One silver lining in the dark clouds of the economy is that it looks set to alleviate the military’s recruiting woes as declining labor market prospects in the civilian economy leave more people looking kindly on joining up. As the story notes, the decreasing casualty levels in Iraq and the prospect of a new, popular, non-horrible commander in chief also seem to be playing a role.

It’s certainly true that talk of repeating a windfall by renting out your place for Inauguration Week is all the buzz in DC. But I haven’t seen any real verification of big money being found in this domain. An awful lot of people genuinely want to be out of town for the inauguration. And that, combined with the buzz about high prices, seems to me to have lifted the supply of housing sky-high reducing the margins available to most people. I clicked on the article because I saw a photo of someone I know, and the caption says “Katherine Mangu-Ward, one of many in Washington willing to rent their homes for the inauguration, has offered her one-bedroom apartment online for $1,000 a night.” But of course Katherine offering her apartment for $1,000 a night isn’t at all the same as someone offering to pay her $1,000 a night.

But if anyone feels like it, I’d gladly entertain an offer in that range.

Word to the wise. If you’re not following Shaq’s Twitter feed you’re not really living in the contemporary world. He’s moved us all the way to Web 4.0.

I’ll reserve final judgment until I’ve finished the book, but based on having read about two thirds of Malcolm Gladwell’s new book, Outliers, yesterday I can tell you that The New York Times‘s negative review is extremely wrongheaded. He’s tackling a much more important subject than in The Tipping Point or Blink, and I’d say he’s delivering. This slim, highly readable volume almost certainly isn’t the definitive last word on the question of what makes people succeed, but it’s a really brilliant summary of most of the currently available research. I really only wish it were longer so that it could explore certain points in more detail, but leaving you with the feeling that you haven’t read enough is far from the worst problem a book can have.

The story of reconciliation between Barack Obama and Hillary Clinton is a nice one, but as I point out in an article for The National, the fact remains that they had some significant differences on the campaign trail. And though we’ve heard a lot about their rapprochement, we haven’t heard a great deal from either of them about the policy direction the administration needs to take. I’m hoping that as the new team is unveiled we’ll hear more statements on policy, and those statements will harken back to the bold approach Obama promised during the campaign.

A libertarian friend recommended as “great” this missive from Cato President Ed Crane making the case that if only we’d listened to the libertarians none of this financial crisis business would have happened. The analysis is pretty damn weak if you ask me. Crane writes:

As for the subprime crisis, it was not just Peter Wallison sounding the alarm. In 1997 Cato published a Policy Analysis by Vern McKinley entitled “The Mounting Case for Privatizing Fannie Mae and Freddie Mac.” Vern wrote: “Because of their quasi-government status, there is a market perception that Fannie Mae and Freddie Mac mortgage-backed securities and debt carry and implicit federal guarantee against default. Hence, the GSEs expose the federal taxpayer to an ever-increasing potential contingent liability that could ultimately cost tens of billions of dollars to rectify.”

I think that analysis is perfectly correct, but the fact of the matter remains that it has almost nothing to do with our present situation. The implicit government guarantee to Fannie and Freddie was a bad idea in my view, but it had nothing in particular to do with the creation of the financial crisis, and the upshot of the crisis ultimately was that even institutions that hadn’t been given such guarantees wound up getting bailed out.

But more to the point, when the best your organization can claim in terms of prescience is that you published something in 1997 then you know you have a problem. Clearly, the McKinley pieces doesn’t have much of anything to say that’s relevant to the specifics of the problems that have unfolded in 2007 and 2008. That’s not McKinley’s fault, it’s a reflection of the fact that he was writing in 1997, before the stock market crash and the subsequent growth of the housing bubble. 1997 was too early to be prescient. Meanwhile, Cato does have a section on its website dedicated to papers on the subject of “Financial Crises and the Global Financial System.” They published no papers whatsoever between September 2004 and May 2008. And the September 2004 paper was about Iraq. 2004 also saw a paper about the Dominican Republic. 2003 witnessed another paper about Iraq and an Anna Schwarz paper on “The IMF’s Dubious Proposal for a Universal Bankruptcy Law for Sovereign Debtors”. But as the stage was being set for the current crisis, absolutely nothing.

Similarly, on housing markets they published absolutely nothing between 2004 and 2008 — precisely the years during which the bubble was growing and changes in policy might have made a difference.

In January of 2005, though, Cato’s Alan Reynolds did publish some sneering nonsense deriding those who believed there was a housing bubble:

The start of each year is prime time for economic pessimists, who try to persuade us terrible things are about to happen. A perennial favorite is the “housing bubble” about to burst, with a supposedly devastating impact on household wealth. [...] A July 2, 2002, Wall Street Journal editorial on this topic worried that “homebuyers are resorting to greater levels of mortgage debt.” Contrary to such anxieties about homeowners being over-leveraged, their equity exceeds 56 percent of the value of homes and that ratio has not declined. Mortgage payments often replaced rental payments as homeownership increased, but that was not an added burden. [...] House prices did not just “bubble” for no reason.

I don’t know what conclusions about “libertarians” should really be drawn from any of this, but it’s clear enough that Crane’s institution was mostly indifferent to the problem as it mounted, and occasionally intervened to try to shout down people who were calling attention to the issues.

George W. Bush on himself:

In an interview conducted earlier this month by his sister, Doro Bush Koch, Mr. Bush said he wanted to be remembered “as a person who, first and foremost, did not sell his soul in order to accommodate the political process.”

“I came to Washington with a set of values, and I’m leaving with the same set of values,” Mr. Bush said. “And I darn sure wasn’t going to sacrifice those values; that I was a President that had to make tough choices and was willing to make them. I surrounded myself with good people. I carefully considered the advice of smart, capable people and made tough decisions.”

Unlike many things that come out of his mouth, this is basically true. Bush considered the advice of smart, capable people such as Colin Powell, Richard Clarke, Rand Beers, Paul O’Neal, Christie Todd Whitman, etc. and he chose to regret it. These were tough choices. The destinies of billions of people around the world were in one way or another effected. Hundreds of thousands of lives lay directly in the balance. And rather taking the advice of smart, capable people Bush decided to take the advice of dumb, inept people. And he did it, as he says, because he was following his values — immoral values that he he shared with the people on whose counsel he preferred to rely. The results have been disastrous and are plain to see.

Robert Rubin speaks up for himself:

“Nobody was prepared for this,” Mr. Rubin said in an interview. He cited former Federal Reserve Chairman Alan Greenspan as another example of someone whose reputation has been unfairly damaged by the crisis.

This seems like a pretty serious dodge here. Presumably the reason the top executives at a giant financial services firm get paid such extravagant salaries is that it’s their job to be prepared for the stuff that “nobody” is prepared for. If the idea is just that you make money while the market goes up, and then when the market goes down the government steps in to rescue you, probably a lot of people could do the job. And if a lot of people could do the job, there’s no need for compensation packages to run into the tens of millions of dollars. But if there is a need for compensation packages that run into the tens of millions of dollars, then people have a responsibility to prove themselves to be super-genius titans of capitalism who can navigate the shoals of the global economy flawlessly.

I don’t, personally, believe that there’s anyone like that out there. So nobody should be blamed for failing to live up to that hype. But people can be blamed for participating in the hype and profiting from it.