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Health care reform seems to me like it ought to be a major priority in an economic downturn, since it’s one of the major inefficiencies sapping the economy of vigor. Not doing so is an example of “eating your seed corn,” in that because you feel like you can’t afford to invest in something important, you end up prolonging really bad policies that eat up funds that always seem to add up to the same amount you lacked to finance the reform. The federal government is not like me — when I’m poor I can’t afford the economy size because I have no mechanisms for borrowing money. But the US government can always afford it, and should never avoid a good long-term economic investment on the grounds that it will cost to much in the short run.

And maybe health-care reform will pay off sooner than we think.

Just imagine where we’d be as a competitive world economy if Hillary Clinton’s health-care plan (or something like it) had passed 17 years ago.

Depressing.

I took advantage of the nice warm weather yesterday afternoon/evening to run some errands. I went via PATH train to Christopher Street to pick up some, ahem, adult supplies, and then on the way back stopped at Pavonia/Newport to go to Home Depot to pick up some light bulbs (long overdue).

Now, yes, it was Halloween. Yes, it was a Friday. Yes, it was nice and warm. But what I saw was swarms of people on their way to the Halloween Parade in the Village, and a mall swarming with people who appeared to be shopping (they were going in and out of the shops, not just wandering through the mall, like I was). Home Depot wasn’t so busy, but it rarely is.

On another note, pace Matthew Yglesias, somebody really wasn’t planning very well when they designed the area around the mall. Yes, it’s right next to the Holland Tunnel, which is an obvious epicenter of car culture, but the walk from the light rail station (or from the PATH station) to Home Depot is fraught with perils, especially crossing the wide street that is the entrance to the tool booths for the tunnel. And then the Home Depot itself! Ack! Designed entirely for drive-up customers, with no consideration whatsoever for pedestrians.

Worse still was a place on the sidewalk I encountered on the way back. The sign that had the button attached for requesting the walk light was placed directly across the sidewalk, blocking it, so that if you wanted to walk past the sign (90 degrees from the direction you’d be crossing the street), you had to step INTO THE STREET!

I usually can’t abide David Brooks’s columns, but on the train home tonight, I got around to reading yesterday’s column. I was thinking “Wow! This is one of the best columns of his I’ve ever read! I haven’t gotten pissed off at his stupidity even once!”

Right up until the last paragraph:

Until these and other issues are addressed, the global markets will lack confidence in asset values. Bankers will cower, afraid to lend. America’s role as the global hub will be threatened. Europeans will drift toward nationalization. Neomercantilists will fill the vacuum.

This is the test. This is the problem that will consume the next president. Meanwhile, the two candidates for that office are talking about Bill Ayers and Charles Keating.

Indeed, he had me with him right up through his last sentence, and then he has to go and ruin it. The fact is, comparing Bill Ayres and Charles Keating as Brooks does is a false equivalency. One is a casual acquaintance of the candidate, while the other was the prime mover behind pushing the other candidate onto the national stage.

Worse still, if McCain weren’t talking about Ayers, Obama wouldn’t need to be pointing out McCain’s association with Keating as a way of showing how hypocritcal and dishonest McCain is.

This is what happens all the time among the elite punditocracy — they can’t seem to bring themselves to come out and state the obvious:

One candidate is a disaster, a dishonest and dishonorable man who has taken his campaign into the gutter. And that candidate is John McCain.

Details of the summit at the White House on Thursday with Bush, McCain, Obama and Senate and House leaders continue to trickle out. For me, a key point from the Washington Post’s illuminating article on the topic is this:

Pelosi said Obama would speak for the Democrats. Though later he would pepper Paulson with questions, according to a Republican in the room, his initial point was brief: “We’ve got to get something done.”

Bush turned to McCain, who joked, “The longer I am around here, the more I respect seniority.” McCain then turned to Boehner and Senate Minority Leader Mitch McConnell (R-Ky.) to speak first.

Boehner was blunt. The plan Paulson laid out would not win the support of the vast majority of House Republicans. It had been improved on the edges, with an oversight board and caps on the compensation of participating executives. But it had to be changed at the core. He did not mention the insurance alternative, but Democrats did. Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, pressed Boehner hard, asking him if he really intended to scrap the deal and start again.

No, Boehner replied, he just wanted his members to have a voice. Obama then jumped in to turn the question on his rival: “What do you think of the [insurance] plan, John?” he asked repeatedly. McCain did not answer.

One Republican in the room said it was clear that the Democrats came into the meeting with a “game plan” aimed at forcing McCain to choose between the administration and House Republicans. “They had taken McCain’s request for a meeting and trumped it,” said this source.

This sounds to me as though Obama is a political genius, either because he was well-advised by Pelosi and Reid, or because he knew the right thing to do, but either way, he stuck to McCain and showed him up. That’s impolite, but it’s hard-ball politics, and I’m glad to see that behind closed doors, Obama is not averse to being impolite.

And there was no way he believed it wouldn’t get out, so he’s also sending a message to potential political opponents: you’re not dealing with a timid novice here, but with someone who knows how to capitalize on a political opportunity to skewer his political opponents.

Kudos to Obama!

With all this talk about the financial crisis, I can’t help but wonder how stupid the people running these firms really are. Couldn’t they tell that the mortgages and investments that have gone bad were bad ideas in the first place?

Take the so-called “liar loans,” where there was no effort to verify income of potential borrowers, and borrowers were encouraged to inflate their income so that they’d be able to get bigger mortgates (and, hence, bigger houses). Why did anyone think it was a good idea to disconnect the mortgage from a realistic assessment of the borrower’s ability to pay?

Of course, it’s not like this tendency in lenders is new. In 1987 I bought a used car (with an insurance settlement to replace an old beater that was stolen), and I had to fight with the car dealer over the price I was willing to spend. I had so much money from the insurance settlement, and wanted to pay a certain amount per month in car payment and no more. But the dealer kept arguing with me, saying my income would allow me to afford a lot more car (with a much longer loan period and a higher monthly payment). I kept insisting that I didn’t *want* to pay more. This was met with a blank stare, something the salesman couldn’t seem to comprehend. I eventually got exactly what I asked for, and a $110/month car payment (I think it was a 2-year loan period, but can’t recall for certain).

Why would any sensibly-run lender want to loan not just more than what the borrower wants, but more than the borrower’s income justifies? Is that not just a really bad business decision?

This is why it annoys me that the government seems to be stepping in to buy the bad investments, and so many commentators seem so willing to say “there’s enough blame to go around for everybody.” No, there *isn’t* — if the lenders had followed good business practices, none of this would have happened. They didn’t and now the whiny-assed titty babies want to be rescued from their bad judgement.

It pisses me off a lot, especially given that the same people championing the bailout (I mean *you*, John McCain) were perfectly happy last Spring to tell the borrowers that they didn’t deserve a bailout themselves because they’d made bad decisions in taking out these mortgages.