It’s All Greek to Us

The Washington independent is a right-leaning paper, so it’s important to put their plaintive wails in context.

Before we start pissing all over the Obama administration for its handling of the bailout, this is what we need to know about the current financial crisis.

1) It was caused by de-regulation: a combination of the repeal of the Glass Steagall act and the belief that markets always know best allowed a massive real-estate bubble to blossom and eventually pop. Despite the fact that people with modest incomes were being sold baloon mortgages with teaser rates they could barely afford for no money down and no real proof of income, right-wing ideologues and financial hucksters went on TV day in and day out to dispel any notion that the housing boom was an unsustainable bubble.

2) Lax regulation allowed AIG to play, what was essentially, an unwise game of chicken: writing billions upon billions of dollars worth of insurance policies on an asset (mortgage backed securities) that had only paper value inflated by frenzy of an unsustainable bubble. AIG had nothing like the reserves to cover these policies once a generalized market bubble popped. This should never have been allowed to happen, but it’s precisely the sort of thing that happens when you allow corporations to do anything they want.

3) When the financial meltdown occurred, it risked bringing down the nation’s largest banks, a financial lifeline for the broader economy. Failure to rescue them would have meant tens if not hundreds of thousands of businesses would have gone under, unable to secure credit to meet payrolls and restock inventory.

4) AIG had to be rescued because failure to do so would have meant a collapse of the broader economy caused by much the same factors as a failure of the banks. Too many investors had hedged their bets with AIG.

Right now Geitner and Obama are doing the only thing possible in this situation if we want to avoid a financial meltdown, and they’re paying a heavy political price for it. But this is a sleight of hand perpetrated by the truly guilty parties, who are looking to use Obama and Geitner as scapegoats so that they themselves may escape blame, and more importantly the deserved consequences of their actions.

By focusing our wrath on Obama and Geitner we take the heat the banks and financial services industry. We scurry around looking for insider deals and culpability among the administration’s appointees instead of pressing for reinstatement of the Glass Steagall act and imposition of reasonable regulations and limits on the broader industry. We are making a Soap Opera out of the Whitehouse that is distracting us from what is happening in the real world: namely, the villains are gearing up for the next unregulated orgiastic feeding frenzy that will leave them sitting pretty on top of fat paychecks with the rest of up picking up the bill resulting from the inevitable collapse.

We should be focusing our energies not on criticizing Geitner for being too generous with taxpayer monies in seeking to prevent a global meltdown. We should be focused on making sure another meltdown doesn’t happen again.

And I have little patience for teabagger types who rail on and on about how unfair it is to shower taxpayer money on corporations, but then wail just as loudly at any talk of taxing the bonuses of wall street executives who received government bailout money.

The Geitner/Obama drama is just a distraction by right-wingers meant to distract our attention from what should be the real goal: reforming and re-regulating our financial system.

I’m just glad I worked out how to deal with this and decided to become a millionaire through the power of positive thinking.

Oh. And I blame George Soros.

@Serolf Divad:
Very well written and sadly all too true.

At this point the only way re-regulation is going to happen is if the Feds start busting heads to get Wall St in line.

Is it possible to use RICO onWall St? At this point, the Mob and various criminal organizations got nothing on them.

@ManchuCandidate: Where is Elliot Spitzer when we need him?

@Serolf Divad: Thank you so much for all of that. As with most people my age, I have a fairly short attention span, so while this whole thing does interest me, I have trouble following sometimes because I get distracted and zone out. I had a vague grasp on all of the stuff you mentioned, but I didn’t really understand the specifics. You’re right absolutely right, though. Politics and big business are all about smoke and mirrors, distraction and sleight of hand. The most important part of actively working to maintain the status quo is to shift the blame when something goes wrong and pretend like you’re just as much the victim as the people who actually lost out.

I think the concept of self-regulation–even outside of business and economics–is just stupid. I’d love to live in a world where we didn’t need laws to keep people from cutting corners and using cyanide as a cheap replacement for “natural almond scent” in aromatic candles. That’s just not how things work on the planet Earth, though. Fact is that even with laws and regulations, people still look out for number one and still try to find ways to cheat each other and get an edge over the competition.

@JNOVjr:
Self regulation works if everyone thinks beyond themselves and is more altruistic than Jeebus. Much like communism could theoretically work.

If there is only one benefit to the shorter attention span of kids today, no one outside of the really crazy will ever read Ayn Rand’s work. It’s long and soooooo boring.

@JNOVjr:
righto little brother. self regulation is a complete joke. one of my favorite things to whine about. up there with campaign funding.

@ManchuCandidate: Much like communism could theoretically work.

I was thinking the same thing. It’s ironic that the same people championing deregulation are the ones accusing Obama of being a socialist.

@baked: I actually have a list of things I like to whine about. It’s mostly people, though. In fact, I call it my “List of People Who Need to Shut the Fuck Up”.

@JNOVjr:
on facebook i just became a fan of “setting dumb ass people on fire.”
maybe i’m watching too much dexter.

@baked: Pfffft, I was a fan of that before it was cool. Oh and speaking of Dexter, are they still playing new episodes? I only ever saw one season because we lost our cable sometime between the first two and we didn’t sign up for Showtime when we got it back. I miss Pen & Teller, too.

Oh yeah, one thing I forgot to add to my initial comment: I never really got why conservatives are always running around screaming bloody murder about government spending. Don’t get me wrong, I don’t think it’s a good idea that the gov’t bankrupts us or anything, but I don’t quite understand the point of having money if you’re not going to use it.

@JNOVjr: Simple. Govt spending makes Jesus cry.

Everyone knows Repugnants have awesome fiscal discipline:

from politicalwire.com

Secret Spending Sends Florida GOP into Crisis

Florida Republicans “are livid over newly revealed records that suggest outgoing chairman Jim Greer used the party as a personal slush fund for lavish travel and entertainment,” the St. Petersburg Times reports.

Records also show that the party’s executive director “padded his $103,000 salary with a secret, $260,000 fundraising contract and another $42,000 for expenses — at the same time the once mighty Florida GOP was having to lay off employees amid anemic fundraising.”

Another sign of trouble: “House Speaker Dean Cannon transferred $665,000 of party money in the days surrounding Greer’s resignation to a separate political committee called the Florida Liberty Fund, suggesting lack of confidence in the party election machine.”

@baked: I find myself self-regulating, every freakin day.

@Nabisco: Dude, sounds like the excrement is hitting the fan in your neck of the continent.

@Nabisco: Yes, because we haven’t figured out how to unload all our financial risk onto others and make money while doing it. If somebody at a poker game behaved the way Goldman did in the markets, they’d get shot.

@redmanlaw: Cue Claude Rains: “I am shocked —shocked!—to discover…”

@Nabisco: Do you use the invisible hand for that? The self-regulating?

@Serolf Divad: Bill motherfucking Clinton, I tell you, Bill motherfucking Clinton is the one what did this, with fucking GLB, the most horrid law ever in the history of law.

I can tell a Clinton era law or regulation just from reading one. They have a stink about them, one of idiotic genius, ivy-league intelligence and practical cluelessness, unnecessary, unworkable complexity, arrogance, form over substance, makework-wasteful regualtory action with no real result in the world, just shit. Truly, you can see the hands of the kind of smug little shits that surround Hillary, or people like Hillary herself, the products of the public policy schools and their cut the baby in half compromise of everything, you can taste it. Big symbolic “protections” for the consumers, for the public, and the whole store secretly given up to the financial industry.

Why do you suppose it is, that even though you get your privacy notice and your opportunity to opt out when you open an account, the Institution nevertheless continues to send you a new notice every year?

Because the system is designed to present you with multiple opportunities to neglect to opt out. Yes, the Privacy Rule was written, purposely, so that members of the public would find it difficult and impractical to even exercise the ineffective opt-out that doesn’t protect shit anyway.

Thats just one little tiny piece of the epic-ly Clintonian GLB Act. There are a thousand.

@Prommie: “Truly, you can see the hands of the kind of smug little shits that surround Hillary, or people like Hillary herself, the products of the public policy schools and their cut the baby in half compromise of everything, you can taste it.”

Too bad Barry hired all of them to come back, no doubt to squelch any Hillbot 2012 uprising. Worse thing he has done was ditching the campaign’s economic team in favor of the old/new crop from Bill C. days…

“I can tell a Clinton era law or regulation just from reading one. They have a stink about them, one of idiotic genius, ivy-league intelligence and practical cluelessness, unnecessary, unworkable complexity, arrogance, form over substance, makework-wasteful regualtory action with no real result in the world, just shit.”

DADT?
DOMA?
Welfare “reform” and a passel of insane requirements and hoops that states and recipients must jump through?

@SanFranLefty: Its not just me, is it? You see it too, Clinton style policy is largely legerdemain, slight of hand, unworkable complexity masking, in most cases, an utter sellout, in an effort to make it look like a compromise. Finance OWNED fucking Clinton.

@Prommie: “…No matter what promises you make on the campaign trail – blah, blah, blah – when you win, you go into this smoky room with the twelve industrialist, capitalist scumfucks that got you in there, and this little screen comes down… and it’s a shot of the Kennedy assassination from an angle you’ve never seen before, which looks suspiciously off the grassy knoll…. And then the screen comes up, the lights come on, and they say to the new president, ‘Any questions?’

“‘Yeah'” he says, “‘what’s my agenda?”

– Bill Hicks

@redmanlaw:
12? i picture one fat bald guy with a monacle and a white persion cat on his lap. other than that, bill pretty much sums up what i think.

@JNOVjr:

You are a smart kid, which gives me a little hope.

Look, guys, this goes back to my favorite screed which I hope you aren’t sick of by now, but which I think bears repeating. We keep looking back and forth from pig to man, and from man to pig, and then from pig to man again, and we don’t see the difference because there isn’t any. Why aren’t we reforming the financial industry? Because even the politicians who froth at the mouth come election time about this stuff benefit from it, either directly or obliquely. It is laughable to think that people would vote directly against policies that help to make them rich. Would you do it?

It’s become clearer and clearer to me that what we are looking at in this country is a plutocracy, and our income and the fruits of our labor are simply going to be transferred upward to benefit about 1% of the population. To mix the barnyard metaphors, we are voting in foxes to look after the henhouse, and the truly sick thing is that we don’t have a choice. After all is said and done, only the foxes can afford to run for office.

I’m not sure that change will come until the whole thing comes crashing down on itself, and even then, the way things are going, I think we see a shift to a falangist or fascist government. I just do.

And I’m the hopeful one, remember?

@Tommmcatt Say Relax:
i’m ready to welcome a benevolent dictator.

@baked: I picture Gendo Ikari surrounded by a bunch of “Sound Only” holograms.

@Tommmcatt Say Relax: I thank you very much. You know, my mother says the same thing about me, but I figured it’s just the senility setting in, because she tends to call me “Billy” while she does it.

As far as your foxes and the hen house metaphor, I’m going to go one step further and say that it’s not just that the foxes are the only ones that can afford to run, but that the foxes are the only ones that want to in the first place. To actually bother going through with the whole process, you need to have some desire for power, even if you intend to use it for the “greater good”. And once you’ve got it, you need to maintain your position if you actually want to use that power, which leads back to what you were saying earlier about voting against your own interests.

If you ask me, the issue is a combination of problems inherent in the human condition and those inherent in the system itself.

@baked: I, for one, welcome our new benevolent overlord.

@Serolf Divad: The Washington independent is a right-leaning paper, so it’s important to put their plaintive wails in context.

Just to clarify, the author of that piece is formerly of Wonkette, Air America, and, um, the Cynics Party.

@JNOVjr: @baked:

Yeah, wait until we all get disappeared for commenting on lefty blogs. Ain’t no such thing as a benevolent autocrat.

Guys, we’re doing it again when we blame Bill Clinton.

DOMA was pushed by right-wingers and only signed by Clinton because he felt he didn’t have the political capital not to sign it. yeah, it was an act of cowardice on his part, but it was the GOP that conceived of, promoted and pushed the law through. We need to not lose sight of the true villains. We’re fucked if we treat DOMA as if Bill Clinton had written the law himself and signed it in the blood of suicidal gay teenagers. We cannot allow ourselves to be harder on our own side than we are on the opposition. That’s a formula for eternal defeat.

DADT was a policy Clinton pushed to replace a policy of actively rooting out gays from military service. The idea behind DADT was that sexuality was a private matter and as long as gays kept it to themselves they should be allowed to serve. Yes, it’s still a demeaning, destructive, shitty policy, but at the time it was viewed and portrayed on the Right as opening the doors to gays in the military. Clinton took a shit load of heat for the policy from the Right.

Most of the financial de-regulation that took place during the Clinton presidency took place after the GOP captured the House in 1994. It was mostly pushed by Republicans (i.e. Phil Graham’s gutting of Glass Steagal). Clinton was an enthusiastic supporter of “free trade” but the real villain in the de-regulation mess is still the GOP.

We cannot allow ourselves to lose sight of these facts, even as we criticize the Democrats for acting like the worthless fucking wimps they’ve proven themselves to be.

Has anyone seen Billy?

@JNOV: Or Uncle Billy’s money?

@Serolf Divad:
I’m not a fan of Bill, but your reasoning makes sense to me. Phil Gramm is the most prominent name on that POS legislation and the one who got the richest off his own POS work.

@Tommmcatt Say Relax:
yes i know, no benevolent autocrats…not YET !!!…i made one up.
there is such a thing in the land i make up for myself. coping strategy.

@baked: Where is our Cincinnatus?

@FlyingChainSaw: Leasing corn from Monsanto.

@baked:

Bakedovia, where the fountains run with champaigne and every garden sports a half-acre of White Widow.

@Benedick:
is that like renting beer?

@nojo:

My bad, I got the Washington Independent confused with the Washington Examiner.

@Serolf Divad: You did have me confused for a sec — the Independent’s where Dave Weigel hangs out.

(And really, I would have expected someone here to pick up on the Megan reference…)

@Serolf Divad: The Examiner gets a pass in my book because they syndicate the New York Times crossword, but their editorial page is, in fact, abominable.

@baked: @Tommmcatt Say Relax: Sounds boring. My made-up places always tend to play like something Keita Takahashi created .

@nojo: I got it but was never part of that particular fan-club.

@Capt Howdy: You know a farmer can’t buy genetically altered corn but only lease the use of seed to grow a crop? Monsanto does a big business in it.

In other news of the day, the archbishop of the Ugandan Anglican church has endorsed the Kill the Gays bill with a few caveats which MAKE IT WORSE!!!!!

@Benedick: Can’t say I’m a member either after the bashing, but history is history.

@Benedick:
time to push for a “Kill the Archbishops” bill

@JNOVjr:

Oh my god that is the most exhausting thing I have seen all month.

@Tommmcatt Say Relax: The games are fun, I promise. I don’t actually own Noby Noby Boy, but Katamari Damacy and We Love Katamari are both in my top 10 fav’rites.

Arthur Jensen: [bellowing] You have meddled with the primal forces of nature, Mr. Beale, and I won’t have it! Is that clear? You think you’ve merely stopped a business deal. That is not the case! The Arabs have taken billions of dollars out of this country, and now they must put it back! It is ebb and flow, tidal gravity! It is ecological balance! You are an old man who thinks in terms of nations and peoples. There are no nations. There are no peoples. There are no Russians. There are no Arabs. There are no third worlds. There is no West. There is only one holistic system of systems, one vast and immane, interwoven, interacting, multivariate, multinational dominion of dollars. Petro-dollars, electro-dollars, multi-dollars, reichmarks, rins, rubles, pounds, and shekels. It is the international system of currency which determines the totality of life on this planet. That is the natural order of things today. That is the atomic and subatomic and galactic structure of things today! And YOU have meddled with the primal forces of nature, and YOU…WILL…ATONE!

Arthur Jensen: [calmly] Am I getting through to you, Mr. Beale? You get up on your little twenty-one inch screen and howl about America and democracy. There is no America. There is no democracy. There is only IBM, and ITT, and AT&T, and DuPont, Dow, Union Carbide, and Exxon. Those *are* the nations of the world today. What do you think the Russians talk about in their councils of state, Karl Marx? They get out their linear programming charts, statistical decision theories, minimax solutions, and compute the price-cost probabilities of their transactions and investments, just like we do. We no longer live in a world of nations and ideologies, Mr. Beale. The world is a college of corporations, inexorably determined by the immutable bylaws of business. The world is a business, Mr. Beale. It has been since man crawled out of the slime. And our children will live, Mr. Beale, to see that . . . perfect world . . . in which there’s no war or famine, oppression or brutality. One vast and ecumenical holding company, for whom all men will work to serve a common profit, in which all men will hold a share of stock. All necessities provided, all anxieties tranquilized, all boredom amused. And I have chosen you, Mr. Beale, to preach this evangel.

Howard Beale: Why me?

Arthur Jensen: Because you’re on television, dummy. Sixty million people watch you every night of the week, Monday through Friday.

Howard Beale: I have seen the face of God.

Arthur Jensen: You just might be right, Mr. Beale.