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Unemployment jumped from 5.7 to 6.1 percent in August, matching its worst mark since 2003. According to the Department of Labor, the economy shed another 84,000 jobs in August. For those keeping count at home, that's 605,000 jobs lost in 2008.

On Thursday night, in what represents a breakthrough of sorts for Republicans, John McCain spoke favorably of a plan to provide some measure of "wage insurance" for Americans who lose high paying jobs and replace them with low paying work.

Good timing.

By mid-afternoon Thursday, War Room reports, Republicans were claiming that Sarah Palin's speech to the Republican National Convention had encouraged $1 million in new online donations. Democrats, meanwhile, were promising that Barack Obama supporters would have contributed $10 million by the time John McCain made his speech Thursday night.

What explains the disparity? One reason could be that the unremitting stream of attacks aimed at Obama by a parade of Republican speakers galvanized Obama's fanbase. Remember those days when progressives were shaken by Obama's stance on FISA or his straddle of various issues relating to guns, faith, and the death penalty? Irrelevant now. After Wednesday night, that old familiar culture war is raging once again. Wallets are emptying.

But there could be another reason for the outpour. For the second night in a row, Republicans at the convention made zero references to the state of the American economy. It's amazing, really. Poll after poll has shown that the economy is the most important issue for Americans -- heck, it's the number one issue in the world right now. And yet, clearly on purpose, McCain's campaign managers have decided to ignore it.

I won't claim that the beating suffered by the stock market on Thursday (the Dow Jones Industrial Average closed down 340 points, nearing new lows for the year) is any kind of direct reaction to the obtuseness on display in Minnesota Wednesday night. Rising jobless claims and weak retail sales are far more likely culprits. But it's also conceivable that some people are watching the Republicans and then comparing their words to what other people are saying, and beginning to get a little nervous.

Take, for example, Bill Gross, the manager of the world's biggest bond fund, PIMCO. In one of his regular Web-posted missives, he observed on Thursday that "government sponsored enterprises, banks, investment banks, global hedge funds and even individual households" are rapidly divesting themselves of a vast array of assets as they attempt to liquidate their various debts.

Unchecked, [such debt liquidation] can turn a campfire into a forest fire, a mild asset bear market into a destructive financial tsunami.

Then there's Janet Yellen, President of the Federal Reserve Bank of San Francisco, who gave her assessment of the economy in a speech in Salt Lake City Thursday:

Turning to the national economy, it was recently reported that growth in the second quarter came in at a fairly robust rate of 3 and quarter percent...

While one might be tempted to interpret the recent strong numbers as a sign that things are turning around, there are three important reasons to think that the strength will not hold up, and that economic performance will be decidedly subpar in the second half of the year.

The reasons: consumer spending in the second quarter was only moderately juiced by the tax rebates, and is slacking off now; export growth has been keeping the economy afloat, but a stronger dollar and weakening global economy will undermine that supporting pillar; and housing, credit, and labor markets are all continuing to slump.

"Decidedly subpar," as Calculated Risk notes, is about as somber a prediction as you are ever going to get from a Federal Reserve Bank President. Put that together with the "tsunami" warning from Gross, and you can begin to understand why investors are jittery.

So now let's see what John McCain has to say about all this, tonight.

Among some of the more excitable communities of what President Bush recently dubbed the "angry left," it has become fashionable to refer to the Republican vice-presidential nominee as "that secessionist Sarah Palin." The evidence for this being her husband's seven-year membership in the Alaska Independence Party (AIP) and her own predilection for, at the very least, showing up at AIP conventions and flashing her pit bull-with-lipstick smile.

I'm not going to take a stand on whether, in her heart of hearts, Palin truly wants to cut ties with the United States. Presumably, even if she did once harbor such a desire, she's now tabled the agenda, seeing as how secession at this juncture would make her ineligible to run for national office. But spending as much time as I do reading blogs written by economists, I find myself unable to resist considering the question of whether secession, for Alaska, makes any practical economic sense.

As usual, Tyler Cowen, the libertarian economics professor who co-authors the Marginal Revolution blog, is ready to help, providing links this morning to two academic papers exploring the economics of secession. I just finished reading the more recent offering, "The Political Economy of Secession" by Paul Collier and Anke Hoeffler. The argument: Significant secessionist movements (by which we can distinguish the real thing from the rampant "romantic localism" that blossoms nearly everywhere) are linked to economic self-interest.

That is, secessionist political communities invent themselves when part of the population perceives secession to be economically advantageous.

Generally, what this translates to in practice is access to exploitable natural resources or other primary commodities. As a provocative example, the authors cite the miraculous transformation of the Scottish National Party from a nonentity into a significant political force -- just about the time oil was discovered in the North Sea.

Oil was discovered in the North Sea in 1966, and most of it was off the coast of Scotland. When the price of oil quadrupled in 1973, the British government imposed taxes on the oil companies so that approximately 90 percent of their additional oil revenues accrued to the government. The Scottish Nationalist Party ran a campaign with the slogan "It's Scotland's Oil" and argued that, if Scotland were independent, the tax revenues would accrue to the five million people of Scotland rather than to the 50 million people of Britain. Per capita oil revenues for inhabitants of Scotland would rise ten-fold if the other 45 million people were excluded. The fragile and recent cause of romantic nationalism could thus be allied to the robust and ancient cause of economic self-interest.

In 1970 the Scottish National Party had only one Member of Parliament and 11 percent of the Scottish vote. In 1974, 11 MPs and 30 percent of the vote.

Collier and Hoeffler offer other extenuating factors (it helps if the population is relatively uneducated, they argue) and survey various secessionist movements, successful and failed, around the world. They do not, however, mention Alaska. Perhaps, like much of the English-speaking world, they were unaware that there even was a significant secessionist movement in the state, until Sarah Palin arrived on the international scene.

Of course, Alaska does have access to natural resources, in great abundance -- notably, oodles of crude oil and natural gas. So Alaska at least partially fits the paradigm of a place where romantic localism intersects with huge economic self-interest. As a commenter on my post "Sarah Palin's Stiletto" wrote last night, "we love high oil prices in Alaska!" The rest of the U.S. winces when the price of a barrel of crude spikes up, but in Alaska, they break out the champagne. Or whiskey. Or whatever. As the New York Times pointed out on Thursday:

Thirty-one other states are projecting shortfalls in their state budgets. Alaska is expecting $5 billion more than it can spend in a state with only 680,000 people.

Interestingly, the Times also chimes in with an observation that fits neatly into Collier and Hoeffler's secession hypothesis.

...Alaska is harder to govern than a smaller, more settled realm in the Lower 48. With vast distances, large numbers of indigenous peoples and a narrowly based extraction economy -- with a handful of giant multinational oil corporations dominating the game -- some economists say a country like Nigeria might be an apter comparison.

The Biafran War just happens to be one of the case studies explored in "The Political Economy of Secession." The authors contend that the civil war had far more to do with economic self-interest than tribal identity politics -- the traditional explanation for internal African strife.

In the realpolitik world, secession for Alaska would probably be a disaster. I am certain Vladimir Putin is chafing at the bit to rectify the awful mistake his predecessors made in 1867, when they sold the territory to the U.S. for a piddling $7.2 million.

Suddenly, the theory that Alaska's proximity to Russia makes Palin an expert in international relations would be no joke.

Finally, as a reward to the Economist's FreeExchange for encouraging How the World Works to think about Alaskan secession, I will leave you with its anonymous blogger's summation of Wednesday night at the Republican National Convention.

So let's see, what's in the news? Well, last night Republicans trotted out a Massachusetts venture capitalist and governor, the former mayor of New York City, former executives of eBay and HP, and an Alaskan neophyte pol who as mayor of a small town delivered $4,000 in federal pork for every man, woman, and child, in railing against coastal elites and Washington politics, while supporting a candidate who's been in the Senate for 26 years.

Can we afford the organic lifestyle?

The Organization for Economic Cooperation and Development (OECD) recently predicted that out of all the G7 elite group of rich countries, only Britain is headed for recession, this year. Britain's housing market, reports The Guardian got even more out of whack than the U.S.', and home prices are falling faster and further. Combine that with high energy and food prices and, well, you can guess the rest.

The Guardian also reports that economic woes are resulting in a troubling display of collateral damage. Organic food sales have gone into free fall, swiftly dropping by 20 percent from their peak earlier this year. (Thanks to the Private Sector Development blog for the tip.)

Figures collected for the Guardian by the market research company TNS show spending on organic food and drinks fell from a peak of nearly £100m a month earlier this year to £81m in the most recent four-week period recorded. The fall has been steepest in eggs, but is also reported in the most popular sectors, including dairy, fruit and vegetables and chicken.

Some farmers are reportedly returning to non-organic production.

I think the Guardian's Juliette Jowit is pushing the provocative envelop when she asks "Was the organic food revolution just a fad?" A commitment to organic food is not like a changing hemline. But as a sign of how powerful price signals are for consumer behavior, the changing consumption patterns in the U.K. can't be ignored.

Shelve the Dan Quayle and Tom Eagleton comparisons. Sarah Palin had a glint in her eye whenever she stuck her stiletto into Obama and the Democrats that said, clear as the light reflecting off an Alaskan glacier -- I'm for real, and don't you forget it.

Ever since the news broke that Sarah Palin was John McCain's pick for vice-president, the narrative pretty much wrote itself for Democrats. 1) McCain's whole "experience" shtick was finished. 2)Who can possibly take this crazy libertarian secessionist wannabe library censor seriously? 3) McCain = reckless, impetuous, risky. The insta-poll numbers reflected the insta-analysis. Although the immediate effect of the nomination seemed to negate Obama's big speech in Denver, as soon as what America thought was the reality of the situation set in, the Obama bounce came back, big time.

But as I dug into her record on energy issues this week, it didn't seem quite so simple. Yes, she was a drill, baby, drill cheerleader, but she also had legitimate reason to claim that she had stood up to oil companies in Alaska -- in fact, unlike McCain, she has no problem with windfall taxes. Going head to head against Exxon and BP in Alaska takes some backbone, and if there's one thing that was clear to me after watching her speech in Minnesota, she's got spine. She might have stumbled a couple of times on the teleprompter when talking foreign policy, but when she was striding Alaska's North Slope, and chatting about pipelines, she was not posing.

I don't think she's going to pull in disaffected Hillary voters -- she's too much a card-carrying member of the religious right for that, which is one reason why the convention attendees were so delirious. But that's not all she is, by a long shot. On one of the crucial issues in this campaign -- energy policy -- Sarah Palin knows the territory.

She's a player. We got ourselves a ball game.

How the World Works confesses surprise: The 2008 Republican Platform acknowledges that climate change is a problem, and humans might have something to do with it:

The same human economic activity that has brought freedom and opportunity to billions has also increased the amount of carbon in the atmosphere. While the scope and long term consequences of this are the subject of ongoing scientific research, common sense dictates that the United States should take measured and reasonable steps today to reduce any impact on the environment.

The language is a clear sign of progress -- in the 2004 platform, the single paragraph devoted to climate change called it a "challenge" but did not acknowledge any human contribution to rising temperatures. The closest this year's platform gets to a more ideological stance:

Republicans caution against the doomsday climate change scenarios peddled by the aficionados of centralized command-and-control government. We can -- and should -- address the risk of climate change based on sound science without succumbing to the no-growth radicalism that treats climate questions as dogma rather than as situations to be managed responsibly.

Sounds plenty reasonable! However, the GOP's prescription for "managing" the "situation" is a little vague: "technology-driven, market-based solutions" are all the platform has to offer.

It's possible that we might require something a little more dramatic. Exhibit A: the news that yet another ancient ice shelf that's been hanging around for thousands of years has broken loose of from its moorings:

One of Canada's five remaining Arctic ice shelves -- the 4,500-year-old, 50-sq.-km. Markham Ice Shelf -- has broken completely away from Ellesmere Island and drifted into the Arctic Ocean, the most dramatic sign yet of how rising temperatures and retreating sea ice are creating "irreversible" changes to the country's polar frontier.

Exhibit B: The Netherlands, where the Dutch have some experience with fending off floodwaters. A commission assigned the task of figuring out how climate change will affect the Netherlands announced on Wednesday its prediction that sea levels could rise between 2-4 feet by 2100, and that the Netherlands' elaborate system of dikes, dams and storm surge barriers needs to be significantly upgraded. (Thanks to MetaFilter for the links.)

The estimated cost of the upgrade: About two-billion-dollars-a year between now and 2050.

Adapting to climate change via technology-driven market-based solutions is laudable. But it's still going to cost us, dearly.

How did J.P. Morgan escape the credit crunch with mere flesh wounds, while other investment banks were getting eviscerated left and right? An embarrassingly gushy Fortune Magazine profile of J.P. CEO Jamie Dimon and "the best team on Wall Street," tells the story, and Portfolio blogger Felix Salmon acutely highlights the crucial passage.

While other banks were rushing to get a piece of lucrative subprime CDO action, Dimon and his crew were hearing warning bells.

In 2006... the market seemed to be saying that the bonds were solid. But Black and Winters concluded otherwise. Their yardstick, once again, was credit default swaps -- insurance against bond failures. By late 2006 the cost of default swaps on subprime CDOs had jumped sharply. Winters and Black saw that once they bought credit default swaps to hedge the AAA CDO paper J.P. Morgan would have to hold, the fees from creating CDOs would vanish. "We saw no profit, and lots of risk, in holding subprime paper on our balance sheet," says Winters.

In other words, the cost of insuring against default would negate the profits gained by making and selling the paper.

Salmon writes: "This is genuinely impressive: Dimon and his lieutenants saw clearly in late 2006 two risks which wouldn't crystallize for most of us until the summer of 2007."

"Most of us" is probably the correct formulation, but Dimon and his crack risk management team were not the only people paying attention to the rising cost of credit default swaps tied to subprime CDOs in 2006.

In April 2006, How the World Works took a close look at an article published four months earlier by ace Wall Street Journal reporter Mark Whitehouse. Whitehouse reported that between September and December of 2005, the price of "credit default swaps on subprime ARM pools" had doubled. The clear implication was that savvy hedge fund operators were beginning to bet on a housing bust, and they were focusing on what would prove to be the weakest link -- securities tied to subprime mortgages.

Here's what I wrote then:

So here's the deal: The smartest players on Wall Street see the housing market about to implode. So they're loading up on cutting-edge financial instruments that will theoretically protect the buyer from exposure to millions of homeowners suddenly beginning to default on their loans. And for the moment, they're making money hand over fist as the value of those derivatives rises with every new data point about slumping housing sales, slow housing starts and rising interest rates.

But what happens if the defaults do start rolling in, and the sellers of those derivatives have to make good on their obligations with cold, hard cash? Will there be enough liquidity in the system to handle the shock? Will state-of-the-art capitalism work as advertised? As Whitehouse reports, the market for credit-default swaps that could be applied to pools of home mortgage loans is new -- it's only been around since last June. Again, no one knows how it will play out.

The warning signs were there for everyone to see, well before Jamie Dimon started running scared. The question I come away with after reading Shawn Tully's Fortune article is not: How was Dimon able to be so smart? It's how come everybody else was so amazingly dumb?

You wouldn't know it from the speeches given at the Republican National Convention on Tuesday night, but there are some Americans who have bigger problems to worry about than the nature of John McCain's patriotism.

Credit Slips' Bob Lawless has the latest numbers on bankruptcy filings.

The U.S. bankruptcy filing rate climbed again in August, reaching a new post-2005 high of 4,476 filings per day. The year 2005 is significant because it was the year that the bankruptcy law changed making it more expensive and more time-consuming to file bankruptcy as well as making bankruptcy less effective once debtors got to bankruptcy court. Despite these changes, the bankruptcy rate has become staggeringly high, and we appear to have returned to an era where we will have well more than 1 million annual bankruptcy filings.

As Lawless notes, it takes some time for a financially stressed American to reach the point of actually filing for bankruptcy, so the numbers we're looking at now represent forces in the economy that have been in motion for years.

Which makes a nice segue into current affairs. On Wednesday, both the Wall Street Journal and the Financial Times reported the collapse of the hedge fund Ospraie Management, described by the Journal as "one of the biggest players in commodities."

From a somber letter sent to investors by Ospraie founder Dwight Anderson:

This year has been very difficult for the Ospraie Fund Ltd. The Fund returned –26.72 percent in August and is down 38.59 percent year-to-date. I am extremely disappointed with this result and the Fund's sudden reversal in performance.

The losses were primarily caused by a substantial sell-off in a number of our energy, mining and resource equity holdings during a six-week period characterized by some of the sharpest declines in these sectors in the past ten to twenty years.

What goes up, comes down -- a mundane observation given a bit of new sparkle by yet another headline this morning "Oil Price of $100 a Barrel on Horizon." (Haven't we already seen that headline, from the other direction?)

Bad bets on oil and gas burned Ospraie, and we can expect more news along the same lines in the future, if the global commmodity bust continues.

Somehow, one suspects neither Anderson or his investors will be filing for bankruptcy any time soon. But what will it take for either Wall Street or the working man to get a mention in Minneapolis?

Those of us who watched, attentively, John Kerry's acceptance speech at the 2004 Democratic convention and his speech at this year's convention in Denver can be excused for wondering what alternate reality we slipped into between campaign years. In 2004 he was stilted and cautious and that whole "reporting-for-duty" shtick, complete with salute, was just painful. In 2008 he delivered one of the most stinging attacks on McCain of the entire convention. He was relaxed, looked like he was having fun, and let the fur fly. I can't have been the only one to wonder how 2004 would have played out if the 2008 Kerry had, uh, shown up for duty.

Water under the bridge, yes, I know. But a link recently passed to me by one of my cycling buddies offers fresh reminders of the difference between then and now.

In 2004, Republicans seized every chance they could to mock Kerry for riding an $8,000 titanium frame Serotta road bike, contrasting it relentlessly with George Bush's more manly Trek mountain bike. Rush Limbaugh took particular glee in painting Kerry as an elitist -- hell, everyone knows road-biking is the sport most beloved of the pusillanimous French!

What I didn't realize at the time is that Kerry was no amateur weekend warrior -- the man can ride!

Here are some excerpts from an account of a ride during the convention Kerry did with Jonathan Vaughters, the director of one of the two American teams to compete in this year's Tour de France, Garmin-Chipotle (named after the team's two sponsors).

Vaughters tells the story:

What I was expecting was the normal 12 mph dawdle with the Senator wearing some ugly Bermuda shorts or whatever. However, when Senator Kerry showed up at Slipstream HQ in Boulder, man, it was a different story ...

On to the ride. Immediately he bumped shoulders with me on the first corner and thought nothing of it. Then he took the first 22 mph pull with me, side by side, for a good 10 minutes. I was somewhat impressed, for sure, but of course we still had some hills to go up. so I withheld judgement.

Chugging along at a fair clip, about halfway up to Jamestown, he had dropped half the group and started asking me for ideas on how to improve some of the anti-doping legislation he has been working to introduce into the Senate. Of course I was so excited he had interest in this area, I spoke until I was blue in the face. And he just about dropped me. Conversation at 280 watts at 6500 ft is not the easiest thing for me, much less a 65 year old guy with a job like his ...

He deftly rode out of the saddle and had quite a nice pedalling style on the steeper grades. Truly impressive.

OK, but all this said, when we got to the top, I knew his undoing was at hand. Descending is the enemy of people who have speeches to go to at night and important jobs to go to in the morning. I have years of experience of riding with sponsors and other folks with real jobs, so I know to take it easy on the descents. Else they get hurt or, at the very least, their egos get a bit bruised.

But man ... o' man ... John Kerry descended like he stole the friggin' bike from the GOP. As we hit the first switchback, he immediately put his weight back, counter-steered, and carved the corner like a pro. He put three bike lengths on me like Magnus and Stuey used to do to me back on Credit Agricole. Unreal. This guy was a pilot on the bike. Down the switchback of Lee Hill and over 90 kph and he was not phased ... one bit.

The entire post makes for a great read. Even if it does make you wonder -- if the guy has no fear on a screaming descent, why wasn't he more aggro in 2004?

Is Sarah Palin Big Oil's pawn or the Hugo Chavez of Alaska?

Just the fact that we can even ask that question is yet another reason why the 2008 campaign for president of the United States is proving to be the most entertaining political freak show in memory. But the question is far from rhetorical. Palin's eagerness to promote drilling in ANWR and offshore has led Obama supporters to the easy conclusion that she is in the tank for the energy industry. Yet a closer look at the facts on the ground in Alaska suggests that pigeonholing the governor in such a small coop misreads what's really going on.

One of the biggest ongoing energy stories in Alaska is the nearly 30-year-long struggle to get a new mega-pipeline built that will ensure the state continues to live large off of its immense natural gas reserves for decades to come. At the moment, two contenders are vying for the right to build such a pipeline. On one side, BP and ConocoPhillips, two energy companies that, along with Exxon, own potentially lucrative leases to pump natural gas in Alaska. The other proposal belongs to TransCanada, a Calgary-based pipeline builder.

Sarah Palin backs TransCanada. Indeed, just a few days before she was selected as the Republican vice-presidential nominee, she signed a bill declaring that TransCanada satisfied the legal requirements of the Alaska Gasline Inducement Act, which Palin had pushed through the Alaska Legislature in March 2007. The "inducement"? $500 million in seed money to get the project off and rolling.

If you dig around a bit on the Web, you may find references, here and there, to Sarah Palin actually being a member of the board of directors of TransCanada. That would be a clear and stunning conflict of interest, if it turned out to be factually correct. But Palin is not listed as a director on any of TransCanada's regulatory filings in either 2007 or 2008, and no news report that I have been able to find mentions it. So chalk it up as just another one of the conspiracy theories that find such fertile ground on the Web. It's not so hard to understand, is it? She's a Republican, she supports drilling in ANWR, she must not only be Big Oil's girl, but actually on the payroll!

Except not. Far from it. Her detractors from the right call her the "Hugo Chavez" of Alaska and "Alaska's Glam Tax & Spend Governor." Big Oil's pawn? In some ways she's Big Oil's worst nightmare. For national Republicans, a windfall tax on oil company profits is heresy. But Palin's already pushed such a tax through in Alaska. And she's clearly not doing the bidding of Big Oil when the subject is natural gas pipelines.

In June, Newsweek's Tony Hopfinger took a close look at the gas pipeline project:

The TransCanada proposal is born out of an attempt by Palin to force the hand of the big oil companies -- BP, ConocoPhillips and ExxonMobil Corp. -- to execute their gas leases, from which the state hopes to raise tens of billions in tax revenue. Uncertainties over natural-gas prices and state taxes have long left the companies skittish about committing to a project....

Alaska owns the natural gas; BP and Conoco, along with Exxon, hold most of the leases to develop it. The companies have long talked of tapping the reserves, but have consistently deemed the pipeline too financially risky without the state first agreeing to favorable terms on gas production taxes. Unlike Palin's predecessor, Gov. Frank Murkowski, who wanted to give the companies generous tax breaks, she has refused to budge.

Italics mine. Robert Rapier, the indefatigable chronicler of all things energy-related (and a former Conoco employee), suggests the tax issue is one reason why the name Hugo Chavez is being associated with Sarah Palin.

As I understand it -- and everything I have read seems to confirm this -- the real sticking point seems to be that Governor Palin refuses to make a long-term commitment on the tax rates for the project. For a $30 billion project, it is pretty important to understand the economics of the project pretty far in advance. What I don't know are specific details of what is being proposed -- nor whether the tax rates being asked for are in some way unreasonable. But I do think it should be reasonable to at least agree in advance not to change the rules during the game. That is, after all, what Hugo Chavez has become famous for. And Palin's threats to tear up existing contracts ... do provide a cause for concern.

Palin has even threatened to revoke ExxonMobil's natural gas leases, on the grounds that the company hasn't done enough to develop them. At the Alaska Gas Pipeline blog (yes, in 2008, even unbuilt pipelines have their own blogs), such threats, along with Palin's successful effort to push through a windfall tax and her lack of commitment on future tax rates, are combining to make energy companies reluctant to upgrade and expand their facilities. So just as Chavez is crippling his country's future (or so the right-wing argument goes) by alienating foreign oil companies and crimping on crucial investment, so is Palin sacrificing tomorrow's prosperity for today.

The right wing is probably going a little overboard on the Venezuelan comparison -- just as is the left, in its efforts to plug Palin into a familiar Bush-Cheney energy framework. One of the more fascinating aspects to McCain's choice of Palin as vice-presidential nominee is that it is precisely on the all-important issue that Palin best satisfies the requirements of a "maverick." Could it be that McCain became so infatuated with the narrative of the pro-drilling, anti-Big Oil governor that he neglected to look any further into the politician's closet?

Much fun is being had with the revelation that Republican vice-presidential nominee Sarah Palin was a member of the Alaskan Independence Party for two years during the '90s, before she joined the Republican Party and began her awesome ascent to power.

The Alaskan Independence Party can best be thought of as an igloo for über-libertarians of the Far North. Among the the planks of the AIP's party platform are a call to abolish all property taxes and a demand for the "complete repatriation" of Alaskan public lands from the federal government.

Economists for Obama, eager to do its part in the Internet's unprecedented, massively distributed "opposition research" investigation of Sarah Palin, focused on plank 17:

To oppose the borrowing of money by government for any purposes other than for capital improvements.

Economists for Obama goes droll: "Apparently, there is no role for fiscal policy adjustments for macroeconomic stabilization."

In other words, no running a deficit to pay for fiscal stimulus boosts, or unemployment insurance extensions, or, heck, gas tax holidays, one presumes. This would appear to suggest that the AIP disapproves of classical Keynesian approaches to managing the economy. No surprise there -- Milton Friedman is a libertarian icon.

I just don't understand why the Republican spinmeisters haven't turned this into a pro-Palin talking point. You can't get more fiscally conservative than a near-complete rejection of all government borrowing.

Perhaps they are only now getting up to speed on the particulars of the policy proposals of a vaguely secessionist Alaskan political party. Perhaps, in this time of economic anxiety, they think American voters don't want to hear that government shouldn't try to smooth out the bumps of the business cycle.

Or perhaps Republicans, like much of the rest of the country, are tongue-tied as they wait for the next twist in an evolving train wreck that is like nothing this country has seen since Thomas Eagleton, George McGovern's vice-presidential nominee, acknowledged that he had undergone electroshock therapy.

But c'mon -- Sarah Palin as heir to the legacy of Milton Friedman? Ron Paul fans must be ecstatic.

UPDATE: Well now, was she or wasn't she a member of the AIP? McCain campaign blogger Michael Goldfarb says that New York Times reporter Elisabeth Bumiller's assertion to that effect is "not true and unsourced." Former Salon alum Jake Tapper has more. (Thanks to Andrew Sullivan's Daily Dish for the links.)

An intriguing flip side to Republican vice presidential nominee Sarah Palin's well documented stance favoring greatly expanded drilling for oil is Alaska's vulnerability to global warming.

Average temperatures in Alaska have risen 3.6 degrees Fahrenheit in the last 50 years -- a rate considerably faster than experienced in the world as a whole. Glaciers are in retreat, wetlands are drying out, and some coastal villages are in serious danger of washing away, as the sea ice that once protected them against the full onslaught of winter ocean fury melts away.

I was unable to find any on-the-record comment by Gov. Palin on the lawsuit filed by the seaside village of Kivalina against against eight energy companies, including Exxon-Mobil, alleging that the corporations had engaged in a "conspiracy" to "mislead the public about the science of global warming." But apparently, being the governor of Alaska means that one must recognize that yes, the ice is melting, and something must be done.

Last September, Palin signed an executive order establishing a "climate change subcabinet" to prepare a climate change "strategy" for Alaska. One of the first jobs of the subcabinet -- figuring out a priority list for state aid. Kivalina is on the list.

Pro-drilling, and yet willing to acknowledge that climate change is real -- again, a perfect match for John McCain.

UPDATE: I would be remiss not to note that in an interview given before she was selected as the Republican vice-presidential nominee, Sarah Palin told NewsMax that she did not believe global warming was man-made:

A changing environment will affect Alaska more than any other state, because of our location. I'm not one though who would attribute it to being man-made.

Conservatives have a host of reasons for fawning over Alaska Gov. Sarah Palin, John McCain's surprise vice-presidential pick. She's solidly pro-life and a solid fiscal conservative. But possibly her most attractive attribute, at this particular moment in time, could be her position on energy. You would be hard put to find an elected politician in the United States who more resolutely supports a rapid ramp-up in exploiting domestic energy supplies -- offshore and on -- including in the Arctic National Wildlife Refuge.

One of her campaign promises in her 2006 run for governor was to "get ANWR open." Drill here, drill now? As CNBC talk show host Larry Kudlow noted in June, with Sarah Palin it's "drill, drill, drill -- all the way."

Here's what she told Kudlow in June:

I think those politicians who don't understand that we need more domestic supply of energy flowing into our hungry markets, you know, they're living in La-La Land. And we're in a world of hurt if their agenda continues to be to lock up these safe, secure domestic supplies of energy.

Remember too Larry, we're talking about a sliver of the coastal plain of Alaska being explored and drilled for oil. It's about a footprint of a 2000-acre plot of land. That's smaller than the footprint of LAX, for instance. So it's not so grandiose an acreage that it is out of the realm of possibility for others to start understanding why it is that we can do this safely.

The fact that an Alaskan Republican supports expanding drilling for oil is no shocker -- so do a majority of Alaskans. But if one of McCain's most effective thrusts in tightening the presidential campaign over the summer was his opportunistic switch to support offshore drilling, he's now added a flanker to his team who can push that line with gusto.

Again, from the Ludlow interview:

We sent [Energy] Secretary Bodman overseas the other day, and our president had to visit the Saudis a few weeks ago, to ask them to ramp up development. That's nonsense. Not when you know that we have the supplies here. You have the supplies in your sister state called Alaska, where we're ready, willing and we're able to pump these supplies of energy, flow them into hungry markets across the U.S. We want it to happen. It's Congress holding us back.

So is Palin Big Oil's girl? Her supporters will no doubt push back heartily on that accusation, noting that in 2004, she resigned after just 11 months as the head of the Alaska Oil and Gas Conservation Commission because of abuses she witnessed involving other Republican commissioners and their ties to energy companies and energy lobbyists. And as governor, she pushed through a major tax increase on oil companies, that would enable the state government, according to the Seattle Times, "to capture more of the windfall when prices are high."

Her official statement at the time:

"By receiving an equitable share for our resources, we are now in a position to demand more accountability and seize opportunities to save for future generations."

That tax increase made her some enemies in the Alaskan oil industry, but right now it makes her look perfect for McCain. Gas prices bothering you? Well, listen to my running mate, who is from Alaska and knows the oil biz inside and out. She says -- drill, drill, drill, all the way, and she's no Big Oil pawn.

How's the timing? Here's a manifesto Palin released in July:

Congressional approval of responsible petroleum development in the coastal plain of Arctic National Wildlife Refuge (ANWR) -- the most promising unexplored petroleum province in North America -- would be of incalculable benefit to my state and our nation.

If we don't move now to enact an energy policy that includes more oil and gas production from domestic sources, including ANWR and the federal [Outer Continental Shelf] OCS, we may look back someday and realize that we failed to perceive a critical crossroad in the history of this nation. I don't think it's overly dramatic to say that our country's future and the quality of life for every American depends on the decisions that are made or not made in the next few months.

Add another constituency to Gulf Coast residents and convention-attending Republicans to those worried by Hurricane Gustav's approach: Insurance companies already battered by the ongoing financial crisis.

The Wall Street Journal reports:

Gustav's timing couldn't be worse for an industry whose investment portfolios -- into which insurers sink premiums, and then liquidate to pay claims -- have sprung leaks.

In the most notable example, American International Group Inc. reported a loss of $12.2 billion in the first six months of the year, mostly from failing subprime-mortgage-related investments. The remaining property-and-casualty insurers reported a combined $5.4 billion in investment losses during the same period, according to a report from Fitch Ratings.

One-time Bush propagandist turned Obama-supporter Andrew Sullivan is in high dudgeon at reports that the new Republican Party platform will ban all public and private funding of embryonic stem cell research. The news comes from Stephen Spruiell, a contributor to the National Review's group blog the Corner, who offered an eyewitness description of back-and forth over an amendment to the existing platform earlier this week, and concluded, with an air of what Sullivan likes to call "Christianist" triumphalism, that:

"The 2008 Republican Platform calls for a ban on all embryonic stem-cell research, public or private."

Lefty bloggers have been quick to pounce on the news, as well they should, since, if true, it represent a remarkable extension of Republican big-government interference in the domain of science and medicine in the United States. Hillary supporters still looking longingly at John McCain should take note -- this is what today's GOP is all about, McCain's protestations otherwise notwithstanding.

I'm a little bit confused, however. I can't find a copy of the final draft of the 2008 Republican Platform online, but in another post to the Corner, Spruiell provided what he says is the full text of the stem cell plank (italics are mine):

Taxpayer-funded medical research must be based on sound science, with a focus on both prevention and treatment, and in accordance with the humane ethics of the Hippocratic Oath. In that regard, we call for a major expansion of support for the stem-cell research that now shows amazing promise and offers the greatest hope for scores of diseases -- with adult stem cells, umbilical cord blood, and cells reprogrammed into pluripotent stem cells -- without the unethical destruction of embryonic human life. We call for a ban on human cloning and a ban on the creation of or experimentation on human embryos for research purposes.

Do you see any reference to private funding in that paragraph? I don't, unless you take the last sentence to be an all-inclusive ban that is not connected in any way to the original reference to "taxpayer-funded medical research." And as far as I can tell, the back-and- forth that occurred between Republican delegates who were debating changes in the language of that plank focused on only one word in the last sentence, which originally called for "a ban on the creation of and experimentation on human embryos." That and has now been changed to or. The significance of that change, I guess, is that it extends the proposed ban to experimentation on embryos that already exist, such as those currently frozen in IVF clinics.

Maybe I'm making too much of an obscure point, although it would be ironic if the lefty blogosphere was accidentally propagating a mistaken interpretation of the Republican Party platform perpetrated by Republican Party zealots. Because whatever the truth is about the platform as it stands now, there is little doubt that the religious right wing of the GOP desperately wants to be able to tell everyone in the United States what they can or cannot do, according to the precepts of their own theology, whether they are publicly or privately-funded. I just wonder why the Republicans just don't come clean, à la Ann Coulter, in the platform, and call for the forcible conversion to Christianity of all American unbelievers. It would simplify politics in the country greatly.

Of course, we have, in the United States, no monopoly on fundamentalist idiocy, although it certainly seems like most other advanced countries are doing a better job of drawing lines between science and religion. But to return once again to one of my favorite examples, India, I ran into a strange bit of synchronicity this morning while reading a decent summary of the archaeological and scientific evidence as to whether an underwater rock formation between southern India and Sri Lanka is actually the remains of a bridge built by Lord Rama in the ancient, ancient past.

(If you are unfamiliar with the details of this fight between fundamentalist Hindu politicians and supporters of a dredging project to widen navigable shipping lanes in the region, I refer readers to my posts from last year, "Don't Mess With Lord Rama (Or His Bridge)" and "Bring Me the Head of the Chief Minister of Tamil Nadu.")

Suraj Bhan closes his review of the evidence, "Ram Setu: Separating a Myth from Reality," with the following paragraphs -- (italics mine):

The literary, archaeological and geological investigations have demonstrated beyond doubt that the Ram Setu or Adam's Bridge is not a man made structure. Propaganda being indulged in by the right wing political parties and their ideologues is totally unscientific.

Scientific knowledge is essential to understand the historical context. It helps people to organize to build a knowledge-based society and to look forward to create a genuine democratic political and social culture ensuring equity and justice.

You would almost think Mr. Bhan was addressing the Republican Party Platform Committee directly, and not his own country's batch of power-hungry sectarian evangelicals.