Maybe that press embargo of Sarah Palin is a good idea

I googled the term, and as expected wiki turned up with the following definition "This bond will protect the owner of a building or other structure should the contractor be unable to fulfill his contractual duty to the insured. In such a case, the insurer is obligated to see that the work is completed." which doesn't seem related to anything on Wall Street.

My guess is a) someone gave Palin the wrong brief or highlighted the wrong word and it stuck with her or b) she read something on a brief and couldn't recall it and used the term that seems "close enough." Both possibilities seem very disturbing.

I think you have nailed it. Except when she's reading a teleprompter, she is absolutely incoherent and incomprehensible. It's as if her mind is shuffling through various sounds bites she has been force-fed and just blurting them out randomly. Thre isn't any sense in her remarks that she is has deep knowledge of the subjects at hand (which is perhaps ok since this is all a new gig for her) but more importantly that she has the capacity for analysis. What I mean is that there doesn't seem to be any already existing framework of thought in her to which she can attach the material she is being coached on. And it's that lack of pre-existing thoughtfulness that is not only worrying but also way too reminiscent of the current occupant of the White House.

Her appeal is being a social conservative (anti-gay, forced pregnancy, etc.), but Western-style, rather than Southern-style. She knows all the right culture war code words. So the conservative base (Dobson and the rest) are eating her up while those who pretend to be more moderate or unconcerned about those issues (The National Review, for example) can still pretend she's not insane. We can only hope more and more people see what you are seeing before November, but I'm not betting on it.

"because her current appeal seriously escapes me"

It's all culture war, Dan. Forget red states and blue states, I've spent most of my life living at the interface between red counties and blue counties in five states. She is authentic red, not east coast intellectual red. This is the Republican Party. This is 35% of the American public. These are the people who attend the churches in my neighborhood.

That's her appeal, and they love her.

Can anyone take a look at her college transcripts? Did she take any courses in economics or finance, even 20+ years ago? Has she been reading the current reporting on the financial crisis (because the reporting in the WSJ and the NYT, among other places, has been pretty decent)? And, if she's been reading it, does she understand it (quick quess--not reading, not understanding)?

I'm much more concerned about this report in "the world's only reliable source for news," by their own admission:

http://www.weeklyworldnews.com/

I'm sure it is against the law to hunt an endangered species from a gov't helicopter while holding a baby.

Construction bonds are bonds that contractors post, especially though not exclusively on public works projects, go guaranty completion. I gather it's the aspect of the insurance industry with which Ms. Palin is most familiar. Also, I gather that the average social science professor doesn't even know what they are. I leave it to the reader to guess whether there are more people in the construction and insurance industries who know what Ms. Palin is referring to, or more social science professors who don't.

I assume she is referring to performance bonds insuring against a contractor/builder failure to complete a project according to the contract terms. I can't imagine that construction bonds represent a large part of the AIG portfolio but then I really don't know.

She's the only one who thinks this (google doesn't come up with anything about "AIG Construction Bond" without "Palin"). Someone suggested she's mistaking Construction bonds and Credit Default Swap.

Slightly off-topic, perhaps, but I worry that Biden will not be able to help himself but to ridicule Palin in their debate, and I don't think that'll go over well with the ignoranti crowd.

Construction bonds are assets particularly at risk in the 57 States Obama believed to have been hit by that tornado which killed 10,000 people. I guess Obama doesn't care about them because that would mean he couldn't follow Joe Biden's advice to send 200 million to Iran after 9/11, just to make sure the Arabs (sic) wouldn't think we'd blame them.

Really, Dan, I had thought better of you. You're the man who claims he became a Republican in high school because of Reagan. Let's be honest with yourself: if you'd been a Fletcher professor then wouldn't you also have been snickering about Bedtime for Bonzo, Eureka College, and all the rest of it?

http://tinyurl.com/4blp3h

sleepyirv, AIG Surety is actually a fairly big operation. You just have to know something, so that you google the right term. (People in the industry generally refer to "surety bonds" or "payment and performance bonds.") What's funny to me is that there all these people who know nothing about the construction, finance or insurance industries, but each of them is absolutely convinced that he is sooo much smarter than Sarah Palin.

I'd be willing to bet that 'construction bonds' stuck in her mind from something related to the Wasilla Sports Complex, which as far as I can tell is her only first-hand experience that might have anything at all to do with finance.

I don’t believe one can intellectually understand Sarah Palin’s appeal. It is felt. She appears to lack the pretension of other politicians, which might make her seem unpolished, but also makes her seem honest and charming. She really does remind people of the many unsung heroes they know who organize the PTAs, the neighborhood barbeques, and the little league fund drives. She gets things done. And she gets them done with a good dose of common sense. Looking at her record, she’s not the ideologue she’s often made out to be. She governs from the center.

Does this qualify her to be Vice President? I don’t know. But, I do know that being an expert doesn’t necessarily lead to one to make good decisions. One need only look at the long line of experts who opposed the Surge to understand that.

I'm with Matt on this one. Rumsfeld and Cheney had tons of knowledge and experience between them, and look what they did. They invaded the wrong country! So by all means, let's go with the gun totin' bible thumpin' hockey mom. She can't possibly do any worse.

I don?t believe one can intellectually understand Sarah Palin?s appeal. It is felt. She appears to lack the pretension of other politicians, which might make her seem unpolished, but also makes her seem honest and charming. She really does remind people of the many unsung heroes they know who organize the PTAs, the neighborhood barbeques, and the little league fund drives. She gets things done. And she gets them done with a good dose of common sense. Looking at her record, she?s not the ideologue she?s often made out to be. She governs from the center.

Does this qualify her to be Vice President? I don?t know. But, I do know that being an expert doesn?t necessarily lead to one to make good decisions. One need only look at the long line of experts who opposed the Surge to understand that.

I think we can assume that Palin was referring to surety bonds, though it sure would be nice if she could articulate things better than she did. At any rate, according to this article AIG folding might bring repercussions:

http://www.bigbuilderonline.com/industry-news.asp?sectionID=363&articleID=776073

It's a pity no hard numbers were provided.

But, I do know that being an expert doesn't necessarily lead to one to make good decisions. One need only look at the long line of experts who supported the invasion of Iraq to understand that.

Fixed that for you. And unlike JFK in the Cuban Missile Crisis, there's no reason to suppose Palin has the mental skills and habits to be an effective skeptic of an expert consensus.

"And unlike JFK in the Cuban Missile Crisis, there’s no reason to suppose Palin has the mental skills and habits to be an effective skeptic of an expert consensus."

An expert consensus such as, for example, knee-jerk academic and coastal liberalism?

She'd make a very impactful teacher.

A low-information Vice President to appeal to low-information voters. Legally Blonde 3: the VPILF. Reese Witherspoon will star as Palin.

“because her current appeal seriously escapes me”

Just imagine Dubya in lipstick - she sounds exactly like him. I never understood his appeal either.

An expert consensus such as, for example, knee-jerk academic and coastal liberalism?

Well, presumably, any kind of expert consensus. But most likely a McCain-Palin administration would reject out of hand (as the Bush administration has done) any expert testimony that runs against the wishes of their patrons. So that's not really what I'm talking about.

I'm thinking more of an expert consensus that a leader finds either appealing or compelling for some reason. Again, like the Joint Chiefs telling us that bombing Cuba, and thus flirting with the possibility of a civilization-ending exchange of nuclear weapons, was our only option in the circumstances. Kennedy, being a pragmatic liberal, was inclined to defer to the military and diplomatic experts, but he was also inclined to think things through to their logical conclusion. And he had also learned from the Bay of Pigs fiasco. It's really hard to imagine Palin in JFK's place in 1962, and standing up to people who hold essentially the same worldview as her. Admittedly that's a high bar; among plausible American presidents of the same era, I think only Eisenhower would have gotten us through the crisis, as JFK did, without a catastrophe.

"It’s really hard to imagine Palin in JFK’s place in 1962, and standing up to people who hold essentially the same worldview as her."

Surely you're joking. The people in the bureaucracy she'd have to stand up to would be very much unlike her, particularly in wordview. I hate to use capitals, but THAT'S HER VERY APPEAL.

I feel a little dirty defending her, but Palin may have a point. At least I get to post a link to "bigbuilderonline," which, frankly, I never thought I would have cause to do: http://www.bigbuilderonline.com/industry-news.asp?sectionID=363&articleID=776073.

She may have experience with this given her experience as mayor. So, no, I don't think Palin has acquitted herself well for the most part in interviews, especially on foreign affairs or how McCain would shring the budget (it's the efficiency!), but on this she may have a point.

See, there, I've been fair to her. Now I get to take a few cheap potshots in other settings.

If anything, that comment shows how down-in-the-weeds her briefings have been to date. She was obviously briefed on why AIG was important by some very smart folks, and she spit out a few of the details she recalled.

See Tyler Cowen though, for the idea that she perhaps could have recalled something a bit more familiar:

http://www.marginalrevolution.com/marginalrevolution/2008/09/sarah-palin-on.html

Quote:

"... The point about construction surety bonds is actually correct, as indeed AIG did issue them and it doesn't seem that any regulation or state authority will make good those guarantees (readers, correct me if I am in error but I can find no record of such guarantees). That means a lot of people bought insurance against adverse construction events and will be left without that protection.

Of course this matters less at lower levels of construction.

The real lesson of this quotation is that the Republicans have no good language for discussing recent events. They're not allowed to say anything that sounds like "showing sympathy for Wall Street," so they have to find someone else to show sympathy for but they can't turn to traditional Democratic rhetoric about how an unregulated capitalist economy is failing us. Citing the construction bonds is like worrying that the financial crisis will postpone the retirement of many professors. Yes that is true but it's odd (though not unprecedented) if that's the first thing that comes to your mind or for that matter to your talking points. ..."

She’s a cretin, conservative or not. Let me preface that while I understand most of Drezner’s readers may be contemptuous of the feminist perspective (I can see the eye-rolling now), but I want to add to this tired commentary. The fact that her cognitive shortcomings are described as “honest” or “charming” is OUTRAGEOUS. Dr. Jones, thank you for linking to your blog posting about the “politics of destruction.” I don’t think that people’s reactions to Palin are that she’s conservative- it’s that she’s provincial, incoherent, and doesn’t even know what the Bush doctrine is. Not to mention that annoying accent. If McCain drops dead and Palin’s at the helm, our lipsticked soccer mom would be collectively ridiculed by the global community. And yes, we should care what the rest of the world thinks about us.

On a side note, destroying the woman personally? Oh, the horror! How inappropriate and disrespectful! Poor Palin and her high school drop-out, loser, pregnant daughter! Please. If you’re going to go that route, one need only point to the glaringly obvious double standard here with respect to Hillary Clinton.

“We” (read: the elitist liberals – or moderates, in my case, but still an unapologetic elitist) won’t make her an “extremist dunce.” I don’t think she’s quite an extremist, but she’s certainly a dunce.

So, Drezner admits he doesn't know what construction (or surety) bonds are, but *Sarah Palin* is the ignoramous???

Usually, when people know that they don't understand something, they will be cautious in calling others ignorant. But I guess when you are a tenured professor, you get to assume that you know everything, and if someone else says something that stumps you, it must be the other person's fault.

Really, is there a better example of elite arrogance than this post? Because I can't think of one. Come back down to us, Drezner - you were a lot more humble when you were untenured.

Dan:

I tend to agree with you that Palin would have been a better VP selection four years from now, though I would really doubt, in that situation, she still would have had much in foreign policy and Wall Street expertise. This kind of thing is just not what governors do (except, perhaps, the governor of New York). The main advantage, in this situation, is having somebody who can explain in simple language what's going on and reassure (Obama would have this -- McCain does not), look like they know what they are doing, even if they don't (both presidential candidates have this) , have access to networks of folks who can do the real work (No problem for either candidate), and know when to take their ignorance out of the room, and let the experts take over (don't know if either candidates have this.)

Palin and Biden would just be horrible in the situation we've got, though for different reasons. Palin's inexperience, were she faced with this, would either overwhelm her, or cause a George W. Bush experts be-darned, I'm decidin everything overreaction. Biden, on he other hand, would likely do a press conference, attempt to awe everyone with his Cliff Clavanisms, give the markets one terrible sound byte that will send them crashing, and NOT let the experts do their work, because he's too busy talking and interfering.

Construction bonds are something that the general contractor typcially must take out to "guarantee" completion of the construction project.
In plan english, if a general contractor is shady or incompetent and is failing at doing its job, the owner/developer can call in on the bonds to fund another general contractor who can finish the job.
At the end of the job, there's usually a 3 (or more) way lawsuit between the owner, contractor, and bondholder to determine why the project really failed and if the owner is justified in getting the bondsmans money.
It's just to make sure the job site doesn't shut down in the middle of work because of the builder's problems.

What this has to do with our credit crisis: Nothing.
Are there other construction bond issuers other than AIG: yes.
Was it dumb to cite this: yes.

As long as the original general contractor can finish the job, the bonds never get invoked. So it's actually kind of rare for any project to actually use the bonds. While the bonds are needed before work starts (typically its a contract requirement), new projects can get them from someone other than AIG.

I am no Sarah Palin fan. However you asked about her appeal.

1) First, she did time as a local news broadcaster. There she learned to speak simply in small soundbites and avoid complex sentences. Watch a local newscast tonight from a town with fewer than 500,000 people. Her style of speech might be more an indicator of *her* opinion of the basic idiocy of the average voter/ viewer than it is of her own basic idiocy. It's hard to tell.

2) Second: there is a huge swath of this country who finds abortion morally abhorrent, an act of murder, an absolute black and white ethical issue. Let's not worry about whether these are woman-haters or hypocritical evangelists or just plain uneducated. Let's simply acknowledge that they exist. In very large numbers.

If you believed with absolute certainty that something legal, affecting millions of people, was tantamount to murder, you would have a very difficult time ever aligning yourself with a party committed to keeping that thing legal. You would even feel a bit uneasy about voting for the opposing party if the candidate in question didn't seem that concerned about this grave moral wrong. If a candidate emerged -- even a vice-presidential candidate, even from the backwaters with not much experience -- who you could tell by the very outlines of her real life shared your abhorrence of this thing, you would feel nothing but relief that you could vote for that candidate without implicating yourself in the legalization of murder.

3) Third: People on the right do not like to be accused of sexism any more than people on the left do. They see in Sarah Palin their chance to disassociate themselves from a perennial charge, without compromising any of their basic political beliefs. Maybe they even see her as their chance to fashion Republicans into THE pro-woman party. This is a very attractive and comforting prospect.

I don't see the appeal of Obama, McCain or Biden, either.

I've worked in construction arbitration and am very familiar with construction bonds. I can assure you that they are not one of the two main reasons that we should be concerned about AIG failing.

For what it's worth Tyler Cowen noted that "The point about construction surety bonds is actually correct, as indeed AIG did issue them and it doesn't seem that any regulation or state authority will make good those guarantees (readers, correct me if I am in error but I can find no record of such guarantees). That means a lot of people bought insurance against adverse construction events and will be left without that protection.... Of course this matters less at lower levels of construction."

Here is a link to a construction industry online news site with an article entitled "AIG Crisis Could Affect Surety Bonds" with nary a mention of Gov. Palin.

I do second the idea that this is probably something that she, being in state government and having been in city government, is more familiar with than most aspects of their operation (and more familiar than most people would be). Construction surety bonds are pretty important to mayors.

From the article:

Whenever a builder gets entitled but not improved land, he needs backing to secure surety bonds for improvements, like roads, sewers, and utilities. AIG was one of a small number of companies with high-dollar bonding capacity. Often the company would buy bonds reissued by local bonding companies.

If AIG went away, those bonds would become much more difficult to secure. "If I'm buying an entitlement, how do I get these bonds?" asked Albert Praw, CEO of Landstone Communities in Los Angeles.

In the past, it was rare for a city to call in a bond, but as many more builders and developers have fallen on troubled times, they've had to call in more bonds. Gross said he knows of one case where a city has called bonds in twice. Without an insurer to write a check, the city could be in trouble. "What would cities do for improvements?" asked Barry Gross, principal of Strategic Land Advisors in Irvine, Calif.

It's important because AIG buys bonds reissued by local smaller surety bonding companies, providing a form of reinsurance to the local bond companies. (Obviously a local problem could cause all the bonds issued by a local company to be called in at once.)

At least some industry folks found it important without mentioning Palin. I don't think it's a case of her picking something out of her briefings; I think it's a case where her mayoral experience makes her familiar with one specific thing that AIG does that is of great importance to mayors (and governors).

I can't help you on translating. I don't speak Palin. But if you've listened to John McCain discussing economic policy in the past few days, it appears that he speaks Palin.

Irritated Fletcher Grad

Subsequent to Gibson's interview, it was revealed that there is no single agreed upon definition of Bush Doctrine.

Here is the beginning of the Wikipedia entry on Bush Doctrine:

"The Bush Doctrine is a phrase used to describe various related foreign policy principles of United States president George W. Bush, created in the wake of the September 11, 2001 attacks. The phrase initially described the policy that the United States had the right to treat countries that harbor or give aid to terrorist groups as terrorists themselves, which was used to justify the invasion of Afghanistan."

Palin's first response, "In what respect, Charlie?" was appropropriate. Since he refused to answer, she responded by talking about Bush's terrorism policy, which was also appropriate. No doubt, had she responded by citing an instance where preemptive action might be necessary, he would have said, "I understand the Bush Doctrine to mean the right to treat countries that harbor terrorists as terrorists themselves."

Perhaps you should save some of your outrage for that kind of sleazy interview tactic.

I don't get the hate for Sarah Palin. Can she be any worse than the economic geniuses that oversaw the current mortgage/banking crisis? I don't say this as a Palin fan (no candidates enthuse me), but I just don't see her as a disaster-in-the-making, compared to the current incumbent yahoos of both parties.

[...] Drezner has more on Palin [...]

Alas, Dan, you missed her statement today on our oil exports:

"Of course, it's a fungible commodity and they don't flag, you know, the molecules, where it's going and where it's not. But in the sense of the Congress today, they know that there are very, very hungry domestic markets that need that oil first. So, I believe that what Congress is going to do, also, is not to allow the export bans to such a degree that it's Americans who get stuck holding the bag without the energy source that is produced here, pumped here. It's got to flow into our domestic markets first."

Now, I assume that by "not to allow the export bans", she really meant "allow export bans". She couldn't possibly have meant anything else, could she?

We should also consider the possibility that the poor woman has spent so much time speaking in tongues in church meetings (including the one she attended on Aug. 17 where the head of Jews for Jesus said that Israelis deserve to be slaughtered by Palestinians because they haven't converted to Christianity, and was then warmly praised by Palin's pastor) that she simply can't STOP doing so after the church meeting ends. And of course it may be cruel and unfair for any of us to criticize her at all for doing this sort of thing; after all, that's what her defenders -- including the ones on this blog -- keep insisting.

Parenthetically, to Matt: it really IS defensible to ask just what is really meant by "the Bush Doctrine", since by far the most important part of Bush's response to terrorism has been the invasion and occupation (for Rube Goldbergian reasons) of a country that WASN'T harboring or giving aid to anti-US terrorists.

These are surety bonds; someone who's been a governor or worked in local government knows that they are very important.

Well, Dan, now that you have had "construction bonds" explained to you so thoroughly, are you convinced that Sr. Sarah knows everything she needs to step in to the Presidency at a moment's notice? No? Ivory tower coastal liberal academic professor elitist sexist blah blah blah.

"Let’s not worry about whether these are woman-haters or hypocritical evangelists or just plain uneducated."

I don't understand how finding the killing of a fetus unethical means you hate women, or are uneducated. What is that piece of information that such people are missing, that will magically make it stop feeling wrong to kill what would become a person?

The woman-hater piece of that gets to what I consider the very core of the debate over abortion. Those that support abortion tend to focus on the woman's perspective, some to the point of considering her a victim of the pregnancy (considering the fetus a punishment, in Sen. Obama's case, for example). Those that oppose abortion tend to focus on the fetus's perspective. So far, I've been unable to really consider either side objectively wrong. I see it as two opposing, but equally valid points of view. Then again, I guess a lot of political issues come down to simply what you believe is right and wrong.

[...] di Daniel Drezner [...]

To Justin: If it's immoral to kill something that "would become a person" -- even if it is absolutely NOT a person at the time, and in fact has less consciousness at the time than an insect (if any) -- then what about all those women who insist on not staying continuously pregnant? Think how many "potential persons" they're keeping from coming into the world! So let's show some absolutely elementary common sense on this subject, hm?

Footnote: Let's keep in mind that I'm talking about early-stage abortions (the overwhelming majority of them -- about 94%, in fact, are first-trimester, with a lot of the rest being due to serious medical problems) -- at which point the fetus hasn't developed a functioning cerebral cortex at all. After it starts to do so, of course, genuine moral problems do start to develop, and they rapidly become more serious. But Palin opposes abortions from the moment of conception on (even in cases of rape or incest), and in the process makes a seriously destructive cretin of herself.

Well, if you read the post carefully, I'm not endorsing that particular view of people who call themselves "pro-life." In fact, I was just trying to shut down the tiresome and endless debate about how selfish and arrogant pro-choice people are and how ill-informed and hypocritical pro-life people are.

As long as we can make fun of the other position, we can distract ourselves from the fact that both beliefs are held deeply and sincerely by a large population whose voting patterns are often, in the final analysis, decided by their position on abortion.

Bruce, I'm not sure what you are comparing abortion with, but I'll give you the benefit of the doubt and at least assume that your claim is that it is common sense to equate aborting a fetus with allowing an egg to be discarded via menstruation. If so, I will rebut, but with acknowledgment that nothing I or anyone else could say will ever make you understand a different viewpoint on the matter.

I was going to delve deep into the logical problems of your claim, but I'll just sum it up instead. First of all, an unfertilized egg would not become a person, in the absence of action. Second, there is a difference between an egg and a fetus, and there is a difference between taking an action (getting an abortion), and not taking an action (not getting pregnant). If your common sense tells you otherwise, I advise you to always consult other people before making decisions.

Tyler Cowen discusses the same Palin econ interview and says:
"The point about construction surety bonds is actually correct, as indeed AIG did issue them and it doesn't seem that any regulation or state authority will make good those guarantees (readers, correct me if I am in error but I can find no record of such guarantees). That means a lot of people bought insurance against adverse construction events and will be left without that protection."

Cowen concludes:
"[McCain] did worse than she did [discussing the financial crisis] and that's after decades on the national scene."

http://tinyurl.com/4cffy2

The ironicity of this post is brilliant!!!

Mr. Drezner, are you really claiming that you didn't know what she was referencing despite having a Masters in Economics? If so, the events of the last week are starting to make a lot more sense.