The Banking Industry vs. The Auto Industry

What went wrong?

Auto Industry: Fucked up due to extremely poor decision making and short sided thinking. The short sided thinking manifested itself as lobbying against increased government regulation that could have kept them out of this mess.

Banking industry: Fucked up due to extremely poor decision making, excessive risks and taking advantage of extremely lax rules brought on by a massive deregulation of the industry.

Who takes the losses if they go under/are temporarily taken over by the government?

Auto Industry: The shareholders, bondholders and CEOs and Boards of Directors would be on the hook. But so would several million workers who depend on the industry for their jobs, health care and pensions. Let's keep in mind that unlike the first group (CEOs, board of directors, etc...) the second group has had ZERO say in the business decisions that drove their companies into the ground. They would be losing their jobs/pensions/health care due to events completely out of their hands.

Banking Industry: If they are temporarily nationalized, the Shareholders of the banks, the bondholders, the current CEOs and board of Directors would be the losers. And by losers I mean they'll most likely walk away from the situation with more money than you or I will ever see in our lives.

How were they Treated when the Asked for a Bailout?

Auto Industry: There was a brutal fight to get the "bridge loans", including public apologies by most CEOs. Multiple GOP senators got aroused when they saw the crisis as an opportunity to bust the UAW. They got bailout money, but scale is much much smaller than that given to the banking industry, and was given with actual enforceable and stringent conditions (as all government money should be).

Banking Industry: Were given inconceivable amounts of cash (upwards of a trillion dollars, possibly more) with zero enforceable restrictions on how the money is spent. When they came back a second time, they got a lot of angry words thrown their way, but in the end still got what they wanted, once again with no enforceable conditions. Congress attempted to put enforceable conditions on executive salaries, but removed them after heavy lobbying from the Obama Administration.

Can we Break their Contracts?

Auto Industry: The Obama administration plan for the industry is focused around the idea of breaking contracts, both with the union and with the bondholders, although according to the Wall Street Journal, the brunt falls mostly on the retirees. Renegotiating contracts during a bankruptcy is pretty common place for failing businesses, but it's pretty sickening to see the brunt fall on retirees who have been counting on their pensions (And as previously mentioned, had NOTHING do to with the position the industry's in now).

Banking Industry: After the outrage over the AIG bonuses, Obama and other Administration officials claimed anger on all the Sunday talk shows, but responded that "we are a nation of laws", and other bullshit excuses when anyone attempts actually do something about it. The Administration position is that their contracts cannot be broken.

What Happens to the CEOs who Fucked up?

Auto Industry: Rick Wagoner is kicked to the curb for his massive role in GM's decline. Not only was this the right thing to do, but it shows that the Administration is willing to use the leverage it has over these failing companies to force major changes.

Banking Industry: CEOs have lunch at the white house, get a stern talking to about how they should lend more money and stop fucking up. Bush Treasury Secretary Henry Paulson fired AIG's CEO, but replaced him with equally craptacular Edward Liddy. Obama team claims they thought about firing Citigroup CEO Vikram Pandit, but said they're was no one better to replace him.

- - -

This isn't meant as a defense of the auto industry, but simply to show the actions that the Obama Administration is capable of when they're willing to take them. The problem is that when the media played up the Wall Street vs Auto Makers story line on on Monday, I think they missed real reason why Obama, Summers and Geithner are coddling the bankers. It's not that they're actively trying to sell us out and reward their friends on Wall Street, even though they're doing a Grade A job of making it seem that way.

The reason Wall Street thinking is all that Geithner and Summers understand. It's all they've ever known, and because of that they'll believe just about any of the bullshit that the Banks tell them. The opposed limits on CEO pay because they believed that it would prevent AIG from keeping their team together, they truly believe that those fuck ups are the only ones who can get us out of this. They truly believe you can't find a better CEO for Citigroup or Bank of America than the same people who drove those very companies into the ground.

While solutions like what Stiglitz is proposing may seem like common sense, Summers and Geithner can't conceive of a world where those types of actions would be required. My hope has always been that the dire nature of our current economic situation would force them into things they don't really believe in, but so far the prospects for that aren't looking so good.

Oh yeah, and putting aside the whole "right thing to do and good for the economy" part, someone should probably tell the Administration that being seen as the defender of bank CEOs is not a good look.

Please make it stop.

Real World Examples of Geithner's Bank Plan

As insanely complex as some of this financial stuff is, it's nice to have real world examples to give us an idea of what's going on. Here is the Geithner bank rescue plan, described by Tom Edsall using the metaphor of a poker game:

Normally, a poker player has to pay full value for every chip, $1 for a $1 chip, $100 for a $100 chip, and so forth. In the Geithner game, the rules are different. A player acquiring $84 worth of "chips" only puts up $6. Of the remaining $78 which S/he owes, the FDIC would provide - in the form of a nonrecourse loan --- $72, and the US Treasury would put up $6.

Let's say the player has a good night, and makes $200 over and above his/her original $84 "investment" with a total stack of $284 (his/her $200 profit and his/her initial $84 buy-in). Our happy camper then takes $84 off the top out of which s/he pays $72 back to the FDIC, and $6 dollars back to the Treasury. S/he would pocket the original $6 investment.

The remaining $200 would then be split between our talented player and US Treasury, each getting $100, good news for one and all. There are no limits on the upside: if the player has an extraordinary night and makes $10,000, s/he will get $5,000, all from an original investment of $6.

If, however, our player has a terrible night, and loses the initial stake of $84, the downside is just $6. S/he gets to gamble $84 with the worst possible outcome being the loss of $6 -- not a bad deal.

. . .

Columbia economist Jeffrey Sachs, an outspoken critic, took the poker image one step further, telling the Huffington Post: "It's as if the taxpayers, banks, and hedge funds are playing poker, but the hedge funds get to use the taxpayer's chips."

Anyone else want to go to vegas with Tim Geithner? In a much less complex but funnier way, John Cole describes the Bank rescue plan as if it were a medical report:

The Illness- reckless and irresponsible betting led to huge losses
The Diagnosis- Insufficient gambling.
The Cure- a Trillion dollar stack of chips provided by the house.
The Prognosis- We are so screwed.

Something to keep in mind anytime you hear a news anchor talk about how much Wall Street approved of Geithner's plan because the stocks soared the day it came out.

Uhh... if you were the ones getting to gamble with other people's money, wouldn't you like this plan too?

Harry Reid: Douche Enabler

Harry Reid, talking about the Douche Caucus:

Senate Majority Leader Harry Reid said Friday that liberal groups targeting moderate Democrats with ads should back off, saying pressure from the left wing of his party won't be helpful to enacting legislation.

"I think it's very unwise and not helpful," Reid said Friday morning. "These groups should leave them alone. It’s not helpful to me. It’s not helpful to the Democratic Caucus.”

So an obstructionist caucus is good for the Democratic agenda? Why? Because Harry Reid says so, that's why. Then he inadvertently reveals something really impressive about the group:

Reid has no qualms about the group, and said that “any public statements” Senate moderates have made have been helpful as the chamber takes up a budget next week that would cost more than $3 trillion. And he added: “Some people of course go to those meetings so they can issue a press release back home that'll make them appear more moderate.”

This is Harry Reid speaking about the members of his own caucus, saying that they're making coldly calculated political decisions rather than actually working to make the legislation closer to their values. Regardless of how horrific that sounds politically, I want to make sure I understand this correctly:

The caucus formed with the purpose of supposedly having no policy ideas or principles includes members who are such phenomenal douches that they're not even committed to obstructing Obama's agenda? They're doing this for the "political benefits" of looking like douchebags? Only in politics would people be stupid enough to buy into to that logic.

And then there's the whole idea of "looking moderate" as a political benefit. When adding or subtracting parts to the budget, this group has the goal of making it less progressive, and more conservative. These Senators do not operate at some magical nonexistent point between liberal and conservative. They are obstructing the agenda that Obama campaigned for and that the majority of the country voted for. They are aligning themselves with conservatives in order to weaken his goals and further conservatives ones. There is nothing"moderate" or "pragmatic" about any of that.

And yet Harry Reid says that criticizing those who are obstructing the Democratic agenda is somehow "not helpful to the Democratic caucus".

You really can't make this shit up.

Jack Bauer vs. Reality, Part 89034583458

Bauer: “WHERE’S THE BOMB?”
A Muslim: “You’re torturing me right now, so I’ll tell you! I wouldn’t have told you where it was otherwise, so this ticking time-bomb scenario proves that series creator Joel Surnow (close friend of Rush Limbaugh) is right and Benjamin Franklin was wrong when it comes to balancing liberty against security!”
- 24.

"Detainee's Harsh Treatment Foiled No Plots"
-The real world, rudely contradicting what the Republicans have been telling us for years.

The latest in a series of post-Bush articles to (belatedly) take on the issue of stupid illegal torture goes on to say that:

Nearly all of the leads attained through the harsh
measures quickly evaporated, while most of the
useful information from Abu Zubaida -- chiefly
names of al-Qaeda members and associates -- was
obtained before waterboarding was introduced, they
said.

So the guy had already been talking with them when they decided to put the boots to him, medium style? It’s good to know that literally no part of the 24 scenario is in any way accurate, I was worried that they might have gotten some minor detail right.

So the men in Guantanamo were put there on a whim by random soldiers who couldn’t make any sense out of what they were seeing in a strange land, but at least the decision to allow torture was subject to long weeks and months of discussions about the moral and legal implications, right? Right?

Such intelligence was significant but not
blockbuster material. Frustrated, the Bush
administration ratcheted up the pressure --
for the first time approving the use of
increasingly harsh interrogations, including
waterboarding.

Oh good, the decision wasn’t a product of an imminent threat or soul-searching discussions about torture, but rather frustration and a vague insistence that this guy (whom they had already realized wasn’t as important as initially thought) might know more.

Fantastic. Once again, none of this is very surprising to anyone who's been paying attention, but after so many years it's still truly shameful to see. Anyone have any ideas about how future Presidents can be held responsible for grossly immoral acts without having the whole thing turn into a partisan vengeance-fest?

What Do You Know From Stupid?

Ladies and gentlemen: the top ten dead
money contract* salary cap hits of the 2009 NFL season:

1. Terrell Owens WR DAL $9,675,000
2. Dre' Bly CB DEN $9,450,000
3. Ken Lucas CB
CAR $8,330,000
4. Cory Redding DT DET $7,333,334
G5. ibril Wilson S OAK
$7,000,000
6. Marvin Harrison WR IND $6,400,000
7. DeAngelo Hall CB OAK
$5,833,334
8. Derrick Dockery OG BUF $5,400,000
9. Anthony Weaver DE HST
$5,400,000

I was actually reading this list, thinking to myself "Oh my wonder! There aren't any Redskins on this li-" until I saw number 10. Brandon fucking Lloyd. $5.3 million.

And yes that's right, Brandon Lloyd is still accounting for $5.3M against the Redskins cap, despite not being on their roster since the 2007 season. This results from the salary cap rule that applied the signing bonus acceleration from a termination to the next year's cap, if that termination occurred after June 1 or was designated as a post-June 1 termination despite occuring prior to that date. For example, if a player had $4M in total signing bonus proration left on the remaining 4 years of a contract (meaning $1M of proration in each year), and that player was released after June 1st, then $1M of proration would remain as dead money in that year and then the remaining $3M would accelerate into the next year.

Due to 2009 being the final capped year, this post June 1 rule is no longer in effect; therefore, when a player is released this year all of their proration in future years accelerates into the current year.

Is it any wonder, then, that our team is owned by the same man whose "business management" skills ran Six Flags into the ground?

Douche Caucus Formed; Plan to Act Like Douches

After 8 Years of doing fuck all, guess who suddently remembers they're a Senator?

President Barack Obama and Democratic congressional leaders always knew they would face Republican opposition to their agenda on Capitol Hill. Now they face another hurdle: a newly formed coalition of 16 moderate Democratic senators led by Indiana's Evan Bayh.

Mr. Bayh and his group are well positioned to force changes in the president's budget and on other contentious issues such as health care and climate change. Their stated goal is to rein in deficits and to protect business interests.

A group to protect business interests? What a relief! There clearly hasn't been anyone sticking up for them over the last 30 years.

So how do you spin forming a group that's true motives are unpopular and purpose is already served by the Republican party?

Recite literally every "moderate" cliche in the book, and wait for a gushing column from David Broader.
Lead douche Evan Bayh:

"Our group seeks to work collaboratively with the Obama administration and Senate leadership to make sure legislation is crafted in a practical way that will solve people's problems,"

We want to work collaboratively with the Obama administration so much that we've formed a caucus to obstruct their agenda! So other than "being practical", what principles do you stand for?

"We are not ideologues. We are pragmatic. We are not strident partisans. We care about our country more than our party."

Yeah, we don't want to be ideologues, those guys suck. We just want to create a group that blindly protects business interests no matter how much it damages our country or party. That's called being pragmatic.

“We really do need to change business as usual,” Mr. Bayh said in an interview Monday. “People want results.”

People do want to change business as usual, and people definitely want results. Although if last year proved anything, the one thing people don't want is Evan Bayh.

But according to Bayh, what "the people" want is a group of douchebags to obstruct the person that the actual people actually elected! What do you say to those who oppose this group?

"We literally have no agenda," Bayh shot back. "How can they be threatened by a group that has taken no policy positions?"

How can you form a group that has no agenda and taken no policy positions? If there isn't a policy goal, then why the fuck would you form a group? What do you discuss at your meetings? How to be more pragmatic? These people make my head hurt.

So what's left? Hey Evan, why don't you give your group a really clever name that has literally no meaning whatsoever?

"Call us the Practical Caucus, or what have you," Mr. Bayh said.

David Broader, the ball's in your court.

Holy awesome sauce! DOOM has a new album

As of late, I've really been embracing what it means to be a Black nerd. Personally, it means continiung a rather proud tradition within a major subset of my mom's side of the family, as I've discussed with my older male cousins on more than one occasion. Avant garde, yet somehow still stuck in the past when it comes to pop culture, my inner Black nerd can escape through outlets such as playing video games, watching sports and especially my tastes in music.

Which brings me to the news that DOOM, the mysterious, metal-clad MC who used to be known as MF DOOM, dropped his latest album, Born Like This, on Tuesday. As I've mentioned here before, I'm a big fan of the self-proclaimed supervillain of hip-hop, whose flow is almost as schizophrenic as it as skillful.

A trip through DOOM's lyrics takes you on a nonsensical journey of hilarious references, so masterfully put-together that you may not catch up until multiple bars have already passed. I can't think of any other rappers that have mentioned Ernest Goes To Camp, Worf from Star Trek and the Hadron Collider in the same song. In essence, DOOM is the hip hop manifestation of the Black nerd.

Shaping his persona from Marvel Comics' Dr. Doom., his songs often feature various audio clips from science fiction movies, radio and TV commercials and Saturday morning cartoons. In 2003, he released an album entitled Take Me To Your Leader under the guise of King Geedorah, a monster from outer space in the Godzilla films. Weird, yes. But DOOM is so dope, he's actually able to pull this off.

Born Like This plays like a copy of the National Enquirer or Weekly World News, set to beats from Jake One, Madlib and the legendary J Dilla. The intro and outro are both loops of a harmonious gospel song, sandwiching the weird grooves and off-kilter lyrics DOOM is known for. The second track, "Gazillion Ear" is as schizo as DOOM's rap style; two-thirds of the song uses Dilla's "Phantom of the Synths" beat, with an in-song interlude which features DOOM spitting over "Dimethyltryptamine," another Dilla beat first used by Jay Electronica.

Gazzillion Ear - Doom

"Microwave Mayo" could have been produced on a 1980's Casio keyboard, but its beautifully-complex synthesized harmonies sound like old NES music gone horribly right. What sounds like jibberish at first makes more sense with each passing rhyme, which is the modus operandi of DOOM's evil genius.

Microwave Mayo - Doom

The album's namesake comes from a poem by Charles Bukowski which paints a grisly, apocalyptic picture of society and fits perfectly into DOOM's schtick. The track "Cellz" features an excerpt of Bukowski reading the poem in a haunting tone before giving way to DOOM's calculated mumbo-jumbo.

Cellz - Doom

Granted, these are only a few samples of what Born Like This has to offer, but this album is solid from top to bottom. Ghostface Killah and Raekwon make well-timed cameos and Posdnous of De La Soul provides vocals for his own evil alter-ego.

If you already didn't find me weird enough, here's hoping that some of you will continue speaking to me in public after knowing that I listen to this. No matter, nothing being said behind my back could be half as bad as things being said about me on the interwebs as of late. Perhaps it is I, DCJONESY, that's been a villain since an itsy bitsy zygote and not DOOM? If it's anywhere near as fun as he makes it out to be, then toss that metal mask in my direction, please.

Michael Steele Has a Plan...

Now it may not seem like a plan, but you just wait:

STEELE: So if I do something, there’s a reason for it. Even, it may look like a mistake, a gaffe. There is a rationale, there’s a logic behind it. […]

Q: There’s a rationale behind Rush, all that stuff?

STEELE: Yup, yup. … I want to see what the landscape looks like. I want to see who yells the loudest. I wanted to know who says they’re with me but really isn’t. … It helps me understand my position on the chess board. It helps me understand, you know, where the enemy camp is and where those who are inside the tent are.

And Michael Steele's next prolonged absence from media appearences begins.......................NOW!

Heckuva Job, Arlen!

And just like that... the fight to pass for the Employee Free Choice Act just got exponentially more difficult:

Sen. Arlen Specter (R-PA) just dealt a big blow to the labor movement by announcing publicly that he would support a GOP filibuster of the Employee Free Choice Act (EFCA), unions' No. 1 priority for this year and a subject of intense lobbying on both sides of the aisle.

"My vote on this bill is very difficult for many reasons," Specter said in a Senate floor speech, minutes after the news was broken by the Washington Independent. "It is very hard to disappoint many friends ... who are urging me to vote their way."

But Specter affirmed that he would join his fellow Republicans to block cloture on EFCA, effectively dooming the union-organizing bill's chances of becoming law in its current form. The Pennsylvania senator, who faces a tough re-election challenge from the right, was the only GOPer to support breaking his party's filibuster on EFCA when it last came up for a vote two years ago.

The evolution of Specter's positions on the bill are just about as openly politically calculated as you can get. Specter was a Cosponsor of the bill who voted for cloture when the it came up in 2007. Since Specter is a Republican, he faced immense pressure to switch sides on the matter, and yesterday he finally caved, just about ending all hopes of the bill's passage.

The only (and I mean ONLY) positive to take from this, was that while he thought he was pulling some sort of cunning political move, voting no on EFCA should end Specter's career as Senator in 2010. Specter won his primary in 2004 by 2 points over his ultra conservative challenger, Club for Growth president Pat Toomey. Well, Toomey's running again in 2010, and Specter is less popular now than he ever was among Pennsylvania Republicans. A poll released the same day as the EFCA announcement(amazing coincidence!) showed incumbent senator trailing Toomey by 14 points. But if Specter was foolish enough to think that screwing over his state's workers at the last minute would be enough to save him, he's got another thing coming:

Conservative groups and politicians, far from won over by Specter’s announcement, continue to hammer away at the embattled Senator, suggesting that his abrupt move on EFCA will do little or nothing to reduce his vulnerability to a primary challenge from the right.

For instance, Specter’s announcement drew only mockery and scorn from former GOP Rep. Ernest Istook, the chair of the anti-EFCA group Save Our Secret Ballot.

“Specter enjoys being the center of attention,” Istook said. “There has probably been more money spent to influence his vote on this issue than on any other vote, from any other senator, at any other time. He wants to continue enjoying the attention and the fundraising opportunity.”

Doug Stafford of the anti-EFCA National Right to Work Committee added in a statement that Specter’s move should be “viewed with some skepticism,” adding that other labor-oriented proposals championed by Specter remain “totally unacceptable” and will enable “Big Labor to corral more workers into forced unionism.”

Specter’s potential primary challenger, Club for Growth president Pat Toomey, has kept up the attacks, blasting Specter’s vote for the “big government stimulus bill” and dismissing Specter’s opposition to EFCA as merely the result of “a threat in the Republican primary.”

It's not like this was Specter's only choice. He could have backed Employee Free Choice, run as an independent with Labor's support and easily won re-election. Instead he chose to screw over the working class, and then be unceremoniously dumped on his ass by the people he was desperately trying to appease. Karmic Justice, I guess.

Train of Thought Field Trip: ResistNet Part III: The Dramatic Conclusion

Last time on Train of Thought Field Trip: After being told by visiting ResistNetters that we had somehow chosen the only crazy thread on the entire site for the first Field Trip, the second Field Trip showcased two all-new exercises in lunacy. With their initial argument disproved, the ResistNetters faced a difficult choice: give up and go home, or make up something else as a last-ditch attempt to appear sane? The second one proved more tempting, and from that came the claims that we took their comments “out of context.”

It is with that in mind that I now present the third trip to ResistNet, featuring three threads. For the last two Field Trips I’ve cut down a handful of the transcriptions because of length, but each comment here appears completely unchanged- none of their psychotic ramblings have been abridged in any way. I warned them last time that this wouldn’t help their case, that leaving out a bunch of rambling aimless conspiracy theories actually helps them, but they didn’t listen. Behold ResistNet as you’ve never seen it before!

In my first journeys into the site I hadn’t noticed anything particularly racist, which seemed weird for such a far-right site. This thread by Cindy McGee Mo Dist 9 Coord changes that completely- after a video about the evils of Islam the racists go wild. Repeat offender Jack007 starts us off nicely:

Islam is a death cult based on murder, torture,
rape, Violent jihad, supremacism and death to
ALL non-believers.

Speaks for itself, really. Clifton.C breaks it down in a nice, easy way:

They are the ENEMY!!!!!!! there so called bible,
is filled with hate, let me explain we love life,
Muslims love death

Good to know that Muslims love death, eh? That’ll come as a real shock to the Muslims I know, I hope they aren’t upset to find out that they don’t actually love life. RabidRex posts a call to arms:

If the biggest threats to America are socialist
liberals and Islam, how did we end up with such
a dangerous weanie wrap running the show in
Washington?

Never under estimate the ignorance and stupidity
of American voters! Never underestimate how much
the jihadists hate you. Action is required and the
time is fast approaching when it will be too late
if action isn't taken. What happened to all the
militias? About time they clean house in America!

When he says ‘clean house in America,’ am I to take it that he wants militias to go after Muslims and ‘socialist liberals’? I’m not sure how else one is supposed to read that. Maybe he actually meant something perfectly innocuous, like having militias start house-cleaning services or something?

On to the next thread,where the thread starter claims that all guns will be confiscated by September. Michigan Patriot starts out looking like he might be a voice of reason, but then something goes terribly awry:

Yeah, I read about this yesterday but it's
something that would be difficult to confirm.
It may be true but you need multiple sources for
it to have credibility. If it is true there's
only a couple ways they could make that happen
in such a short period of time. It would mean that
they would need to bring in 300,000-500,000 UN
troops with heavy artillary and also use chemical
weapons. It's very possible, I wouldn't put
anything past Obama and this evil government and
the globalists that control them. My research
concludes that there already is foreign troops in
our country along with UN and other foreign
military armored vehicles. It certainly wouldn't
be a stretch to say this couldn't happen. If this
is true or not, sometime in the near future we will
be in for the battle of our lives. Get ready, it's
coming.

More context sure helped this guy! Pretty realistic scenario he's envisioned there. Oh and also there are already foreign troops inside our country according to his 'research,' good thing the LIEBERAL MEDIA won’t report it, right? John P. has a flair for the dramatic:

You can get my Gun out of my Cold Dead Hands.

That Sounds like An invitation Doesn’t It. I’ll Call lord soros and aCORN Tonight And Ask Them to send obama Brown shirts To Get You.  Cheryl stops the thread derail by posting more entirely factual information about the UN:

It is part of the UN Millenium Declaration that
is part of the Global Poverty Act. This gives
the UN Army the RIGHT to enter America and disarm
it's Citizens.
1) The UN Millenium Goals were setup in 2000, and
are a stated part of the Bush Administration's
foreign policy.
2) This act doesn't setup any budgetary
requirements all it does is "require the President
to develop and implement a comprehensive strategy"
for a foreign policy which is already in effect
since 2000.
3) this is not Obama's bill, its a companion bill
to the first bill introduced in the House by Adam
Smith, but Obama supported this bill when he was
in the Senate.
UN Global Poverty Act requires US to pay 845
billion to the UN and adhere to UN treaties. Also
Sets up international courts that supersede our
courts. Money will not be used in the US .

I like the last sentence best, apparently we’re moving towards a post-currency utopia? But it’s a bad thing? Perhaps she’ll post over here and clarify. John C Matthews is up next:

Hi Sandy, the second time I have seen this one
today. Are there any verifications from more
friendly source than Kremlin spokesmen? I have some
reservations on this story. Could you furnish any
kind of statement from any Western news source. I
know the mainstream media is in the tank, but there
are a couple of sources like Politico and CNS.com.
Very disturbing.

Yes- no believable sources, yet still ‘very disturbing.’ Does John C Matthews look at pictures of Bat Boy on tabloid covers and shiver, chilled to the core by the very believable existence of a hideous bat-child? This is pretty much the political news equivalent of that. Our third and final thread takes us to another ridiculous story, where an Israeli fake psychologist has been writing about how awful Obama is. Fight the Power actually calls out the thread-starter on how absurd the whole thing is:

I always make it a habit to check the authenticity
of anything forwarded by email. According to
snopes.com, Dr. Sam Vaknin is not a psychologist,
nor is he a mental health professional in any
respect. The "Dr." refers to a doctorate in
philosophy from the unaccredited Pacific Western
University. The article cited was composed by
someone else with a few bits of actual material
from Mr. Vaknin. Please authenticate things like
this before you post them - it does our cause no
good to be citing fraudulent articles.

Also, it turns out Vaknin has gotten in trouble for making up all sorts of things before while claiming to be a doctor. How do the ResistNetters react to this sobering bit of information? John takes it in stride:

I see nothing here that would indicate this is a
"Fraudulent Article" as you say, So I figure that
your statement is just a matter of your own opinion.

SNOPES? Please! I don't put ANY stake on what snopes
says, as they tend to be biased towards the left
anyway.

I don't see where "DR." Sam Vaknin's being a "Mental
Health Professional" or not, discredits his opinion
what so ever, he is a recognised authority on the
subjuct who has voiced his opinion on Obama,
an opinion you obviously disagree with,so you have
set about to discredit the good doctor.

Having observed many members of the Democratic
party for many years, I would have to say that
Narcissism, is quite a commom trait among the
Democratic hierarchy.

This is one of those posts I would have trimmed down a bit in the past- but now we can see that instead of merely being a little bit off, this guy is completely insane! Thank god for adding context. Let me add a bit more, by throwing in his next post in the same thread:

Just exactly what is this "Cause" you speak of
Fight the power? The "Cause" of Defending Obama?
You sound just like one of those Know it alls
who came out of some institution of LOWER Learning
with a robe, a piece of worthless paper, and a
very high opinon of yourself. As a fervent defender
of Obama, it is you Sir that are Gullible, to the
extreme.

Quite frankly Sir, I don't give a damn what his
credentials are, or what his proper academic title
is, or where he went to college, or even if he is
a convict.

I care not at all for the mind numbed socialist
sheep being indoctrinated at todays institutions of
lower learning, and it sound to me like you are one
of those.

What ever this guys title, or background, or
criminal history, he's DEAD RIGHT on this issue,
And it doesn't take magical mystery tour in academia
to figure this out.

Vaknic has the one thing they failed to bestow on
you whilst you were entranced by your academic
exploits. He has common sense.

Railing against academia, ignoring blatant contradictions within his own post and also within the story he’s trying to defend, AND accusing the other guy of being a brainwashed zombie? This post has it all and I’m glad that the entire thing is here for the world to see, instead of just a smaller portion of it. Meanwhile JAMES PAUL WILKERSON,JR IS ALWAYS SHOUTING:

TO JOHN TALKING ABOUT THE FOREFATHERS IF THEY LIVED
TODAY. THEY WOULD NOT STAND FOR WHAT IS GOING ON.
THERE WOULD BE NO DOUBT, THERE WOULD BE A REVELUTION,
A WAR. THEY HAD A SET AND THEY EXERCISED THAT
STRENGTH.

Is a ‘revelution’ a huge angry party? If so, I might actually agree with his post. Dan’s post doesn’t make sense, no matter how many times I read it:

this doc is so target i still think he,s iilegal
president

uhrgiuhargnfjgnkrg to you too, buddy. Greg Carpenter can’t believe it’s not factual!

WOW!!!!!!!

Literally can’t believe it. Karenlee is our last contributor, somehow ignoring the pages of controversy about how Vaknin is a fraud to add her views:

WOW, thanks for the insight. I think this pretty
much answers most of our questions about this man.
It sure helped me to answer the question of why he
has helped divide us even more now...than ever
before. It seems the USA is in for serious trouble
to come.

I think they’ve officially run out of excuses now, although you never know what wondrous thing the mind of a wingnut will create. Having proved that additional context just makes them look crazier, I once again declare victory in the name of the Train. I will ask that each of you take a moment to reflect on the plight of the handful of reasonable people stuck over there: the odd man or woman trying to hold the site to a level of factual basis which their peers simply will not allow. May they eventually realize that the internet has a number of communities which aren’t dominated by nutcases!

Local Newspapers - Non Profits?

Senator Cardin (D-MD) today proposed a bill to grant newspapers tax-exempt status as nonprofit organizations:

Struggling newspapers should be allowed to operate as nonprofits similar to public broadcasting stations, Sen. Benjamin Cardin, D-Md., proposed Tuesday.

Cardin introduced a bill that would allow newspapers to choose tax-exempt status. They would no longer be able to make political endorsements, but could report on all issues, including political campaigns.

Advertising and subscription revenue would be tax-exempt, and contributions to support coverage could be tax deductible.

Cardin said in a statement that the bill is aimed at preserving local newspapers, not large newspaper conglomerates.

Well, as Nelson from the Simpsons said:

Liveblog 8 PM Tonight

Obama's press conference tonight doesn't really merit a liveblog, but I wanted a chance to test out the software so here it is. Stop by and check it out.

Don't you ever get tired of being wrong all the time?

Bobby Jindal, one month ago today:



Really? Because I'm pretty sure a volcano erupting would definitely be worse than any eruption of spending, any way you slice it.

Wait a minute, what's that you say? A volcano erupted yesterday?

Mount Redoubt Volcano In Alaska Erupts Explosively

ScienceDaily (Mar. 23, 2009) — Alaska's Mount Redoubt Volcano has erupted, spewing ash thousands of feet into the air.

The volcano, 106 miles southwest of Anchorage, erupted explosively on March 22, 2009, at approximately 10:38 PM AKDT, sending a cloud of volcanic ash to an estimated 50,000 feet above sea level. Scientists from the Alaska Volcano Observatory (AVO) are monitoring the volcano closely as the eruption continues.

Ash plumes generated by the explosive bursts are drifting north-northeast. Ash fall has been reported in Skwentna and the Chuitna area.

I've said it before and I'll say it again; you really just can't make this stuff up (via Suril's G-Reader feed, what it do?).

Geithner's Plan

After a months of discussion, The Obama administration's plan for the banking sector was revealed today by Treasury Secretary Timothy Giethner. He unveiled it today in a Wall Street Journal op-ed and a press conference this morning:

The U.S. government will offer hundreds of billions of dollars in equity and loan guarantees to investors who bid against one another to buy troubled assets from banks, officials said today.

The "Public Private Investment Plan" detailed this morning, a long-awaited but risky piece of the government's financial stabilization strategy, will pour government money into private investment funds as a way to move loans from the balance sheets of banks to those of long-term investors.

Under the plan, the government and private investors will invest together to buy up between $500 billion and $1 trillion worth of real estate-related loans and securities from banks. The government will use up to $100 billion from the Troubled Assets Relief Program, matched by private funds, to capitalize the purchases.

The hope is that instead of hoarding cash in case those assets continue to lose value, banks will resume lending money once the toxic assets are off their books.

The government and private investors, meanwhile, will hold the assets for the long term, and stand to either make or lose money depending on how the economy does.

As with many of these issues, it's good to check in with the people who got the economic mess right the last time around and see what they say about these current developments.
Paul Krugman:

Why was I so quick to condemn the Geithner plan? Because it’s not new; it’s just another version of an idea that keeps coming up and keeps being refuted. It’s basically a thinly disguised version of the same plan Henry Paulson announced way back in September. To understand the issue, let me offer some background.

Start with the question: how do banks fail? A bank, broadly defined, is any institution that borrows short and lends long. Like any leveraged investor, a bank can fail if it has made bad investments — if the value of its assets falls below the value of its liabilities, bye bye bank.

But banks can also fail even if they haven’t been bad investors: if, for some reason, many of those they’ve borrowed from (e.g., but not only, depositors) demand their money back at once, the bank can be forced to sell assets at fire sale prices, so that assets that would have been worth more than liabilities in normal conditions end up not being enough to cover the bank’s debts. And this opens up the possibility of a self-fulfilling panic: people may demand their money back, not because they think the bank has made bad investments, but simply because they think other people will demand their money back.

Bank runs can be contagious; partly that’s for psychological reasons, partly because banks tend to invest in similar assets, so one bank’s fire sale depresses another bank’s net worth.

So now we have a bank crisis. Is it the result of fundamentally bad investment, or is it because of a self-fulfilling panic?

If you think it’s just a panic, then the government can pull a magic trick: by stepping in to buy the assets banks are selling, it can make banks look solvent again, and end the run. Yippee! And sometimes that really does work.

But if you think that the banks really, really have made lousy investments, this won’t work at all; it will simply be a waste of taxpayer money. To keep the banks operating, you need to provide a real backstop — you need to guarantee their debts, and seize ownership of those banks that don’t have enough assets to cover their debts; that’s the Swedish solution, it’s what we eventually did with our own S&Ls.

Now, early on in this crisis, it was possible to argue that it was mainly a panic. But at this point, that’s an indefensible position. Banks and other highly leveraged institutions collectively made a huge bet that the normal rules for house prices and sustainable levels of consumer debt no longer applied; they were wrong. Time for a Swedish solution.

But Treasury is still clinging to the idea that this is just a panic attack, and that all it needs to do is calm the markets by buying up a bunch of troubled assets. Actually, that’s not quite it: the Obama administration has apparently made the judgment that there would be a public outcry if it announced a straightforward plan along these lines, so it has produced what Yves Smith calls “a lot of bells and whistles to finesse the fact that the government will wind up paying well above market for [I don't think I can finish this on a Times blog]”

Why am I so vehement about this? Because I’m afraid that this will be the administration’s only shot — that if the first bank plan is an abject failure, it won’t have the political capital for a second. So it’s just horrifying that Obama — and yes, the buck stops there — has decided to base his financial plan on the fantasy that a bit of financial hocus-pocus will turn the clock back to 2006.

James Galbraith:

If I'm right and the mortgages are largely trash, then the Geithner plan is a Rube Goldberg device for shifting inevitable losses from the banks to the Treasury, preserving the big banks and their incumbent management in all their dysfunctional glory. The cost will be continued vast over-capacity in banking, and a consequent weakening of the remaining, smaller, better- managed banks who didn't participate in the garbage-loan frenzy.

Dean Baker:

Treasury Officials Who Missed $8 Trillion Housing Bubble Still Haven't Noticed It

If the NYT description of the Treasury Department's bank rescue plan is accurate, then this should have been the headline to the article. The article reports that the Treasury Department is confident that it will not lose money by buying mortgage backed securities at far above their market price because: "the government can hold those mortgages as long as it wants, officials are betting the government will be repaid and that taxpayers may even earn a profit if the market value of the loans climbs in the years to come."

House prices are currently falling at more than a 20 percent annual rate. If they fall another 20 percent in real terms, they will be back at their trend level. A further 20 percent decline will hugely increase the percentage of mortgages that are underwater, reducing the value of mortgage backed securities from their current level. There is no obvious reason that house prices should then again rise above their trend level.

The failure of people like Ben Bernanke and Timothy Geithner to recognize the $8 trillion housing bubble led to this crisis. It appears as though they somehow still don't understand it. This fact should have been the headline of the news article since their continued failure to understand the housing market could cost taxpayers trillions of dollars and further damage the economy.

Atrios (While he writes things in a much funnier way, don't forget that he has PhD in economics):

People are spending too much time trying to make sense of a plan which doesn't make much sense, certainly not as advertised.

The Geithner plan will:

1) Funnel more government money to the banksters.
2) Allow the banksters to pretend for a bit longer that their hunks of big shitpile aren't quite as shitty as we thought by using the bullshit price that this process comes up with, allowing too big to fail businesses to stay in business for a bit longer.

This might make sense if you truly believe the magic market you believe in fervently is genuinely incorrectly pricing the assets, perhaps because you genuinely believe that if you could turn around the economy fast enough that you could massively reduce expected foreclosures.

But if you genuinely believe that, I don't think you've been paying too much attention to just what's been going on in the housing market. I don't think you paid too much attention 3 years ago when you didn't realize that it didn't quite make sense that so many people could afford $700,000+ homes in Orange County. I don't think you paid too much attention to the degree of speculation and outright fraud that was happening in parts of the country.

And adding a non economic perspective to the mix, Chris Bowers:

The question of the day is whether or not the Obama administration's "new" bailout plan, presented today by Treasury Secretary Geithner, will work.

Over the weekend, Paul Krugman was the leading voice of "no, it probably won't." On the other side, Brad DeLong was the main proponent of "yes, it probably will."

Lacking relevant policy expertise, I am not going to pretend that I can determine whether Krugman or DeLong is correct. And even if I had the expertise, economics is a field of study where, like all areas of social science, "experts" disagree with each other all the time. So, no matter if you are in the "nuh-uh" or "ya-huh" camp on this one, it isn't hard to find someone smarter than you, and more well-versed in economics than you, who agrees with you. So expertise and smarts aren't really the main sources of disagreement in this case. People don't disagree with you just because they don't know what they are talking about.

Instead, disagreement in this case comes down to a more fundamental, personal disposition. Do you trust the people running the financial sector, or not? Do you think that the current crisis was simply a blip in an otherwise well-functioning economic financial system?

Personally, I don't trust it. I don't think the people running the financial system have anyone but their own best interest at heart. Further, I don't think that what is good for them has ended up being good for us. I don't think there is anything stopping them from ripping us off with taxpayer money the way they ripped us off with 401k money. I don't think there is anything stopping them from just making more bad assets that sink us, while they get rich. My belief is that we need to impose stricter limits on executive compensation, place increased restrictions on financial speculation, and to reorganize government spending and create a much larger, non-bailout and non-military oriented public sector in a way that protects us from these financial speculation bubbles. Whether or not the bailout plan will work, this should prevent us from ever getting into this situation again.

Sorry for the extensive quoting, but I wanted to get it all out there. While no plans are a guaranteed success, this just seems like a much riskier strategy than was required. And even if the plan works, I'm not a fan of using taxpayer money to cover the asses of same people who were gambling our money away in the first place. In this plan none of those people lose their jobs, in fact they are essientially rewarded for their actions.

I liked the section in Geithner's speech about regulation, but like Chris Bowers said it seems to be a bit backwards. You give them piles of money to keep the current system in place, AND THEN you come up with a plan for new "sweeping" regulations? Wouldn't you put in the new sweeping regulations, and then hand them piles of money? What's stopping these people from taking our money and engaging in the same risky behavior? They clearly don't have a problem buying new jets or throwing lavish parties while we're propping up their businesses and they know they're under the microscope - so why would any of that suddently change?

To paraphrase Dean Baker, if Geithner isn't smart enough to resolve the banking crisis without enriching those who gave us the banking crisis, then he proably shouldn't be Tresury Secretary.

The Train of Thought Lounge: Rise and Fire!

So, I forgot to post a new installment of The ToT Lounge on Friday because I was busy drinking all day and watching the NCAA Tournament. My bad!

Unfortunately, my beloved Terps were bounced by Memphis, although I was very proud of Maryland's efforts in upsetting Cal in the first round. Who ever thought that Gary Williams' job was in jeopardy? Oh that's right... everyone did.

Even though I'm very late with this, today's lounge will honor my favorite announcer in the world, Gus Johnson. Two years ago, the excitable wordsmith and Howard alumnus (Bison!! YOU KNOW!!) blessed the world with some of his most unforgettable calls. So let's relive the magic! After all, it's all that will keep me going until the games pick back up on Thursday.

Train of Thought Field Trip: ResistNet Part II

Last time on Train of Thought Field Trip: We visited ResistNet, a gathering point for insane far-right wingnuts. At ResistNet they spend their free time idly speculating on the best way to assassinate elected officials and policemen, and writing long typo-ridden paragraphs about the shadowy conspiracy that moves closer every day to finally destroying America once and for all. Not sounding crazy yet, right?

A day after that was posted they started showing up here, desecrating our beloved comments section with more paranoid gibberish. TheObamaForum, a site created by Ron Paul supporters, was brought in as an attempt to somehow say that although they’re insane, the existence of some people who pretend to be insane Obama supporters somehow mitigates that. The claim was also made that the first Field Trip somehow violated their “Right To Free Speach,” a right which even my spell-checker knows doesn’t exist. Among all the comments, one clear pattern emerged: these guys are really gung-ho when it comes to leaving anonymous comments on a website. If that’s how dedicated they are to resistance, it looks like Obama has absolutely nothing to worry about.

Still, one poster might have made a point: what if the thread I chose was somehow unrepresentative of the usual level of discourse on ResistNet? That would hardly do, painting the entire site as crazy if it’s only just that one thread. There’s only one way to be sure- I had to go back, back to ResistNet. What did I find? Well, let’s just say that where we’re going, we won't need our sanity!

The first thread for today is this one, asking about the correct time to begin armed resistance against the state. Robert Winkler replies first- here’s his suggestion:

ANOTHER LIE!!! MORE LIES!!!
OBAMANATION IS NOTHING BUT LIES!!!
Now, I too will ask; when is the right time???
GOD BLESS AMERICA!!! LET'S ROLL!!! and
let the chips fall where they may.........

Off to a great start! Mftysac77, already featured last time, weighs in:

i also ask myself when is the right time but,i dont wanna
loose a million patriots to concentration camps before we say
ok the time is now.or let the beat us down anymore or
suppress us anymore.the world is watching!!

String together a bunch of partially related sentences and… post! Szewski is a tactical genius:

If we run to the hills, they win. I'm sure they won't be too
concerned about small bands of gorilla fighters. They will
still control everything.

As far as I know the government has absolutely nothing to fear from gorilla fighters, unless Obama and company draw their strength from the National Zoo. Except if "gorilla fighters" refers to fighters who are gorillas, actually, in which case they should be at least slightly intimidated. At this point Mike Durham does the unthinkable, and warns people that this conversation is insane. How does that go over?

Well I would certainly think so since Mr Durham utilizes his
freedom of religion at every chance he gets. Bottom line is
this post broke no rules. Its a discussion, not a call to arms.

Richard Mears is sounding suspiciously similar to a lawyer. After the other thread I’d be careful about that, don’t want to have deal with death threats and angry warnings. Ryan gets back to the task at hand: ignoring voices of reason and romanticizing the fight against the US government:

You know 150 years ago these liars and thieves would have
been tarred and feathered in front of the whole town. We
have skipped that part. We cant go back and try it now,
they would hang us out to dry. When it is time to fight
it will be all or nothing. The time is close!!

Richard thinks the time is closer than close- it’s ice close!

I think now is the time for an armed resistance,or by 2012.
What one can do with i.ooo well armed men.

Not much, unless he's using a numbering system I'm entirely unfamiliar with. By now the entire thread has gone insane, with Darren R. Young constantly posting pages of semi-related quotations. As the thread devolves into arguments about whether or not the topic is militant enough, chris Diquarto finally spies his chance to post a warning:

lets keep an eye for the chinks and russians when obama
opens the doors for our enimies

Racism, paranoia, a leftist conspiracy to destroy the country, typos, and a basic inability to even grasp what the rest of his wingnut friends were talking about- this is a tiny gem of a post. Alright, so that conversation was thoroughly insane. How about one more? Over here Sandy Staats WV State Director posts a terrifying video documenting the horribly mundane canvassing techniques being used to drum up support for Obama. Who cares? Apparently Susie does, very very much:

Well that just about made me lose my dinner! Wish
someone would have come knocking at my door today as I
have four college males here for springbreak who I'm sure
would love to give them "their opinions" ..

Volunteer: “Hey would you like to sign up for emails about Obama’s policies?”
Susie: “YES… AND BY YES I MEAN I’M GOING TO KILL YOU!”
Perfectly reasonable. Streetsweeper also has a similar idea:

Nobody came a knocking on my door.......*wah*
Had a *surprise gift* fer 'em.

Nope, not crazy! Jack007 brings this one to a close with a passionate post:

This guy in this video is a f@@king idiot and moron and the
people who supoort him and especially the black racist and
robots are truely a clear & present danger to our country,
our way of life, our freedoms, liberties and our sacred
constitution

What can I say? This guy is a Posting Artist. Actually, that goes for the entire ResistNet community. This highly scientific survey of 3 threads has provided irrefutable evidence that pretty much everyone on the site is deranged. Presumably none of the Anonymous Comment-Posting Army is brave enough to return and face our withering blasts of Truth, so I hereby declare victory in the name of the Train.

Keep Guantanamo Open

... and throw everyone who was ever a member of the Bush administration in it:

Many detainees locked up at Guantanamo were innocent
men swept up by U.S. forces unable to distinguish
enemies from noncombatants, a former Bush
administration official said Thursday.

Oh for fucks sake. This isn’t a surprise (to anyone who is informed by sources more reliable than 24, anyway), but it’s just wonderful to hear it from someone who could have said it years ago from a position of relative prominence. Thanks for waiting, jerk! Well at least all these misunderstandings have been cleared up by now-

"There are still innocent people there," Lawrence B.
Wilkerson, a Republican who was chief of staff to
then-Secretary of State Colin Powell, told The
Associated Press. "Some have been there six or seven
years."

Oh. Quite right.

Wilkerson is doing the right thing- and who knows, maybe the fact that it’s coming from a Republican will help convince some conservatives that torturing random Muslims doesn’t necessarily help anyone*. Doing the right thing now, though, is pretty much the definition of ‘too little too late.’ Anyone want to seriously debate whether or not others in the White House were aware of this as well? Luckily we don’t have to, because Wilkerson took care of that for us:

Wilkerson wrote that "U.S. leadership became aware
of this lack of proper vetting very early on and,
thus, of the reality that many of the detainees were
innocent of any substantial wrongdoing, had little
intelligence value, and should be immediately
released."

Former Defense Secretary Donald Rumsfeld and Vice
President Dick Cheney fought efforts to address
the situation, Wilkerson said, because "to have
admitted this reality would have been a black mark
on their leadership."

If President Obama can’t find a way to immediately close the place, perhaps he could find some new inmates for it? By their own standards these guys are perfectly eligible for Gitmo prisoner status, let’s get some mileage out of it before it closes for good!

*This is a joke- nothing will ever convince them of that. I’ll refer you to the GOP primary debates, where the only person who didn’t come out of the gates enthusiastically fawning over the wonders of torture was the man who had literally been tortured himself.

Getting our Money Back

Well done, House!

The House overwhelmingly passed legislation on Thursday to tax bonuses paid out by AIG and other bailed-out firms at a rate of 90 percent. "We want our money back and we want our money back now for the taxpayers," said Speaker Nancy Pelosi (D-Calif.)

But the measure passed, 328-93, only after a hectic scene in which dozens of Republicans switched their votes from no to yes.

And to the six democrats who voted against it:

Melissa Bean (IL-08)
Larry Kissell (NC-08)
Walt Minnink (ID-01)
Mike McMahon (NY-13)
Harry Mitchell (AZ-05)
Vic Snyder (AR-02)

Fuck off. Your primary season starts today.

Message Fail

I don't know what genius wrote up this set of talking points on the AIG Bonuses, but they should probably be taken out back and shot:

As angry as the president is at the news about A.I.G., which he learned Thursday, Mr. Emanuel said, “his main priority is getting the financial system stabilized, and he believes this is a big distraction in that effort.”

“People are not sitting around their kitchen tables thinking about AIG,” Axelrod said. “They are thinking about their own jobs.”

Chris Bowers:

Wow. That is a lot of cognitive dissonance, given that President Obama himself said that people were "right to be angry, I'm angry," over the bonuses. Are people angry, or don't they care? Depends on if you are listening to President Obama or to his senior advisors, I guess.

Look, people are angry about their jobs, and their health care, and they are taking out that anger on the bonuses. It is a fairly simple causality chain that should be obvious to any political observer.

1. People are pissed about the economy being in a recession, because of the impacts on their lives.
   
2. People blame Wall Street for the recession.
   
3. People don't like that, to fix the recession, more government money is being spent on Wall Street than on average Americans.
   
4. When Wall Street get even richer as a result of all this, it makes people really, really angry.

People aren't mad at the bonuses in and of themselves. People are angry about the bonuses because they are angry about the recession. Because they are angry at Wall Street. Because they are angry at the bailout. The anger at the bonuses is just a vehicle for that anger right now. To not recognize this is an extraordinary level of tone-deafness. There is a direct, obvious connection between anger over the bonuses and people being worried about their jobs.

As much as many people in politics like to think otherwise, people are not dumb. Right now, they can quickly draw a connection between their economic condition and people on Wall Street getting rich. If you think that people are sitting around thinking "I am worried about my job, so I wish people would stop talking about Wall Street, because I see no connection between the two whatsoever," then you are just blind. Worse, you have basically turned into the same people who defended the Bush administration for losing $12 billion in cash in Iraq, because that wasn't really very much money.

People are pissed about the bonuses because they are pissed about the recession. Because they are pissed at Wall Street. Because they are pissed a a Wall Street bailout they were told was necessary, but that only seems to helping make the rich get richer. If that isn't obvious to you, it should be. Democrats and progressives are screwed if we don't catch this populist wave.

Yeah, and I'll also go on the record as saying when 84% of the public feels "outraged or bothered" by something, playing down its importance probably isn't your best bet.

My Worst Fear

As explained by Rob Kuttner (A strong Obama supporter who previously defended of these appointments using the "Obama is a secret progressive using moderates to govern progressively" theory):

In the past two weeks, political support for the Tim Geithner/Larry Summers approach to solving the banking crisis has been unraveling in Congress, with blistering criticism from legislators of both parties.

The financial danger is that the Treasury will burn through the money approved by Congress without fixing the system. The political danger is that Republicans will posture as the populists, expressing faux-indignation that so much taxpayer money has gone to Wall Street. The overarching risk to Obama's presidency is that the plan won't work, and his political capital will evaporate along with the financial capital.

There is a whole other path to repairing the banking system, and a whole other set of experts, equally brilliant and better in touch with financial realities. But their unfiltered views are not reaching the president. This loyal opposition, of which more shortly, is not limited to lefties; it spans the ideological spectrum.

. . .

In defending the AIG bonuses, CEO Edward Liddy actually said that you had to pay bonuses to attract and keep "the best and brightest talent," in this case the very people who are costing America's taxpayers $175 billion and counting. Far from receiving bonuses, these people deserve to share a cell with Bernie Madoff.

By the same token, Larry Summers and Tim Geithner are not the only smart people about finance. If President Obama wants a second opinion, he could begin with Paul Volcker, nominally chairman of Obama's own "Economic Recovery Advisory Board," which so far is mainly window-dressing. According to my sources, Summers and Geithner seldom talk to Volcker because they don't like Volcker's criticisms of their plan.

The president could also consult with several people in the Federal Reserve System who have a different view, and also the FDIC leadership, and the Congressional Oversight Panel that was created by Congress as the precondition for appropriating the TARP money. The panel has the statutory right to get documents from the Treasury. But under Geithner as under Paulson before him, Treasury has been stonewalling. Legislators of both parties are increasingly viewing Geithner as part of the problem.

As the administration continues its coziness with Wall Street and the approach fails to bring zombie banks back to life, populist anger passes to both the Republicans and to media tribunes such as Lou Dobbs. This brand of populism is one part anti-Wall Street, but two parts anti-government and anti-immigrant. It has no strategic coherence as a recovery plan.

The alternative to Lou Dobbs' brand of populism is of course Franklin Roosevelt's. But something is really off when Sen. Sam Brownback, the AEI, and the Kansas City Federal Reserve Bank start sounding more like Roosevelt than Barack Obama's treasury secretary does.

With everything else going on right now, this is my greatest fear. Some on the progressive blogs have taken the position that this is only one aspect of his Administration, and that there is plenty of progressive change to come in other areas. I couldn't agree more, but that's the same reason I'm very worried. Nothing exists in a vacuum, and although the economy may just be "one issue", it will dominate news and national discourse for much of the discourse for much of the foreseeable future. While they may not control directly control other aspects of his agenda, their actions will go a long way in determining the political position he's in when he decides to take up the other fights.

Let me repeat: The actions that Larry Summers and Tim Geithner will have a bigger effect on Obama's political capital than anyone in the Administration short of Obama himself. Anyone whose has followed the careers of Tim Geithner and Larry Summers should understand just how terrifying possibility is.

Train of Thought Field Trip: ResistNet

Today’s field trip takes us somewhere new, a place some of you may never have even imagined located in the wildest corner of the internet. I’m talking about ResistNet, which describes itself as a network for “idea-based resistance to Obama-led socialistic agenda.” Their front page is a gloriously messy jumble of flags, text boxes, and pictures of Obama looking tired, but to find real gold you have to look at their forums. It’s a completely different atmosphere than Free Republic- whereas FR is a huge echo chamber for the screaming dittohead hordes scrambling towards the most ignorant position possible on any given subject, ResistNet is more like a conversation between inmates in a right-wing psychiatric ward.

The topic at hand today is the death of the United States, which happened decades ago according to thread-starter Joyce Rosenwald:

You see, as far as government is concerned, we are
the enemy, and the enemy has no rights.
This week the government took the back door to gun
confiscation. They created a situation where the
ability to manufacture bullets is gone. Guns
without bullets are useless. You now have a very big
decision to make. Do you continue to live as slaves
under the illusion of Freedom until the illusion is
destroyed, or do you fight now while you still have a
chance?

Handguns show up repeatedly during the thread as a symbol of revolution. Exactly what use is a pistol against a tyrannical federal government armed with tanks, jets, and nuclear weapons? No one ever seems to notice that this might be an important question. Anyways, Sharon Rondeau picks up the ball and starts running:

YOU ARE RIGHT.
I CHOOSE TO FIGHT. THE QUESTION IS WHEN AND WHERE?

DECLARING WAR ON YOUR CAPSLOCK KEY IS JUST THE FIRST STEP. Joseph F. Yates also goes the all-caps route, but my favorite thing about his post is that he doesn’t appear to be responding to anyone in particular:

YOU MAY BE RIGHT BUT WE CANNOT JUST GIVE UP. IF WE
DO THEN THAT IS WHAT THEY WANT.

Who is right about what? It is a mystery. JACK L. CANNON, USMC RET brings a nice healthy dose of ‘crazy’ to the thread (crazy even by the standards they’ve set thus far, mind you):

Joyce : I've been there and done that ,. I was
wounded Three times (SHOT TO HELL FOR MY EFFORTS),
And, all it did was make me more HARD CORE,,, IF it
comes to Shooting ,... I"LL TAKE IT TO THE WALL, For
we Marines, Special Forces, Etc Know how , Not to
mention When ,Where, what,& who . My belief is
Death or freedom,, For I cannot acept bondage,.......
SO, I think it might be just a matter of time....................

JACK CANNON is up there with MAXIMILLIAN SLAUGHTER and GUN KILLSALOT on the list of ‘names of people who go crazy and start a secession movement,’ so I’ll assume he’s entirely serious. Joyce Rosenwald returns to the conversation here, but instead of being a voice of reason or something (ahahaha) she somehow makes the whole thing even more ominous:

I've met a few special forces guys who feel as you
do. They are trained killers. They know how to take
a man out without leaving any evidence behind. He
told me when bodies of cops and low level politicians
are found I should know their war against the traitors
has begun.

Hahaha everyone on this site should go to prison forever. Mftysac77 really needs to adjust his watch or check a calendar or something:

lets go!WHERE ARE YOU MILITARY?
foreign and DOMESTIC!the time is yesterday

TIME DOES NOT WORK THAT WAY! Kim Matott makes an argument only slightly more coherent than the guy from Faaip De Oiad:

It would be nice to get the country back by talk but
i dont think its gonna work.Its not just the usa its
world wide,they are trying to get rid of two thirds of
the world population,the other third to be slaves to
the elite.

The next bit is great, I’ve had to cut it down for the purposes of our field trip though. Basically someone insults lawyers, then a lawyer posts saying he feels somewhat insulted, and then there’s a page where everyone crazily threatens him. First, Joyce Rosenwald:

Grow up. I'll give you some free advice. If civil
violence should break out if I were you I'd head for
the hills. Some rioting people may have read Shakespear.

Later Diogenes takes a break from posting epic-length nonsense to make this confusing non-sequitur, which I can only conclude must somehow be an insult:

I collect lawyers as some collect tea cups and there
is no disputing they are good at what they do

Finally, Ruth Hammons posts a plan worth reading:

It would seem so hopeless that the only solution is
to volunteer for the first new space colony and call
it and the ship that takes us: The New Pilgrims and
the Newest New World! Hummmmmmm from covered
wagons to space ships is a long stretch
isn't it?

Unfortunately she doesn’t know about the tragedy that will befall the ship: the assassination of the captain, the formation of factions like the Spartans and the Believers, and then the problems with Centauri indigenous life (mindworms, namely).

More from ResistNet in the future, unless they finally make one death threat towards elected officials too many and get shut down. Take care, wingnuts!

Douchebag Outrage Comes to an Abrupt End with AIG Bonuses

Remember that asshole from CNBC who ranted that Obama's housing bill being a bailout for "losers"?

You know, the one that was staged in an attempt to start the Great Douchebag Revolution?

Well that all came to a screeching halt when it's about defending his douchebag friends:

SANTELLI: Now, think about it this way. Maybe I'm missing something. But the outrage seems to be about M's, millions of dollars, right? $165 million, OK?

But I would think that it should be looked at as a pretty big positive, because when you go from the M, maybe you should try to go to the B's, which is the billions of dollars, and maybe that's going to even enlighten it for the T, trillions of dollars. You know, $165 million is like worrying about 16.5 cents, while $165 maybe necessitates a little more outrage. What do you guys think?

BECKY QUICK: Hey, Rick, I think the real idea here is just the idea of rewarding bad behavior, which is something you've spoken out against in the past.

SANTELLI: No, I guess what I'm saying is it's an order of magnitude. Don't you think this dynamic that the average guy reading his newspaper is really starting to be in tune with this?

A bill that helps people pay unfair morgages vs. 73 exectutives getting several hundred million dollars of taxpayer money as a bonus for bankrupting a multi-billion dollar business?

Yeah Rick, I'm sure the "average guy" would really be in a bind over that one. Someone should probably tell him that yelling ignorant shit on the trade floor of the Chicago Stock Exchange isn't the best way to guage public opinion.

Time will only tell where the Great Douchebag Revolution goes from here. And to think... they were even forming small groups!

Fun with Your Money: AIG Edition

Over the weekend we found out that AIG would still be paying out 165 million dollars in bonuses, the majority of which went to the AIG Financial Products, the division whose greed and stupidity made AIG worthless in the first place. And yes, AIG would be that same insolvent bank that taxpayers have been propping up to the cost of 170 BILLION dollars since last year.

If that enrages you, at least you're not alone. This story is that it has managed to piss virtually everyone off in one way or another. Even Larry Summers!

Mr. Summers also appeared on CBS’s “Face the Nation,” remaining consistent in his core message about the bonuses: “It is outrageous. The whole situation at AIG is outrageous. What taxpayers are being forced to do is outrageous.”

"Outrageous!" A strong rebuke from president's chief economist! And his plan to get the money back from a company where we have 1000% leverage? Well, he's tried nothing and he's all out of ideas:

"We are a country of law. There are contracts. The government cannot just abrogate contracts. Every legal step possible to limit those bonuses is being taken by Secretary Geithner and by the Federal Reserve system."

Huh. That's some pretty weak ass outrage. Oh and that whole "every legal step" thing? Well it turns out he isn't telling the truth. Shocking, I know. Glenn Greenwald:

Apparently, the supreme sanctity of employment contracts applies only to some types of employees but not others. Either way, the Obama administration’s claim that nothing could be done about the AIG bonuses because AIG has solid, sacred contractual commitments to pay them is, for so many reasons, absurd on its face.

As any lawyer knows, there are few things more common – or easier -- than finding legal arguments that call into question the meaning and validity of contracts. Every day, commercial courts are filled with litigations between parties to seemingly clear-cut agreements. Particularly in circumstances as extreme as these, there are a litany of arguments and legal strategies that any lawyer would immediately recognize to bestow AIG with leverage either to be able to avoid these sleazy payments or force substantial concessions.

Since the contracts are secret and we’re apparently just supposed to rely on the claims of AIG and Treasury Department lawyers, it’s impossible to identify these arguments specifically. But there are almost certainly viable claims to be asserted that the contracts were induced via fraud or that the bonus-demanding executives themselves violated their contracts. Independently, it’s inconceivable that there aren’t substantial counterclaims that AIG could assert against any executives suing to obtain these bonuses, a threat which, by itself, provides substantial leverage to compel meaningful concessions. Many of these executives were, after all, the very ones responsible for the cataclysmic losses.

The only way a company like AIG throws up its hands from the start and announces that there is simply nothing to be done is if they are eager to make these payments. One might expect AIG to do so -- they haven't exactly proven themselves to be paragons of business ethics -- but the fact that Obama officials are also insisting that nothing can be done (even while symbolically and pointlessly pretending to join in the populist outrage over these publicly-funded "retention payments") is what is most notable here.

Legal strategies aside, just as a business matter, one of the first steps taken by every company in severe distress is go to its creditors, explain that it cannot make the required payments, and force re-negotiations of the terms. That’s as basic as it gets. To see how that works, just look at what GM and other automakers did with their union contracts – what they were forced by the Government to do as a condition for their bailout. Obviously, if a company goes into bankruptcy, then contracts to pay executive bonuses are immediately nullified, but the threat of bankruptcy or serious financial distress is, for obvious reasons, very compelling leverage to force substantial concessions. And the idea that, in this economy, AIG executives (of all people) will be able simply to leave and go seek employment elsewhere unless they receive their "retention bonuses" (even assuming that’s an undesirable outcome) is nothing short of ludicrous.

Since I wrote the first part of the post, Barack addressed the issue with a sharper tone than Summers, Romer and other Administration members used on Sunday:

“In the last six months, A.I.G. has received substantial sums from the U.S. Treasury,” Mr. Obama said. He added that he had asked Treasury Secretary Timothy F. Geithner “to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole.”

In strongly-worded remarks delivered in the White House East Room before small business owners, Mr. Obama called A.I.G. “a corporation that finds itself in financial distress due to recklessness and greed.”

“Under these circumstances, it’s hard to understand how derivative traders at A.I.G. warranted any bonuses at all, much less $165 million in extra pay,” Mr. Obama said. “How do they justify this outrage to the taxpayers who are keeping the company afloat?”

White House officials said that the administration is not looking to take A.I.G. to court to stop the company from paying out the bonuses. But they said the Treasury Department would be trying to figure out what they can do to block A.I.G. from making the payments within the legal confines of A.I.G.’s contractual obligations to the executives.

“All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multimillion-dollar bonuses,” said Mr. Obama, who called the issue one of “fundamental values.”

Strong words, and let's hope he means it. And I say hope because last month when reports of CEO bonuses for bailed out banks were brought to light, we got this:

President Obama branded Wall Street bankers “shameful” on Thursday for giving themselves nearly $20 billion in bonuses as the economy was deteriorating and the government was spending billions to bail out some of the nation’s most prominent financial institutions.

“That is the height of irresponsibility,” Mr. Obama said. “It is shameful. And part of what we’re going to need is for the folks on Wall Street who are asking for help to show some restraint and show some discipline and show some sense of responsibility.”

Since that comment the Administration took actions on the issue, just not the ones we were expecting:

A funny thing happened this weekend, after congressional Democrats surmounted a fierce lobbying effort and maintained one of three executive-pay limitation plans that were being eyed for removal from the final stimulus bill.

It turns out that Wall Street wasn't the only opponent of more stringent limits on bonuses for bailed-out executives -- Treasury Secretary Tim Geithner and White House economic adviser Larry Summers were leading the charge to keep CEO pay caps out of the stimulus.

The outrage behind the AIG scandal might be so overwhelming that it forces Giethner and Summers into actions that they clearly don't want to take. Then again, that's what I've thought/hoped would happen about 10 different times over the past three months, so I'm not exactly holding my breath.