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Messianic Pretensions
For all the figurative heat of crashing markets, impending recession numbers, carnage in the commodities, the flying squirt-bomb of the American dollar, the cat's cradle of international political crises, humanitarian disasters across Africa, the usual Islamist terrorism, and the deep winter freeze portended by a flatlined solar magnetic low -- there is Hope. But that is of another world. Hope, in this world, must be for the right things.

My column today may be read as an extension of what I wrote Wednesday for this page. I concluded those remarks by noting that if, by a surprise that is not implausible, McCain wins, we may have riots across the United States starting in Grant Park, Chicago, and an unprecedented outpouring of anti-American venom across 24 time zones. (Take France, for example, where support for McCain was clocked in a recent poll at one percent.)

Original: http://www.realclearpolitics.com/articles/2008/10/messianic_pretensions.html

A Turn in the Housing Market?
Is it possible that the housing market has turned?

Blamed for just about everything bad that has happened recently to the economy, housing sales, I dare say, are showing signs of picking up. At the risk of being considered a lunatic, I say this for reasons of systematically gathered data, personal experience and common sense.

First the data, which hasn't and won't get as much attention they deserve, considering the fact that everyone has been blaming the dismal housing market for as far back as recent memory can take us. The good news is that the National Association of Realtors said sales of existing-home sales--including single-family, townhomes, condominiums and co-ops--for September jumped 5.5 percent higher over the previous month. They are1.4 percent higher than September 2007. That's the first time that sales have risen compared to a year earlier since November 2005.

Original: http://www.realclearpolitics.com/articles/2008/10/a_turn_in_the_housing_market.html

A Reality Check on Obama's Wish List
What will an Obama administration and a Congress with increased Democratic majorities do? That's a relevant question, given the Democrats' leads in the polls. And it's a little hard to answer, given the financial crisis that has been raging and the recession that seems to be ahead.

One thing they will certainly do is raise taxes on high earners. The Bush tax cuts are scheduled to expire in 2010, and congressional Democrats will gleefully allow the top rates to rise. Left-leaning Democrats, like Barack Obama himself, want to "spread the wealth around," as the candidate told Joe the Plumber in October. Blue Dog Democrats want to reduce the budget deficit and will welcome the additional revenue that the Congressional Budget Office's static-analysis models will promise. Raising taxes when the economy is weakening is not the medicine prescribed by Keynesian economics, and it is probably not what Obama's economic advisers would prescribe if they were starting from scratch today. It is what Herbert Hoover and Congress did in the early 1930s, and it helped to produce the Great Depression. But it is baked into the pie.

Original: http://www.realclearpolitics.com/articles/2008/10/a_reality_check_on_obamas_wish.html

I Hear America Singing
SANTA MONICA, Calif. -- Like Walt Whitman, I hear America singing:

"...the varied carols I hear;

"...The carpenter singing his, as he measures his plank or beam,

"The mason singing his, as he makes ready for work..."

Original: http://www.realclearpolitics.com/articles/2008/10/i_hear_america_singing.html

Reagan + Friedman + Keynes: We Need All the Help We Can Get.
Back in early 1981, when I went to Washington to work for President Reagan, one of the architects of supply-side economics, Columbia University's Robert Mundell, visited my OMB budget-bureau office inside the White House complex. At the time, we were suffering from double-digit inflation, sky-high interest rates, a long economic downturn and a near 15-year bear market in stocks.

So I asked Prof. Mundell, who later won a Nobel Prize in economics, whether Reagan's supply-side tax cuts would be sufficient to cure the economy. The professor answered that during periods of crisis, sometimes you have to be a supply-sider (tax rates), sometimes a monetarist (Fed money supply) and sometimes a Keynesian (federal deficits).

Original: http://www.realclearpolitics.com/articles/2008/10/reagan_friedman_keynes_we_need.html