We are all glad that the Gadhafi regime is purportedly on its last legs. When I visited Libya in 2006, tragedy was what I saw—and a friendly population under the yoke of a psychopath. But I don’t think we have had much idea of what we were doing in Libya—a sort of diplomatic pastime secondary to presidential jet-setting and golfing. Moreover, I don’t see any hypocrisy in critiquing our confusion over Libya, as a supporter of the removal of Saddam Hussein. Wanting to use American power and influence to its fullest extent when going to war is preferable to not wanting to use all our power and influence when going to war. The hypocrisy is rather on the Left, which once damned the principle of intervention against an Arab Middle East oil-exporting nation that had not recently attacked us, only to support intervention against an Arab Middle East oil exporting nation that had not recently attacked us. In the Left’s defense, one could argue their consistency is that it’s OK if you have a UN vote, but irrelevant whether you have consent of the U.S. Congress.
Saddam Hussein’s Iraq was the object of 23 different Congressional authorizations (one should go back and read that October 2002 long list of “whereas”es), had been in hot and cold wars with us since 1991, attacked four neighbors, and in the heart of the ancient caliphate was hosting all sorts of terrorists. In a post-911 climate it made sense to reckon with him. Indeed, I think one of the great untold stories of Iraq was the carnage of Islamic terrorists who by volition promised that Iraq would be the central theater in jihad, flocked there, were killed and wounded in droves, and lost—and vastly weakened their cause. But in contrast, the West was apparently in the middle of a weird charm offensive with Gadhafi (one advanced by bought-and-paid-for American academics, European oil companies, and multicultural elites), and the result by 2010 was that Libya was considered no longer the 1986 Libya that Reagan had bombed.
Victor Davis Hanson, “The Middle East Mess”, Works and Days, 2011-08-24
August 27, 2011
QotD: Consistency
August 24, 2011
August 23, 2011
Markets hate uncertainty
I’ve often remarked that the economy won’t — can’t — recover as long as governments (the US government in particular) keep messing around with the rules of the game. Amity Shlaes explains why:
One product makes clear exactly how unusual this year’s slide has been, and offers a clue as to why 2011 broke the rules. It’s called the Congressional Effect Fund. Founded by Wall Streeter Eric Singer in 2008, the fund is premised on the idea that equity markets dislike a hostile Washington, tolerate a friendly Washington, but prefer an inactive Washington above all.
It follows that stock-market rallies would come most often when Congress is idled — in recess, at home, in the districts. From 1965 until early this summer, the Standard & Poor’s 500 Index, Singer’s proxy for stocks, rose 17 percent while Congress was out of session versus only 0.9 percent while Congress was working in Washington.
In one study, four scholars took a step back to look at a century of returns — from 1897, just after the Dow Jones Industrial Average was founded, to 1997 — and found that average daily returns when Congress was out of session were almost 13 times higher than when it was in. Their explanation: “Perhaps the market enjoys the temporary certainty exhibited by the absence of Congressional decisions.”
Singer is blunter. About Washington’s impact on the economy, he says simply: “Congress subtracts value.”
The regulators are still on the job, but the legislators appear to be the ones causing the greater degree of uncertainty — and thereby limiting market opportunities. Nice work, government.
