The Jaded Monkey Is In The Glove Box

Apparently, Goldman Sachs doesn't get it about both the financial crisis and the Senate hearings:

Goldman Sachs Chief Executive Lloyd Blankfein told legislators Tuesday that when clients approach the investment bank as a market maker to buy or sell securities, they don't care what the firm thinks of the securities or whether it's betting against them.

Now, for some investors, that might be true.  Jaded monkeys like me who have spent 30 years in the underbelly of the financial markets dealing with the cowboys have learned how to read between the lines and focus on specific words and phrases in offerings and private placement memoranda would have hedged the Goldman Sachs offering, asking to get in on the other side of the deal.

 

Similarly, if I was offering to bundle my holdings and have GS place them, I'd want them to minimize my risk and play down the potential for loss. It's just good business sense, if by "business sense" you mean leaving the suckers holding the bag while I sail to Bimini.

 

Which, unfortunately, is precisely what "good business sense has come to mean in America in the 21st century.

 

But, to borrow from another set of hucksters, wait! There's more!

Sen. Carl Levin, chairman of the Permanent Subcommittee on Investigations, lashed out at Blankfein, claiming that Goldman creates conflicts of interest when it underwrites securities while betting against them.

Levin cited examples where Goldman employees described collateralized debt obligations the firm was selling, or assets backing those deals, as "shitty (corrected for impact)," "crap," "junk" and "lemons."

You'd think these morons would have learned from the Enron debacle. Worse still, as an employee of a FINRA registered firm, my e-mails are subject to storage and archiving for possible use in any investigation of my firm's practices.

Let's tie these two together: It's one thing to sell a risky security to an investor and make the blanket disclaimer that it could conceivably go belly up faster than fish after dynamite. It's another thing to know an investment is shitty and still try to pump out a sale. Markets demand perfect information and if your brokers are proudly boasting of selling a pig in a poke, that same braggadocio ought to be shared with the investment community, and not covered up in order to maximize your profit on betting against the very instruments you've sold.

Derivatives serve some purpose, it's true. An airline that hedges its fuel costs by purchasing futures on its fuel is doing right by its shareholders. Further, if it goes out and places a bet that the price will go down below the future contract price, it is mitigating its loss on the contract.

And vice versa for the firm selling the fuel futures contract. It's an entire other thing, tho, for the broker selling the futures contract to place a side bet based on knowledge he or she has with respect to the price of crude, say, that either party or both is not savvy to.

And still, Goldman Sachs are not getting it! As a "market-maker," Goldman Sachs has an obligation to set the ground rules for the market it is creating. It has what's called a fiduciary responsibility (a responsibility not unlike the one a doctor has to a patient or a lawyer to a client) to perform up to certain standards that exceed the expectations of investors. And it has a well-earned reputation to protect.

In one fell swoop, in one release of e-mails about a series of "shitty deals," Goldman has destroyed its credibility, the markets' credibilities, and rejected its fiduciary responsibility. Rather than admit this, however, Goldman has basically gone on the record as saying they acted in accordance with what some fly-by-night shyster would have done: fleeced investors.

There was a time in this country when an investment bank-- Merrill Lynch, Smith Barney, Goldman Sachs-- would have competed for clients based on its reputation and the trust its investors and clients placed in them.

Now, I'll admit one thing: the Internet and the rise of discount brokerage houses has made that aspect of their business moot. After all, why pay 2% of your assets and 20% of any trades to Goldman or Bear Stearns when you can commit the same trade at TD Ameritrade for $9.99? You keep more of your money, and it's the same damned shares.

This forced Wall Street houses to find new and more innovative ways of fleecing people so they can afford to drive their Beamers and fly their Falcon 50s to their beach house on Bermuda. But that same technology that defeated one aspect of their business made this other aspect of their business wildly profitable.

Powerful computers, advanced mathematics, and the ability to sift through mounds of information well-ahead of investors has given the Wall Streeters a powerful leverage over not only investors, but the American marketplace. Wal-Mart no longer sets prices as much as Wall Street does, by forcing Main Street to dig deeper and deeper into its bottom lines and come up with more and more income and dividends.

And this, this is the great tragedy of Goldman's blind spot. They aren't just stiffing investors and clients, they're stiffing the poor shnooks who bought houses and now have lost value in them, and opened shops and had to close those, and tried to keep hold of a job that was terminated because the company lost money directly or indirectly to Goldman's coffers.

 

 

 

All Hands On Debt!

When your national debt is $14 trillion dollars, you want to bring it down quickly but safely. You want to avoid unduly burdening your citizenry for past mistakes (*koffkoff*warofchoice*koffkoff*) but you have to balance that with the simple fact that a $14 trilion dollar deficit already burdens your citizenry for those mistakes.

 

That's why I endorse Erskine Bowles' position: All cards are on the table.

 

Half of our debt is owned by foreign nations. In effect, given that our debt rivals our gross domestic product--- roughly 87%-- we're working for the Chinese, British, Japanese and Saudis.

Half of those nations don't have good redundancy schemes.

 

As recently as 1990, our public debt was around $4 trillion dollars. Bill Clinton was able to shift the tax burden from the middle class to the rich and made significant strides in cutting the national debt. Our debt-to-GDP ratio has not been this high since just after World War II, which saw an enormous expansion of the economy as the wars wound down, and the GI Bill was enacted, which encouraged home ownership and college education, among other benefits for the returning veteran.

 

Roosevelt raised taxes. Rather, he expanded the tax base to include all income, not just wage income, proposed taxes on corporate earnings, and instituted the payroll tax that funded Social Security. And he raised the top marginal tax rate to 91% (!!!). He squarely put the burden of economic recovery on the shoulders of those who both brought the nation to its knees in the Great Depression as well as those who benefited from the increase in economic activity most.

 

In fact, consistently, with the exception of Eisenhower (who these days would probably be a Democrat), every Republican president since World War II has raised the percentage of debt to GDP, and every Democrat (Obama is an incomplete grade) has lowered it.

 

Democrats are rightly called the party of tax and spend. Republicans just spend. Democrats can afford what they buy, Republicans put it on a massive credit card and the bill is now coming due.

 

This is why Obama had to create a debt commission, to correct the mistakes of yet another Bush Presidency. And the solutions are not pretty. There's only so much personal income to be had from the middle class, which has seen its wages stagnate since 1980 and after adjusting for inflation, decline. Yes, more families now have two incomes so there's more income coming in the door, but there's also more debt going out the door: payments for a second car, for example, or disproportionate taxes on that second income (the "marriage penalty"), child care payments, increased spending on clothes and food, and so on.

 

The gap in income between the rich and the poor does give some material for increases in income taxes, its true, but it's not as much as many would think, and certainly not fourteen trillion dollars worth. It may be time for more effective revenue enhancements, to use a cliche: a national sales tax, for example, that exempts staples and necessities, scaled so that the more expensive an item in a class of goods is, the more taxes will be thrown off.

 

If you buy a Hyundai, in other words, you won't pay as much as a Camry, and nowhere near what a Lexus buyer would pay.

 

In addition to raising taxes on the wealthier, I'd like to see some tax cuts that make sense. For one thing, cut taxes on bank accounts, savings accounts, to encourage people to put their money into the bank.

 

Which would encourage lending by the banks. Which would encourage economic activity. Which would generate more jobs and income. Which would raise the GDP. Which would make us a healthier nation once again.

They're Coming To Take Me Away, Ha Ha!

I'm really rather upset with this:

Renowned physicist Stephen Hawking has repeated his long-held belief that intelligent aliens are likely to exist, and that a visit by them to present-day humanity would probably have unfortunate consequences for us.

Publicising a new documentary he has made for the Discovery Channel, the legendary boffin told the Times at the weekend:

“To my mathematical brain, the numbers alone make thinking about aliens perfectly rational... If aliens ever visit us, I think the outcome would be much as when Christopher Columbus first landed in America, which didn’t turn out very well for the Native Americans.”

I'm not upset because I want to quibble with Dr. Hawking with the usual rebuttal that it's a long way from whatever planet they'd originate from and why would they come all this way to get into our faces?

 

He's right. It's a distinct possibility.

 

I'm upset because, dammit, this is the third piece of science I've read or seen this weekend/week that has anticipated a four novel trilogy I'm doing research on! ThumbPer must be reading my notes and getting in touch with people!

 

Back to the story at hand: Mankind has always had an exploratory nature. If there's a cave, we'll enter it; An ocean, we'll cross it; a moon, we'll visit it.

 

With the exception of the moon so far, none of this has turned out well for the visited. Not the bear in the cave, not the native across the ocean, not the pristine environment we've seeded with our trash and illness.

 

Now, one could make the quibble, which I would, that as we advance as a civilization and grasp a larger understanding of the world around us, we've learned that it's important to co-exist with those around us. We have not learned the lessons perfectly, to be sure, but it is a learned lesson nonetheless. We've learned, because we've recognized the resources are limited and people have a right to be treated as equals.

 

Other societies might view such an attitude as immature at best, and as weak at worst. In America, we've never really come to grips with the historical nature of our more savage side, choosing instead to sanitize our history to show the "Injuns" as at best, our helpmeets and at worst, brutal savages who needed to be tamed and civilized.

 

Echoes of those hegemonic harmonics echo to this day in Arizona, where anyone can be stopped on the street and asked for identification, pending deportation back to Mexico for being an undocumented alien.

 

One wonders how Arizona would handle a full-blown invasion from Alpha Centauri, but I digress...

 

While there's no guarantee that aliens would be peaceful, there is reason to suspect that they'd be more interested in learning what they can from us, and teaching us what they can. The question is, would it be something we'd want to learn? Look at the second and third waves of colonization in human history: it's all about training natives to be more "like us".

 

Just like the more Cro-Magnon element of the United States rails against cultural diversity and tolerance, so would many aliens insist that their way is the right way, no matter how peaceably and palatably they'd offer it to us "in the spirit of intergalactic good will."

 

I don't think the first contact we have with an alien society will be a full-blown invasion, as some movies have suggested. On the other hand, I do think any alien visitation will be made with an eye towards the benefits the aliens can take from our resources. Resources unavailable from easier sources. If they needed metal ores, the asteroid belt would make a whole lot more sense than dropping into a steep gravity well. If they needed water, comets would be much easier to corrall and melt.

 

Which really doesn't leave us much to bargain with. Finished products, manufactured goods, and scientific discoveries are possibilities.

 

After all, even tho physics is the same in this galaxy as any other galaxy, the creative mind demands that we will have made discoveries that they have not. For every nuclear power system they can offer us, we might be able to offer them the Slinky. It's not unheard of for natives to bilk the pioneers, even tho historically it's worked the other way around.

 

It will be interesting, when the day comes, to measure value systems, and to see what the universe has hidden from us on this lonely marble.

 

Nobody Asked Me, But...

1) I hope President Obama considered this when he approved more off-shore drilling. Wait, of course he did! That's why he only approved it off the shores of red states!

 

2) It looks like England has mimicked us once again: Find a charismatic young candidate, then let the old conservatives make up shit about him.

 

3) Good luck with that, Blago!

 

4) I have neither seen nor read about Obama's speech to bankers yesterday, but he must have promised he'd let them use Vaseline  the next time they want to screw us.

 

5) Those were NOT the deposits and assets you were supposed to keep an eye on, you idiots!

 

6) You might not be aware of the latest YouTube kerfuffle which centers around spoofs using a clip of a film about Hitler called "Downfall". Some of them are really very clever. Here's the last one (h/t Sean Paul Kelley)

 

7) Grow your own solar panels! Note: You'll need Silicon Tetrachloride gas, a laser, a taco converter, and a steady hand.

 

8) If you have friends in Bolivia, I'll take a million cases, please.

 

9) Zombie chupacabra!

 

10) Toys you probably won't want to buy for your children (but may want for yourself, you dirty little minx!)

How Green Was My Alley?

If you've been comatose for the past few weeks and this is the first thing you read upon awakening, you might not be aware that today is the fortieth anniversary of Earth Day. Otherwise, I should suspect at some point you've been reminded.

 

As a born, bred and raised New Yorker, environmental issues are second nature to me. You don't live five people in a four room apartment without developing a sense of how quickly trash can build up, how even the tiniest pollutant in one room can affect the entire apartment, and how hard it is to balance supplies with available space to put things in.

 

I am proud that I was among the many who participated in environmental issues from the get-go. My Boy Scout troop helped developed and run one of the first recycling programs in America, for which we were designated what would now be called "Green Troop". I still have my green ecology flag patch with green and white stripes and the Greek letter theta in place of the stars. We wore those proudly to Jamborees.

 

The lessons of those days as a Scout-- see, it's not all about barring homosexuals and promoting Christianity. Most of my troop was Jewish and about half of the patrol I led ended up being gay-- are not lost on me to this day: it's still annoys me when I see litter, and I still advocate for the environment, ecology and on a limited basis, for animal rights. We are all part of a bigger picture, and we cannot afford to think small.

 

I say all that as background to this post: It's important to remember that we can all do more. 

 

But, it's also important to remember that we can only do so much. As with many things in life, it's a delicate balance. We have choices to make, even the most militant tree-huggers among us. 

 

In tough economic times, it becomes even harder to make those choices, but it also becomes more critical. We have to remain acutely aware that there are many well-intentioned people out there who will take the easy way out because they can justify it. They'll drop that wrapper because someone else can get a job picking it up, for example. They'll buy a dollar menu meal at McDonald's because for 99 cents, they can't afford a head of broccoli much less a salad. 

 

Even the easiest choices, like buying CFC bulbs instead of incandescent because they're more economical, become convulted as those savings come over time, and I have to pay out money right now for the hall light. It's hard, I know, and we who can have to forgive those who cannot make the "right" choice, and try somehow to make up for it until those folks can get their feet back under them.

 

There's a real simple rule of thumb to help you decide if you're living your life more or less green: physical effort. The more of you that you put into a process or product, the greener it likely is. 

 

Think about it: you buy a salad at the local grocer, or you can buy the salad makings and toss them yourself after washing and peeling and cutting them up. Which is greener? Likely, the home made salad. 

 

Or you need to go to the corner store: you hop in the car or you ride a bike. Greener? The bike, of course. The balance between what you can do and what you cannot do becomes clearer. If by putting a little bit of you into it you can help make things a little better in your environment, then it's a good thing. And if getting involved means doing more than is practicable and sensible, then you're trying too hard to do too much. 

 

You call the pizzeria: should you walk over and pick it up or have them drive it over? Walk, of course. Not only is the car going to pump out more carbon, but the driver is focused on getting your pizza to you as fast as possible for the bigger tip and to get to the next delivery. Hell, even if you drive to pick it up, you'll have done an incremental good if you watch your speed and take the shortest possible route.

 

In other words, flying cross-country to enter a bike race is not a good thing for Mother Earth. But picking up that wrapper that you're standing over is. 

 

The little bits add up, as New Yorkers are painfully aware. When you have eight to ten million people wandering your streets, if everyone picked up one piece of garbage, the streets would practically police themselves. 

 

And if eight to ten million people each littered, we'd need five times as many sanitation workers. The cumulative effect of many people doing one thing is staggeringly large.

 

Also, the benefits of paying it forward are quite high. If one other person sees you care enough to pick up a piece of paper, they may not pick one up too, but they might think twice about not carrying their wrapper to the trash can. That can make a difference. Leading by example does not have to mean imitation, but emulation.      

Related Stories?

The timing of these two stories is suspect, but either story certainly merits attention:

 

Item 1 - New York State Senator Pedro Espada, a Democrat, is under investigation by the FBI and IRS for siphoning $14 million from a government-funded health clinic.

 

Item 2 - Florida Republicans have had their party American Express records seized by the FBI and the IRS (there they are again!) for hundreds of thousands of dollars in unrelated personal charges.

 

Hmmmm. Included in that Florida investigation is Marco Rubio, who is challenging Governor Charlie Crist (who has not been named in the probe) for the Senate.

 

You may remember that it was Crist who angered Florida voters by literally embracing the Obama stimulus package, so much so that the state Republicans have begun to try to force Crist out. Those efforts have not been effective, but Crist has acknowledged the pressure and said he would run as an independent if need be.

 

The sense I get is that the Espada story provides a certain immunity to the Federal Government and to Obama in particular as its chief executive from charges that Obama's entire administrative plan is to embarass Republicans at each and every turn, where possible.

 

This of course differs from the Bush program of, um, "selectively investigating" Democrats using the full weight of the Department of Justice, in that Obama has not demanded a loyalty oath from the Justice and Treasury Department employees involved in the investigations.

 

One is forced to wonder, however, at the timing of the Florida investigation: the revelations about Rubio et al certainly could have waited until a more opportune time (even allowing for the obvious politicization charges). The primary election isn't until August 24. The nearest administrative date to this day's story is the June 14 qualifying date.

 

Unless Crist figures Rubio might be in a Federal penitentiary by then, of course.

 

All of this occurs in front of a backdrop of GOP backpedalling on opposition to the financial reform regulations that are currently under discussion in Congress.

 

Still, the timing, while possibly coincidental, is intriguing. Espada is a leader-by-armtwisting in the New York State Senate, having first brought that body to its knees by defecting from the Democratic caucus along with one other Senator, then returning when it became obvious he was in serious trouble either way he sliced the issue.

 

It should be noted that Espada is only slightly the lesser sleaze of the two defectors. Hiriam Monserrate was recently expelled from the Senate after being convicted for beating his girlfriend up.

 

Too, Espada's counsel, Steve Pigeon, has a colorful history in Erie County, to put it politely.

 

The scalp of Espada would be a big coup for the FBI and the IRS. Espada has ducked several nasty controversies in his career, from non-residence in his district to campaign violations in 2008 that racked up $60,000 in fines. And it certainly is big enough to throw a shadow on the Florida investigation and buy the Feds some breathing room.

 

Cuba Goes Capitalist

Interesting:

Private profits in communist Cuba? This is no joke. It's Havana's latest, limited experiment with the free market. The government is divesting itself of hundreds of state-run barbershops and beauty shops with three workstations or less, turning people who have been wage-earners for decades into small-time entrepreneurs. Like some Cuban growers who are allowed to rent stalls from the government in farmers markets, and some cooks who run modest restaurants out of their homes, these hairstylists and manicurists will be entering the world of free-market competition.

Admittedly, it's small-scale stuff, the stuff of experiments, but considering the Great Satan to the north, this is practically like, I don't know, the state of Texas electing a Socialist congressperson.

 

There's not much to admire about Cuba at this point in its existence. It truly is the lone wolf of the communist experiment, having outlasted the Soviet Union, its satellites and even China.

 

The embargo the US has effected for half a century now is strongly in force, altho you can start to see daylight around the edges. Likewise, Cuba has started to see the wisdom of inviting the west to visit its shores, at least as tourists, and as partners in some limited ventures. 

 

We can marvel at their stick-to-it-tiveness, for sure. And their ability to cope under what must be enormously stressful conditions, taxing even the hardiest souls at times. 

 

But this development is one that should be applauded. China has shown that capitalism is not completely inconsistent in a socialist/communist culture, and has set an example that we can imagine Cuba will follow. I for one am hoping they can work it all out. Cuba has a lot to offer the world, and its a shame its been burdened by an embargo decades beyond its effective purpose.  

 

Making An Ash Of Ourselves

There's a Ludditic element to this whole problem of the volcanic ash spewing from Eyjafjallajökull on Iceland: that God or nature or random chance could so cripple the movement of people across and to and from an entire continent is somewhat poetic. Life is what happens when you're busy making other plans.

 

It's estimated that the volcano has cost New York City $250 million in lost tourism alone. That's in less than one week. Worldwide, 63,000 flights have been cancelled, meaning something on the order of 1 million people have been forced to either sit and wait or make very roundabout travel arrangements. The British navy is being pressed into action to shuttle people across the Channel from the mainland, where some airports remain unaffected for now. The crippled tourism industry into Europe has Greece nervously pacing the floor.

 

I'm a bit surprised that there wasn't a better backup plan in place earlier on. After all, Iceland is responsible for 1/3 of the lava flow on the earth's surface over the past five hundred years, and Iceland has in recent years shown more and more seismic activity and instability. And Iceland is near routes from the New World to most major northern European cities.

 

And Eyjafjallajökull wasn't even considered the main problem on Iceland. That honor belongs to Upptyppingar, which is farther north and much bigger. However, Eyjafjallajökull in the past has been a bellwether, a precursor eruption to at least three bigger eruptions, the last in 1823, of the subglacial volcano, Katla.

 

In other words, to periphrase Donald Rumsfeld, this was an unknown problem we knew about.

 

The moment the April 14th eruption was confirmed, there should have been plans put into effect to bring European travellers home safely and quickly. Cruise ships could have been commandeered-- it's early in the North Atlantic season anyway-- safe harbor airports could have been identified and re-direction of flights initiated (air traffic controllers could have been shifted around: remember, all pilots and ATCs are required to be fluent in English, so it's a matter of logistics, not translation), and a joint private-public effort could have been kicked into gear to try to find housing for the temporarily displaced.

 

Of course, the airlines are already playing the "CYA" game, claiming that it's Europe's fault.

 

Based on previous experience with Iceland's volcanoes, this cloud of ash is likely to spew for months, and some of it has already drifted over Canadian airspace. It's going to be a horrible summer for Europe if that holds true.

Nobody Asked Me, But...

1) The volcano in Iceland will not be the only explosion this weekend, I predict. DO NOT PICK UP THE DEBRIS! Right wing brains, such as they are, are toxic!

 

2) So Obama cancels a modest plan to re-visit the moon...which to me holds far more immediate benefits to mankind...to affirm the commitment to visit Mars this century. Interesting. While the moon is lifeless, so far as we know (Mars is more doubtful than not), it holds vast quantities of minerals from asteroid impacts, comets, and even from its formation as a piece of the earth and the planet that collided with us billions of years ago. Mining operations could be set up on the Moon almost immediately, robotic mining tools that would then fling materials into a stable orbit around the earth for, say, a retired shuttle to pick up and bring back to earth. Undoubtedly, this is part of the private operations that are being planned. The government ought to be up in the front of the pack and ahead of the curve on this, rather than tailing behind, making sure there's sufficient oversight. Cuz. You know...Republicans.

 

3) Home-grown terrorism is not limited to the Teabaggers.

 

4) Think the Teabaggers are really popular and have the backs of the people? Think different.

 

5) Today is National Stress Awareness Day? Today? WHAT!? Why was I not informed in triplicate and a copy sent to my cat!? Why am I ALWAYS the last to know????

 

6) By the way, today is also National Health Care Decisions Day. Help the one you love kick the bucket. But don't get too stressed about it.

 

7) Wow, there really IS a reason why every iPhone ad shows the time "9:42"...

 

8) Thank God.

 

9) I wonder what she did to deserve a two-year nationwide ban? Judging from the picture, I suspect she may have a problem keeping her clothes on. I must examine this case carefully.

 

10) Errrrrrrrrrrrrr, ummmmmmmmmm...not sure how to introduce this....unique....museum.

Capitalist Fools

Capitalism is an economic system based in fear. If you're a coward, you're a capitalist.

Think about it. According to theory, capitalism is advanced through the "enlightened" self-interest of individuals (I'll get back to the enlightened bit later). Translation: greed. Greed is good in capitalism. Indeed, if capitalism can be said to have any morality, that morality is based in greed.

But greed is based in fear, just as nearly every negative emotion is. Greed is about the fear that you will not have enough, never have enough and therefore must always have more.

Ask anyone who was mixed up in the junk bond bubble of the Reagan years or the dot-com bubble of the Clinton/Bush years or the real estate bubble of the Bush years: it was not about having enough, it was about having more. From the homeowners who foolishly bit into a mortgage they could never possibly handle to the bankers who lent that money knowing full well those borrowers couldn't afford the mortgage to the stockholders who demanded higher earnings every quarter from the bankers who lent the money to the people who couldn't afford it, to the governments who gladly accepted the property and income taxes due on the money that the shareholders demanded by higher each quarter from the bankers who lent the money to people who couldn't afford it, all of this monumental folly was based in greed.

And enabled by countless pundits, analysts, media flacks, and government officials. "Ownership society," Mr. Bush? OWERship society is more like it, you pompous butthead!

Adam Smith in positing capitalism, even tho he called it laissez-faire (French for "leave to do"), spoke for the need for taxes on business activity, strong government oversight, and warned against business combinations of any sort that involved removing the personal responsibility for the actions of a business.

We call those "corporations". You'll never hear this from your immature libertarian friends who read Ayn Rand for the sex scenes and came away with some muddled sense of economic theory crossed with personal freedom.

Adam Smith, in Wealth of Nations, speaks of the "Invisible Hand" precisely once (Book IV, chapter II, paragraph IX , if you're playing along at home). It was in the context of domestic trade being preferable to international trade. In other words, all those "free marketeers" are bullshitting you. And yet, an entire conservative cottage industry has arisen over a gross distortion of Smith's intent.

All to support and justify naked greed. There is no community when greed is involved. You would steal from your neighbors as soon as you'd steal from a stranger if capitalism had its way. And if you don't believe that, pick up any newspaper.

Indeed, on a macro basis, this is precisely what happens. International trade and relations are less dependent upon any sense of community than local and domestic trade, which was Adam Smith's point about the "invisible hand". Why were we attacked on September 11, after all? Was it because we're rich? Was it because we supplied arms to Israel, or Osama bin Laden? Was it because we had protected Muslims in Bosnia? Was it because we helped harm Muslims in Palestine?

Whatever part of the political spectrum you come from, it doesn't matter. Whatever answer to that "why" you feel comfortable with, it doesn't matter. All answers return to the greed of capitalism. Our private industries made money in conflict with our so-called "moral values." After all, if we fear radical Islam, why were we helping the mujahadeen in the 1980s? It's not like we were friends with radical Islam back then. We had just had hostages returned from Iran, for goodness sake!

Once you look at the world around you and do a thought experiment, you understand why greed needs to be in check, and why capitalism is for cowards. If we took morality out of the equation, if we truly allowed capitalism to be laissez-faire, crime would be a booming industry, all drugs would be legal, and porn would be available on the counter of your corner newsstand instead of bowdlerized and forced into dark corners and pay-per-view television.

Is that what we really want?

If capitalism was based on enlightened need, one could conceivably find a lot of good in capitalism. Capitalism presumes that we each have the other citizens of our community in mind.

Sadly, no...

Capitalism is not immoral, but capitalism is responsible for immoral acts. Capitalism is also responsible for the greatest man-made tragedies to befall America and by extension, the world.

In and of itself, capitalism is not immoral. It is amoral. It does not think. It only works like a vast enumbed machine, not distinguishing between friend or foe, between good or evil, between moral and immoral.

And here's the real kicker: capitalism is antithetical to American values, if we define "American values" as freedom, equality, and morality.

Those are in our Constitution. They're declared and demanded in the Declaration of Independence. And yet, self-interest sans enlightenment is harmful to all three of those. Sure, you can say that freedom exists, but is it really freedom when your boss can fire you at-will, and worse, threaten that to hold your behavior in check? Is it really freedom when that same boss can demand you work overtime or put in free hours from home, but then get all pissy when you ask for a few hours to take your sick kid to the hospital?

Is it really freedom without equality? And is it ever equal in a society where greed is honored and acquisition the goal?

And is that EVER moral?

Dumberer And Dumberest

How do you react when your party has just been handled its biggest legislative defeat in decades? Do you go back, lick your wounds and try to regroup? Do you indulge in a little self-examination and introspection, wondering how you could have let go of both Houses of Congress so ignominously in only twelve years after forty years of dominance by the other guys, who successfully portrayed you as a party out of touch with the people and enslaved to the mantra of mammon?

 

Or, do you double down on the stoopid and go to bat for the wealthy?

Bit by bit, bipartisan negotiations in the Senate over financial regulatory reform have broken down. Richard Shelby, the ranking Republican on the Banking Committee split with the Democratic Chairman, Chris Dodd in February. Bob Corker filled the gap, stepping in to try to hammer out a compromise on an issue in which both parties see the potential for good policy and good politics. But wary of delays after a bitter health care fight, Democrats voted the bill out of committee in March with no Republican support, and now are looking to open up the legislation to amendments and debate on the Senate floor. As recently as last month, Republican leadership was open to a deal.

In a floor speech this morning, Senate Minority Leader Mitch McConnell threw cold water on the prospects of detente, establishing a hard line of attack against the Dodd bill, and indelibly marking the party line: "We must not pass the financial reform bill that's about to hit the floor."

The crux of his criticism is that the bill "institutionalizes... taxpayer-funded bailouts of Wall Street banks." He knocked the expansion of power at the Fed and Treasury, while sounding the alarm on Wall Street accountability.  If the outline of his speech sounds familiar, it's because it is the exact argument pollster Frank Luntz urged Republicans to make earlier this year in a widely publicized memo.

 Now, there's really nothing wrong with McConnell's, errrr, Luntz complaints: there probably ought to come a point in bailing out financial institutions where we say "enough is enough" and let the chips fall. Surely, we came awful close in 2008/2009.

But what this list of talking points ignores is the bill contains mechanisms that will circumvent all but the worst scenarios by forcing banks to pony up and self-insure their operations by levying a financial tax on transactions.

And there, my friends, is the rub: for every stock sale, a piece of the money moving about will go to the Federal Reserve. For every derivative traded on the market, a bit will go to the Feds. For every wacky and hardly-understood transaction some quant analyst dreams up to further drape a veil over the investors' eyes, well, the financial institution will have to stand by the research with a bit of its own money.

Put up or shut up, as they say. And in truth, this is what Luntz and McConnell object to. A tax. On people who would gladly take taxpayer money. Seems a pretty stupid stance to take.

Too, the bill has other, even better and more effective requirements, like forcing every bank to present a plan to wind down their businesses, should the worst happen (which it will and for which every bank ought to have been prepared all along, since these crises happen every twenty years or so anyway). And a liquidation plan that lifts the burden and responsibility (and the potential for politicizing monetary tragedy) from the FDIC and puts it squarely on two other pillars: The Treasury/Fed and three bankruptcy judges.

All of this, included in the Dodd bill, makes for a fairly comprehensive step towards financial reform that will protect the average American (but not the ubergreedy rich) from having to bail out banks at a rate unheard of in world history.

McConnell, not surprisingly, is on the wrong side of history.

 

Lost Weekend

The Republican party could and probably should have mailed in the get-together this weekend.

 

All this weekend established was the already-known: they hate Obama (for what reasons still mystify me), they are gradually incorporating the Teabaggers (who like any cancer will eventually suck the life out of the host body), they have no clear leadership, including Sarah Palin, and they aren't going to bounce Michael Steele anytime soon.

 

Wow. So they really will try to win an election as the "Party of No"? Or even the party of "Hell, No!" as Palin has put it in the past?

 

There was a time in this country when you had to run as a party of "Why not?" In other words, present ideas and policies that you felt fit the problems facing Americans today. The only solutions we've heard from any Republican are the same damned solutions that they've run on since Reagan and the same ones McCain lost on in 2008.

 

And since Obama has already lowered taxes on the vast majority of Americans...

 

Much has been made that 2010 will prove to be a rout of Democratic candidates. Keep in mind that midterm elections almost always see a decline in majority party holdings when the President and Congress come from the same party (2002 being the sole exception in the past fifty years, but then we were at war and had just been attacked by terrorists, hardly the usual election cycle). The Republicans can't lose seats and can only stand to win some, so they've pretty much banked a bragging right already.

 

But a party with weak-willed leadership that has proven untrustworthy and unfocused can only mean good news for Democrats. The formal inclusion of the Teabaggers between now and November can only dangerously destabilize the Republican party, especially if they refuse to take action against Steele and his profligate ways.

 

You aren't going to convince the voters you mean business about the economy if you're spending $19 million of your $23 million bankroll and you have only won three special elections.

 

On top of that, you don't have a Newt Gingrich who has a plan to capture seats. Sarah Palin won't get her hands that dirty, and there's no one else with the star power necessary...I mean, who takes John Boehner seriously?...to get all the ducks marching in a row, especially after six years of Republican majorities in Congress, a Republican President and a Republican SCOTUS failed to enact much of the right wing agenda, except some state-wide referendums on gay marriage.

 

Abortions are still legal, there's still no stronger act enforcing heterosexual marriage than Clinton's Defense of Marriage Act, and taxes are still low but not as low as many Republicans have railed for over the past decade. Are they seriously going to go back to the base, hat in hand, and say "No, this time we really mean it!"

 

Much of this election, then, will be run on perceptions and misperceptions, and right now, Obama has done a marvelous job of wresting the national dialogue to his point of view, despite the engaged efforts of FOX News and their fellow travelers. Perceptions of healthcare transformed with its passage and now the Republicans are forced to retake ground they thought they had won in the months leading up to that vote.

 

Too, since healthcare reform, Obama has not sat on his laurels, instead signing a nuke treaty, holding a nuke summit and bully-pulpitting Democrats to get to work on a bigger jobs bill.

 

This all works in the favor of Democrats. That's not to say that the Dems can sit back and talk about the crabgrass. They have to start really twisting arms and lining up votes for such disparate things as the jobs bill, the replacement for Justice Stephens, and any other issues Obama dares bring up before the November elections.

 

So this weekend was all about drinking the Kool-Aid for Republicans. Well, at least the GOP gave the city of New Orleans some needed money...years too late.

Just When You Thought They Couldn't Get ANY Stupider...

...along comes "Connecticut Yankee In King Arthur's Asylum" Bob Owens:

Palin’s view of nuclear weapons was shaped by her stint as the commander in chief of the Alaskan National Guard, our first line of defense against Soviet nuclear weapons.

BWAHAHAHAHAHAHHAHAHAHAHAHAHAHHAHAHAHHAHAHAHAH

I'm sure for the few months she was actually governor of Alaska, she made daily inspections of the "nucular" arsenal at Elmendorf.

Nothing like a crash course in "nucular" proliferation to qualify one as an expert. I wonder if Bobo Wens read "Grillin' Fer Dummays" and presumes himself an expert on the fine art of outdoor cooking?

 

Nobody Asked Me, But...

1) Welcome to the party, pal! This is what I love about FOX News: thirty years behind the times, they only suddenly notice that the future of the large majority of Americans is deeply in doubt. What morons are so dense as to watch news that's thirty days out of date?

 

2) Stupak runs scared. I imagine he was only worried that he'd have to deal with liberals opposing him and that the right-wing of the country would shower him with flowers and candies for getting abortion de-funded from the Feds. Guess again, Skip! We would have forgiven you...the Christians? Eh, not so much!

 

3) Navel contemplation is a good thing, GOP. Goodness knows, you might learn something about how to run a country.

 

4) First, let me say: the guy was a jerk. He should have understood that there would be a reaction to a guy on a plane with a lit anything. But it's also important to understand that people crack bad jokes all the time (like, you know, me) and while we should be expected to be misunderstood, an overreaction is an overreaction. Of course, some would blame the air marshal...

 

5) Right, but we ought to get government off the backs of businesses...sheesh! Of course, no regulation could possibly prevent God's wrath, right? Those miners, so effeminate!

 

6) Run, do not walk, to pick up the latest copy of National Geographic magazine. Apart from some beautiful photography, you'll get a heads-up on the real crisis about to hit the world, and there's no walking this one back. Significant portions of the planet will be at war within a decade over this resource, and it's already affecting our foreign policy, and may even force us to kowtow to Canada.

 

7) Why do Republicans hate blacks?

 

8) There's a budget battle brewing in New Jersey that will make California look like a walk in the park. The newly-elected governor is abrogating his responsibilities and his duties in apportioning state funding to communities AND telling them they can't raise local property taxes to cover the shortfall. Sounds to me like a recipe for disaster. Pity, because Jersey was only just starting to live down its reputation as a state "only" next to New York.

 

9) So who wrote the Book of Fail?

 

10) What do General Jack D. Ripper and Mahatma Gandhi have in common?

The Toughest Interviewer: David Letterman?

This intriguing little piece crossed the Huffington Post the other day, and it took me until this morning to finally get around to reading it:

The enigmatic Tea Party movement softened its hardcore image with the recent appearance of Pam Stout, president of the Sandpoint, Idaho Tea Party Patriots, on the Late Show with David Letterman. Mrs. Stout is no doubt a sweet-hearted woman with growing concerns over the welfare of America, but her popularity as a political activist in the fragmented Tea Party movement has cast a spotlight upon common naivete rampant among many Tea Party groups.

Go fig. David Letterman explores and even mocks the Teabaggers, but does it in a respectful and ojective fashion.

 

I'm used to seeing Jon Stewart occasionally tossing a no-hitter with a conservative, when he's not busy sucking up for party invites or helping hawk a book. Stewart is well-read, smart and has a knack for connecting the dots for people who are deliberately ignoring the other side of their story.

 

I wasn't expecting David Letterman to be as accomplished. In fairness, he wasn't taking on a powerful celebrity who had clearly thought out his positions, but a poor retiree from South Dakota who had memorized a party line and bleated it back politely and passionately.

 

For example...well, let Mike Green do the heavy lifting here:

Letterman asked Stout to explain how a Tea Party president would've handled the financial crisis. She stated flatly:

"I think several businesses would've gone out of business. Car companies and the banks."

Stout acknowledged Letterman's rebuttal that nearly two million jobs may have been lost if the government had not stepped in (which was the basis of the bailout begged for by Republicans, including Dubya and then-presidential candidate John McCain). Ironically, the Tea Party's fundamental complaint today was reflected in a poll reported by Fox News that showed a mere 30 percent of American citizens supported Bush's Bailout plan in Sept. '08.

Senator John McCain was quite direct about Bush's Bailout when he spoke to a crowd of supporters in Scranton, PA on Sept. 22, 2008 (according to a report by a local CBS affiliate television station):

"Never before in the history of our nation has so much power and money been concentrated in the hands of one person. This arrangement makes me deeply uncomfortable. We will not solve a problem caused by poor oversight with a plan that has no oversight."

Senator McCain expressed that President Bush and Treasury Secretary had crafted a plan that was unprecedented in American history. The labels of "socialist" and "communist," however, would be reserved for the next president. Meanwhile, McCain openly stated the economic crisis was caused by "poor oversight."

If that's the case, who was overseeing whom? And did anything change, other than a bit of reshuffling the same deck of cards that built the economic house which currently requires all the propping it can get?

Letterman then joked that the two million jobs that Stout would have allowed to go by the board would have been picked up eventually...by China.

Letterman really did a "props up" job in exposing the naivete of the Teabaggers, who in typical overreactive and emotional style, still haven't got it through their heads that this is America, and that there are bigger issues on the table than tax cuts.

And since I know a few conservatives read my blogposts and get this far, let me pose this question now: what if the Laffer curve, the darling of the Reagan set, is right and we've reached the bottom of the bell on the wrong end?

Recent history suggests that may be the case, since the economy took off in the nineties after Clinton raised taxes on the rich. Perhaps it is the Teabaggers who are the real communists, trying to keep us all in check by keeping the purse strings tight.

Go read the rest of Green's article. I tip my hat to David Letterman.

 

 

FOX Gets Coburrrrrrrrrrrrrrrrrrrrrrrrned!

Well, well, well...it's a good thing he's on the wrong side:

The Fox News playbook calls for the promotion and evisceration of its critics. If the White House bad mouths the network, Glenn Beck adds a red phone to his set so its staff can call in. If LL Cool J objects to Sarah Palin rehashing an old interview of him for her show, a Fox spokesperson wishes Cool J "the best with his fledgling acting career," while bemoaning his lack of interest in inspiring others. It's hard to imagine what Bill O'Reilly would talk about if not for all the liberals and elites who regularly point out his network's failings.

So what is Fox News going to do with Tom Coburn, that upstanding conservative poster-senator from Oklahoma. Capitol News Connection has acquired audio of a recent Town Hall Coburn held in Oklahoma, in which the Senator, who is well-respected on both sides of the aisle, did not hide his disdain for the conservative info-tainment industry. After a woman said she did not want to go to jail for refusing health care, Coburn told her she was misinformed. “The intention is not to put any one in jail. That makes for good TV news on FOX but that isn't the intention,” Coburn responded.

“What we have to have is make sure we have a debate in this country so that you can see what's going on and make a determination yourself,” Coburn added and then again warned the crowd against the myths perpetrated on FOX News.

“So don't catch yourself being biased by FOX News that somebody is no good. The people in Washington are good. They just don't know what they don't know,” Coburn said.

He even had nice things to say about Nancy Pelosi, who has all but been equated to a devilish harpy hell-bent on emasculating every man and woman in the heartland.

 

Yes, apparently in the middle of America, even the women have dicks. At least the Republican ones, which would explain Larry Craig.

 

Coburn is showing enormous courage for a Republican. Goodness knows, the way they march in lockstep with each other, in ranks that would make a fascist tear up a little, makes dissent difficult. Just look at the way the Teabaggers jumped ugly on "RINOs" like Olympia Snowe when she voted HCR out of committee or Arlen Specter before he switched parties to avoid a primary against an avowed economic royalist with designs on scrapping the Smithian free market system nominally in place with a more Ferengi-oriented economic system, ethics and oversight be damned.

 

Coburn is an enormously respected conservative Senator from Oklahoma, who's enough of a crackpot to warn that healthcare reform will allow sex offenders to obtain Viagra (they can already), whose economics is questionably simplistic,  and who threw a temper tantrum to try to stop the Easter recess in the Senate for reasons that are wholly unclear.

 

In other words, he's one of them.

 

This would be similar to an Al Franken hissy fit about Air America Radio, to extend a hypothetical.

 

The Republican party has gone to great lengths in the past to keep its ducks in line, something we lefties can only marvel at. We're a fractious bunch and we are not afraid of dissension among the ranks if it helps us hammer out a solid policy that is palatable to independents without selling out too badly our principles.

 

Sometimes we even succeed and don't look like buffoons. Healthcare reform is one of those issues. When we're on, we're very hard to beat. When we are not on, we beat ourselves.

 

I often repeat a theory that the Republican party runs about thirty years behind the Democrats when it comes to party evolution. I think this is continuing: Obama is our Reagan, and the Republicans have now split into what amounts to the "Jesse Jackson Faction" (the hard left that back Ted Kennedy in 1980 in the primaries) and what became the Democratic Leadership Council, which eventually got Bill Clinton and Barack Obama elected (after the party reconsolidated under Bush's tyrannies).

 

The right, in other words, has a long way to go to heal. The "JJF" of the GOP is the Teabag faction. The ur-DLC are the RINOs, and it is the RINOs that will eventually win this fight. Coburn is merely choosing the winning side.

 

And Into Plowshares...

God bless him for the effort:

 

President Obama says the Nuclear Posture Review his administration releases today is part of his long-term goal -- very long-term -- of a world without nuclear weapons.

 

That dream is "unlikely to be achieved even during my lifetime," Obama told The New York Times. But in the meantime there are "a series of specific steps that we could start taking to move in a direction that lessens the threat of nuclear weapons."

[...]

As part of the review, the U.S. pledges not to use nuclear weapons against non-nuclear nations that are abiding by the global non-proliferation treaty.

That pledge should bind most countries more tightly to the goals of the non-proliferation treaty, Obama said, while sending a message to "outliers" like Iran and North Korea.

It's a START, as they say. Certainly, if he's willing to pursue this diligently, he will have earned his Nobel in arrears.

To use a weapon against a nation that does not have it and has shown no propensity or capability for causing extensive damage to the United States is the height of bullying...which is precisely why you will see Republicans bleat about "not even in self-defense????" Bullies, the lot of them. It doesn't matter that we have a military twice as large as the next eight nations combined. It doesn't matter that we are currently the only nation who could commit significant numbers of troops and amounts of materiel to two conflict theaters and still have enough left in reserve for a couple of other sorties.

 

No, these jackasses want to bomb the planet into oblivion, if need be.

 

Why? Because America is better than everybody else, and damned if we aren't going to set out to prove it by wasting the rest to smithereens!

 

Isn’t it sad that a nation founded on the precept that “All men are created equal” would develop a national sense of pride that is grounded largely in its superiority? That we can't extend the hand of egalitarianism writ large into both our Declaration of Independence and Constitution, and play fair with not only the people in our own country, but people around the world?

 

That "all men are created equal" to these numbnuts nimrods means that they all turn to the same white ash when incinerated by a weapon no one has any business having?

 

Yes, I'm aware that American exceptionalism is posited to mean that our values, of equality, of democracy, of opportunity for all, are superior to the constructs, concepts, and conceits that had ever been put forth before.

 

That was 235 years ago. What have we done for us lately?

 

I submit that we, in our hubris, have caused the world not only to envy us, but to despise us just as the little rich girl in your neighborhood is despised every time she trots out a new bicycle or a fur coat, for her conspicuous consumption.

 

I submit that we, in our humility, should dial it down a notch and start repudiating some of these masterful marvels we've unleashed on an unready planet. In our egalitarian spirit, we owe it to the world to try to coax the genie back into the bottle. It can't happen, I know that, but we can try, and the closer we get to shoving him back in the bottle and putting a cork in it, the safer the world will be.

 

Let's turn that exceptionalism into a show of grace.