the entire neighborhood is traumatized by what they have seen. The ordinary sense of family and community is lost after a man has been forced to watch his wife being raped, or parents are forced to watch the rape of their daughters, or children see their mothers raped.

“Neighbors are witnesses to this. Many flee. Families are dislocated. Social relationships are lost. There is no more social network, village network. Not only the victims have been destroyed; the whole village is destroyed.”

The devastating injuries treated by Dr. Mukwege at his hospital can all but stun the imagination. There is no need to detail them further here. AIDS and other sexually transmitted diseases are commonplace. Often the ability to bear children is destroyed. In many other cases, women end up giving birth to the children of their rapists.

“The hospital can take care of 3,600 women every year,” said Dr. Mukwege. “That is our maximum capacity. We can’t take any more.”

He spoke of ambulance teams that would drive into villages and be besieged by rape victims desperately seeking treatment. “It is awful to see 300 women in need of help,” he said, “and you have to take 10 because the ambulance can only take 10.”

Ms. Ensler spoke of her encounter with an 8-year-old girl during one of her trips to Congo. The girl’s father had been killed in an attack, her mother was raped, and the girl herself was abducted. The child was raped by groups of soldiers over a two-week period and then abandoned.

The girl felt too ashamed to allow herself to be held, Ms. Ensler said, because her injuries had left her incontinent. After explaining how she persuaded the child to accept an embrace, to be hugged, Ms. Ensler said, “If we’re living in a century when an 8-year-old girl is incontinent because that many soldiers have raped her, then something has gone terribly wrong.”

Despite the presence in the region of the largest U.N. peacekeeping mission in the world, no one has been able to stop the systematic rape of the Congolese women.

If these are not war crimes, crimes against humanity, then nothing is.

Now I’m taking my horrible cold back to bed.

Bobo and Krugman

February 20, 2009

Bobo babbles about “Money for Idiots,” and says the nation’s economy is an interwoven context that we all share. To stabilize this communal landscape, sometimes you have to give money to those who have been foolish.  Mr. Krugman, in “Who’ll Stop the Pain?” says the Obama administration’s policy initiatives will help in this difficult period — but they are intended to mitigate the slump, not end it. No doubt this recession will pass — but how, and when?  Here’s Bobo:

Our moral and economic system is based on individual responsibility. It’s based on the idea that people have to live with the consequences of their decisions. This makes them more careful deciders. This means that society tends toward justice — people get what they deserve as much as possible.

Over the last few months, we’ve made a hash of all that. The Bush and Obama administrations have compensated foolishness and irresponsibility. The financial bailouts reward bankers who took insane risks. The auto bailouts subsidize companies and unions that made self-indulgent decisions a few decades ago that drove their industry into the ground.

The stimulus package handed tens of billions of dollars to states that spent profligately during the prosperity years. The Obama housing plan will force people who bought sensible homes to subsidize the mortgages of people who bought houses they could not afford. It will almost certainly force people who were honest on their loan forms to subsidize people who were dishonest on theirs.

These injustices are stoking anger across the country, lustily expressed by Rick Santelli on CNBC Thursday morning. “The government is promoting bad behavior!” Santelli cried as Chicago traders cheered him on. “The president … should put up a Web site … to have people vote … to see if they want to subsidize losers’ mortgages!”

Well, in some cases we probably do. That’s because government isn’t fundamentally in the Last Judgment business, making sure everybody serves penance for their sins. In times like these, government is fundamentally in the business of stabilizing the economic system as a whole.

Let me put it this way: Psychologists have a saying that when a couple comes in for marriage therapy, there are three patients in the room — the husband, the wife and the marriage itself. The marriage is the living history of all the things that have happened between husband and wife. Once the patterns are set, the marriage itself begins to shape their individual behavior. Though it exists in the space between them, it has an influence all its own.

In the same way, an economy has an economic culture. Out of billions of individual decisions, a common economic landscape emerges, which frames and influences the decisions everybody makes.

Right now, the economic landscape looks like that movie of the swaying Tacoma Narrows Bridge you might have seen in a high school science class. It started swinging in small ways and then the oscillations built on one another until the whole thing was freakishly alive and the pavement looked like liquid.

A few years ago, the global economic culture began swaying. The government enabled people to buy homes they couldn’t afford. The Fed provided easy money. The Chinese sloshed in oceans of capital. The giddy upward sway produced a crushing ride down.

These oscillations are the real moral hazard. Individual responsibility doesn’t mean much in an economy like this one. We all know people who have been laid off through no fault of their own. The responsible have been punished along with the profligate.

It makes sense for the government to intervene to try to reduce the oscillation. It makes sense for government to try to restore some communal order. And the sad reality is that in these circumstances government has to spend money on precisely those sectors that have been swinging most wildly — housing, finance, etc. It has to help stabilize people who have been idiots.

Actually executing this is a near-impossible task. Looking at the auto, housing and banking bailouts, we’re getting a sense of how the propeller heads around Obama operate. They try to put together programs that are bold, but without the huge interventions in the market implied by, say, nationalization. They’re balancing so many cross-pressures, they often come up with technocratic Rube Goldberg schemes that alter incentives in lots of medium and small ways. Some economists argue that the plans are too ineffectual, others that they are too opaque (estimates for the mortgage plan range from $75 billion to $275 billion and up). Personally, I hate the idea of 10 guys sitting around in the White House trying to redesign huge swaths of the U.S. economy on legal pads.

But at least they seem to be driven by a spirit of moderation and restraint. They seem to be trying to keep as many market structures in place as possible so things can return to normal relatively smoothly.

And they seem to understand the big thing. The nation’s economy is not just the sum of its individuals. It is an interwoven context that we all share. To stabilize that communal landscape, sometimes you have to shower money upon those who have been foolish or self-indulgent. The greedy idiots may be greedy idiots, but they are our countrymen. And at some level, we’re all in this together. If their lives don’t stabilize, then our lives don’t stabilize.

Here’s Mr. Krugman:

Earlier this week, the Federal Reserve released the minutes of the most recent meeting of its open market committee — the group that sets interest rates. Most press reports focused either on the Fed’s downgrade of the near-term outlook or on its adoption of a long-run 2 percent inflation target.

But my eye was caught by the following chilling passage (yes, things are so bad that the summarized musings of central bankers can keep you up at night): “All participants anticipated that unemployment would remain substantially above its longer-run sustainable rate at the end of 2011, even absent further economic shocks; a few indicated that more than five to six years would be needed for the economy to converge to a longer-run path characterized by sustainable rates of output growth and unemployment and by an appropriate rate of inflation.”

So people at the Fed are troubled by the same question I’ve been obsessing on lately: What’s supposed to end this slump? No doubt this, too, shall pass — but how, and when?

To appreciate the problem, you need to know that this isn’t your father’s recession. It’s your grandfather’s, or maybe even (as I’ll explain) your great-great-grandfather’s.

Your father’s recession was something like the severe downturn of 1981-1982. That recession was, in effect, a deliberate creation of the Federal Reserve, which raised interest rates to as much as 17 percent in an effort to control runaway inflation. Once the Fed decided that we had suffered enough, it relented, and the economy quickly bounced back.

Your grandfather’s recession, on the other hand, was something like the Great Depression, which happened in spite of the Fed’s efforts, not because of them. When a stock market bubble and a credit boom collapsed, bringing down much of the banking system with them, the Fed tried to revive the economy with low interest rates — but even rates barely above zero weren’t low enough to end a prolonged era of high unemployment.

Now we’re in the midst of a crisis that bears an eerie, troubling resemblance to the onset of the Depression; interest rates are already near zero, and still the economy plunges. How and when will it all end?

To be sure, the Obama administration is taking action to help the economy, but it’s trying to mitigate the slump, not end it. The stimulus bill, on the administration’s own estimates, will limit the rise in unemployment but fall far short of restoring full employment. The housing plan announced this week looks good in the sense that it will help many homeowners, but it won’t spur a new housing boom.

What, then, will actually end the slump?

Well, the Great Depression did eventually come to an end, but that was thanks to an enormous war, something we’d rather not emulate. The slump that followed Japan’s “bubble economy” also eventually ended, but only after a lost decade. And when Japan finally did start to experience some solid growth, it was thanks to an export boom, which was in turn made possible by vigorous growth in the rest of the world — not an experience anyone can repeat when the whole world is in a slump.

So will our slump go on forever? No. In fact, the seeds of eventual recovery are already being planted.

Consider housing starts, which have fallen to their lowest level in 50 years. That’s bad news for the near term. It means that spending on construction will fall even more. But it also means that the supply of houses is lagging behind population growth, which will eventually prompt a housing revival.

Or consider the plunge in auto sales. Again, that’s bad news for the near term. But at current sales rates, as the finance blog Calculated Risk points out, it would take about 27 years to replace the existing stock of vehicles. Most cars will be junked long before that, either because they’ve worn out or because they’ve become obsolete, so we’re building up a pent-up demand for cars.

The same story can be told for durable goods and assets throughout the economy: given time, the current slump will end itself, the way slumps did in the 19th century. As I said, this may be your great-great-grandfather’s recession. But recovery may be a long time coming.

The closest 19th-century parallel I can find to the current slump is the recession that followed the Panic of 1873. That recession did eventually end without any government intervention, but it lasted more than five years, and another prolonged recession followed just three years later.

You can see, then, why some Fed officials are so pessimistic.

Let’s be clear: the Obama administration’s policy initiatives will help in this difficult period — especially if the administration bites the bullet and takes over weak banks. But still I wonder: Who’ll stop the pain?

Collins, Cohen and Kristof

February 19, 2009

Ms. Collins, in “The Devil Made Me Do It,” says that lately she is beginning to wonder if, in our current troubled times, being in a Senate — any Senate — actually is hell.  Mr. Cohen, who is still in Tehran, writes about “Reading Khamenei in Tehran.”  He says the central Iranian political fact of recent years has been the reinforcement of Ayatollah Ali Khamenei. How to engage with Iran begins and ends with him.  Mr. Kristof, writing from near the Chad-Sudan border, gives us “Trailing George Clooney,” in which he says that the Darfur conflict has now lasted longer than World War II, and the international community has remained monumentally feckless. Can George Clooney get the world to take action?  Here’s Ms. Collins:

Long, long ago there was a television series, called “Kolchak: The Night Stalker,” about a newspaperman who spent most of his time tracking down demons of the underworld. Since his editor never believed his stories, Kolchak did not get in the paper much. Today, of course, he would be a blogger and have a wide international following although no real source of income.

But I digress. The point here is that in one memorable episode, Kolchak was confronted by a politician who sold his soul to the devil in order to win a seat in the State Senate.

When I first saw this particular program, coyly titled “The Devil’s Platform,” I was covering a real-life State Legislature in Connecticut. My first thought was that accepting eternal damnation in return for a career as a state senator was a little like swapping your house for a pair of socks.

But lately I am beginning to wonder if, in our troubled times, being in a Senate — any Senate — actually is hell. Everybody has seen pictures of the state senators in California, held hostage to a spectacular financial fiasco, sleeping at their desks during the long, long hours of deliberations, which revolve around whether Gov. Arnold Schwarzenegger can get a wealthy Republican broccoli farmer to vote for his budget.

And Washington! Imagine you’re Harry Reid, the majority leader. Every time something important comes up, you’ve got to round up 60 votes. And Reid only has 59. One belongs to someone who is apparently doomed to spend the rest of his life in court in Minnesota, arguing about absentee ballot witness registration.

And another, of course, belongs to Roland Burris, cursed with an inability to come up with a consistent story on whether he tried to raise money for Illinois’ rogue governor before said governor forked over a Senate seat. The other senators resent Burris because he is proof that just about anybody blessed with strong persistence and a weak memory can join their club. Reid should also consider the possibility that Burris has been infected by a mind-altering demon that could, at any moment, convince him that he dwells in a reverse reality where all good senators vote against the White House agenda.

The U.S. Senate’s rules — like those in California — wind up leaving the power in the hands of a very few moderate Republicans. Everybody else just sits around reading their mail — or, in the case of California, napping in the aisles — while one or two members of the minority party tries to decide whether to let the economy fall off a cliff.

The good news is that in Washington, the whole world is now run by Susan Collins and Olympia Snowe, both of Maine. True, not what you had in mind when you spent the last year obsessing about the next president. But way better than California, which is facing a series of end-of-times crises that include insolvency, 200,000 imminent layoffs and a halt to all public construction programs. And for weeks, it has all hung on State Senator Abel Maldonado, the above-mentioned broccoli farmer.

As of last night, Maldonado was holding out for changes in the state election laws that would make it easier for him to get the Republican nomination to run for state controller. (I believe there was once an episode of “Marcus Welby, M.D.” in which a troubled would-be father refused treatment for sterility on the grounds that it would hurt his chances of being elected controller. Back in the day, it was inspiring what high regard TV scriptwriters had for state government.)

Maldonado has always denied that his political ambitions had anything to do with his inability to make up his mind about the budget. Nevertheless, one of his ongoing demands has been to eliminate money for new office furniture for his mortal enemy, the current controller, John Chiang.

The California situation is so dire that everybody in the state appears to have forgotten that their governor is a movie star. Schwarzenegger used to be one of the most famous people on the planet, and now he’s spent months begging members of his own party to throw him three lousy votes so he can keep the Department of Motor Vehicles’ offices open. When Arnold’s ally, the Senate minority leader, revved up the pressure, the Republicans responded by electing a new minority leader.

On the plus side, all those arguments about whether the Constitution should be amended so people born outside the United States could run for president can be put on the back burner.

If the nation’s only action-hero governor is at a loss, clearly new powers are needed. Look up that “Night Stalker” episode on the Web and you will learn that the demon soul-selling senator (Tom Skerritt) got “the ability to assume the form of an indestructible black mastiff, and destroy his enemies both within his own party and opposing him.”

I wonder if Harry Reid has heard about this.

Obviously not.  Harry Reid took the deal where he turns into a prairie dog, turns tail, and dives back down into his burrow at the first sign of any threat…  Here’s Mr. Cohen:

No Iranian puzzle frustrates America and its allies as much as how to reach Ayatollah Ali Khamenei, the supreme leader who sets the country’s direction.

When I asked one veteran Iran hand how old Khamenei is, the answer was: “Not old enough.” Years of probing have failed to unearth a conduit to the man with the white beard and outsized glasses whose image, often smiling, dots the billboards of Tehran. The guy’s a mystery.

Solving it lies at the heart of the Iranian challenge facing President Obama because although Khamenei’s authority is not absolute, his veto power is. He can no more be bypassed than the Great Recession.

Khamenei, imprisoned and tortured under the shah, will be 70 in July. He’s led Iran for two decades, since the death of Ayatollah Ruhollah Khomeini. His vast authority includes the right to name the heads of the elite Republican Guards, the armed forces, the judiciary and state television. He has indirect power to vet parliamentary candidates. Yet he cloaks his absolutism in the mild garb of the arbiter.

Under the system know as “Velayat-e-faqih,” or the guardianship of the religious jurist, an idea developed by Khomeini to justify the clergy assuming political power, Khamenei is virtually assured of ruling for life. Short of the reappearance of the “hidden imam,” not spotted since his disappearance in the 9th century, his earthly deputy presides as custodian of the Islamic Revolution.

To many Iranians, this setup represents the core betrayal of the revolution, whatever the elements of democracy — including a June presidential election — that have emerged around the Constitution’s incorporation of the contested idea of a God-given guide.

To many western officials — enamored or unhappy by turns with various more colorful figures than Khamenei, and casting around for the real center of power in Iran’s labyrinth of the democratic and the deified — the system is equally maddening.

But it’s not about to change. On the contrary, I’d say the central Iranian political phenomenon of recent years has been the reinforcement of Khamenei. How to engage with Iran begins and ends with him.

The notorious wealth of his chief rival, Ali Akbar Hashemi Rafsanjani, has tended to reinforce Khamenei’s pious image. The favoring of the Revolutionary Guards under President Mahmoud Ahmadinejad has strengthened an institution beholden to Khamenei. The reformist wave has ebbed.

More important, his attacks on “the arrogant powers” — read the United States — have been buttressed by the hubris of the Bush administration. His passionate support for the Palestinian cause has resonated, most recently because of the Gaza debacle. Even his attempts to align the Islamic Revolution with the world’s disinherited against U.S. “economic dominance” have been comforted by the travails of global capitalism.

So what does this astute man want? What will he give? Khamenei said last year: “Undoubtedly, the day the relations with America prove beneficial for the Iranian nation, I will be the first one to approve of that.” This suggests dogma does not preclude movement.

Khamenei sees his primary task as safeguarding a revolution whose core values include independence, cultural and scientific self-sufficiency, the global revitalization of Islam as a guiding body of law, and social justice. He believes America demands “submission and surrender to its hegemony.”

Given these convictions, the United States must embark on a visionary change of direction. Obama must assure Khamenei that not only has America abandoned the goal of regime change, it sees Iran as a central player in regional stability. That deals with the independence obsession.

Obama must abandon military threats to Iran’s nuclear program in favor of an approach recognizing the country’s inevitable mastery of the nuclear fuel cycle, while securing verifiable conditions that ensure such mastery is not diverted to bomb manufacturing. That addresses Iran’s intellectual pride (as well as the fact that the neighborhood includes the nuclear-armed powers of Israel, Pakistan and India).

He must redirect U.S. policy toward Israel-Palestine to make Hamas-Fatah reconciliation a core American objective, recognize that the “terrorist” label is an inadequate description of the broad movements that are Hamas and Hezbollah and end the Israel-can-do-no-wrong policy that sabotages a two-state solution. This would allow Khamenei to claim that his demands for Palestinian justice — as the self-styled leader of the world’s Muslims — have been heard.

In return, Iran must accept the two-state solution backed by the Arab League (Khamenei has said “the fate of Palestine should be determined by the Palestinian people”). It must reciprocate American movement on Hamas and Hezbollah by ending its military, but not political, support for them.

It must back U.S. efforts to stabilize Iraq and Afghanistan. It must improve its poor human-rights record. And, to show goodwill, it must hit the pause button on the centrifuges once high-level talks with America begin.

Khamenei is not irrational. Social justice is the fourth pillar of the revolution. He has said, “What Islam pursues is economic development and prosperity for all social strata.” Yet Iran is a profoundly unequal society. With oil prices at around $35 a barrel, that won’t change without creating more wealth in ways that only engagement with the West can bring.

Now here’s Mr. Kristof:

I was going to begin this column with a 13-year-old Chadian boy crippled by a bullet in his left knee, but my hunch is that you might be more interested in hearing about another person on the river bank beside the boy: George Clooney.

Mr. Clooney flew in with me to the little town of Dogdoré, along the border with Darfur, Sudan, to see how the region is faring six years after the Darfur genocide began. Mr. Clooney figured that since cameras follow him everywhere, he might as well redirect some of that spotlight to people who need it more.

It didn’t work perfectly: No paparazzi showed up. But, hey, it has kept you reading at least this far into yet another hand-wringing column about Darfur, hasn’t it?

So I’ll tell you what. You read my columns about Darfur from this trip, and I’ll give you the scoop on every one of Mr. Clooney’s wild romances and motorcycle accidents in this remote nook of Africa. You’ll read it here way before The National Enquirer has it, but only if you wade through paragraphs of genocide.

The Darfur conflict has now lasted longer than World War II, but this year could be a turning point — provided that President Obama shows leadership and that the world backs up the International Criminal Court’s expected arrest warrant for Sudan’s president, Omar Hassan al-Bashir.

The stakes are evident in this little market town of Dogdoré, whose normal population of just a few thousand has swelled to 28,000 desperate, fearful people driven from smaller villages. They don’t think it’s safe here, but they find some reassurance in numbers — and leaving town isn’t an option, either, because flying out from the dirt airstrip is the only way to avoid rampant banditry on the roads.

Aid workers were pulled from Dogdoré in the fall because of violence in the area, leaving people on their own. Aid workers have just returned, but the entire town remains on edge.

One of the first persons we met was Qatri Ibrahim, a young woman who fled her village when the Sudanese janjaweed militia attacked and shot her 5-year-old and 8-year-old sons. “I’m afraid,” she said grimly. “But there are other people here, so I stay.”

In Darfur and eastern Chad, you can randomly approach any group of people and find heartbreaking stories. Mr. Clooney was clowning around with a group of boys bathing in the river — taking their photo and showing it to them digitally — and that’s when we met the 13-year-old boy with the bullet in his knee.

He’s Suleiman Ahsan, and he was wearing a pair of blue shorts — the only clothes he has. He also has a machete scar on his forehead; both it and the bullet date from a janjaweed attack on his village two years ago that killed his father.

Last year, Suleiman joined a militia and became a child soldier to avenge his father. “Recruiters come to the camps looking for boys like me to fight,” Suleiman told us. “Boys of 10 or 12 are old enough.”

Suleiman said that he learned to shoot but found the soldier’s life too grueling, so he deserted. Now he’s back to struggling to find food.

The International Criminal Court’s arrest warrant for President Bashir — widely expected in the coming weeks — has the area particularly on edge, for fear that Mr. Bashir could retaliate by using a proxy force to invade Chad.

The fact that Sudan’s state-sponsored slaughter of civilians goes on, year after year, in and out of Darfur, is a monument to the fecklessness of the international community. A spasm of that same fecklessness intruded on this trip with Mr. Clooney, who is traveling unofficially but is a United Nations goodwill ambassador.

Apparently concerned that Mr. Clooney might say something strongly critical of Mr. Bashir — perhaps come down hard on genocide? — the United Nations called me on Wednesday to say that effective immediately it was pulling Mr. Clooney’s security escort as he traveled these roads along the border. Now that did seem petty and mean-spirited. A Frenchman working for Save the Children was murdered on such roads last year, and the U.N. requires a military escort for its own vehicles here.

If the U.N. is too craven to protect its own goodwill ambassadors — because they might criticize genocide — it’s not surprising that it and the international community fail to protect hundreds of thousands of voiceless Darfuris.

Oh, and now for the juicy truth about all of Mr. Clooney’s wild romances and motorcycle accidents. Darn — out of space. Wait for my next column from this trip on Sunday …


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