Greg Mankiw outlines it here. It's the best plan I have come across and coincidentally, unless I am misreading matters, it appears to be precisely the plan that has been adopted by the Treasury Department.

I know that economic times are tough. But predictions of The Great Depression 2.0 strike me as being entirely wrong headed. We still have a very potent economy and despite the fact that it is going through a bad business cycle, there is no reason to think that it will not come back quite soon and stronger than ever. Indeed, there is every reason to believe that the economy currently is stronger than we give it credit for. The following is an important takeaway note:

It turns out that John McCain, who was widely mocked for saying that "the fundamentals of our economy are strong," was actually right. We're in a financial crisis, not an economic crisis. We're not entering a second Great Depression.

It would be nice if the media would pay attention to the arguments made by people like Professor Casey Mulligan. But "if it bleeds, it leads" and since there is so much emphasis on the bleeding, the hidden strengths of the economy are not liable to receive much attention nowadays. Pity--we are potentially setting ourselves up for bad policymaking fueled by abject panic and the mistaken belief that American capitalism itself is coming to an end.

We have two of them and they address a common topic:

It seems to every administrator that it is only by his efforts that the whole population under his rule is kept going, and in this consciousness of being indispensable every administrator finds the chief reward of his labour and efforts. While the sea of history remains calm the ruler-administrator in his frail bark, holding on with a boat-hook to the ship of the people and himself moving, naturally imagines that his efforts move the ship he is holding on to. But as soon as a storm arises and the sea begins to heave and the ship to move, such a delusion is no longer possible. The ship moves independently with its own enormous motion, the boat-hook no longer reaches the moving vessel, and suddenly the adminstrator, instead of appearing a ruler and a source of power, becomes an insignificant, feeble man...

--Leo Tolstoy, War and Peace.

And from the Economist, there is this:

. . . How far should the balance between governments and markets shift? This special report will argue that although some rebalancing is needed, particularly in financial regulation, where innovation outpaced a sclerotic supervisory regime, it would be a mistake to blame today's mess only, or even mainly, on modern finance and "free-market fundamentalism". Speculative excesses existed centuries before securitisation was invented, and governments bear direct responsibility for some of today's troubles. Misguided subsidies, on everything from biofuels to mortgage interest, have distorted markets. Loose monetary policy helped to inflate a global credit bubble. Provocative as it may sound in today's febrile and dangerous climate, freer and more flexible markets will still do more for the world economy than the heavy hand of government.

There is now a lot of talk that McCain rallies are being filled with "hate" against Obama and that this hate could lead to violence. James Joyner says phooey to this line of argument, and he's right:

Sheesh.  Look:  It's the closing days of a long, polarizing campaign.  We've been whipped up to believe that this is The Most Important Election in American History and that The Fate of America's Future is at stake.  McCain is losing.  Obama is winning.   The culmination of all this is that some McCain supporters are frustrated.

So what?

This has been the case as long as I can remember.  Certainly, we saw it in 2004, as Kerry supporters simply could not believe that we were about to re-elect George W. Bush.   Heck, we saw it from supporters of Hillary Clinton, Mitt Romney, and other losing candidates in this year's primaries.   People who are enthusiastic enough about a candidate to show up at a rally are naturally going to have a hard time dealing with the fact that their fellow partisans/countrymen don't share their view.  That's especially for those afflicted with Pauline Kael Syndrome and therefore can't even imagine what kind of people would vote for the other candidate.

It should go without saying, but in the event that you need to hear it from me, people who call Barack Obama a "terrorist" or advocate violence are being ridiculous at best and despicable at worst. But spare me the contention that this is some new phenomenon in American politics. It's not. Really, it's not. And need it really be said that so long as he continues to appear on Bill Maher's show, Andrew Sullivan is in no position whatsoever to decry the supposed lack of civility in American political discourse?

deserves another:

A man at the center of a voter-registration scandal told The Post yesterday he was given cash and cigarettes by aggressive ACORN activists in exchange for registering an astonishing 72 times, in apparent violation of Ohio laws.

"Sometimes, they come up and bribe me with a cigarette, or they'll give me a dollar to sign up," said Freddie Johnson, 19, who filled out 72 separate voter-registration cards over an 18-month period at the behest of the left-leaning Association of Community Organizations for Reform Now.

"The ACORN people are everywhere, looking to sign people up. I tell them I am already registered. The girl said, 'You are?' I say, 'Yup,' and then they say, 'Can you just sign up again?' " he said.

I call shenanigans and I want an investigation. Pronto. We have a Congress that supposedly loves engaging in oversight and delights in holding hearings on all sorts of issues. Why doesn't it do so here?

And no, the answer "because the party controlling Congress is the one most likely to benefit from ACORN's fraudulent activities" doesn't cut it. Voter fraud--you know, the stuff so many people on the other side of the partisan divide say does not exist--should not get a pass on the basis of so weak an excuse. If the current leadership in Congress can't carry out its oversight responsibilities, maybe we ought to get a new leadership that can. Not to mention a President that won't tolerate this nonsense.

The words you are looking for are "endemic voter fraud":

Officials in Missouri, a hard-fought jewel in the presidential race, are sifting through possibly hundreds of questionable or duplicate voter-registration forms submitted by an advocacy group that has been accused of election fraud in other states.

Charlene Davis, co-director of the election board in Jackson County, where Kansas City is, said the fraudulent registration forms came from the Association of Community Organizations for Reform Now, or ACORN. She said they were bogging down work Wednesday, the final day Missourians could register to vote.

"I don't even know the entire scope of it because registrations are coming in so heavy," Davis said. "We have identified about 100 duplicates, and probably 280 addresses that don't exist, people who have driver's license numbers that won't verify or Social Security numbers that won't verify. Some have no address at all."

The nonpartisan group works to recruit low-income voters, who tend to lean Democratic. Most polls show Republican presidential candidate John McCain with an edge in bellwether Missouri, but Democrat Barack Obama continues to put up a strong fight.

Jess Ordower, Midwest director of ACORN, said his group hasn't done any registrations in Kansas City since late August. He said he was told three weeks ago by election officials that there were only about 135 questionable cards -- 85 of them duplicates.

"They keep telling different people different things," he said. "They gave us a list of 130, then told someone else it was 1,000."

Yeah, I'm shocked--shocked!--to find all of this happening.

I can't believe I am actually wasting time writing this, but someone needs to point out to Jimmy Carter that when it comes to Presidents with lousy economic policies, his Administration still takes the cake no matter how bad things have gotten in the current financial crisis. Under the Carter Administration, inflation skyrocketed into the double digits--reaching 13.5% at the time of the 1980 Presidential campaign. Unemployment was at 7.7% nationwide by 1980 and worse in various industrial pockets. Interest rates were at a shocking 21.5%. Any President who is responsible for such a sorry spectacle has no business lecturing successors on how to set economic policy.

Contrary to Carter, "spending, borrowing and tax cuts" have nothing to do with the current economic crisis. As anyone who hasn't been living in a cave knows, the current economic crisis was brought about by the Community Reinvestment Act of 1977--signed by Jimmy Carter--along with Fannie Mae and Freddie Mac, all of which conspired to introduce Americans to the phenomenon of subprime mortgages. We thus started down the primrose path to offering mortgages to people at risk of not being able to pay those mortgages back. Mortgage-backed securities arose from subprime lending and while it is tempting to blame a lack of regulation for the emergence of MBSs, it has been conclusively demonstrated that deregulation is not the villain in this story. Indeed, opting for regulation--as Carter, with financial lust in his heart, appears so plainly to do--will have a deleterious policy effect.

I realize that Carter wants to obscure a clear examination of his calamitous economic record by trying to get people to dislike George W. Bush and I understand why Carter is resorting to tired shibboleths as he makes the effort. But that shouldn't excuse Carter's rhetorical dishonesty. Carter's Pavlovian answers do nothing to address the current financial crisis and despite the news of the moment, the economic disaster Carter helped bring about does not even remotely look better over time.

[Please be aware:  this post is not by Mr. Yousefzadeh and there is no reason to suppose that it reflects his opinions.]

Many conservatives, especially those on the libertarian side, detest Mr. McCain for his recurrent opposition to freedom, and especially for the creation of the McCain-Feingold Incumbent Protection Act, and are eager to vote for third-party candidates.  But a spoiler vote in a losing cause, increasing the Republican margin of defeat, will not bring the Republican party toward more libertarian policies; the larger their defeat, the more pressure they will feel to emulate the victorious Democrats.  Thus a spoiler vote will generally have the opposite of the intended effect.

There is one exception to this unfortunate rule.  In states more favorably disposed toward Mr. McCain, spoiler votes can be cast with little chance of altering the statewide outcome, and with no chance whatsoever of altering the national outcome:  if Mr. McCain loses, e.g., Kentucky, then he will also lose all of the swing states (in which he polls 20% worse).  

Thus voters in the following states can vote their consciences without negative consequences:

Alabama
Alaska
Arizona
Arkansas
Georgia
Idaho
Kansas
Kentucky
Louisiana
Mississippi
Missouri
Montana
Nebraska
North Dakota
Oklahoma
South Carolina
South Dakota
Tennessee
Texas
Utah
West Virginia
Wyoming

Explained here. Scary how accurate Michael Cannon is here.

but health care is not a right. Of course, that won't stop people from calling health care a right--and enacting policies that will bankrupt the country in the process.

is no panacea at all:

As usual after a financial crisis, we hear demands for new controls and regulations to stop it from happening again. But since every crisis has led to thousands of new pages of regulation, why is it that regulation doesn't stop crises from happening again? No matter what pundits say, we are nowhere near a laissez-faire situation. Look no further than the US federal institutions in Washington, DC, and we find 12,113 individuals working full time to regulate the financial markets. What did they do with the powers they had?

Made mistakes. American politicians, central banks and regulators were just as eager as speculators to expand the housing bubble. They just had a bigger pump.

The US Federal Reserve lowered interest rates from 6.5 percent to 1 percent between 2001 and 2003, and housing prices soared. Starting in 1995, the government threatened banks and thrifts with regulations and legal challenges if they did not extend more loans to poor neighbourhoods and a government-sponsored company such as Fannie Mae used its state guarantees to purchase more risky loans and expand the sub-prime market.

Is the solution to the crisis really to give more power to people and institutions that contributed to bringing it about?

Well, no. But that's what we are going to do anyway. And here is why:

Regulations and controls often result in new difficulties even when the intentions of policymakers are good and the hopes are real. That does not even begin to address the problem that a lot of new regulations are just symbols, enacted to show people that politicians have done something, even if they know that it does not really address the problem. It follows the politicians' logic from the British television series Yes, Prime Minister: "Something must be done. This is something. Therefore we must do it."

You know the rest:

Democratic vice-presidential nominee Sen. Joe Biden sharply attacked the recent moves of Sen. John McCain's campaign in a speech today, casting the Arizona senator as "an angry man, lurching from one position to another."

Biden, after taking two days off the campaign trail following the death of his mother-in-law, opened a campaign swing through Florida by attacking McCain for recent remarks from Alaska Gov. Sarah Palin and other allies linking Obama to 1960s radical William Ayers. He called Palin's remarks "simply wrong" for a vice-presidential candidate, his first direct criticism of his counterpart on the GOP ticket.

"You know, the idea here that somehow these guys are once again injecting fear and loathing into this campaign is ... I think it's mildly dangerous," Biden said. "Here you have out there these kinds of, you know, incitements out there -- guy introducing Barack using his middle name as if it's some epitaph or something," Biden told a crowd more than a thousand at a rally in Tampa, apparently meaning to use the word "epithet."

"Epitaph," "epithet," hey, it makes no difference. And in the event that this and other posts makes you think otherwise, Joe Biden has a much higher IQ than you do. And he is prepared to defend that proposition--"angrily," if necessary:

There really cannot be enough attention paid to groups like ACORN, that are quite clearly engaged in voter fraud:

State authorities on Tuesday raided an organization that registers low-income people to vote, alleging that its canvassers falsified forms with bogus names, fake addresses or famous personalities.

The secretary of state's office launched an investigation after noticing that names did not match addresses and that most members of the Dallas Cowboys appeared to be registering in Nevada to vote in November's general election.

State authorities on Tuesday raided an organization that registers low-income people to vote, alleging that its canvassers falsified forms with bogus names, fake addresses or famous personalities.

The secretary of state's office launched an investigation after noticing that names did not match addresses and that most members of the Dallas Cowboys appeared to be registering in Nevada to vote in November's general election.

ACORN claims to have sought to alert officials in Nevada about voter fraud and swears that it is innocent of any charge that it sought to pass along fraudulent voter applications as being genuine. Funny thing, of course, is that ACORN's hands are being caught in all sorts of cookie jars.

Remember: Voter fraud supposedly does not exist.

"How dare the U.S. Chamber of Commerce support Republicans instead of supporting Democrats and oh, by the way, I have no problem whatsoever with unions supporting Democrats as resolutely as the Chamber of Commerce supports Republicans."

Do these people even know what they are complaining about?

It's nice to see that I am not the only person so unhappy with the tone and tenor of last night's Presidential debate:

With the country at one of its most interesting -- not to mention terrifying -- moments in a generation, John McCain and Barack Obama met in Nashville for what was surely one of the dullest and least satisfying presidential debates in memory.

There have been boring debates before, of course. Truth be told, probably only a fraction of these encounters, over the 32 years since general election debates became a fixture of presidential campaigns, actually delivered on their promise of great political drama. And even interesting debates are inevitably somewhat stilted affairs, as candidates cleave to their scripts and try to avoid blunders.

But the Belmont University showdown was something entirely different. Place the gravity of the moment next to the blah-blah-blah artifice of the rhetoric and overall insubstantiality of the evening, and this is what you get: The worst presidential debate ever.

The day after leaves behind a puzzle: How the hell did candidates manage to be so timid and uninspiring at a time when American troops are in two problematic wars, the world financial markets are in scary free fall and the Dow has lost 1,400 points since Oct. 1? This is a moment history rarely sees -- and both men blew it.

It was an odd reversal of the usual optics of power. Ordinarily, the national stage can take even life-size pols such as Michael Dukakis and imbue them with an outsize aura.

Tuesday's debate was a look through the wrong end of the telescope: Men with fascinating biographies seemed conventional. The promise both men once offered of a new, less contrived and more creative brand of politics was a distant memory.

Of course, there are arguments in the piece with which I disagree--it's funny how Sarah Palin's misstatements are concentrated on but Joe Biden's aren't; Biden misstated the role of the Vice President and the Constitution's treatment of the Vice President during the course of his debate with Sarah Palin and completely goofed up the history of Lebanon as well. Equally misguided is the argument that the reason this debate didn't go well had to do with the vapidity of the candidates' responses to questions. Here is a news flash: Candidates always give vapid responses to questions. They gave them in the previous Presidential and Vice Presidential debates as well.

The true problem with the most recent debate has to do with the fact that it constituted a faux effort to commune with the public. Townhall meetings are nothing of the kind. They are little more than sideshows that purportedly demonstrate efforts by politicians to reach out to the American people, but they never deliver in terms of authenticity or in terms of confronting the candidates with hard-hitting questions. The reason last night's debate was so unsatisfactory had to do with the fact that in a time of significance and importance, the format made the candidates talk down to people, rather than talk up to events.

No more townhalls. Please. We should be a more serious country than this.

I'll start off at the outset by noting that I really hate townhall debates. I think that this faux effort to look like a candidate of the people--Haroun al-Rashid in the marketplace meets the best of Lincoln v. Douglas--is about as contrived a political spectacle as there is. How authentic is it really when the questions that are being asked by the citizenry are vetted by a professional journalist in order to decide whether they are actually acceptable? Whoever you believe was the winner of the debate, let us all agree that the format was the big loser--though in fairness, it ought to be noted that Tom Brokaw worked manfully to overcome the limitations of the debate setting.

As for the debate itself, I know that there were people who said that McCain needed to make up for all of his electoral problems with a single knockout win tonight. That kind of thinking is, of course, unrealistic and it is mainly propagated by (a) people who don't quite understand how Presidential elections work and (b) denizens of the Obama campaign who sought to set expectations ridiculously high for McCain. But all of this having been written, heads should explode all around if serious attention is not paid to some whoppers by Obama during this second debate. He told us that the government invented the computer, which is silly. He told us that we ought to stop humanitarian disasters overseas but never contemplated the possibility that a humanitarian disaster could and likely would unfold in Iraq if we follow Obama's precipitous plans for a withdrawal and if we listened to him when we were contemplating implementing the surge and the counterinsurgency strategy. And Obama wondered what it might have been like if we intervened to stop the Holocaust, but was apparently unaware of the fact that the liberation of concentration camps was part and parcel of the Allied offensive into Germany near the end of World War II.

Here's a thought experiment: Imagine what would have been the mainstream media response if Sarah Palin made these mistakes.

Done? Good. Now, let's see if the same response unfolds in mainstream media circles in response to Obama's verbal blunders. By all rights, it should.

For someone who is tipped as the smartest person in either chamber of Congress, this is one of the more embarrassing verbal blunders around. May it receive widespread media coverage and popular opprobrium.

Wise words. He informs us that there will be no Great Depression 2.0, which far too many people are worrying about, of course. He also points out that some of what we have been doing to try to adjust to the crisis will only serve to make things worse:

The temporary banning of short sales is an example of a perennial approach to difficulties in financial markets and elsewhere; namely, "shoot the messenger." Short sales did not cause the crisis, but reflect beliefs about how long the slide will continue. Trying to prevent these beliefs from being expressed suppresses useful information, and also creates serious problems for many hedge funds that use short sales to hedge other risks. Their ban can also cause greater panic in other markets.

Well put. Becker also calls for the sale of Fannie and Freddie to private sector actors as soon as possible. Let's see how long it takes for that sale to occur.

And people say that Henry Waxman is a serious investigator.

Nonsense.

Get ready for this narrative to be replayed all over again in an Obama Administration:

"It's like déjà vu all over again."

As John McCain heads into the second round of presidential debates tonight, Yogi Berra's words come to mind. Mr. McCain could do worse than remind the middle class what happened to them the last time a charismatic Democratic candidate promised them a tax cut. While he's at it, he might also remind them how much more expensive it will be to send Barack Obama to the White House at a time when his fellow Democrats will have a majority in both houses of Congress.

The Clinton years hold some good lessons on both these scores. Back when Mr. Clinton was campaigning for president in 1992, he made a pretty direct pitch: Raise taxes on people making more than $200,000, and use those revenues to fund tax relief for the "forgotten middle class."

In an October presidential debate, then-Gov. Clinton laid out the marginal-rate increase he wanted and some of his plans for the revenue that would be brought in. He followed with a pledge:

"Now, I'll tell you this," he said. "I will not raise taxes on the middle class to pay for these programs. If the money does not come in there to pay for these programs, we will cut other government spending, or we will slow down the phase-in of the programs."

Mr. Clinton, of course, won that election. And as the inauguration approached, he began backtracking from his promise. At a Jan. 14, 1993, press conference in New Hampshire, he claimed that it was the media that had played up a middle-class tax cut, not him. A month later, he announced his actual plan before a joint session of Congress.

On page one of the New York Times, the paper described the fate of the middle-class tax cut this way: "Families earning as little as $20,000 a year -- members of the 'forgotten middle class' whose taxes he promised during his campaign to cut -- will also be asked to send more dollars to Washington under the President's plan."

Don't say you weren't warned.