The NYT’s Friedman:

Until we fully understand what turned two brothers who allegedly perpetrated the Boston Marathon bombings into murderers, it is hard to make any policy recommendation other than this: We need to redouble our efforts to make America stronger…the best place to start is with a carbon tax. A phased-in carbon tax of $20 to $25 a ton could raise around $1 trillion over 10 years, as we each pay a few more dimes and quarters for every gallon of gasoline…It’s the only way to revive the country and a moribund Republican Party.

Imagine the nonsense you have to believe in order to write the words above. But then again, “to be in Tahrir Square tonight, to feel the energy and pride of a people taking back the keys to their country and their future from a tired old dictator, was a privilege.” QED.

Economist:

Over the past 15 years air temperatures at the Earth’s surface have been flat while greenhouse-gas emissions have continued to soar. The world added roughly 100 billion tonnes of carbon to the atmosphere between 2000 and 2010. That is about a quarter of all the CO₂ put there by humanity since 1750…An unpublished report by the Research Council of Norway, a government-funded body, which was compiled by a team led by Terje Berntsen of the University of Oslo, uses a different method from the IPCC’s. It concludes there is a 90% probability that doubling CO₂ emissions will increase temperatures by only 1.2-2.9°C, with the most likely figure being 1.9°C. The top of the study’s range is well below the IPCC’s upper estimates of likely sensitivity. This study has not been peer-reviewed; it may be unreliable. But its projections are not unique. Work by Julia Hargreaves of the Research Institute for Global Change in Yokohama, which was published in 2012, suggests a 90% chance of the actual change being in the range of 0.5-4.0°C, with a mean of 2.3°C. This is based on the way the climate behaved about 20,000 years ago, at the peak of the last ice age, a period when carbon-dioxide concentrations leapt. Nic Lewis, an independent climate scientist, got an even lower range in a study accepted for publication: 1.0-3.0°C, with a mean of 1.6°C. His calculations reanalysed work cited by the IPCC and took account of more recent temperature data. In all these calculations, the chances of climate sensitivity above 4.5°C become vanishingly small. If such estimates were right, they would require revisions to the science of climate change

Common sense seems to be clawing its way towards the surface when things like this appear in the Economist.

Watt:

“Global temperature…has risen from near the coldest to the warmest levels of the Holocene within the past century” is not true. The coldest part of the Little Ice Age occurred about 400 years ago, during the Maunder Minimum, so right off the bat, their conclusion is flawed. They appear to be unaware of the cyclic nature of temperature change and use the low point of the 1880-1915 cool period as their starting point for assessing the rate of warming over the “past century,” rather than 1913-2013. Comparing the depth of cooling in a cool period with a warm period peak is comparing apples and oranges. It distorts the real rate, which should be measured from cool peak to cool peak or warm peak to warm peak. The 1880-1915 cool period was followed by the 1915-1945 warm period, the 1945-1977 cool period, and the 1978-1998 warm period. The rate of warming from 1913 to 2013 is about 0.7°C per century (which is about the same as the warming rate over the past 400 years as we have been thawing out of the Little Ice, long before atmospheric CO2 began to rise significantly).

The so-called elites believe in some things as ardently as the Aztecs and Incas did in now-unfashionable gods. They believe in these falsehoods for a lot of reasons, but one reason is that it confirms their being the apotheosis of human wisdom, a task made all the easier because technological progress reinforces their views that certain trends are profound and irreversible, and therefore they stand at the peak of humanity and wisdom. (The other reason is money of course.) And Oh how fashionable are their beliefs. Hubris. Pride goeth before the fall. It is stunning to watch the decline of skepticism among those whose North Star should be skepticism. This can’t end well. HT: PL

The head of emerging markets at Morgan Stanley Investment Management:

To keep China’s economy growing, panicked officials launched a half-trillion-dollar stimulus and ordered banks to fund a new wave of investment. Investment has risen as a share of gross domestic product to 48% — a record for any large country — from 43%…the amount of new credit generated annually has more than quadrupled to $2.75 trillion in the 12 months through January this year. Last year, roughly half of the new loans came from the “shadow banking system,” private lenders and credit suppliers outside formal lending channels. These outfits lend to borrowers — often local governments pushing increasingly low-quality infrastructure projects — who have run into trouble…

China’s total public and private debt has exploded to more than 200% of GDP — an unprecedented level for any developing country…if private debt as a share of GDP accelerates to a level 6% higher than its trend over the previous decade, the acceleration is an early warning of serious financial distress. In China, private debt as a share of GDP is now 12% above its previous trend, and above the peak levels seen before credit crises hit Japan in 1989, Korea in 1997, the U.S. in 2007 and Spain in 2008…

if private credit grows faster than the economy for three to five years, the increasing ratio of private credit to GDP usually signals financial distress. In China, private credit has been growing much faster than the economy since 2008, and the ratio of private credit to GDP has risen by 50 percentage points to 180%, an increase similar to what the U.S. and Japan witnessed before their most recent financial woes…

Alan Taylor examined the 79 major financial crises in advanced economies over the past 140 years and found that they are just as likely in countries that rely on domestic savings and owe little to foreign creditors. The bulls also argue that China can afford to write off bad debts because it sits on more than $3 trillion in foreign-exchange reserves as well as huge domestic savings. However, while some other Asian nations with high savings and few foreign liabilities did avoid bank crises following credit booms, they nonetheless saw economic growth slow sharply…

Japan used its vast financial resources to put troubled lenders on life support. Debt clogged the system and productivity declined. Once the increase in credit peaked, growth fell sharply over the next five years: to 3% from 8% in the 1970s and to 1% from 4% in the 1980s…

Through 2007, creating a dollar of economic growth in China required just over a dollar of debt. Since then it has taken three dollars of debt to generate a dollar of growth. This is what you normally see in the late stages of a credit binge

China’s credit binge seems rather similar to what the Fed has done with six years of QE. What happens when China’s borrowers can’t repay their loans and the bond market becomes less accommodating of Treasury bonds?

What’s happening in this nondescript building in Shanghai?

Mandiant released a much-anticipated report Tuesday morning, offering the most detailed look to date inside the Chinese People Liberation Army’s direct involvement in hacking into American government and corporate websites. The PLA Unit 61398 is identified by the report as the most prolific hacking group inside the Chinese government. Dedicated to infiltrating English-language sites, the unit recruits English-language proficient speakers and experts in computer security, but otherwise scrubs any mention of its organization from Chinese-language websites. Operating out of a 12-story, 130,663 square foot facility in the Pudong New Area sector of Shanghai, its building is able to contain as many as 2,000 personnel. Special high capacity fiber-optics were installed by China Telecom when the building was constructed in 2007 and the outfit utilizes over 1,000 servers. In this three-year investigation, Mandiant documented Unit 61398 hacking into 141 companies (including 115 in the U.S.) across 20 industries, and stealing many terabytes of compressed data in sustained attacks averaging 356 days. The longest persistent attack documented by Mandiant lasted 4 years and 10 months. The largest recorded theft was 6.5 terabytes from a single company over 10 months. These attacks were just a small number of the total conducted by Unit 61398 and were conducted by individual hackers with online personas such as “Ugly Gorilla”

This has been going on for many years now, and so many of the details appear to be in the public domain. Wonder what we’re doing about it.

Globe and Mail:

here are four reasons Chinese growth may be better than expected — from an unlikely source: Ian Russell, president of the Investment Industry Association of Canada. Mr. Russell took some notes from the recent Asian Financial Forum in Hong Kong, where he says delegates “were probably surprised” by the many presentations “pointing to an optimistic near-term outlook.”

Reason 1: Fears that China’s export sector will sputter due to a loss of competitiveness and rising labour costs are overblown. Sure, some lower paying work may migrate to poorer countries in Asia, but China is starting to move into more profitable, higher value-added manufacturing that requires skilled and more pricey labour.

Reason 2: A growing middle class numbering 300 to 400 million people will trigger substantial consumer and investment spending. A knock against China has always been that its economy is overly dependent on exports and investment. But China is changing quickly and growth is about to be boosted by the needs of its increasingly wealthy middle class.

Reason 3: China tightened the monetary spigots because of worries about inflation. But prices seem to be under control and the housing market has cooled. Residential construction could come roaring back to its traditional 40 per cent share of fixed investment from the currently depressed 35 per cent. This would add several percentage points to growth.

Reason 4: The government will boost stimulus spending should it be needed. Those fearful of a hard landing have to keep in mind that the government has shown itself to be adept at intervening at key points to keep growth buoyant.

This view contrasts sharply with the detailed analysis we pointed to the other day. Who is right? Hard to say. It’s interesting that the US is suing S&P for not warning the world that housing was about to collapse in 2006. That suit, which seems politically motivated for at least two reasons, will no doubt find emails and documents that question the sustainability of the housing boom. But, really, did you think that housing was about to collapse in 2006?

This fascinating article explores the many problems with China’s credit bubble, a subject we return to from time to time. It makes the point (page 3) that government debt, adjusted for off-balance sheet liabilities, is 90% of GDP, not 30%. When will the wheels come off, if ever they will? The chart above suggests that bubbles have a way of bursting on a rather predictable schedule. We note this post from mid-2007 when the US housing and financial sectors were just about to unravel and we didn’t see it coming at all. These things are surprises for a reason.

WSJ:

American manufacturing is more dependent on metals and minerals access than ever before. Yet there is no country on the planet where it takes longer to get a permit for domestic mining. Among other consequences of this red tape, there are now 19 strategic metals and minerals for which the U.S. is currently 100% import-dependent — and for 11 of them a single country, China, is among the top three providers…The U.S. has domestic resources for 18 of those 19 metals and minerals we now exclusively import from abroad. But a maze of government regulations has made mining them here too difficult. That’s the consistent finding of the annual Behre Dolbear Country Rankings for Mining Investment, known in the mining world as the “Where-Not-to-Mine Report.” The U.S. is currently tied for last place (with Papua New Guinea) in the time it takes to permit a new mine — seven to 10 years on average.

The unemployment rate in ND, where all that fracking is taking place, is 3%, versus 7.9% in the US overall. Imagine what could happen to the US economy if we just stopped shooting ourselves in the foot.

From Zero Hedge:

By the early 1980s, Japan’s economic success was beginning to lead to unrealistic expectations about future prosperity. Many commentators, abroad as well as at home, used the ‘fool’s guideline’ of extrapolation to contend that Japan would, in the foreseeable future, oust America as the world’s biggest economy. The international expansion of Japanese banks and securities houses was reflected in the proliferation of sushi bars in New York and London. Boosted by the diversion of still-cheap capital from industry into real estate, property values in Japan soared, peaking at $215,000 per square metre in the prized Ginza district of Tokyo.

Comforted by inflated property values, banks made loans which the borrowers were in no position to repay. The theoretical value of the grounds of the Imperial Palace came to exceed the paper value of the entire state of California. Meanwhile, a soaring yen was pricing Japanese exports out of world markets.

Though comparatively gradual – mirroring, in true bubble fashion, the relatively slow build-up of asset values – the bursting of the bubble was devastating. Properties lost more than 90% of their peak values, and the government’s policy of propping up insolvent banks and corporations created “zombie companies” of the type that exist today in many countries. Having peaked at almost 39,000 at the end of 1989, the Nikkei 225 index of leading industrial stocks deteriorated relentlessly, bottoming at 7,055 in March 2009.

The Japanese economy was plunged into the “lost decade” which, in reality, could now be called the ‘lost two decades’. In 2011, Japanese government debt stood at 208% of GDP, a number regarded as sustainable only because of the country’s historic high savings ratio (though this ratio is, in fact, subject to ongoing deterioration as the population ages).

With hindsight, we now know that the Japanese asset bust was an early manifestation of the ‘credit supercycle’, which can be regarded as ‘the biggest bubble in history’. The general outlines of the super-cycle bubble are reasonably well understood, even if the underlying dynamic is not. To understand this enormous boom-bust event, we need to distinguish between the tangible components of the bubble and its underlying psychological and cultural dimensions.

Conventional analysis argues that tangible problems began with the proliferation of subprime lending in the United States. Perhaps the single biggest contributory factor to the subprime fiasco was the breaking of the link between borrower and lender. Whereas, traditionally, banks assessed the viability of the borrower in terms of long-term repayment, the creation of bundled MBSs (mortgage-backed securities) severed this link.

Astute operators could now strip risk from return, pocketing high returns whilst unloading the associated high risk. The securitisation of mortgages was a major innovative failing in the system, as was the reliance mistakenly placed on credit-rating agencies which, of course, were paid by the issuers of the bundled securities. Another contributory innovation was the use of ARM (adjustable rate mortgage) products, designed to keep the borrower solvent just long enough for the originators of the mortgages to divest the packaged loans.

We agree with the history regarding both Japan and the US. Pretty disturbing. With the MBS’s, mortgages became simply bundled bets, with the bookies the only ones sure to make money. A fool’s game, but apparently fun while it lasted.

As you would expect with an analysis of this sort, things are predicted not to end well in the credit super-cycle. There are lots of predictions (here and here for example) that China will go the way of Japan. We don’t know about that. As for the US, with its unique ability (so far) to print money or have the Fed finance Treasury borrowings, it’s hard to believe that this will end better than it did for Japan. We’ll see.

Within the lifetime and personal memories of many Americans still living, most everyone knew farmers and soldiers. As late as America’s entry into World War I, over 42% of Americans still lived on farms. Your grandparents knew farmers and soldiers. It’s hard not to know a farmer or have spent time on a farm when 4 out of 10 of your countrymen lived their lives in agriculture.

Similarly, everyone knew soldiers not so long ago. WWI drafted 2.8 million Americans, when America only had 50 million men in total. WWII took 10 million draftees, and there were 3.4 million between Korea and Vietnam. One way of looking at Vietnam, for example, is that the draftees were as many as all boys in the United States who turned 18 in 1970 — a pretty large group of Baby Boomers. And none of these figures include the men who enlisted — surprisingly, perhaps, the total number of Vietnam veterans is over 2,500,000. So for a long time in America it has been true that most Americans knew something of farming and the military in a direct personal way.

No longer. As a statistical matter today, there are almost no new soldiers or farmers in America. Annual military recruits amount to 175,000 or so a year in a country of 300,000,000. And it’s even worse in agriculture. There are lilterally almost no new farmers in America today. At the time of WWII, farming still occupied 18% of the labor force – it’s less than 2% today. Every single year America loses more farmers than it creates. Many (perhaps most?) young Americans probably have not one single friend who becomes a farmer or soldier today.

Mark Steyn asks from time to time why there have been virtually no war songs during the last decade, as opposed to WWII. Part of the reason is Hollywood, of course, but another aspect of the phenomenon is this: all Americans were involved in WWII (see the PBS Soundies program, for example); very few are involved in America’s battles today. In WWII, war songs were about us; today war songs would be about them.

We sometimes hear from voices in the new media that this is the same America that won WWII. Well, this is pretty clearly not the America of WWII. Not even close, as the 5.4 million majority of those under 30 proved last November when they voted. And there is not much memory of that older America to boot. There are justifiable reasons to be very concerned about these collective losses of experience, memory and toughness in our very dangerous world.

The inventions of the late 19th and early 20th centuries were disruptive, as we noted seven years ago. But they were disruptive over an extended period of time, since their roll-outs were slow and uneven. But seven years ago there were no iPhones, no twitter, no tumblr, almost no YouTube, and indeed, our first mention of Google was only months old. Furthermore, the roll-out of these technologies has been nearly instant and worldwide. Six years ago, for example, Facebook was arguably worth a mere billion dollars or so. Fast forward: there are more than a billion smartphones in use today, for example. We have a country where the young don’t know Shakespeare and haven’t read the Bible, and their lives are almost wholly unconnected with the past. No wonder that things are so messed up.

It will be interesting to see whether and to what extent values of the past might be recaptured in the USA after the inevitable debt crisis hits. Hard to say what will happen when behaviors like illegitimacy can’t be afforded anymore and the religion of secularism breaks down. Better to be in a red state than a blue state when that time comes.

Weekly Standard:

According to the latest semi-annual report issued by the Bank for International Settlements, the gross market value of outstanding over-the-counter derivatives is $25.4 trillion​—​yes, trillion​—​with 75 percent of the contracts linked to interest rates: forward rate agreements, swaps, options. In June 2008, shortly before the crash, the gross market value of outstanding OTC derivatives was $20.4 trillion, with 46 percent linked to interest rates.

So what has actually changed since the precrisis financial situation? Instead of tamping down speculative betting on interest rates in favor of rational market pricing of loanable funds, the Fed’s monetary policies are stimulating it. No wonder traditional financial intermediation​—​the kind that used to channel depositor funds toward promising new businesses​—​is now oriented toward gaming various hunches about the Fed’s next move. Even smaller banks are learning to churn their Treasury holdings rather than make loans to private-sector borrowers​—​especially since federal regulators are evaluating their portfolios.

Productive economic activity requires a commitment of resources based on faith in the future; it’s inherently risky, but that’s the nature and genius of capitalism. Unfortunately, the Fed’s tactics for suppressing interest rates have brought about conditions antithetical to entrepreneurial capitalism: loose money, tight credit.

At Bretton Woods, 44 countries voted to make the dollar the world’s reserve currency. Any chance they’d re-up on that today? HT: PL

Bloomberg:

China’s unexpected surge in exports last month renewed concern from analysts at Goldman Sachs Group Inc., UBS AG and Australia & New Zealand Banking Group Ltd. (ANZ) that statistics from the nation can be unreliable. The 14.1 percent jump from a year earlier was the biggest positive surprise since March 2011, according to data compiled by Bloomberg. The increase didn’t match goods movements through ports and imports by trading partners according to UBS, while Goldman Sachs and Mizuho Securities Asia Ltd. cited a divergence from overseas orders in a manufacturing index…

ANZ’s Liu and colleague Louis Lam published research last week that underscored doubts about the quality of China’s economic data. They found that quarterly GDP, industrial production, fixed-asset investment and inflation data published in percentage terms failed to conform to “Benford’s Law,” which holds that in any series of numbers certain patterns will be found only if the statistics are naturally generated…

After China’s statistics bureau reported third-quarter GDP in October, Standard Chartered Plc analysts said the 7.4 percent increase was “too good to be true” when compared with the slowdown in electricity production and the readings of a manufacturing index…Rushed shipments and even faked exports to secure tax refunds may have contributed to the stronger growth data

This is hardly the first time we’ve noticed such things. However, it’s one thing to fudge the books when you’re growing at 10% a year. It’s a wholly different matter now, when so much of the world is in economic distress.

Chain’s expansion of credit has been vast — said to be the equivalent of creating the entire US commercial banking sector in five years. And the Shanghai exchange is back to 2000 from 6000 not so many years ago. Not a good picture. An article in Foreign Policy says that the economic and political transitions necessary in China are going to be very hard to manage. We think that’s an understatement.

“By 2030 as many as 300 million more people will have moved from the countryside to join 600 million already living in cities.” China’s new premier will have a lot on his hands.

The gulf is so wide between the blue and the red that there is no bridging it. So we return to that old chestnut, catastrophic climate change caused by CO2 from fossil fuels, etc. In a bowl full of 10,000 blue marbles, one turned red over the last century. What a leap of faith it must require to believe that this means Doom! (Or what a fat paycheck!)

Doom! Pay no attention to the 7800 nitrogen marbles! Pay no heed to the 2000 oxygen marbles! That one CO2 marble spells Doom! Doom! And they say the skeptics are anti-science.

China’s foreign exchange reserves stopped growing at the time of the Asian financial crisis of the nineties, and then with the financial crisis of 2008, and they have have once again done so. Whether this has predictive value this time around remains to be seen. HT: ZH

We reprint two endorsement editorials in their entirety. St. Louis:

Four years ago, in endorsing Democrat Barack Obama for president, we noted his intellect, his temperament and equanimity under pressure. He was unproven, but we found him to be presidential, in all that that word implies. In that, we have not been disappointed. This is a serious man. And now he is a proven leader. He has earned a second term.

Mr. Obama sees an America where the common good is as important as the individual good. That is the vision on which the nation was founded. It is the vision that has seen America through its darkest days and illuminated its best days. It is the vision that underlies the president’s greatest achievement, the Affordable Care Act. Twenty years from now, it will be hard to find anyone who remembers being opposed to Obamacare.

He continues to steer the nation through the most perilous economic challenges since the Great Depression. Those who complain that unemployment remains high, or that economic growth is too slow, either do not understand the scope of the catastrophe imposed upon the nation by Wall Street and its enablers, or they are lying about it.

To expect Barack Obama to have repaired, in four years, what took 30 years to undermine, is simply absurd. He might have gotten further had he not been saddled with an opposition party, funded by plutocrats, that sneers at the word compromise. But even if Mr. Obama had had Franklin Roosevelt’s majorities, the economy would still be in peril. Extraordinary, perhaps existential, economic challenges lie just beyond Election Day. The nation’s $16 trillion debt must be addressed, but in ways that do not endanger the sick and elderly, or further erode the middle class or drive the poor deeper into penury.

The social Darwinist solutions put forward by Republican Mitt Romney and his running mate, Rep. Paul Ryan, are not worthy of this nation’s history, except that part of it known as the Gilded Age.

Mr. Obama has not been everything we expected. In his first weeks in office, Democrats ran amok with part of his economic stimulus package. His mortgage relief program was insufficient. Together with his Treasury secretary, Timothy Geithner, the president has been too deferential to the financial industry. The president should have moved to nationalize troubled banks instead of structuring the bailout to their benefit. Regulatory agencies and the Justice Department were unable to bring financial crooks to heel.

We had hoped that Mr. Obama would staff the executive branch with the best and the brightest. There have been stars, but there have been egregious failures, too. The “Fast and Furious” operation at the Bureau of Alcohol, Tobacco and Firearms was a disgrace. The vastly expensive and unaccountable intelligence and Homeland Security agencies need stronger oversight. The now-renamed Minerals Management Service could have used some best-and-brightest inspectors before the Deepwater Horizon blowout in the Gulf of Mexico.

People who don’t understand the word “socialist” accuse Mr. Obama of being one. But as president he has proven to be pragmatic and conciliatory. He is not one to tilt at windmills. He did not close Guantanamo. He cut deals with anyone who’d come to the table. In health care, banking regulation and most other policy areas, he has practiced the art of the possible.

In foreign policy, after being awarded the Nobel Peace Prize for doing little more than not being George W. Bush, he has been a centrist. He has stood with Israel, but not as its surrogate. He brought the last of the U.S. troops out of Iraq. He began to wind down the war in Afghanistan — too slowly in our view. He let the nations of the Arab Spring follow their own course to democracy. He used thumb drives instead of bunker busters in Iran.

Against the advice of his senior advisers, he approved the SEAL mission that killed Osama bin Laden. He has been almost ruthless in his pursuit of terrorists, reserving to himself the right to approve targets. Regretfully, he massaged “due process” to allow himself to assassinate an al-Qaida leader who was an American citizen.

He is not a happy warrior, literally or figuratively. He is careful, cautious, private and deeply thoughtful, almost introverted. His rhetoric soars because he is a good writer, and good writers tend to be solitary souls. He is not as good working off the cuff, as was demonstrated in Wednesday’s debate with Mr. Romney. But being careful and thoughtful is a good thing in a president.

As to Mr. Romney, we are puzzled. Which Mitt Romney are we talking about? The one who said of himself, in 2002, “I’m not a partisan Republican. I’m someone who is moderate and … my views are progressive.” Or is it the Mitt Romney who posed as a “severely conservative” primary candidate? Is it the Mitt Romney who supported abortion rights and public health care subsidies in Massachusetts or the one who is pro-life and anti-Obamacare now? Is it the Mitt Romney who wants to cut taxes by $5 trillion or the one who can’t remember saying that now? Is it the Mitt Romney who said in May that 47 percent of Americans are moochers or the one who said last week that’s not what he believes?

Mr. Romney apparently will say anything that will help him win an election. As a president, he might well govern as a pragmatic chief executive, or he might sell himself to the plutocrats and the crazies who have taken over his party. He is asking Americans to take a lot on faith — there’s nothing to see in his tax returns; he can cut taxes and whack away debt while trimming deductions he will not specify.

Mr. Romney’s business career is the only way to judge his foundational beliefs: He did not run a company that built things and created jobs and strong communities. He became fabulously wealthy by loading up companies with tax-deductible debt, taking millions out up front along with big management fees. Some companies were saved. Others went bankrupt. Mr. Romney’s firm always got out before the bills came due, either in lost jobs, bankruptcies or both. If the nation’s most pressing issue is debt, why elect a president whose entire business career was based on loading up companies with debt?

In picking Mr. Ryan as his running mate, Mr. Romney signaled that he’s ready to perpetuate that model in public office. The middle class hasn’t had a raise in 20 years. Income inequality has reached record heights. Mr. Romney is the very embodiment of what’s gone wrong with the economy: Too many people at the top create vast wealth that they do not share, either by creating jobs or by paying fair tax rates.

If more Americans were paying attention, this election would not be close. Barack Obama would win going away, at least 53 to 47, perhaps even 99 to 1. But the atmosphere has been polluted by lies, distortion, voter suppression and spending by desperate plutocrats who see the nation’s changing demographics and fear that their time is almost up. They’ve had the help of a partisan Supreme Court.

The question for voters is actually very simple. The nation has wrestled with it since its founding: Will this be government for the many or the few? Choose the many. Choose Barack Obama.

Las Vegas:

U.S. Ambassador to Libya Chris Stevens and three other Americans died in a well-planned military assault on their diplomatic mission in Benghazi seven weeks ago, the anniversary of the 9/11 terrorist attacks. So why are details surfacing, piecemeal, only now?

The Obama administration sat by doing nothing for seven hours that night, ignoring calls to dispatch help from our bases in Italy, less than two hours away. It has spent the past seven weeks stretching the story out, engaging in misdirection and deception involving supposed indigenous outrage over an obscure anti-Muslim video, confident that with the aid of a docile press corps this infamous climax to four years of misguided foreign policy can be swept under the rug, at least until after Tuesday’s election.

Charles Woods, father of former Navy SEAL and Henderson resident Tyrone Woods, 41, says his son died slumped over his machine gun after he and fellow ex-SEAL Glen Doherty – not the two locals who were the only bodyguards Secretary of State Hillary Clinton and the Obama administration would authorize – held off the enemy for seven hours.

The Obama administration was warned. They received an embassy cable June 25 expressing concern over rising Islamic extremism in Benghazi, noting the black flag of al-Qaida “has been spotted several times flying over government buildings and training facilities.” The Obama administration removed a well-armed, 16-member security detail from Libya in August, The Wall Street Journal reported last month, replacing it with a couple of locals. Mr. Stevens sent a cable Aug. 2 requesting 11 additional body guards, noting “Host nation security support is lacking and cannot be depended on,” reports Peter Ferrara at Forbes.com. But these requests were denied, officials testified before the House Oversight Committee earlier this month.

Based on documents released by the committee, on the day of the attack the Pentagon dispatched a drone with a video camera so everyone in Washington could see what was happening in real time. The drone documented no crowds protesting any video. But around 4 p.m. Washington received an email from the Benghazi mission saying it was under a military-style attack. The White House, the Pentagon, the State Department and the CIA were able to watch the live video feed. An email sent later that day reported “Ansar al-Sharia claims responsibility for Benghazi attack.” Not only did the White House do nothing, there are now reports that a counterterrorism team ready to launch a rescue mission was ordered to stand down.

The official explanation for the inadequate security? This administration didn’t want to “offend the sensibilities” of the new radical Islamic regime which American and British arms had so recently helped install in Libya. The official explanation for why Obama administration officials watched the attack unfold for seven hours, refusing repeated requests to send the air support and relief forces that sat less than two hours away in Italy? Silence.

An open discussion of these issues, of course, would lead to difficult questions about the wisdom of underwriting and celebrating the so-called Arab Spring revolts in the first place. While the removal of tyrants can be laudable, the results show a disturbing pattern of merely installing new tyrannies – theocracies of medieval mullahs who immediately start savaging the rights of women (including the basic right to education) and who are openly hostile to American interests.

When Republican presidential nominee Mitt Romney promptly criticized the security failures in Benghazi, the White House and its lapdog media jumped all over him for another “gaffe,” for speaking out too promptly and too strongly. Prompt and strong action from the White House on Sept. 11 might have saved American lives, as well as America’s reputation as a nation not to be messed with. Weakness and dithering and flying to Las Vegas the next day for celebrity fund-raising parties are somehow better?

This administration is an embarrassment on foreign policy and incompetent at best on the economy – though a more careful analysis shows what can only be a perverse and willful attempt to destroy our prosperity. Back in January 2008, Barack Obama told the editorial board of the San Francisco Chronicle that under his cap-and-trade plan, “If somebody wants to build a coal-fired power plant, they can. It’s just that it will bankrupt them.” He added, “Under my plan … electricity rates would necessarily skyrocket.” It was also in 2008 that Mr. Obama’s future Energy Secretary, Steven Chu, famously said it would be necessary to “figure out how to boost the price of gasoline to the levels in Europe” – $9 a gallon. Yet the president now claims he’s in favor of oil development and pipelines, taking credit for increased oil production on private lands where he’s powerless to block it, after he halted the Keystone XL Pipeline and oversaw a 50 percent reduction in oil leases on public lands.

These behaviors go far beyond “spin.” They amount to a pack of lies. To return to office a narcissistic amateur who seeks to ride this nation’s economy and international esteem to oblivion, like Slim Pickens riding the nuclear bomb to its target at the end of the movie “Dr. Strangelove,” would be disastrous. Candidate Obama said if he couldn’t fix the economy in four years, his would be a one-term presidency.

Mitt Romney is moral, capable and responsible man. Just this once, it’s time to hold Barack Obama to his word. Maybe we can all do something about that, come Tuesday.

To one paper the president could or should win 99 to 1. To the other he’s a narcissistic amateur retailing a pack of lies. Not much overlap between the two Americas.

Abe Lincoln on kings: “they always bestrode the necks of the people, not that they wanted to do it, but because the people were better off for being ridden.” So it was in the king-craft of Mao:

“We can start communism with food, clothes and housing,” Mao declared. “Collective canteens, free food, that is communism.” Communist cadres in the provinces competed for Mao’s attention and praise, striving to outdo one another with highly inflated estimates of harvests. Radical new planting techniques, supposed to yield massive amounts of wheat and other grains, were backbreaking failures or ruinous fakes.

On Khrushchev’s last visit to Beijing in 1958, before the split between the two communist giants became a chasm, Mao boasted to Khrushchev that China had more rice than its citizens could eat; his chief worry was how to deal with the surplus. In reality, the people were already starving.

By the end of 1958, as agricultural production fell sharply and government quotas were raised to fantastic levels, famine spread. In July 1959, at a conference of senior leaders at the hilltop resort of Lushan, China’s defense minister, Marshal Peng Dehuai, led a move to review the Great Leap Forward and to halt, or at least rein in, the drive to total collectivization.

Peng, a peasant hero and veteran of the communists’ revolutionary war, had visited his and Mao’s home province of Hunan and seen the suffering first hand. He would be destroyed by Mao, branded a “right deviationist” and the leader of an “anti-party clique.” From then on, any attempt to relieve the peasants’ suffering was crushed, as purges swept through the country.

The famine lasted until 1962, when Mao was finally outmaneuvered by his lieutenants, including China’s president Liu Shaoqi and the chairman of the State Planning Commission Li Fuchu. Liu Shaoqi, while not directly criticizing Mao, told a mass meeting of 7,000 leading cadres from across China that farmers believed their problems were due 30% to natural calamities and 70% to man-made disaster. In the words of Frank Dikötter, the leading historian of the Great Famine, “the very use of the term ‘man-made disaster’ was a bombshell, drawing gasps from the audience.” The communes were dismantled and China’s peasants were able to cultivate and grow and cook their own food once more. Harvests improved rapidly.

Mao never forgave his opponents for this affront. In his eyes Liu Shaoqi had become China’s Khrushchev, and Mao set about plotting his revenge. What followed, in 1966, was the “Great Proletarian Cultural Revolution,” a decade of anarchy and violence. The Communist Party was torn apart. Suspect leaders and cadres, along with their families, were crushed, or were killed, or were scattered to China’s remotest and impoverished regions. Liu Shaoqi was tortured and allowed to die.

Calvin Coolidge: “It is a great advantage to a president and a major source of safety to the country, for him to know that he is not a great man.” The authoritarianism of the malignant narcissist almost always masks itself as profound concern for others, making it powerful and scary.

Update: In the new China, Wen Jiabao’s family is worth $2.7 billion or so.

A politician in May 2008:

we’ve got have leadership from Washington, the same way we had leadership when Kennedy said we’re going to the moon, we want to invest what we need to make it happen and there are all sorts of spin offs benefits from that. So that’s what we want to do on global warming here in the United States.

We are also, though, going have to negotiate with other countries. China, India, in particular Brazil. They are growing so fast that they are consuming more and more energy, and pretty soon, if their carbon footprint even approaches ours, we’re goners. That’s part of the reason why we’ve got to make the investment; we’ve got to lead by example. If we lead by example — if we lead by example, then we can actually export and license technology that have been invented here to help them deal with their growth pain. But keep in mind, you’re right. We can’t tell them, don’t grow. We can’t — drive our SUVs and you know, eat as much as we want and keep our homes on you know, 72 degrees at all times, and whether we’re living in the desert or we’re living in the tundra, and then just expect that every other country’s going say OK.

You guys go ahead and keep on using 25 percent of the world’s energy. Even though you only account for 3 percent of the population, and we’ll be fine. Don’t worry about us. That’s not — that’s not leadership. That’s not going to happen.

Meanwhile: “Even though the cost of solar power has fallen, it still remains triple the price of coal-generated power in China.”

Gordon Chang:

the Chinese economy is in obvious distress, with fewer analysts buying Beijing’s claims that the country is growing in the high single digits. Charles Dumas of Lombard Street Research, for example, thinks China’s growth rate is only 1.6%, and it could even be lower than that.

Signs point to bad conditions every time there’s physical evidence. They used to say that every business in China kept three sets of books. That’s probably not enough to mask the current troubles.