The Obama administration has managed to get us into a trade war with Brazil, the Financial Times reports. Brazil is raising tariffs on American goods in retaliation against American farm subsidies for cotton. For a president who ran on restoring America's good relations with the rest of the world, Mr. Obama sure does seem to be encountering some obstacles. First America's relations with China frayed over the Google hacking, the American weapons deal with Taiwan, and Mr. Obama's meeting with His Holiness the 14th Dalai Lama. Then Turkey, a NATO ally, recalled its ambassador to America after Secretary of State Clinton couldn't stop Congress from passing a resolution on Armenian genocide, and after an American diplomat reportedly interrupted a meeting between Ms. Clinton and the Turkish prime minister so that Ms. Clinton could meet with the Sheik of Qatar, stating, "This meeting has to end. The meeting with the Qatar Sheikh is more important." And don't forget the snub of Europe. Whatever one's view of the underlying merits of all these cases, they do pose a certain challenge to the widely repeated narrative that America's problems with the world were all the result of President Bush's clumsy neo-conservative cowboy unilateralist foreign policy.

"A tiny one half of one percent tax on all financial transactions would generate about $200 billion a year, according to the Economic Policy Institute," Robert Reich writes. These taxes all start out "tiny" until the government needs or wants more revenue. And when you add up all the tiny taxes all of a sudden they aren't so tiny any more.

In view of the attention this site has devoted to F.A. Hayek (see, for example here and here), readers may be interested in the latest from fund manager Seth Klarman. On Mr. Klarman's list of ten "false lessons" that investors seem to have learned from the financial crisis:

The chairman of the Federal Deposit Insurance Corporation, Sheila Bair, spoke today to a conference of the National Association of Business Economics. Among her remarks:

Our financial sector has grown disproportionately in relation to the rest of our economy.

Whereas the financial sector claimed less than 15 percent of total U.S. corporate profits in the 1950s and 1960s ... its share grew to 25 percent in the 1990s ... and to 34 percent by 2008.

We know that a vital and innovative financial sector has long been one of the key competitive advantages of the U.S. economy.

But we must also recognize that the excesses of the past decade were a costly diversion of resources from other sectors of the economy.

First Wind Holdings LLC will get a $117 million loan guarantee from federal "stimulus" funds to finance the construction and start-up of a wind energy project in Kahuku, Hawaii, the federal Department of Energy announced Friday. Once complete, the project will create "six to ten" jobs, according to the Department of Energy. At $117 million, works out to a federally guaranteed loan of between $19.5 million and $11.7 million for each job created.

Last year, when the Obama administration awarded its first windmill windfall of $115 million to First Wind, we reported on some of First Wind's connections to the administration:

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The governor of Indiana, Mitchell E. Daniels Jr., was in New York today and spoke to the Hudson Institute's New York briefing series about the state of the nation.

"Not so damn good," was the way Mr. Daniels summed it up, warning that America faces two or three risks that rose to the level of what he called "survival issues."

The first was mounting government debt, which he called "unsustainable" and "unaffordable," and which could make America end up like Lehman Brothers. "This is not policy, this is arithmetic," Mr. Daniels said, speaking not only of the current debt but of the looming promises such as Medicare and Social Security.

The second was terrorism and the possibility that terrorists could obtain nuclear technology.

Neither of the two parties has "covered themselves with glory," Mr. Daniels said. But the upcoming elections will deal with "larger questions than we are used to dealing with," including, "will the public sector be the servant, the enabler of the free economy…or will they be the master."

Rep. Eric Massa, the Democratic member of Congress from New York who is resigning, says the House leadership forced him out because he wouldn't vote for their version of a health care overhaul.

The New Yorker article on Treasury Secretary Geithner argues that the bank "stress tests" were one of his big successes. The article paraphrases a bank analyst, Richard Bove of Rochdale Securities, as saying that "U.S. banks now have more capital as a percentage of assets than in any year since 1935." Says the New Yorker, "Between March 9th and May 7th, when the results of the stress tests were announced, the Dow rose by almost two thousand points, and the spread between AAA and BAA bonds—a reliable indicator of financial distress—fell sharply. Other factors contributed to this revival: the decline in house prices slowed; the Fed began buying mortgage bonds; Congress started to disburse funds from the stimulus program; and the U.S. accounting authorities granted banks more leeway in writing down their assets. From abroad, the Group of Twenty nations agreed on a range of policies to fight the global slump. But the stress tests surely played an important role in reassuring investors that the banking system wasn't about to collapse."

The New York's John Cassidy writes up his interview with Treasury Secretary Timothy Geithner, in which Mr. Geithner complains he just isn't understood. Mr. Cassidy quotes Mr. Geithner as saying, "We saved the economy, but we kind of lost the public doing it." From the New Yorker article:

The New York Times's Nobel laureate economics columnist, Paul Krugman, has a column today blaming the "ideology" of "free-market fundamentalism" for the financial crisis in America and Ireland. He doesn't deal with the fact that there's also an economic crisis in Greece, which is hardly a bastion of free-market "fundamentalism."

"In an otherwise polarized environment, two-thirds of Democrats, Republicans and independents share an unfavorable view of major banks and financial institutions, the Pew Research Center found last month," reports the New York Times. Here's the full language from the Pew poll:

While the public is wary of too much government, it makes an exception when it comes to stricter regulation of major financial companies. A clear majority (59%) says it is a good idea for the government to more strictly regulate the way major financial companies do business; just 33% say this is a bad idea. Support for tougher regulation of financial firms is as high as it was last April (60% good idea).

Like Rep. Charles Rangel before him, who had issues with declaring rental income on a villa in the Dominican Republic, and like the Treasury secretary, Timothy Geithner, who was confirmed to oversee the IRS despite his own tax issues, the new head of the tax-writing Ways and Means Committee, Rep. Sander Levin, has his own tax issues. Roll Call reports that "Newly anointed House Ways and Means Chairman Sander Levin (D-Mich.) repaid a Maryland property-tax credit Friday that he should not have received, his office confirmed." Link via Yid With Lid.

FutureOfCapitalism.com post on Sears chairman's letter: February 23, 2010.

Wall Street Journal editorial on same: March 6, 2010.

Charles Krauthammer:

Imagine a bill granting every American a free federally delivered ice cream every Sunday morning. Provision 2: steak on Monday, also home delivered. Provision 3: a dozen red roses every Tuesday. You get the idea. Would each individual provision be popular in the polls? Of course.