Some Hollywood people are apparently raising money for Evan Bayh, hoping that he’d have a broader appeal than Hillary Clinton. But even though the Bayh family name is well known in Indiana, a national reputation is harder to build.

If Angela Merkel can become the Chancellor of Germany (I bet she will), Hillary Clinton has a fair shot at becoming President. The first woman thing is a significant factor. For the Dems to win it is absolutely essential to have a larger majority among female voters than the Republicans achieve among male voters. John Kerry did not appeal to women in the way Bill Clinton did. Because she would make history, Hillary could. She would have to adapt some of her positions in a convincing way, which will be very tough. But she’s quite tough so I wouldn’t write her off. Then I wouldn’t write anyone off at this early stage.

Contrary to popular belief, John F. Kennedy actually won because he achieved a majority among male voters. Women favored Nixon in 1960. There were periods when women were more Republican than men (1920 some Democrats thought woman suffrage could lead to permanent Republican rule). Winning big among women will be important in 2008.

The gender gap is one thing. The Dems need to reach out to Hispanics, Jews and the working classes of the Rust Belt. There is no Catholic block vote anymore but like in 2004, if the Dems can’t offset the Republicans’ dominance among Protestants by winning more Catholic votes, they’ll lose again. I don’t really see why Hillary Clinton couldn’t do better than John Kerry among all these groups. She could also do worse. Like Kerry, she would polarize Americans geographically and she wouldn’t probably be competitive in most red states.

In 1990-1998, the economic depression caused by the 1980′s careless crediting and the collapse of the Eastern trade forced the government to gain debt to maintain the welfare state. But, in 1998, this worrying development was halted. Thanks to Niinist?¶, debt was paid.

But, in 2003, Kokoomus was left out of the government coalition. See how the curve turns?

But it wasn’t just Ohio. The social issues were not decisive on a nationwide scale. I actually believe Kerry lost Florida and became uncompetitive in key states like Arizona and Missouri because his international strategy was a bit fuzzy. At times he was tremendous in criticizing Bush but he was bad at presenting the alternative. Perhaps the Democratic Party was so divided that Kerry calculated he keeps more people on boat by staying fuzzy.

Yes the Democrats lost in 2004. The Democrats can win in 2008 by learning from their mistakes in 2004. All in all Kerry was a good candidate (not the best ever but good, although he played safe too much) but the party wasn’t ready to win yet. Exactly because the Republicans won, they will be less likely to learn anything from the previous election. Tides always turn, at one point one party goes out of office and is replaced by the other. Because there are only two national parties, the next party in government will be the Democratic Party. The party after that will be the Republican Party, again.

But you’re quite right that everyone eventually aspires to the center; that can be seen in all the democratic political processes the world over. What surprised me was the lack of that in the Democratic strategy in 2004.

There was one overriding factor that suprised me the most: the Achilles heel of the Republican Party was energy policy, – or lack of. Just concentrating on energy issues (not social ones) would have, I believe, paid off for the Democrats. Energy policy is progressive, – social welfare issues regressive – in American politics today. Yet the Democrats rarely mentioned that, choosing instead to talk about spending on welfare, co-operating with the UN (big mistake), and Kerry’s war record.

All the other issues, – Christian morals, abortion, stem-cells – those to me are mere trifles. Inasmuch as they are domestic issues, they will eventually be worn away by domestic politics, – meaning that eventually they’ll inspire the kind of ankle-biting advocacy that winds up (unfortunately) being the most effective way to transform a democratic society. What really mattered to me was the grand, international strategy. And in that sense the Cheney team was more prepared than Kerry.

George W. Bush appeals to many Democrats, he’s after all a big spender. Hillary Clinton has already started moving to the right, John Kerry has also adjusted many of his positions during the years. That is called pragmatism and at the end of the day pragmatic politics tends to appeal to the broader mass of people. More significantly than what Hillary Clinton and John Kerry have done, Bill Clinton brought new life to the Democratic Party during the 1990s. Someone with his charisma could very well reach back to that part of the Democratic voting base that is temporarily pro-Bush.

I bet many fiscally conservative voters feel uncomfortable with all the Evangelical Christians and their creationist and anti-stem cell research positions, whereas many social conservatives are not necessarily anti-state, for many it depends on where the state decides to invest. I’m sure more Americans are conservative than liberal but there’s also a tendency toward centrism (in the American sense). People like John Aschroft and John Bolton are not exactly mainstream. People like that are heroes in the conservative talk radio. For example, many young Americans are tolerant, even if they tend to be fiscally conservative. The lack of tolerance can be the undoing of the Republican majority in the future.

Still, there is a fascinating willingness to self-destruct and to test the limits in the Bush team which seems to hold Finnpundit in thrall

I think the notion of American willingness to self-destruct is hyperbole, yet there is a willingness to test the limits, which I like seeing in the Bush team (or, I should say, the Cheney team). You don’t know how refreshing that is to hear after the disappointing show of the Democratic Party since 9/11.

Far from being in thrall of Bush, I’ve been a life-long Democratic Party member (I left the party in 2004, and registered as an Independent). The Democratic Party is the one with all the problems, with its reversion to the failed social policies of the sixties and seventies in answer to the crises of today. That, above all, eroded its voting base.

These arguments have been used by Europe since… oh, well… since 1776.

http://byrned.faculty.udmercy.edu/2003%20Volume,%20Issue%203/balofpayart.htm

It has a number of very interesting graphs.

This graph shows the deficit as a percentage of GNP.

http://www.cbo.gov/showdoc.cfm?index=6060&sequence=2#figure1-2

Note that ten years earlier, things were worse.

This one

http://byrned.faculty.udmercy.edu/2003%20Volume,%20Issue%203/balofpayart.htm

??¦ discusses the significance of the deficit in the world economy. I especially like this quote:

This gives rise to two opposing arguments as to the cause of the growing indebtedness of the U.S. to the rest of the world. Is the villain, so to speak, the large and sustained deficit in the Current Account Balance that causes the Capital Account Surplus, or is it the Capital Account Surplus that causes the Current Account Deficit?

2) The effects of the relatively high, real-risk adjusted interest rates, and the resulting appreciation of the dollar has been exacerbated by ongoing intervention in exchange markets by Japan, China and the like, in order to keep the dollar overvalued??¦

Anyway, one can agree or disagree, the point being that there will always be alternative points of view when one discusses the deficit. Google the deficit, and you???ll get an earful.

From the classic libertarian point of view, the government should not be in the business of issuing credit. And that certainly is the case when US state governments are concerned, because states do not control their own currencies, and have forfeited the right to conduct foreign policy to the federal government. Almost all of the states attempt to cover budget fluctuations (due to tax collection fluctuations that are tied to the health of the economy) with debt, – the most notable one in recent history being California, which became so disastrous a Governator was called in to clean up the mess.

But the US government has a special position because the entire world freeloads off of the American worker-consumer, due to the extraordinary openness of the American consumer society. This freeloading causes so many imbalances that some safeguards have to be taken. Tariffs would be the worst (thought some still clamor for that). Floating the currency is a solution, but even that can be a problem when the US success is so dynamic that the currency becomes way overvalued.

The best measure to take is to bring down the value of the currency, by running a deficit. And since no nation in the world is ready to match the US in the degree of openness, the world has no choice on the matter, – except, of course, if they would open up their markets to match that of the US.

That, by the looks of things, ain???t happening.

This is possible as long as Asian countries keep demanding dollars as payment. They are in a vicious cycle: if they stop, the value of the dollars they have will start to fall. So they keep massing more and more dollars in their vaults just to keep it from falling. When their people stop accepting this green funnymoney courtecy of Greenspan et al, the following things will happen.

1. Asian economies will take a dive, as their exports to the US will no longer be possible, since the greeback-funnymoney offered in return will be useless. Their own money will dive too, alleviating the fall somewhat, since much of their money balances is based on the huge amount of funny money in the vaults of their central banks.

2. US economy will experience increasing inflation and, as a result, skyrocketing interest rates, as the funnymoney will start pouring back.

3. The Euro will skyrocket, Euroland interest rates will rise and Euroland economy will hit a severe deppression, due to falling investment and practically zero export resulting from high-priced euro.

4. Oil prices will rise at an even faster rate. Who knows what kind of calamities this will bring. It might even have a stabilizing effect in the long run, European real price for oil may even fall, as inflation and overpriced euro make it cheaper in comparison.

The magnitude of these effects in absolute and relative terms is unknown, but basically, this is the scenario. If oil production takes a turn for the worse, things may turn even worse.

The US economy has a singular position in the world thanks to the reserve currency. It’s also true that rich countries can afford substantial debts for a longer time and small poor countries can’t afford relatively small debts. I think, too, that eight George W. Bush years will be too short a time to undermine the US economy permanently. The next president, whoever that will be, is less likely to be a populist. Thanks to the stability of the Clinton years, the Bush team knew they could afford their reckless policies for a time.

Debt can grow very fast if you have an administration in power that is not concerned about it. The economic priorities are changing and the statistics for the past three years help us to predict the future. Snow is still talking about reducing the debt and perhaps the mere talk is a good sign. If they were openly talking about growing the debt even more, we could be absolutely certain about the outcome for the second Bush term.

Do we really know what the effects of printing more dollars are for the real economy (both in the US and in the world)? Is everything really like Finnpundit says, as long as there is a demand for the dollar, the Fed can print as much as they want and the statistics will look good. In the past Portugal used to be the poorest country of Western Europe and their endemic problem was the constant printing of escudos (which was permanently cured thanks to the euro) that destroyed the confidence in that country’s economy. But the escudo wasn’t the reserve currency of the world, either. So only if and when there will be a switch in the reserve currency, can the printing presses bring about a collapse.

My argument has been all the time that America is what it is because everyone else trusts in America. Bush is eating away at that trust thanks to his fiscal policies. He may not be able to destroy the trust because there will be a new administration soon enough and his treasury team will be just another footnote in history. Still, there is a fascinating willingness to self-destruct and to test the limits in the Bush team which seems to hold Finnpundit in thrall.

The problem is that although Bush is not allowed to run for a third term, the Republicans will want to win a third consecutive term. It is still more than likely that the 2008 budget will be an election budget. My guess is that they will spend (and borrow) even more toward the end of the second term. For a long time, the Bush fiscal policy has been saying one thing and doing the opposite. That is called populism. People wanted believe what they heard but didn’t want to know what the administration did. I’m not so sure that the war is the number one priority. That’s just an excuse to ignore the numbers to say that everything serves the war policy. If the war would be such a high priority, I don’t think the Bush team would be spending so much borrowed money on everything else.