Call Him Mr. President

His To Lose: Call him Mr. Lucky. Call him Mr. Opportunity. Call him Mr. Cool. Call him Mr. Smart. Get used to the idea of calling him Mr. President. The political deck is stacked in favor of Barack Obama winning the presidential election. Obama is dealt a winning hand on so many political measuring rods only a bolt of lightening in the form of a major terrorist attack on our cities could change the landscape. Thirty days before a general election is an eternity in political years. A month out, only Ronald Reagan charged from behind and won going away. John McCain is not Ronald Reagan. Although a Reagan disciple, McCain lacks the charisma and charm of the Great Communicator. The struggling economy is the foremost topic in voters' minds. They are angry at the Republican administration for betraying them. No matter how hard McCain tries, Democrats believe he cannot distance himself from Mr. Bush and his administration's failed policies and deceptions of the past eight years. Obama from the birth of his candidacy in February 2006 has hammered away for change in Washington, nullifying lobbyists and transforming into a bottom-up people powered pipeline. It was vague enough where people could read into it anything they so desired. Fact is the change message was nothing more than the oldest ever political slogan -- Throw the Rascals Out. During the campaign, Obama has managed to fill in the holes of his blank resume. His biggest gap was experience. He's demonstrated enough knowledge on foreign policy issues to mildly comfort and close that margin somewhat. His domestic agenda is populist liberal and highly suspect how to pay for it. But, it sounds good and positive perceptions usually trump. Obama offers hope whatever that might be. McCain offers tried conservative principles unfortunately violated by excessive spending and corruption in the ranks of government elected and appointed officials that spread to executives in the financial markets. It's turned into an election for Obama to lose and the Democratic Party is remarkably adept at that.
The dynamics: The Obama campaign has demonstrated phenomenal success raising records amount of money, primarily tapping small donations from people through the Internet. They spent the money wisely, first through TV ads portraying his remarkable rise to prominence for voters who never heard of him. Then they targeted key battleground media markets with ads that countered the onslaught of opposition ads. The financing helped create an effective support group of volunteers and staff in all 50 states. They were better organized, smarter, outnumbered and outworked their opposition, first the Hillary Clinton campaign and now the McCain troops. To inflate his base, Obama spearheaded a voter registration drive bringing a few million new voters into the process. Registered Democrat Party voters now exceed the Republicans in the vast majority of states. Obama's success Nov. 4 rides on how skillful his campaign can get the new enrollees to the polls. The luck factor? Just look at Ohio, the swing state in so many elections past the Democrats narrowly lost. The Ohio Supreme Court upheld its Secretary of State's interpretation allowing same day registration and voting. This allows Obama to tap into his second strongest constituency, college students who notoriously are enthusiastic but seldom vote. There are 24 college campuses in Ohio with Obama expected to make a clean sweep. The latest polls indicate Obama leading or tied in the three largest swing states -- Ohio, Florida and Pennsylvania. If he wins two of the three, he wins the election. These trends reflect a pattern difficult to turn around this late stage of the game. McCain is a touchdown behind with time running out and already thrown two hail Mary passes from his maverick arsenal. The last dynamic that needs to be addressed is the racial prejudice card among older white voters. The Yahoo/Ipsis Poll conducted by Stanford University researchers recently concluded that 6% of white voters would not vote for Obama because of cultural negatives they harbor against blacks. That's a significant handicap despite all the political negatives McCain must overcome. What's disconcerting is older whites outnumber Obama's base coalition of blacks, youth and the affluent by a comfortable margin and tend to vote in greater percentages. Not for Obama's sake but for America's, let racism turn into an ostrich and hide its head in the ground.
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The Public Will Get It in Due Course

Time Machine: As Congress and the Bush administration regroups to package a bailout formula to rescue the financial markets, a trickle down malaise will suffocate the life blood of Joe Six Pack and his bosses. Credit. Consider the following analogy. While living in Oregon I experienced the second largest flooding in recorded history of the mighty Rogue River. The middle channel raged turbulently tossing logs like toothpicks and crushing anything that stood in its path. Liken that to the pressures now placed on the stressed out financial markets gasping for air. On higher ground as the river rose the water inched forward lapping menacingly yet tranquilly forging its onward path. Eventually the flood is a foot deep on high ground. First, the home's flooring is inundated with water and later cars are submerged. The destruction continues until the river crests. Liken that to the effect the market's collapse will make its way on Main Street. Most economists agree the credit crunch already crippling the large financial institutions will creep downstream. Credit will remain available for consumers who pay their bills on time but will find it more expensive and extensions less available. High risk consumers will be denied home, auto, school and other personal loans of which they have become enamored with the past 10 years of easy credit. Small and mid-sized businesses will suffer from the credit crunch, especially those who borrow money to meet payroll in order to maintain adequate cash flow. Layoffs could occur, increasing unemployment prospects. Some companies such as McDonald's franchises in the South already have been unable to borrow on credit to stock inventory. Businesses which borrow for the holiday season could be forced to retrench. Up to now, the public suffering from the market crises are those whose home values have decreased as much as 25% in the past two years and investors holding retirement accounts which dropped by a third in the past two weeks.

Gutless Politicians: The 228-208 House vote rejecting the bailout was absent of profiles in courage. Two-thirds of the Democratic caucuses voted in favor and one-third of the Republican conference voted for it. Only five voted aye against their district's constituency's wishes vehemently against the bailout plan. In all other cases, the House members in tight Congressional races in November voted against it. Instead, they looked at the polls: 73% saying the government is on the wrong track, 65% disapproved of Bush's performance, 73% of the job Congress is doing, while 19% have a "lot of confidence" in the government, 11% in corporate America and 10% in the financial industry. The vote reflects a lack of leadership not only of Bush and Republican leaders but also the presidential candidates Barack Obama and John McCain. Obama, who favors the bailout plan as a necessary evil, has remained on the sidelines. McCain tried to muscle bipartisan support but failed. Democrats are not blameless at the top. House Speaker Nancy Pelosi blabbed partisanship in a speech to House members prior to Monday's vote. Bad timing and dumb strategy. Congress is all politics and the blame game after the House vote was pedantic. Republicans demonstrated a startling lack of leadership. Enough Democrats refused to carry Bush's water bucket. Joe Six Pack will suffer the consequences as the financial meltdown festers. Crafting a new bailout plan will be tricky and, worse, time consuming. Almost as bad as doing nothing, the Democrats have enough votes to carry the bailout on their own terms by overloading too many goodies into the system which could comeback and bite them on the butt.

Public Doesn't Get It

Failure To Communicate: Reading email responses of Americans opposed and fearful of the government's $700 billion bailout plan for the financial markets indicates they don't understand that the alternative of doing nothing is guaranteed calamity. All they understand is the government making them liable to save the ones who created the mess. "I had to pull my 401(k) to make ends meet," said a "pissed off" New Mexico woman who was among 2,000 who responded to an NBC survey. "Because of greed and corruption it has come to this," said a woman, 70, who said she has to continue working to survive. Many questioned whether the bailout plan would help the middle class. Pardon the pun, but Joe Six Pack is forced to cram for a crash course in capitalism. The dynamics of our financial markets are so complex even Nobel Laureate economists are hard pressed to explain them. And that is part of the problem. Treasury Secretary Henry Paulson is a superb negotiator as he has proven in the bailout deliberations with Congress but he has failed to articulate his case to the American public. It has been a flaw in the Bush administration since taking office in 2001. This failure to articulate fed into a credibility gap where little the administration says is believable in the public mindset. You can't blame the public's skepticism in this case. Unfortunately, there's too much evidence that drastic measures must be taken to avoid a worldwide depression. The Paulson plan, now a bill being debated in Congress, is a gamble to restore confidence in the market system and allow resumption of credit for individuals and businesses. Either that or deja vu of the late 1920s.
Lighting the Christmas Tree: The bailout bill has so many protections for taxpayers and oversight conditions on Treasury and the failed bank and money market institutions that one wonders if they don't trip over each other and impede the Treasury from carrying out out its mission. Caps and penalties were placed on executive golden parachutes for those companies participating in the federal bailout. But the plans to help homeowners struggling to make mortgage payments is incredibly iffy. The government will buy only the worst mortgage assets, leaving more valued ones in the pool for banks to worry about. Previous legislation and the White House's Hope Now Alliance aimed towards lenders voluntarily readjusting mortgages to lower rates has failed while mortgage foreclosures increased to 9%. Treasury officials hope they can leverage the recalcitrant lenders into submission. Good luck.
My Take: Approve the bailout plan and keep your fingers crossed. We live in a credit/debit card society. One wonders after the dust settles if it will become more cash and carry. Main Street must remain patient. This is no overnight fix.

Tale of Two Halves: My Chargers are giving me ulcers. Spotting the Oakland Raiders 15 points in the first half, San Diego rallied slowly in the third quarter and scored 25 in the fourth to win going away 28-18. With the season at the quarter pole their record at 2-2 remains both telling and teasing. Telling because they remain inconsistent performing on all cylinders for an entire game. Teasing because each game shows positive adjustments of just how much they can achieve with all that talent and depth chart. It's tough to swallow Buffalo and Tennessee remain undefeated in the American Conference.

And The Debate Winner Is ...

Point Counterpoint: Presidential debates are viewed in the eye of the beholder and Friday night's first face-to-face scrimmage between Barack Obama and John McCain was just that. Neither won or lost among those both candidates were addressing: The Undecided. The debate's tone was mostly cordial. There were no major gaffes or defining moments. McCain emerged as the cagey bantam rooster scarred but unscathed from years in the political ring. Obama was the young upstart confidently flapping his political feathers. Both candidates were too crafty to be pinned down on whether they supported bailout plans to rescue the financial markets now being negotiated in Congress. Nor would they commit to cutting pet domestic programs they have promoted during this campaign marathon. McCain said he would consider a spending freeze on all programs except national security and entitlements. Obama said he may have to reconsider priorities of his targeted projects. McCain repeatedly described his opponent as naive and inexperienced. Obama argued McCain was an extension of failed domestic and foreign policies he consistently supported the last eight years of the Bush administration. When the debate shifted to its main theme of foreign policy, McCain came out swinging. He was right supporting the surge in Iraq. Obama said he was wrong supporting the Iraq invasion. McCain said political success in Iraq will stabilize relations in the Middle East. Obama said the real fight against terrorism is in Afghanistan and its Pakistan borders. Six times during the debate McCain referred to Obama as too inexperienced to become commander-in-chief. "He just doesn't understand," McCain said four times. On foreign policy questions, Obama said "I agree with John" three times and then added his own nuances. Neither candidate addressed the cost of the two wars in terms of how the next president would pay for it because of the economic strain at home. China now owns $519 billion in U.S. Treasury notes, about 20% of the $2.67 trillion owned by foreign investors.
Post Debate: The three cable networks treated the debate as sportscasters and commentators critiquing the Super Bowl. It was shameful how Fox ballyhooed McCain's performance and MSNBC drooled over Obama's presidential bearing on the commander-in-chief perception. It was left to CNN to provide some clinical insight. During the debate, the bottom of the CNN telecast showed red, blue and green lines how Republicans, Democrats and independents were reacting to the debaters. After the debate, CNN produced a series of polls taken throughout the country. In general, the polls showed Obama even with McCain on foreign policy and dramatically ahead on domestic issues. One poll of 30 undecided voters had six saying they were now committed. The consensus: the debate moved few voters and the race remains as tight as ever although acknowledging events of the past week have given Obama a temporary slight advantage. Here's my take: Obama said nothing that would dissuade me his ability to become a strong, vibrant commander-in-chief; as a Democrat who voted for Obama in the California primary, I subscribe to his basic approach addressing domestic issues. What concerns me is his lack of specifics how to pay for them. I oppose his windfall tax proposal on Big Oil and do not believe more than marginal tax increases would help the economy at this time of economic turmoil. I also oppose Obama's suggestion of taking borrowed money now financing the Iraq and Afghanistan wars and spending it on rebuilding the nation's infrastructure. There must be cuts and savings elsewhere that Obama has yet to convince anyone they are forthcoming.
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A House Divided

Ideological Impasse: Conservative House Republicans are imposing their ideological dogmas to kill the government's plan to rescue the financial markets. With the blessing of Republican Minority Leader John Boehner, House conservatives are proposing an alternative plan in which private investors would receive tax cuts while paying the Treasury to insure loans to purchase the toxic mortgages that have caused the credit freeze. Democrats earlier had won concessions from Treasury Secretary Henry Paulson for more oversight, taxpayer protection, help to homeowners from mortgage foreclosure, capping executive bailout golden parachutes and phasing in of $700 billion to purchase the securities considered worthless by banks. Both plans would sell the mortgages when the housing market stabilized with the hope they could turn profits for the holders whether private or government held. Both plans are designed to thaw the credit freeze and encourage banks to resume lending to businesses and consumers who are the linchpins of growing the economy. There is no guarantee either plan would work although both sides agree fast action is required. At the heart of the House Republican conservatives' approach is a disdain for government essentially nationalizing segments of the financial markets and spreading socialistic policies similar to what France undertook in the 1970s. Their fortitude is backed by a growing Main Street backlash to the Paulson Plan by irate taxpayers.
Political Spin: Republican presidential candidate John McCain suspended his campaign and returned to Washington Thursday with aspirations to broker a deal providing his leadership and country-first ideals. Why it took him six days in a week in which he contradicted himself daily is open to conjecture. Once he entered the stage, Republican leadership gave him a cool reception and the Democrats tried to render him irrelevant. Democratic chief financial negotiators Rep. Barney Frank and Sen. Chris Dodd along with Republican Sen. Bob Bennett announced a tentative agreement with Paulson and Fed Chairman Ben Bernanke. McCain's presence provided cover for the rebelling House conservatives although he sidestepped endorsing either plan publicly. Suddenly, it was clear the Paulson compromise would not pass a House vote and the Republicans would kill their own party administration's rescue efforts. Politically, McCain locked himself in a box. He could oppose his president and support the conservative base of his party or he could approve the Paulson compromise with his own adjustments and face the wrath of his hard core constituency. No deal becomes McCain's executioner. So could a deal in which he was on the losing side. Even if he succeeds in brokering a deal, the outcome unravelling in the markets would not be clear until well after the Nov. 4 election. McCain's POW wounds might prevent him from raising his arms high enough to comb his hair, but he certainly is facile enough to throw the mother of all hail Marys.

Go Beavs: I sat there not believing what I was seeing. Oregon State was systematically demolishing No. 1 ranked USC with a 5-foot-9 freshman running back who darted, squirmed and wiggled his way through the best defense in college football. Jacquizz Rodgers accomplished in one night what David did to the Philistines by slaying Goliath. I commented previously that the only team to beat USC this season was themselves. True enough, penalties, a key fumble turnover and two interceptions contributed to the Trojans loss. But that in no way shortchanges the Beavers for controlling both sides of the line of scrimmage, outplaying and outcoaching the vaunted USC team with the best, deepest and most athletic talent in the NCAA. Rodgers in 26 carries ran for 168 yards and two touchdowns. Hindsight is 20-20 but this upset was always a possibility. Call it a resurrection of ghosts past. In 1967, Oregon State defeated an O.J. Simpson national championship team 3-0 in the Corvallis mud. Two years ago the Beavers knocked off USC at home depriving the Trojans a chance to play in the BCS championship game. In Oregon, fans cling to these rare instances of stardom for national championships in football are beyond reality even they acknowledge. I know. I lived in Oregon for 12 years and suffered the ups and downs of Beaver fortunes as well as their arch rival down state Oregon Ducks. Meanwhile, even if USC runs the table against Pac10 opponents the remainder of the season, their prospects of playing in the BCS finals are slim to none. The top 10 ranked teams are dominated by schools in the toughest of all conferences, the South East Conference and the Midwest's Big 12.
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Congress Twiddles While Wall Street Burns

Paulson's Panic: It is unfair but true Treasury Secretary Henry Paulson panicked when he realized the global economy was tanking as a result of the U.S. financial mortgage market bubble burst. His panacea is to use the full faith and credit of the U.S. government to buy the toxic bundled securities in an effort to unlock the credit freeze encouraging banks to lend to corporations and consumers so normal business can resume. The concept is the federal government coming to the rescue like the cavalry does in Western movies. The motive is to instill confidence in our financial systems and confidence at this stage of the crises is an essential psychological player in our complex economic system. Paulson's problem is a roll of the dice with no assurances his plan will work. Through no fault of his own, Paulson represents an administration which lacks credibility that began in 2002 when it told us we faced nuclear attack if we didn't invade Iraq pre-emptively. Despite misgivings, Paulson does have support in Congress to act immediately. It's a drill of working out the kinks in a bipartisan game of one-upmanship in efforts to get it done fast but right. Billionaire investor Warren Buffet added credence to Paulson's plan Wednesday by announcing he would spend $5 billion to purchase preferred stock from Goldman Sachs. For the government and private investors such as himself to do nothing, Buffet said the nation would suffer an economic disaster of "Pearl Harbor consequences."



Cautious Consequences: Newsweek's Robert J. Samuelson points out banks and hedge funds are de-leveraging to sell securities to gain better cash advantage, a symptom of a financial crises. But the heavy selling reduces prices. Lower prices deplete capital and production which in turn prompts more selling and heightens fear. At best, the Paulson plan may stall this spiral by unloading their least attractive securities. But it wouldn't automatically stimulate new lending, revitalize "securitization" or prevent more de-leveraging. The rescue is being constructed so quickly it may include flawed provisions only the passage of time will tell. If Congress continues to dawdle, Paulson's panic would be realized.

Health Coverage Boondoggle: Here's another personal example why health costs escalate unabated. Three years ago my pulmonary doctor authorized Medicare and Medi-Cal to purchase a CPAP, a breathing devise designed for patients suffering from sleep apnea. Coram, the Rancho Bernado, Calif., provider was responsible, helpful and efficient replacing and improving parts attached to the breathing machine. Several months ago the company was acquired by a large provider of pulmonary devises and its equipment distribution service turned over to one of its subsidiaries. In the meantime, I switched coverage to the HMO Health Net as the primary payer. Dialing the new guys on the block, I was told in no uncertain terms the only way I could receive the requested part was to have my primary physician fax them 1) the exact product description, 2) a copy of the original sleep apnea diagnosis, 3) the doctor's reason for the need for the part, 4) pre-authorization from Health Net and 5) the primary care physician's personal updated clinical evaluation of my condition. Fact is, my doctor has none of those records other than my word I use a CPAP. It occurred under my previous health coverage in San Diego before I moved to Temecula. I asked the new provider if I could pay cash for the part. Absolutely not. I needed doctor's approval. This irreplaceable part so crucial and protected by the new provider is none other than a simple air filter, a small swatch of clothe. The provider charges the insurance carrier $15 for a package of two. Having no part of this nonsense, I called my pharmacy and told him my story. He checked his order catalogue, found the filter and sent it to me shipping free. The retail cost: $4.95. There is no doubt the bureaucracy of the health providers contributes to price escalation of the system. In this case triples the retail cost. Multiply that example by the millions of similar cases. It adds up in a hurry.
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Bitterness on Main Street

Blank Check: Under the $700 billion bailout plan to save the financial markets and unfreeze credit strangulation, the Bush Administration is granting monarchical powers to one man. Treasury Secretary Henry Paulson in consultation with Fed Chairman Ben Bernanke will decide which companies bad debts will be bought and which not. They both testified Tuesday before a Senate banking committee and demanded Congressional approval by the end of the week. Enactment would restore confidence in a broken system caused by lax regulation and manipulative and corrupt accounting practices. At the moment, that's more important than the cloudy, broad details the administration so far has set forth. Bernanke said failure to act would lead to a recession and plunge more homeowners into foreclosures and unemployment. The plan is drawing bipartisan criticism. Democrats want greater regulatory reform, help to homeowners before they default on mortgage repayment and limits on executive buyout compensation. Sen. Richard Shelby, the ranking Republican on the Senate Banking Committee, said he opposed federal bailouts of corporations and individuals and there were no credible assurances the Paulson plan would work and end up costing taxpayers trillions of dollars. "Just because God created the world in seven days doesn't mean we have to pass this bill in seven days," said Rep. Joe Barton, R-Texas. Paulson has argued the plan be accepted now and tinker with its mechanics later.

Campaign Crossroads: Both Obama and McCain have pledged to support the bailout plan and offered their own proposals. Obama said restructuring how the government awards contracts could save $40 billion. McCain proposes a blue-ribbon oversight panel to monitor the Treasury Secretary's carte blanche decisions. Fact is, both presidential candidates are on the outside looking in with the winner of the election inheriting the fiscal mess that will alter their domestic spending agendas advocated on the campaign trails. The mood on Main Street is angry and righteous. The cost of the bailout in its current stage is about $2,500 per taxpayer. They have no say in the process other than taking out their vengeance on all the candidates on the Nov. 4 election ballot.

A Win Is a Win: After two opening season losses, my Chargers manhandled the New York Jets on Monday Night Football to bring their record to 1-2. Of course, the East Coast media focused the pre-game hype on future Hall of Famer Brett Favre still constrained learning his new team's offense. The game reminded them that the San Diego quarterback is a fast rising star in his own right quickly ascending to among the league's elite. Philip Rivers dominated the offense despite malingering toe injuries to two teammate stars in running back LaDamian Tomlinson and tight end Antonio Gates. The defense was more successful and aggressive than the first two games but still allows too many yards and points. In this game, the Charger special teams, usually stingy, was Swiss cheese. It's a long season with 13 games remaining and with all that talent and depth they still should make the playoffs. It's a weird year in that Buffalo, Denver, Baltimore and Tennessee remain undefeated in the American Conference while previous contenders Indianapolis and New England are crippled with injuries.