The real cause of the crisis lies in huge inequalities in income distribution which generated much larger investable funds than could be profitably employed. The political problem of insufficient economic growth of the middle class was then “solved” by opening the floodgates of the cheap credit. And the opening of the credit floodgates, to placate the middle class, was needed because in a democratic system, an excessively unequal model of development cannot coexist with political stability.
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Geithner proposed asking Congress to give the president broad power to guarantee all the debt in the banking system, according to two participants, including Michele Davis, then an assistant Treasury secretary.
The proposal quickly died amid protests that it was politically untenable because it could put taxpayers on the hook for trillions of dollars.
“People thought, ‘Wow, that’s kind of out there,’ ” said John C. Dugan, the comptroller of the currency, who heard about the idea afterward. Mr. Geithner says, “I don’t remember a serious discussion on that proposal then.”
But in the 10 months since then, the government has in many ways embraced his blue-sky prescription....(today's NY Times)
When Lyndon Johnson advised his aides, just days after President Kennedy was assassinated, that he intended to use his presidency to enact landmark civil rights laws, he was warned that it was far too early to risk the nation's support on something so controversial. "Hell," Johnson replied, "What's the presidency for?"
Barack Obama, after nearly a hundred days[...]has yet to decide what his presidency is for.
Five years after the Abu Ghraib revelations, we must acknowledge that our government methodically authorized torture and lied about it. But we also must contemplate the possibility that it did so not just out of a sincere, if criminally misguided, desire to “protect” us but also to promote an unnecessary and catastrophic war. Instead of saving us from “another 9/11,” torture was a tool in the campaign to falsify and exploit 9/11 so that fearful Americans would be bamboozled into a mission that had nothing to do with Al Qaeda. The lying about Iraq remains the original sin from which flows much of the Bush White House’s illegality.
Levin suggests — and I agree — that as additional fact-finding plays out, it’s time for the Justice Department to enlist a panel of two or three apolitical outsiders, perhaps retired federal judges, “to review the mass of material” we already have. The fundamental truth is there, as it long has been. The panel can recommend a legal path that will insure accountability for this wholesale betrayal of American values.
President Obama can talk all he wants about not looking back, but this grotesque past is bigger than even he is. It won’t vanish into a memory hole any more than Andersonville, World War II internment camps or My Lai. The White House, Congress and politicians of both parties should get out of the way. We don’t need another commission. We don’t need any Capitol Hill witch hunts. What we must have are fair trials that at long last uphold and reclaim our nation’s commitment to the rule of law.
Knowing that torture was condoned in our names is an abominable thing. This parlor game of moving forward, not backward, of letting bygones be bygones, admitting error, and just getting the hell on with our days is just as dismal, because this, finally, internalizes the message that we citizens, our government, and other nations will take from this sorry affair, which is that while we begrudgingly acquiesce to stopping, we will, even now, refuse to recognize the act itself as truly criminal.
There is absolutely no pride to be gained in no longer torturing, but blocking justice in those instances in which we have. It is no act of courage; it is no enlightened position. It is merely the easiest path, and the one followed in nearly every instance by nations proven to have committed foul acts. Sorry, but we're not about to do anything about it. We'll stop, but in exchange for stopping we expect the episode to be forgotten. What would count as a war crime for you other countries counts for us as an internal matter, and we consider it closed.
I do not feel like begging. After years of railing against the practice (to be largely ignored, because in those days the majority of voices presumed torture to have positive effects, and therefore be justified), after years of government denial that any such thing was happening (in spite of clear and demonstrable evidence that it did), the last thing in the world that I feel like doing is once again begging, at long last, and to the supposed reasonable people that replaced the last reasonable people, that we actually follow our own goddamn laws, or treat crimes by our powerful with the same grave manner as we do crimes by anyone else in the nation.
I am fucking sick of it...
...if we don’t at least deal with the collective failures that occurred in the Bush Justice Department immediately following 9/11, we are setting ourselves up for a time when a future administration will see no risk in again sanctioning torture. This is a problem that the Obama administration cannot duck—no matter how much it would like to.
...Worse, as the fundamental flaw in the administration's cosmology becomes more and more evident, the economic team around the president is closing ranks. Even David Axelrod, once the administration's champion of a more skeptical view of a bank-centric universe, appears to be peering through the Geithner-Summers telescope.
Back in February, he crossed swords with Geithner, arguing for executive pay caps. But there he was on Sunday, whiffing on a pro-populist softball offered up by Fox News' Chris Wallace, who asked: "When taxpayers are putting up most of the money and taking more of the risk, why would the Obama administration allow some of these executives to get even richer?"
Axelrod's answer? "On some of these programs, we're asking financial companies to come in and help solve this problem by providing more lending, by buying up toxic assets and so on. We don't want to create disincentives and undermine the program."
"Asking" them? Aren't we, in fact, bribing them with massive capital infusions and loan guarantees? That's what being surrounded by a group of modern day Ptolemys will do to a person.[...]
There is an enormous human cost to this bank-centric dogma. Unemployment, already at levels not seen since 1983, is skyrocketing. In many places in the country, it's approaching 20 percent (and in Detroit it's 22 percent).
Writing about the "grand book" that is the universe, Galileo declared that it "cannot be understood unless one first learns to comprehend the language and interpret the characters in which it is written... without these, one is wandering about in a dark labyrinth."
That's where we find ourselves today, wandering about in a dark financial labyrinth -- being led by good men blinded by an obsolete view of the world.
By way of illustration: the global value of financial assets (which means: debt) in the whole world by September 2008 - as the crisis was exploding with the collapse of Lehman Brothers - was $160 trillion: three-and-a-half times larger than the value of global GDP. The financial system cannot be rescued by pumping in the money available.
The question of exactly who and what the G20 is, has yet to be resolved (the 3,070-word communiqué uses the word "we" ninety times). Perhaps - as Claude Sautet said in another context - being together will become enough to answer it. That has worked for the G7/G8, after all; but doesn't such very lack of definition suit less-than-accountable power all too well?
The shift from in-itself to for-itself may yet happen. Everything seems open in these deeply uncertain times - including the future of a new body that in its early incarnation more fairly reflects the shifting economic and geopolitical power-balances in the world. If a trend towards its institutionalisation develops, the implications for its older and more established siblings (the G7/G8, the International Monetary Fund and World Bank and World Trade Organisation) might also be profound. The United Nations too - which hosts an emergency summit of its own in June 2009, but which has been missing in action in many of the global deliberations - needs to find its voice.
A grouping that emerged in ad-hoc fashion from a crisis which has wrecked the lives of millions and threatens even greater damage, whose character is less than defined and whose final form is unclear, is in an odd position: it has neither the credibility that comes from substantive achievement nor yet the taint of failure and disappointed expectations. The diversity of the G20 is an additional complicating factor here for those who would anathematise it with the vehemence they might attach to the G8 or the IMF; a group that includes the governments of (say) Brazil, South Africa and India is by that very fact significantly different from one run by rich, white, western elites.
...But for the most part, the fate of the European center-left has been to preside over slightly less awful center-right policies and then to suffer retribution at the polls.
With European parliamentary elections coming up in June, and even nominally center-left governments more solicitous of banks than of ordinary people, it's not at all clear that progressive parties will benefit from what should be the greatest embarrassment of capitalism since the 1930s, or that the politics and regulation of capitalism will be transformed.
The Brussels meetings produced a brave communiqué, calling for a Global New Deal, built on sustainable development, the harnessing of private finance, and broad social justice. The meetings opened with a stirring speech by Bill Clinton, who managed to sound more progressive than he ever did in office. I found myself thinking: If only this man had been president[...]
This Group of 20 meeting was notable only because the club of seven leading democracies plus Russia ("the G-8") was expanded to include emerging world powers such as India, China, and Brazil. The most important third world nations never embraced financial market fundamentalism, and they are a salutary counterweight.
But the 2009 summit, whose extensive press clippings will soon be fishwrap, succeeded mainly because it managed not to fail. Michelle Obama dominated European television for a week. Her husband was hailed as a diplomatic genius for mediating a minor dust-up between French President Sarkozy (who was threatening to take his boule and go home because of the summit's tepid acceptance of an OECD blacklist of forbidden tax-havens) and Chinese President Hu Jin-tao (who insisted that the communiqué not give any role to the OECD, which excludes China.) Obama solved the spat with an indirect reference to the OECD list, and persuaded the two grown men to shake hands like adults. In this age of diminished expectations, that feat passes for statecraft.
But the Europeans did not get the Americans to commit to the details of tougher financial regulation. Nor did the Americans get the Europeans to agree to more economic stimulus spending. Instead, the two camps punted the ball to two international organizations of dubious provenance. (read the whole thing)
The great wealth that the financial sector created and concentrated gave bankers enormous political weight—a weight not seen in the U.S. since the era of J.P. Morgan (the man). In that period, the banking panic of 1907 could be stopped only by coordination among private-sector bankers: no government entity was able to offer an effective response. But that first age of banking oligarchs came to an end with the passage of significant banking regulation in response to the Great Depression; the reemergence of an American financial oligarchy is quite recent...
Throughout the crisis, the government has taken extreme care not to upset the interests of the financial institutions, or to question the basic outlines of the system that got us here. In September 2008, Henry Paulson asked Congress for $700 billion to buy toxic assets from banks, with no strings attached and no judicial review of his purchase decisions. Many observers suspected that the purpose was to overpay for those assets and thereby take the problem off the banks’ hands—indeed, that is the only way that buying toxic assets would have helped anything. Perhaps because there was no way to make such a blatant subsidy politically acceptable, that plan was shelved.
Instead, the money was used to recapitalize banks, buying shares in them on terms that were grossly favorable to the banks themselves. As the crisis has deepened and financial institutions have needed more help, the government has gotten more and more creative in figuring out ways to provide banks with subsidies that are too complex for the general public to understand....
Looking just at the financial crisis (and leaving aside some problems of the larger economy), we face at least two major, interrelated problems. The first is a desperately ill banking sector that threatens to choke off any incipient recovery that the fiscal stimulus might generate. The second is a political balance of power that gives the financial sector a veto over public policy, even as that sector loses popular support.
Big banks, it seems, have only gained political strength since the crisis began. And this is not surprising. With the financial system so fragile, the damage that a major bank failure could cause—Lehman was small relative to Citigroup or Bank of America—is much greater than it would be during ordinary times. The banks have been exploiting this fear as they wring favorable deals out of Washington. Bank of America obtained its second bailout package (in January) after warning the government that it might not be able to go through with the acquisition of Merrill Lynch, a prospect that Treasury did not want to consider.
The challenges the United States faces are familiar territory to the people at the IMF. If you hid the name of the country and just showed them the numbers, there is no doubt what old IMF hands would say: nationalize troubled banks and break them up as necessary.
In some ways, of course, the government has already taken control of the banking system. It has essentially guaranteed the liabilities of the biggest banks, and it is their only plausible source of capital today. Meanwhile, the Federal Reserve has taken on a major role in providing credit to the economy—the function that the private banking sector is supposed to be performing, but isn’t. Yet there are limits to what the Fed can do on its own; consumers and businesses are still dependent on banks that lack the balance sheets and the incentives to make the loans the economy needs, and the government has no real control over who runs the banks, or over what they do.
At the root of the banks’ problems are the large losses they have undoubtedly taken on their securities and loan portfolios. But they don’t want to recognize the full extent of their losses, because that would likely expose them as insolvent. So they talk down the problem, and ask for handouts that aren’t enough to make them healthy (again, they can’t reveal the size of the handouts that would be necessary for that), but are enough to keep them upright a little longer. This behavior is corrosive: unhealthy banks either don’t lend (hoarding money to shore up reserves) or they make desperate gambles on high-risk loans and investments that could pay off big, but probably won’t pay off at all. In either case, the economy suffers further, and as it does, bank assets themselves continue to deteriorate—creating a highly destructive vicious cycle.
To break this cycle, the government must force the banks to acknowledge the scale of their problems. As the IMF understands (and as the U.S. government itself has insisted to multiple emerging-market countries in the past), the most direct way to do this is nationalization. Instead, Treasury is trying to negotiate bailouts bank by bank, and behaving as if the banks hold all the cards—contorting the terms of each deal to minimize government ownership while forswearing government influence over bank strategy or operations. Under these conditions, cleaning up bank balance sheets is impossible.
Nationalization would not imply permanent state ownership. The IMF’s advice would be, essentially: scale up the standard Federal Deposit Insurance Corporation process. An FDIC “intervention” is basically a government-managed bankruptcy procedure for banks. It would allow the government to wipe out bank shareholders, replace failed management, clean up the balance sheets, and then sell the banks back to the private sector. The main advantage is immediate recognition of the problem so that it can be solved before it grows worse.
The government needs to inspect the balance sheets and identify the banks that cannot survive a severe recession. These banks should face a choice: write down your assets to their true value and raise private capital within 30 days, or be taken over by the government. The government would write down the toxic assets of banks taken into receivership—recognizing reality—and transfer those assets to a separate government entity, which would attempt to salvage whatever value is possible for the taxpayer (as the Resolution Trust Corporation did after the savings-and-loan debacle of the 1980s). The rump banks—cleansed and able to lend safely, and hence trusted again by other lenders and investors—could then be sold off.
Cleaning up the megabanks will be complex. And it will be expensive for the taxpayer; according to the latest IMF numbers, the cleanup of the banking system would probably cost close to $1.5trillion (or 10percent of our GDP) in the long term. But only decisive government action—exposing the full extent of the financial rot and restoring some set of banks to publicly verifiable health—can cure the financial sector as a whole.
This may seem like strong medicine. But in fact, while necessary, it is insufficient. The second problem the U.S. faces—the power of the oligarchy—is just as important as the immediate crisis of lending. And the advice from the IMF on this front would again be simple: break the oligarchy.
Oversize institutions disproportionately influence public policy; the major banks we have today draw much of their power from being too big to fail. Nationalization and re-privatization would not change that; while the replacement of the bank executives who got us into this crisis would be just and sensible, ultimately, the swapping-out of one set of powerful managers for another would change only the names of the oligarchs.
Ideally, big banks should be sold in medium-size pieces, divided regionally or by type of business. Where this proves impractical—since we’ll want to sell the banks quickly—they could be sold whole, but with the requirement of being broken up within a short time. Banks that remain in private hands should also be subject to size limitations.
This may seem like a crude and arbitrary step, but it is the best way to limit the power of individual institutions in a sector that is essential to the economy as a whole. Of course, some people will complain about the “efficiency costs” of a more fragmented banking system, and these costs are real. But so are the costs when a bank that is too big to fail—a financial weapon of mass self-destruction—explodes. Anything that is too big to fail is too big to exist.
To ensure systematic bank breakup, and to prevent the eventual reemergence of dangerous behemoths, we also need to overhaul our antitrust legislation. Laws put in place more than 100years ago to combat industrial monopolies were not designed to address the problem we now face. The problem in the financial sector today is not that a given firm might have enough market share to influence prices; it is that one firm or a small set of interconnected firms, by failing, can bring down the economy. The Obama administration’s fiscal stimulus evokes FDR, but what we need to imitate here is Teddy Roosevelt’s trust-busting...
The people who have spent their lives cloistered in this Wall Street community aren't much for sharing information with the great unwashed. Because all of this shit is complicated, because most of us mortals don't know what the hell LIBOR is or how a REIT works or how to use the word "zero coupon bond" in a sentence without sounding stupid — well, then, the people who do speak this idiotic language cannot under any circumstances be bothered to explain it to us and instead spend a lot of time rolling their eyes and asking us to trust them.
That roll of the eyes is a key part of the psychology of Paulsonism. The state is now being asked not just to call off its regulators or give tax breaks or funnel a few contracts to connected companies; it is intervening directly in the economy, for the sole purpose of preserving the influence of the megafirms. In essence, Paulson used the bailout to transform the government into a giant bureaucracy of entitled assholedom, one that would socialize "toxic" risks but keep both the profits and the management of the bailed-out firms in private hands. Moreover, this whole process would be done in secret, away from the prying eyes of NASCAR dads, broke-ass liberals who read translations of French novels, subprime mortgage holders and other such financial losers...
The situation with the first TARP payments grew so absurd that when the Congressional Oversight Panel, charged with monitoring the bailout money, sent a query to Paulson asking how he decided whom to give money to, Treasury responded — and this isn't a joke — by directing the panel to a copy of the TARP application form on its website. Elizabeth Warren, the chair of the Congressional Oversight Panel, was struck nearly speechless by the response.
"Do you believe that?" she says incredulously. "That's not what we had in mind."
Another member of Congress, who asked not to be named, offers his own theory about the TARP process. "I think basically if you knew Hank Paulson, you got the money," he says.
This cozy arrangement created yet another opportunity for big banks to devour market share at the expense of smaller regional lenders. While all the bigwigs at Citi and Goldman and Bank of America who had Paulson on speed-dial got bailed out right away — remember that TARP was originally passed because money had to be lent right now, that day, that minute, to stave off emergency — many small banks are still waiting for help. Five months into the TARP program, some not only haven't received any funds, they haven't even gotten a call back about their applications.
"There's definitely a feeling among community bankers that no one up there cares much if they make it or not," says Tanya Wheeless, president of the Arizona Bankers Association.
Which, of course, is exactly the opposite of what should be happening, since small, regional banks are far less guilty of the kinds of predatory lending that sank the economy. "They're not giving out subprime loans or easy credit," says Wheeless. "At the community level, it's much more bread-and-butter banking."
Nonetheless, the lion's share of the bailout money has gone to the larger, so-called "systemically important" banks. "It's like Treasury is picking winners and losers," says one state banking official who asked not to be identified.
This itself is a hugely important political development. In essence, the bailout accelerated the decline of regional community lenders by boosting the political power of their giant national competitors.
Which, when you think about it, is insane: What had brought us to the brink of collapse in the first place was this relentless instinct for building ever-larger megacompanies, passing deregulatory measures to gradually feed all the little fish in the sea to an ever-shrinking pool of Bigger Fish. To fix this problem, the government should have slowly liquidated these monster, too-big-to-fail firms and broken them down to smaller, more manageable companies. Instead, federal regulators closed ranks and used an almost completely secret bailout process to double down on the same faulty, merger-happy thinking that got us here in the first place, creating a constellation of megafirms under government control that are even bigger, more unwieldy and more crammed to the gills with systemic risk.
When banks get 25 percent to 30 percent on credit cards, and 500 or more percent on payday loans, capital flees from honest pursuits, like auto manufacturing. Sure, GM is awful. Sure, it doesn't innovate. But the people who could have saved GM and Ford went off to work at AIG, or Merrill Lynch, or even Goldman Sachs. All of this used to be so obvious as not to merit comment. What is history, really, but a turf war between manufacturing, labor and the banks? In the United States, we shrank manufacturing. We got rid of labor. Now it's just the banks.
Which is why the middle class is shrinking. Basically, we're all waiters now; we're bowing and scraping and working for the banks. Look closely at any American, and it's even odds that he or she, directly or indirectly, is somehow employed by the "financial services sector," which covers insurance and real estate and financial instruments of any kind. As brokers, lawyers, loan collectors, loan consolidators, secretaries at big investment firms, chauffeurs of private limousines, or even the high-tech types who exist solely to service banks–all of us, millions of us, are part of it, living off it in some way, as three generations ago we lived off manufacturing.
[...]
...here's the Plan.
First, we have to pass a new type of law against usury that accepts the world in which we all live now[...]let's cap interest at 9 percent, then let a federal agency give exemptions[...]
Second, we should have state-owned banks[...]
Third, we should have at least one or two "public guardians" as directors at the banks and other financial firms we have bailed out with $700 billion in taxes and all the money the Fed has printed[...]
Fourth, we should require the banks we bail out to cancel an appropriate amount of consumer debt–especially in the instances where people would have paid back the principal by now had the interest rate been more reasonable[...]
Finally, we should think about ways to "inject equity" directly into the accounts of working people rather than into banks. The best way to do this is to announce a plan to raise the gross replacement rate of Social Security from 44 percent to something closer to 65 percent, which is still short of the rate in may European social democracies. We can afford this as much as or more than they can[...]
hickory end-grain chopping block, shipped to New York
hickory edge-grain carving board, shipped to New York
hickory face-grain cheese platter and maple end-grain chop block, shipped to California
reclaimed cedar, hickory, and oak table top, shipped to California
Israel now sends $1.2 billion in “defense” products to the United States—up dramatically from $270 million in 1999. In 2006 Israel exported $3.4 billion in defense products—well over a billion more than it received in US military aid. That makes Israel the fourth-largest arms dealer in the world, overtaking Britain.
Much of this growth has been in the so-called “homeland security” sector. Before 9/11 homeland security barely existed as an industry. By the end of this year, Israeli exports in the sector will reach $1.2 billion—an increase of 20 percent. The key products and services are high-tech fences, unmanned drones, biometric IDs, video and audio surveillance gear, air passenger profiling and prisoner interrogation systems – precisely the tools and technologies Israel has used to lock-in the occupied territories.
And that is why the chaos in Gaza and the rest of the region doesn’t threaten the bottom line in Tel Aviv, and may actually boost it. Israel has learned to turn endless war into a brand asset, pitching its uprooting, occupation and containment of the Palestinian people as a half-century head start in the “global war on terror.”
Did Bernard-Henri Lévy comprehend that "the American left" and "the Charlie Rose television program" are, in fact, distinct entities? Might there be aspects of social and political life that do not impinge upon the consciousness of Sharon Stone or Warren Beatty (who, to judge by American Vertigo, are among the American left's most important figures)? Can a thing be, and yet not be, well publicized?
I frame these questions with all due seriousness, for they touch on something one must always keep in mind while reading Lévy's work--his new book, Left in Dark Times: A Stand Against the New Barbarism (Random House, $25), most emphatically included. For BHL (as he is known in France and, increasingly, the United States) is not simply another pundit. He brings to current affairs a certain philosophical method, which he succinctly unpacked not many years ago in his book War, Evil, and the End of History. There Lévy explained that he found it impossible to recognize as valid any political movement "about which I could not have the feeling, even if illusory, that it began, ended, and found its reasoning in me alone." And so while "the American left" may or may not exist, what Charlie Rose so lovingly calls "this table" certainly does--for BHL has sat at it. Hence certain rigorous deductions are possible....
Washington must assert its full emergency powers and tackle two things at once: manage the gradual downsizing of the financial system in an orderly fashion that sustains lending, and revive production and employment by force-feeding activities of many kinds. This cannot be a voluntary program that simply invites bankers to participate on their terms. The government must impose emergency regulatory controls to keep finance in step with the nation's overall goals. If bankers resist these terms, they should be cut off, isolated from the public's lifesaving assistance.
These are not idle suggestions. The nation is now in the grip of dynamic political change, and this will not stop with the decision on Paulson's grandiose bailout. Presuming the bailout prevails in Congress, Paulson will be handing out public billions to Wall Street players in the next few months. The political counterforce for genuine public-spirited solutions should be pushing back right away. Activists and intellectuals, public citizens and heavyweight financial players, even some members of Congress, are already at work on the details. If Congress reconvenes for a lame-duck session, you will see some of these measures surface for public debate and popular agitation.
The essence of this action will borrow ideas and models from the New Deal and update them to fit our present circumstances. This not simple nostalgia. It is a clearheaded recognition that the public interest has not been served and the crisis will not recede until it is. Here are five concepts for recovery and reconstruction that are in circulation. If we are lucky, these proposals will redefine the next presidency, whoever wins.
1. Stop the easy-money bailout. Instead of buying rotten assets from Wall Street firms with no strings attached, the government should examine their books and decide which banks can be saved with direct infusions of capital in exchange for public ownership--roughly on the terms Warren Buffett got when he aided Goldman Sachs (preferred shares and guaranteed dividends). The failing institutions should get regulatory euthanasia. This approach gives the government direct control over the survivors and ensures that the public is protected from egregious loss. The model is the Reconstruction Finance Corporation of the 1930s, which recapitalized banks and corporations under stern supervision.
2. Help the folks who are hurting--directly. A homeownership corporation patterned after the New Deal original would have the money and the flexible authority to supervise "workouts" for millions of failing families. This is what bankers do for corporations when they get in over their head. Government can do the same for indebted households: stop the liquidation, stretch out default dates and arrange manageable terms. This is not a bleeding-heart gesture--keeping families in their homes is economic stimulus, and it halts the decay of neighborhoods.
3. Get serious about economic stimulus. We need a recovery program five or six times larger than the pitiful $60 billion proposed by Democratic leaders. These billions should go for the familiar list of neglected priorities--fixing bridges and schools--but should also jump-start the green agenda for alternative fuels and restoration of ruined ecosystems. The government should subsidize the new industries of our age, just as New Deal spending financed the modern development of aircraft, petrochemicals, steelmaking and other key industries in the 1930s.
4. Re-regulate the bad actors and indict the criminals. Start by restoring the law against usury--the predatory lending practices that ruin weak and defenseless borrowers. Government cannot wait for a relaxed debate about restoring regulations. We need newly designed controls over the financiers and well-defined public obligations imposed not only on banking but also on hedge funds and private equity firms. These cannot be discretionary rules. If the money guys don't like them, they should get out of the business. Paulson's Wall Street colleagues are already mobilizing lobbyists for this fight, but they may discover that Washington has been changed by events. The easygoing deference to Big Money seems suddenly out of fashion.
5. Create a new brain for government management of the economy. The crisis and the halting decision-making by the Treasury and the Federal Reserve--not to mention the secrecy and special deal-making on behalf of financial interests--make it clear that deep reform is required. I would start with a special reconstruction and recovery agency, empowered to lead policy and oversee banking regulators and the economic stimulus. The Federal Reserve's so-called independence is an antique concession to the big banks and doesn't make any sense. Monetary policy and fiscal policy must be balanced and decided in the same process. That rational approach might have stopped the Fed from the biases and dereliction that led to this crisis.
These ideas and many others are in gestation. They will reach fruition when politicians and other leaders swallow their bruised egos and rethink their supine posture, arm in arm with Wall Street. That looks improbable at the moment. But voters can help them change their minds. (read the whole thing)
Dramesi, who went on to serve as chief war planner for U.S. Air Forces in Europe and commander of a wing of the Strategic Air Command, was not surprised. "McCain says his life changed while he was in Vietnam, and he is now a different man," Dramesi says today. "But he's still the undisciplined, spoiled brat that he was when he went in."
This is the story of the real John McCain, the one who has been hiding in plain sight. It is the story of a man who has consistently put his own advancement above all else, a man willing to say and do anything to achieve his ultimate ambition: to become commander in chief, ascending to the one position that would finally enable him to outrank his four-star father and grandfather.
In its broad strokes, McCain's life story is oddly similar to that of the current occupant of the White House. John Sidney McCain III and George Walker Bush both represent the third generation of American dynasties. Both were born into positions of privilege against which they rebelled into mediocrity. Both developed an uncanny social intelligence that allowed them to skate by with a minimum of mental exertion. Both struggled with booze and loutish behavior. At each step, with the aid of their fathers' powerful friends, both failed upward. And both shed their skins as Episcopalian members of the Washington elite to build political careers as self-styled, ranch-inhabiting Westerners who pray to Jesus in their wives' evangelical churches.
In one vital respect, however, the comparison is deeply unfair to the current president: George W. Bush was a much better pilot...(read the whole thing)
Secondly: what the fuck? What kind of lunatic comes up with this as his "illustrative example"? Your simplifying parable is more fantastic and complicated than the actual story! At first I thought you were kidding, then I had to go back and read it to believe it -- astounding! It should tell the readers of this debate quite a bit that this is your idea of a good way to start an argument: "Say for example that your best friend is killed in broad daylight with a crossbow, and the government frames you for the crime using advanced morphing technology."
...set of state polling that follows is so strong for Obama that he continues to hit record marks in all three of our projection metrics. We are now projecting Obama to win the election 90.5 percent of the time, with an average of 346.8 electoral votes, and a 5.4-point margin in the national popular vote.
