Oops! When your policy is to block every nomination, eventually someone you're blocking is bound to win a Nobel Prize

The 2010 Economics Nobelists

"[T]he same Senators cheerfully confirmed Bush nominees who didn't know much about economics of any kind."

-- Paul Krugman, in an August blogpost
about GOP obstruction of economist Peter Diamond's
nomination to the Federal Reserve Board

by Ken

In a way you almost have to feel sorry for "Clueless Dick" Shelby and his band of confederates in the Party of No. I mean, let's just say, hypothetically speaking, that you decide to "just say no," senatorially speaking, to the confirmation of every executive appointment sent from the White House. What are the odds that one of those suckers is going to go and win a friggin' Nobel Prize while you've got him cooling his heels?

Actually, considering just how many nominations the Nopers have blocked, the odds probably aren't that daunting. With a group of that size, I also wouldn't bet against one of them finding a cure for cancer, or --

Here's how economics Nobelist Paul Krugman greeted the news Monday on his blog:

Yay Peter!

My former colleague Peter Diamond, along with Dale Mortenson and Chris Pissarides, has won the Nobel. Richly deserved. The prize is for work on frictions in markets, which is very important stuff; but Peter, an incredibly profound thinker, has done much much more.

And yes, this is the same Peter Diamond whose nomination to the Fed board has been held up because of Republican doubts about his qualifications.

The "Republican doubts about his qualifications" link is to an earlier Krugman blogpost:

August 6, 2010, 11:55 AM
Peter Diamond, Macro Maven

This is disgusting: Senate Republicans holding up Peter Diamond's nomination to the Federal Reserve Board on the grounds that he may not be qualified to make monetary policy. Aside from the fact that the same Senators cheerfully confirmed Bush nominees who didn't know much about economics of any kind, this is especially stupid right now.

Why? Because right now one of the hot topics is whether the apparent shift in the Beveridge curve signals a rise in structural unemployment -- and Diamond wrote the seminal paper on the whole subject -- the top result on Google scholar.

Diamond is exactly the man we need -- which, given the way things have been going lately, probably means he won’t get confirmed.

Update: Some commenters note, correctly, that there’s an ongoing dispute over what the rise in vacancies without a corresponding fall in unemployment means. But that’s precisely the point: we want Peter Diamond, who pioneered the whole study of this subject, in the Fed, where he can help make sense of the situation.

The "This is disgusting" link is to a Bloomberg report:

Obama Fed Board Pick Diamond Gets Referred Back to White House by Senate

By Scott Lanman and Laura Litvan - Aug 6, 2010 6:19 PM ET

The Senate sent the nomination of Peter Diamond, one of President Barack Obama’s three nominees for the Federal Reserve Board, back to the White House because of objections from at least one lawmaker.

The office of the executive clerk of the Senate said the procedural move occurred as part of actions taken on nominees without debate before the chamber left for a summer break. Obama is likely to resubmit Diamond’s nomination, an administration official said. . . .

Apparently there's more to the Diamond story. It seems maybe Senator Shelby wasn't so much questioning Diamond's qualifications as playing political tit-for-tat. Ezra Klein wrote yesterday on his washingtonpost.com blog:

Diamond and Kroszner

According to the New York Times, Republicans are blocking Nobel Prize-winning economist Peter Diamond's nomination to the Federal Reserve Board "in retaliation for a refusal by Democrats to give a full 14-year term to Randall S. Kroszner, who served on the Fed board from 2006 to 2009." Tyler Cowen would like to see this mentioned more often.

MarketWatch says "Kroszner was the Fed's point-man on consumer lending and mortgage matters, a position that led to conflict with Dodd." [Dodd, in case you've forgotten him already, is now-outgoing Senate Banking Committee Chairman Chris Dodd.] Moreover, Kroszner's term would've been for 14 years, and Dodd argued that a decision of that length should go to the president about to enter office, not the unpopular leader about to leave it. But the bottom line seems to be this: The Democrats, who held the majority at that point, did not want to confirm Kroszner. George W. Bush did not, to my knowledge, offer up a second candidate.

Of course, Republicans can't say they're obstructing Diamond -- remember, they're in the minority here -- because they're still annoyed over Kroszner. So instead, we're getting this ridiculous dance in which Sen. Richard Shelby (R-Ala.) questions the qualifications of a Nobel Prize-winning economist. And Democrats will of course extract payback next time they're in the minority and the Republicans want to move some Fed nominees.

There's no good argument here for further delaying Peter Diamond's nomination. There's a very good argument, however, for either running fewer nominations through the Senate, or radically revamping the process by which the Senate considers -- or doesn't consider -- nominations.

I'm a little fuzzy here as to what exactly Ezra means by "running fewer nominations through the Senate." If I'm reading right, he's talking about changing the constitutional system of executive appointments. (Or can we legislatively slash the number of appointments that require Senate confirmation?) And then he suggests considering "radically revamping" the confirmation system.

Still, you have to hope "Clueless Dick" Shelby is feeling some heat. While a case can certainly be made that the whole point of a 14-year appointment is to leapfrog multiple presidential administrations, there is surely at least a legitimate question as to how late in an administration a president ought to be making such an appointment. Of course "Clueless Dick" doesn't engage in that discussion. He simply uses his senatorial clout to whipsaw a nomination in the new administration's first year -- a distinction Ezra seems a little fuzzy on in his rush to suggest that Dems and R's play the same games with presidential nominations.

It would be too much to hope that "Clueless Dick" is feeling as well as looking like a jackass here. As Krugman points out, he routinely rubber-stamped utterly clueless nominess in the Bush era. But then, he is, well, a clueless dick.


SAY, WTF IS BUGGING THIS TYLER COWEN
GUY, AND WHY THE HELL SHOULD WE CARE?

Ezra's Tyler Cowen link, in case you weren't curious enough to click through, is to a Tweet: "Someone should mention that Reps are blocking Diamond as retaliation for earlier Dem. block of a qualified R. nominee." No, I didn't know who Tyler Cowen is either, so I found his (and Alexander Tabarrok's) blog (Tyler's an economist at Georg Mason University -- home, by the way of the Koch brothers' Mercatus Institute; I'm not saying there's any connection, just that it's important to continuously tar everyone at George Mason, especially the economists, with that brush), Marginal Revolution, and glanced at the five posts he devoted to the Economics Nobel awards on Monday -- an announcement of the award to the three economists, individual posts on each, and "Some personal observations on the Prize." (Alexander Tabarrok added a single post.) In Tyler's post devoted to Peter Diamond I did find this:

Here is the bit of most current interest:

On April 29, 2010, Diamond was announced by Barack Obama as one of three nominees to fill the three vacancies then present on the Federal Reserve Board, along with Janet Yellen and Sarah Bloom Raskin.[5] On August 5 the Senate returned Diamond's nomination to the White House, effectively rejecting his nomination. Ben Bernanke, the current Chairman of the Fed, was once a student of Diamond.

But otherwise -- and I skimmed all the subsequent posts as well -- I found nary a mention of "Reps blocking Diamond as retaliation for earlier Dem. block of a qualified R. nominee." Let me see if I've got this straight then. According to our Tyler, "someone should mention" those dastardly Dem doings -- just not him?

Or is it possible that if he mentioned it, someone might feel obliged to mention why the Dems blocked the R. nominee? (This would presumably have to be someone else, because the T-man doesn't seem to think this part of the story is worth mentioning.) Or maybe there's another Tyler-tweet out there somewhere?

(Note: I realize I'm being disrespectful here to a highly esteemed -- at least by himself -- economist. Hmm. I think I can live with it.)

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Do New Orleanians have to put up with the bullying of the Party of No? (Maybe not.) PLUS: Sir Sleazebag found!

When he defeated indicted Louisiana Rep. William Jefferson, Donklephant asked, "Is Anh Cao A Model For A New Republican Party?"

Donklephant blogger Justin Gardner wrote:

No doubt many GOPers will call Cao a RINO if he doesn’t toe the party line, but this is the type of guy who can bring independents and moderate Dems back into the Republican party. And I hope Obama finds an ally in Cao from time to time when they’re trying to solve difficult problems that require common sense solutions over partisan jockeying.

Fingers crossed.

Well, it doesn't appear to be working out that way. Howie writes:

When it looked like a few House Repugs might break ranks with their party's obstructionist leaders, I mentioned that Anh Cao, the Repug from New Orleans, was most likely to vote yes -- since he said he would for the good of his constituents. Then House Repug Whip Eric Cantor got a-hold of him and persuaded him that there are some goods that are gooder than his constituents'.

Now BayouBuzz reports:

Louisiana Congressman Cao Faces Recall Petition Over Stimulus Vote

Congressman Joseph “Anh” Cao, a Republican, who defeated William “Bill” Jefferson, is facing a recall petition because of his vote on the Barack Obama stimulus package. The recall has been initiated by a group of ministers.

Cao had indicated that he would be voting in favor of the controversial legislation but instead voted against it.

Papers have been filed with the Office of the Louisiana Secretary of State which started the process, requiring sufficient signatures to force a recall election for the office held by Representative Cao.

Cao represents a majority African American community, many who were outraged by Cao’s vote. Cao made national news with his victory over Bill Jefferson.

One elected official, State Representative Juan A. LaFonta, Democrat of District 96, told Bayoubuzz that he does not know about the existence of the petition but that he would sign it.

“We don’t need Cao to be Steve Scalise”, said LaFonta. Scalise is a Republican who represents a neighboring conservative Congressional District. “People are starving and Cao needs to represent the people of the district”, LaFonta said.

Cao is Vietnamese and has been hailed by many in the media as a new face of the Republican Party.

The group of ministers who filed the petition want to make sure that he faces a recall, which could be a very daunting act, if not impossible act, in Louisiana based upon the state’s history.

HOWIE ADDS:

I hope Anh Cao gets recalled, not just because he's a Republican but because he put his obstructionist party's wishes ahead of the interests of his own constituents and ahead of the interests of the United States. Today's NY Times focuses on GOP hypocrisy around the country as more and more Republican members of Congress who, like Cao, voted to obstruct, are now celebrating the parts of the Stimulus Bill they like. Take Michigan's Twittering idiot Pete Hoekstra for example -- who doesn't seem to understand Twitter at all and who gave away state secrets on it a few weeks ago:

Representative Peter Hoekstra of Michigan sounded almost giddy on Wednesday in a post on the microblogging Web site Twitter: "If you know of someone thinking of buying first home, now may be the time. Stimulus incentive is very generous! Up to 8k! Check it out."

Mr. Hoekstra, who also voted against the bill, appeared less optimistic last week. "House passed spending bill. I don’t believe it will work," Mr. Hoekstra wrote on Twitter. "Hope we’re wrong but I don’t think so."

BULLETIN: BILLIONAIRE SIR SLEAZEBAG FOUND!

The Washington Post reports today:

Allen Stanford Found in Virginia

FBI agents found R. Allen Stanford, the suspected mastermind of a $9.2 billion financial fraud, in Fredericksburg, Va., and served him with court papers, authorities said.

The Securities and Exchange Commission charged Stanford, his three companies and two associates with fraud Tuesday after determining that he was allegedly misleading customers in the sale of certificates of deposit and other financial products.

Federal agents raided his office buildings in Houston, a judge froze his assets and a receiver was put in charge of his companies. But Stanford, a billionaire who spends much of the year in Antigua, where the bank at the center of the alleged fraud is based, could not be found.

The lawyer representing him in the SEC investigation had weeks earlier ended his association with Stanford and disavowed any earlier statements.

The investigation into Stanford has focused on what the SEC has called "impossible" returns on his investment portfolio, generating questions about whether he was running a Ponzi scheme.

The SEC has worked with criminal authorities on the case, but no criminal charges have yet been filed against Stanford. The SEC often files civil charges before criminal charges are filed.

But remember, since "Sir Allen" isn't under any kind of criminal indictment, he wasn't arrested. He was merely served the papers. Apparently he did surrender his passport (though if he can make his way to, say, Antigua, of which he more or less owns a chunk, it doesn't seem likely that he'll be turned away for want of a passport), but then he was and sent on his way.

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