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Sunday, December 12, 2010



In open societies where political majorities tend to form around the middle of the bell curve of opinion, the theory of triangulation says that under normal circumstances, you want to be positioned in or near the middle to win elections. It is unusual when fringe candidates have an opportunity to win, though it does happen. But a reliable strategy for survival is triangulation.

In recent times the masters of this approach were Bill Clinton and Tony Blair. Clinton ran as a "New Democrat," a kind of socially liberal but economically middle of the road candidate, one who had a very good ear for the public's view and a willingness to pay attention to opinion polls. After winning the Presidency, he took a lurch to the left, probably driven by his wife's and advisors' policy preferences, but after a couple of disasters (especially Hillarycare), he recaptured the center in time to win re-election and ride a Republican Congress to a budget surplus. This enabled him to overcome his most outrageous personal behavior.

Tony Blair led "New Labour" into government after more than a decade in Parliament's wilderness, and won a second term despite the lack of any defineable strategy for running the government. In fact, it was his ad hoc approach and search for the moderate solution to every problem that enabled him to be so dominant. The Conservatives and Liberal Democrats actually fed into his strategy since they adopted fringe positions on the right and left respectively. Always looking moderate by comparison, Blair's tenure actually depended on restraining the true believers in his own party. Eventually, they called him on his pre-arranged deal with Gordon Brown, his partner in government, to turn over the reins. But Blair's luck held again. He got out of government in time to miss the worst of the financial crisis and is having a successful career as a peacekeeper and elder statesman. Brown, captured by his party's left, was defeated quickly by a Conservative candidate who more successfully adopted the Blair strategy.

Last week, we saw President Obama make his first real concerted effort to implement a triangulation strategy. In reaching a compromise tax rate extension with Republicans, Obama, really for the first time, attempted bi-partisan engagement. In part, this was simply a bow to reality since Republicans will be taking over the house in January, and might have passed a similar bill in the Senate. If that happened, it would be difficult for Obama to veto.

Interestingly, the House Democrats were the ones excluded from the table, and they howled. We expected the social democrats (who call themseleves "progressives") in academia, labor unions, and moveon.org to howl and they did not disappoint. Already, there were accusations that Obama was a conservative, a closet Republican and other equally ridiculous assertions, followed by the inevitable conjecture about primary challenges in 2012.

For all his rhetorical skills, Obama seems to be an essentially poor communicator. It's all too academic, too self-sure, and lately, way too antagonistic. This time it was sort of... I hate to do it but I have to deal with hostage takers on the right and purists on the left, and this was the best deal I could get...

So now, everybody hates him.

We said this was going to be the solution, it was inevitable, and frankly, the estate tax deal also strikes middle ground fairly well. For those D's who think Obama gave away the store on that one, the government will still be confiscating one-third of taxable estates, consisting mainly of our AFTER TAX savings. I would say Obama struck a more than fair deal for his redistributionist fans.

The reality is that the left's commitment to their class war goal of punishing the "wealthy" and their belief that elites should run our society by means of an ever growing federal government, can not be exaggerated. If you don't believe that, just read the breast beating comments on the progressive blogsites. If Obama is ever going to have a chance in 2012, he will have to show he can separate himself from those folks. Though he made a move away from them this week, I am not convinced that he can ever be a successful triangulator, since he seems to be a true believer too. He has not been convincing about much of anything recently.

So a couple of bombs go off in the vicinity of Iranian nuclear scientists, killing one, and the best the Iranians can do is blame the U.S. or Israel, they don't know which. Sadly, the U.S. seems to have neither the will nor the capability to pull off this type of operation. I would like to believe the Israeli's still do.

As far as WikiLeaks publication of all those secret cables is concerned, I think that constitutes an obvious felony, but whether I am right about that or not, the bigger concern is, how was it able to happen? Wouldn't you think there would be some kind of fail safe security procedures to prevent such leaks? Is there any adult supervision anywhere in this government?

We expected last Monday night's football game to be a disappointment and as Jets fans, had no illusions about our underdog status for the night. That having been said, the Jets continued their season-long difficulties on both lines of scrimmage, and were not really competitive. It's good to be 9-3, and having Miami and Buffalo still at home should get us to 11-5, but how deep can you go in the playoffs if you can't protect the quarterback, run the ball, and get to the other guy's quarterback?

The Knicks' roll continues, home, away, it doesn't matter. Get the ball, outrace the other team to the basket, then get it back again. It's all offense, all the time under Mike D'Antoni. When was the last time you saw the Knicks over 100 points every night?

On December 15, 1949, Birdland opened, fittingly with the Charlie Parker Quintet. The drummer for that gig was Roy Haynes. Last Thursday, night, I was privileged to see that same Roy Haynes, 85 years young, leading his quartet at Birdland. Still fit enough to bounce around the stage, pounding his drums from seemingly all angles, hands and feet in simultaneous motion, Haynes presence dominated while still generously leaving room for almost all of the solos to his much younger bandmates. All aquitted themselves brilliantly and the packed house (almost packed for the second set as well) was clearly engaged from the start and aware they were enjoying something really special in jazz. This was among the most memorable of so many great shows I have attended at Birdland.

John Pizzarelli comes in this week, I believe. Check your local listings. Reservations probably a must.

When we sold 1542 shares of ADC Telecommunications on 12/3 at 12.73, part from the IRA and part not, we took about a $5,000 profit on those shares purchased between 2001 and as recently as 2010 (at 6.27). That cut into previously taken losses over the years on this stock and on its options ( this was a covered call disaster similar to the Enron debacle). I thought the takeover bid was too low, and would have preferred seeing ADCT continue to recover on its own, but it was not to be.

On 12/6, we bought 50 more shares of Honeywell (HON) at 51.28. On 12/8 we bought 15 shares of GLD for the IRA. Our gold position keeps growing, and so does the price, which this time was 135.89. On 12/10 we bought 200 shares of Pfizer (PFE) despite the musical chairs game in the CEO office. The drugs have become income stocks and that's OK with me. Speaking of income stocks, we got a few more dividend increases last week including GE for the second time this year!

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Hi RedWave:

Regarding your January 17th post, it was interesting to see someone from the right interested in paying for the treatment of our mentally ill. Or did "seeing to it" only mean that we should insist on their getting into treatment? If they fail to get treatment without our paying for it, do we then throw them in jail? I do believe we should spend more to provide care for the mentally ill. Still I cannot help but be amused by your ability to point to that, with no mention of background checks for gun buyers. Worried about your reputation with others on the right? If that is the case then be careful they don't think you are in favor of paying for other people's medical problems. Sincerely, Dr. C.
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