A new independent 527 group called Health Care for America Now PAC is running this ad in Ohio attacking Senator McCain over his health care proposals. Other versions of this ad will be used to target Republicans in tight Congressional races. It’s pretty clear that the Democrats and groups closely tied to the Democratic party have found a winning issue.

From the New York Times:

An independent group is spending more than $4 million to go on the air with a series of television advertisements aimed at Senator John McCain and seven Congressional candidates on the issue of health care.

The commercials, which were paid for by the group, Health Care for America Now, assert that Mr. McCain and his fellow Republicans support “health care plans and policies that would leave millions of Americans on their own to fight the insurance industry.”

In the 30-second spot on Senator McCain, titled “Fighter,” a woman says, “I’ve never faced an enemy like cancer. But it’s O.K. I’m a fighter. Under John McCain’s health care plan, 20 million could lose their insurance at work — I could be one of them.”

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Over the past three weeks, Senator McCain’s lead over Senator Obama has narrowed from low double digits to high single digits reflecting a trend towards seen in many states across the nation but in Georgia at least McCain’s narrowing lead seems to be holding steady at nine points. It suggests that McCain has bottomed out at least in Georgia. This week’s Rasmussen Reports poll in Georgia (link is to US Census demographic data) shows no difference from last week’s poll from Survey USA. McCain leads Obama, 54% to 45%.

While his numbers may be souring in much of the country, John McCain is still strongly ahead of Barack Obama in Georgia, 54% to 45%, in the latest Rasmussen Reports telephone survey of voters in the state.

In August, McCain led Obama 54% to 43%.

Nationally, Obama has been gaining ground steadily in the Rasmussen Reports daily Presidential Tracking Poll ever since the Wall Street debacle began to dominate the news.

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Polls in Minnesota (link is to US Census demographic data) remain conflicted either showing a narrow lead for Senator McCain or for Senator Obama. A Survey USA poll on October 2nd showed McCain with a narrow one point lead. Today’s Rasmussen Reports gives Obama a seven point edge, 52% to 45%. Looking at the internals of both polls, my sense is that the Rasmussen Reports is likely the more accurate of the two polls. Obama likely leads and likely by more than the margin of error.

The race between Barack Obama and John McCain has changed little in Minnesota. The latest Rasmussen Reports telephone survey in the state finds the Democrat in front 52% to 45%.

The match-up has changed just a single point since last month when Obama was ahead 52% to 44%. Obama has maintained relatively consistent leads since tracking began, with exceptions of polls conducted in August and March, when he led by four percentage points.

Minnesota is historically a blue state, casting its votes for Democratic candidates in the last eight elections. In 2004, John Kerry won the state by a 51% to 48% margin.

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One day these latest McCain ads will be studied as examples of how not to conduct a Presidential campaign. This message has zero effect on me. The ad is a 30 second spot.

To begin with the National Journal is hardly an objective deterimant of liberalism. In 2004, they found Senator Kerry the most liberal. Had Senator Clinton won the nomination, I am sure she would have won the honour. Progressive Punch, a progressive group, rated Rhode Island Senator Sheldon Whitehouse the most liberal Senator. I forget off the top of my head where Senator Obama ranked but it was not even in the top twenty. For many of us, the problem with Obama actually is that he isn’t liberal enough. To be perfectly honest, I still have no idea what his core political convictions are. If you want to attack Senator Obama and perhaps score some points, I’d argue that the McCain campaign would be more successful asking who is the real Senator Obama? We just don’t know.

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The Obama campaign released this ad overnight on the McCain health care proposal to tax health care benefits. It is a 30 second spot and it should lay waste to whatever slim chances McCain has winning this election.

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Here are three (all I can handle right now, sorry) articles from both the US and international media about the US Presidential race. Highlights of each article provided with a link to the full article.

McCain Loses By Not Winning
By Roger Simon writing for Politico.

Watching John McCain and Barack Obama at their second presidential debate was like watching two fighters circling each other, throwing a jab here, landing a blow there, but neither one ever delivering a knockout punch.

The trouble for John McCain, however, is that he needed one.

So if you had to say somebody lost Tuesday night, it was McCain. Because he had to win and he did not. He is the one who has to change the current trajectory of the campaign, and he did not do that.

McCain is behind in the national polls and way behind in the Electoral College vote projections. His party is lagging in voter registration in key state after key state, and in voter enthusiasm in general.

I tend to agree. McCain needed a game changer. He didn’t get it. I expect him to continue to lag in the polls and I do not discount the possibility of a landslide loss in both the popular vote and the Electoral College. Senator Obama is likely to become the 44th President of the United States and it is now time to begin to consider how we should approach an Obama Presidency. I’ll repeat what I noted earlier this morning before I was subsumed by the tidal wave of harsh economic news that has kept me up all night — this blog welcomes all opinions and views within the parameters of civil and frank discussion. By The Fault remains an anti-Obama blog, perhaps Obama-skeptic is a better description, and it’s likely that an Obama Presidency will give us much to fret over. I have low expectations, perhaps we’ll be surprised but I doubt it. I see a coming storm that I am not sure Obama will be capable of handling. It would likely overwhelm most men, men in this case being the operative word. Experience does matter. Americans might learn that some day. But I am not too optimistic on that front either.

Democratic Group Backing McCain Opens an Office in Scranton
By Bill O’Boyle in the Times Leader.

Lynn Forester de Rothschild helped open the Democrats for McCain headquarters on Main Avenue in West Scranton. About 30 supporters turned out to welcome de Rothschild and speak out for the Republican ticket.

“What it came down to was that I decided I love my country more than my party,” de Rothschild said, explaining her support of Sen. John McCain and Gov. Sarah Palin. “I’m really worried. I do not want (Obama) in the White House.”

De Rothschild, 54, said she sees Northeast Pennsylvania – specifically Luzerne and Lackawanna counties – as the key to winning Pennsylvania’s 21 electoral votes. And, she said, whoever wins Pennsylvania will likely become the next president.

“Barack Obama has never had the mandate of Democrats,” she said. “And Howard Dean and Nancy Pelosi ignored the 18 million people that voted for Hillary Clinton. They can’t be surprised at the 5 million to 7 million Clinton supporters who are now supporting McCain.”

Barack Obama Left Unscathed by Unchallenging Debate
By Gerard Baker in the Times of London.

John McCain was running out of time to halt Barack Obama’s gaining momentum today after their second presidential debate ended without a “game changing” moment for the Republican who is now fighting an increasingly uphill battle to persuade voters that he can fix America’s economic crisis.

With their third and last debate to follow next week, and less than a month until Election Day, Mr Obama hits the campaign trail today ahead in national polls and a slew of battleground states unscathed from their encounter in Nashville, and boosted by the economic crisis that a clear majority of Americans believe he is better able to handle.

The two candidates clashed on the economy, Iraq, Pakistan and Iran – and often found ways to criticize each other in a “town hall” setting where they fielded questions from ordinary voters – but it was a format that left the dynamic of the race unchanged.

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The stunning developments just keep on coming. The British government has today acted to shore its banking sector with a £500 billion plan that injects £200 billion into the capital markers immediately plus another £250 billion available to retire more debt if needed and a partial £50 billion nationalization of several UK-based banks including Barclays, the Royal Bank of Scotland and HBOS among others. From the Times of London:

Gordon Brown set out a radical £500 billion package today to save the British banking sector from collapse and break the damaging logjam in credit markets.

The three-part package includes using £50 billion of taxpayer funds for a partial privatisation of stricken banks, met from increased public borrowing and with strings attached including reining in executive pay.

In addition, the Bank of England will pump at least £200 billion into the money markets under its existing Special Liquidity Scheme. The Government is also making a further £250 billion available for banks to guarantee medium-term debt to help restore confidence and get banks lending to each other again.

The package was unveiled by the Prime Minister and Alistair Darling, the Chancellor, at a Downing Street press conference this morning at which the two men drew a distinction between their rescue plan and the $700 billion US bailout involving the purchase of “toxic” assets.

Here are some more reports on today’s developments:

Alistair Darling on SkyNews
A video interview of Alistair Darling, the Chancellor of the Exchequer from the Times of London.

Darling Unveils Bank Rescue
From the Financial Times:

Britain’s largest banks are to be part-nationalised after the government took the momentous decision to pump tens of billions of pounds of public money into the sector to avert a banking collapse.

The scheme failed to stabilise shares in the UK’s biggest banks and the FTSE 100 fell another 200 points or 4.4 per cent to 4,404.32.

The government is to put up to £250bn into the banking system in an effort to keep banks lending. It will also offer a guarantee to banks issuing medium term debt, which could mean backing a further £250bn of bank borrowings. But it is likely to demand dividend cuts and the end of big bonuses at the banks in return.

Under the plan, announced by the Treasury on Wednesday, seven leading banks and the Nationwide Building Society will initially apply for £25bn in permanent capital to raise their Tier One capital ratios, with a further £25bn available as a stand-by and for other eligible institutions. The banks have agreed to conclude their recapitalisation by the end of the year.

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It is still unclear to me at least how Iceland’s banking sector became so exposed to global currents that its collapse is threatening the whole of Iceland. While the global financial crisis is having reprecussions across all corners of the world, no where is the pain being felt harder across an entire nation than in Iceland. Iceland is a small country that in the last 30 years became quite wealthy and as Iceland became wealthier, its banks grew. But Iceland has 250,000 or so people. It’s a tiny market and so Icelandic banks in order to grow more expanded overseas and they expanded aggressively into the British Isles. Therein probably lies their downfall. But the issue now is that the collapse of the Iceland’s banks, the three largest have failed, is threatening to subsume the whole of the Icelandic economy and the people of Iceland with it.

Let’s start with the background as noted Simon Watkins in the Financial Mail who noted back in March 2008 that the Credit Default Swaps premiums on Icelandic bank were astronomical.

CDSs are quite simple. They are contracts that allow someone who owns bonds issued by a company to insure themselves against it defaulting. The price of CDSs is measured in percentage points and is essentially a price for insuring debt.

For example, CDSs on Lloyds TSB are priced at about 1.33%, or 133 basis points. That means anyone with £10m of Lloyds TSB bonds could insure against it defaulting for £133,000 a year.

These prices move constantly because there is a market in CDS contracts, so watching the figures gives an idea of just how risky the market thinks a bank or any other company is. The higher the figure, the higher the risk.

Lloyds TSB has low exposure to US mortgage market toxicity and its 133-point figure is one of the lowest among banks. Most are in the same ballpark. Barclays, for example, is at about 170 basis points and HSBC 145.

To get a sense of what is a bad figure, let us take Bear Stearns, the bank that needed an emergency bailout last week. In the days and hours before the crisis hit Bear Stearns, its CDS price hit 720 points.

The message being sent out by the credit markets was clear – the bank’s debt is very high risk.

So what are the other interesting figures? In the UK it is worth noting HBOS (Halifax Bank of Scotland). Its CDS price was about 235 points last week, a long way from seriously worrying but markedly higher than most other British banks.

This reflects its high mortgage exposure in the UK, its relatively high exposure to certain types of near-prime mortgages in the US and its slightly higher dependence on financial markets to fund lending.

More risky is Alliance & Leicester, whose price was about 342 points last week, again reflecting its high dependence on wholesale financial markets, which have become frozen in recent months. But the real horrors are in Iceland.

Credit insurance for debts at Iceland’s biggest bank, Landsbanki, is priced at 610 points while that for Kaupthing is priced at a hair-raising 856. Given that these two have taken billions in UK retail deposits, it may be a sobering thought for savers to consider where they are putting their cash. These banks are now seen as the most unsafe in the developed world.

That was in March 2008. Landsbanki, Kaupthing and Glitnir have now all failed. Below the fold a few more reports on how far-reaching the crisis is in Iceland and the lengths to which Iceland is going to save itself from a total economic collapse. (more…)

The United Auto Workers union (UAW) has released this ad. It is a 30 second spot and entitled “worried.” The ad concludes noting that “we can’t afford John McCain.” I don’t disagree but the problem is that we can’t afford Barack Obama either. And given that it would come down to which is the lessor of of two evils and that’s not something I do. The lessor of two evils is still evil. I didn’t vote in 2004. I intend to abstain this time around.

It’s hard to reward the GOP with the Presidency again given the disaster of the last eight years. I understand McCain’s maverick qualities and appreciate his world view. It’s alot closer to mine than Obama’s recipe for disaster. I tend to look at US politics more through my own interests and that’s clearly the international front and I certainly understand that most of you focus on the domestic front. This blog welcomes all opinions and views within the parameters of civil and frank discussion. By The Fault remains an anti-Obama blog, perhaps Obama-skeptic is a better description, and it’s likely that an Obama Presidency will give us much to fret over. I have low expectations, perhaps we’ll be surprised but I doubt it. I see a coming storm that I am not sure Obama will be capable of handling. It would likely overwhelm most men, men in this case being the operative word. Experience does matter. Americans might learn that some day. But I am not too optimistic on that front either.

Update: Make that two new ads from the United Auto Workers union. This ad is also a 30 second spot. This ad focuses on McCain’s healthcare proposals. In the end, this is the issue that prevents me from supporting Senator McCain though Senator Obama’s proposals also fall far short of what’s needed. Woefully inadequate to be frank.

See what you miss by not living in a battleground state.

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Globalization is not an easy term to define. Globalization is a word that has several connotations today. But broadly speaking, it is a process which began around the late 1970s, by the shift in world economy from an international to a more global one. In the international economy, individuals and firms from different countries traded goods and services across national boundaries, and the trade was closely regulated by nation-states. In the global economy, goods and services are produced and marketed by an oligopolistic web of global corporate networks whose operations, although spanning several national boundaries, are only loosely regulated by nation-states. It is also a process made possible by cheap energy.

In a profound sense, I am a product of globalization and it’s hard to knock something that created you. But I have never been indifferent to the rather mixed results that globalization has wrought in socio-economic terms. When it comes to globalization, I am more a critic than a fan but I do have feet in both camps (okay more like just a toe in the fan camp). But this post isn’t really about that subject because frankly that aspect of globalization might take a year or more to write. This post considers if we have reached the end of globalization as political force as the world economy tumbles.

One of the dramatic developments this weekend was the failure of Nicholas Sarkozy to get the European Union to act in concert over the spreading financial contagion in European capital and credit markets. By Monday, it was clear that member states would act in their own self-interest as Germany, the largest economy in the Eurozone, acted to save its banking system unilaterally. This is not without historical precedent. One of the lessons of the Great Crash of 1929 was that in the midst of that great economic crisis, countries generally retreated from the world economy enacting all sorts of trade barriers that ultimately prolonged the Great Depression. Lessons were learned and a system after the Second World War was put in place to ensure global dialogue and cooperation in times of economic crisis. The Breton Woods agreement, the World Bank, the IMF, the OECD, the European Union and GATT-WTO (from the Cancun to the Uruguay to the Doha rounds) are all part of this system. And this system is certainly under duress. Mention the term WTO in a leftist circle and watch the epithets flow. American conservatives aren’t too fond of the WTO either seeing everything as some conspiracy towards world government. The more sane among us, of course, can point to pluses and minuses. Economics is, after all, about trade-offs.

My own view is that globalization is ultimately tied to energy. If we can’t solve our energy crisis then it is likely not going to be a model going forward simply because it can’t. To move what we what we move across the global simply requires cheap energy. And corporations who have fashioned a global supply chain are likely to reconsider that move as energy costs surpass labour costs. I don’t think we have reached that point and I’m not sure we will in my lifetime but I am pretty sure that the peak oil phemonenon will lead to a new economic paradigm, one more based on regionalism than on globalism, a continental shift if you will. And it’s quite possible that the profound economic changes as yet unleashed will recreate the political map of the world. Paul Saffo, a Professor at Stanford and a futurist, for example argues that there is a one in two chance in that by 2050 the United States will no longer exist as a unified political entity having broken up to supra-regional city-states.

Today Carl Mortished in the Times of London too reflects on why globalisation will yield to regional fiefdoms. That article is below the fold and well worth reading. (more…)