Richard Russell Sums Things Up Nicely...

Veteran (with a capital "V") market and world-events analyst Richard Russell offers the best commentary I've yet seen in trying to digest the recent political turn of events in the U.S. [credit michaelrunge]:

The verdict is in

"Much power has now been transferred to the Democrats. They don't deserve it. They went along passively, cowardly, and cluelessly with the Bush caravan. Their real claim to power is not courage or intelligence, their real claim to their new power is simply that they are not Bushies or neo-cons. In all, it's a sad story. But it's a story, less sad than it was a day ago.

Effectively, the reign of Bush and the neo-cons is over. Today there is one less neo-con, Rumsfeld is gone. What turned the tide? Actually, it was the belated back-stiffening of the press. The newspapers, early on, were cowed by the Bush crowd. Later, Iraq, lies, and the administration's arrogance was too much for the press. The press regained its courage. With the recovery of courage by the press, the truth emerged, and the Bush people were doomed.

Economically, the big picture will now boil down to four phenomena: (1) Iraq, (2) the continuing massive US deficits, (3) the longer-term effects of the deteriorating housing picture, (4) the incredible disparity between Wall Street and the rich -- and the great mass of struggling Americans.

Iraq will be a continuing cancer. I have no idea how it will be resolved.

The deficits will probably be ignored despite much hand-wringing.

The housing situation (in my opinion) will deteriorate and become a huge problem.

The disparity between the rich and the poor will remain an unsolved cancer -- it will also be a source of anger on the part of most Americans.

The consensus continues to be that housing is due for a "soft landing." In my opinion, the soft landing is a fantasy. I think it will be well into next year before we know what kind of landing housing is headed for. I think it's going to be a very hard landing, one that will work a hardship on the entire nation."

For my own record, Rummy was only swapped with another deep-rooted NeoCon--so no points can be awarded there.

Also, in his "four phenomena" Russell makes no mention of the huge, sustained leap in oil prices we'll almost certainly see over the next couple years. And at some point as well the health care system is going to begin unravelling, although that may not happen for five or six years yet. I'd rate either of those situations above "the disparity between rich and poor", which is something I don't see Americans getting all that worked up about.

Oh....and for an interesting take on all those analysts who're foreseeing a "soft landing" in housing, The Big Picture has scraped out of the dustbin a long list of market predictions and prognostications that were made during the Crash of 1929 and the resulting depression.

Comments

[Loveandlight]

It also helped that Howard Dean as DNC chairman pursued a strategy actually geared towards winning elections. The Dems used to have a better organization on the grassroots once upon a time, but that changed when the Clintonistas let that organization atrophy and wither in favor of campaigns run by blow-dried consultants.

[wilfred]

I dont' think it was the press at all. The power faction of the CIA simply turned on Bush/Rove (see Woodward's book State of Denial). The media and Diebold simply followed orders. Rove must have been suprised.

[auntiegrav]

Wilfred has probably got it at least partially correct. I don't think too much credit should be given to Howard Dean. The Democrats may have been a little more motivated, since they were starting to get terrified of ending up in a prison camp somewhere, so they put down their latte and advertising copy long enough to vote, but in the long run, they don't deserve the victory, and we should throw all the lying bastards out.

[mj]

We can't throw all the bums out - we work within the system we have - revolutions don't work - one ends up with Stalins and Hitlers - they simply wait in the wings while idealists fight it out and then they grab the reins of power. People are fed up with the Iraq debacle and want out. We will leave and then the place will break down completely. It took a lot longer for Americans to give up their illusions of military might during Vietnam and so we lost almost 60,000 soldiers- It was pointless and this is pointless- The cause is lost(always was) and now both parties are just trying to figure out how to leave- but we will leave and Iraq will disintegrate into chaos - There will be no happy ending. Dante's inferno for the warmakers-

[different clue]

I agree with Willfred and AuntieGray above. (Though I think Dean had more effect
than Willfred thinks). But anyway, yes,
the RCM (Ruling Class Media) didn't "develop
a spine". They recieved new orders from the
Ruling Class.
The Super Rich were happy to put Bush into
office in order to steal several trillion dollars from the country. But now that the
majority is feeling pain, and Iraq is going
badly, the Ruling Class is afraid of the
natives getting restless, and wants to throw
us some bones so we will be happy and quiet
down. The Ruling Class wants to created the
fabricated appearance that "the system works". The Ruling Class does not consider
the disparity between rich and poor to be a
problem. The Ruling Class considers that to
be the goal. They want to lock in their gains and they feel that too much more Bush
could make it hard for them to do that.

By the way, Gates is not a NeoCon. He is
an "Establishment Realist". He is CIA. The
CIA and the NeoCons hate eachother, and nominating him is part of a long-range chess
game against the NeoCons. (Now that the NeoCons have served the purpose for which
the Ruling Class installed them and needs
to discard them. They were Useful Idiots in
their time, but their time is passing, and
they are no longer Useful).

[different clue]

Oh, and...about the Democrats being supine
cowards. Some just are, no doubt, but I suspect some of them are scared by genuine
death threats, made credible by the airplane
"accident" which killed Senator Wellstone,
and the Anthrax Letters which "somebody"
mailed to the offices of Democratic Senators
Daschle and Leahy. Notice how no anthrax
got sent to Republicans? When is the last
Republican Senator to die in a plane "crash"?
If I were a Democratic Senator and saw all
that, I would be scared too. Though I hope
my response would be to spray tinfoil in
public.

[Loveandlight]

Good thing I'm not a Republican, or else I'd totally wig out over all these people actually disagreeing with me. ;-)

[wilfred]

I don't disagree with you, I think Dean did a terrific job as opposed to the DLC-infested Clintonistas. It's just that we won also in 2000, 2002 and 2004 but this time the PTB allowed honest vote counting (more or less)-- the question is why. Let me quote from Huxley:

"There is, of course, no reason why the new totalitarians should resemble the old. Government by clubs and firing squads, by artificial famine, mass imprisonment and mass deportation, is not merely inhumane (nobody cares much about that nowadays); it is demonstrably inefficient and in an age of advanced technology, inefficiency is the sin against the Holy Ghost. A really efficient totalitarian state would be one in which the all-powerful executive of political bosses and their army of managers control a population of slaves who do not have to be coerced, because they love their servitude. To make them love it is the task assigned, in present-day totalitarian states, to ministries of propaganda, newspaper editors and school teachers. But their methods are still crude and unscientific. The old Jesuits' boast that, if they were given the schooling of the child, they could answer for the man's religious opinions, was a product of wishful thinking. And the modern pedagogue is probably rather less efficient at conditioning his pupils' reflexes than were the reverend fathers who educated Voltaire. The greatest triumphs of propaganda have been accomplished, not by doing something, but by refraining from doing. Great is truth, but still greater, from a practical point of view, is silence about truth. By simply not mentioning certain subjects, by lowering what Mr. Churchill calls an "iron curtain" between the masses and such facts or arguments as the local political bosses regard as undesirable, totalitarian propagandists have influenced opinion much more effectively than they could have done by the most eloquent denunciations, the most compelling of logical rebuttals. But silence is not enough. If persecution, liquidation and the other symptoms of social friction are to be avoided, the positive sides of propaganda must be made as effective as the negative. The most important Manhattan Projects of the future will be vast government-sponsored enquiries into what the politicians and the participating scientists will call "the problem of happiness" - in other words, the problem of making people love their servitude."

So perhaps the New Totalitarians, concerned with the happiness of their slaves, simply came back to the fore.