Tuesday Reads

Good Morning!

By now, you probably have heard that diplomat Richard Holbrooke has died at the age of 69 from an aorta tear.  His obits are chock-full of some amazing accomplishments.  Here’s one example from CNN.

Holbrooke was best known for being “the chief architect of the 1995 Dayton Peace Agreement” that ended the Bosnian war — the deadly ethnic conflict in the 1990s that erupted during the breakup of Yugoslavia.

Serving President Bill Clinton as assistant secretary of state for Europe from 1994 to 1996, Americans got a taste of Holbrooke’s drive and intellect, as typified in this remark from “To End a War” — his memoir of the Dayton negotiations.

“The negotiations were simultaneously cerebral and physical, abstract and personal, something like a combination of chess and mountain climbing,” he wrote.

After President Obama took office in 2008, Holbrooke took one of the toughest diplomatic assignments — U.S. special representative for Afghanistan and Pakistan, the region Obama regards as center of the war on terrorism.

He rated a great one at the Grey Lady.

More recently, Mr. Holbrooke wrestled with the stunning complexity of Afghanistan and Pakistan: how to bring stability to the region while fighting a resurgent Taliban and coping with corrupt governments, rigged elections, fragile economies, a rampant narcotics trade, nuclear weapons in Pakistan and the presence of Al Qaeda, and presumably Osama bin Laden, in the wild tribal borderlands.

One of his main tasks was to press President Hamid Karzai of Afghanistan to take responsibility for security in his country and to confront the corruption that imperils the American mission there. At times, Mr. Karzai refused to see him, but Mr. Holbrooke was undeterred.

“He’s an enormously tough customer,” Mr. Holbrooke said during one of the periodic breakfasts he had with reporters who covered his diplomatic exploits. “As you’ve heard,” he added with a smile, “so am I.”

He helped his boss, Mrs. Clinton, whom he had supported in her presidential bid, to persuade Mr. Obama to send more troops to Afghanistan, while pressing for more aid and development projects to improve the United States’ image there. But he died before anyone knew if the experiment would succeed.

A brilliant, sometimes abrasive infighter, he used a formidable arsenal of facts, bluffs, whispers, implied threats and, when necessary, pyrotechnic fits of anger to press his positions. President Obama, who praised Mr. Holbrooke on Monday afternoon at the State Department as “simply one of the giants of American foreign policy,” was sometimes driven to distraction by his lectures.

As we posted yesterday, a huge Senate Majority voted to advance the Obama-McConnell Tax deal.  Only 15 senators voted to stop Cloture. The up or down vote will be scheduled for either today or tomorrow. Stay tuned. We’ll follow the details here.

Fifteen lawmakers voted against it, including five Republicans: Sens. Tom Coburn (Okla.), Jim DeMint (S.C.), Jeff Sessions (Ala.), John Ensign (Nev.) and George Voinovich (Ohio).

Nine Democrats and one independent voted against the bill: Sens. Jeff Bingaman (N.M.), Sherrod Brown (Ohio), Russ Feingold (Wis.), Kirsten Gillibrand (N.Y.), Kay Hagan (N.C.), Frank Lautenberg (N.J.), Pat Leahy (Vt.), Carl Levin (Mich.), Mark Udall (Colo.) and Sanders.

“It makes no sense to me to provide huge tax breaks for millionaires and billionaires while we drive up the national debt that our children and grandchildren will have to pay,” Sanders said in a statement after the vote.

Obama applauded the Senate’s action to move his tax cut compromise with Republicans and urged the House to do the same quickly.

In a statement in the White House briefing room, Obama hailed the Senate’s “strong bipartisan support” for the package and declared “this proves that both parties can in fact work together.”

BostonBoomer brought this my attention so I thought I’d post it.  Is there a Real-Life Da Vinci code in the Mona Lisa?  Cue the Twilight Zone Music.

Intrigue is usually focused on her enigmatic smile.

But the Mona Lisa was at the centre of a new mystery yesterday after art detectives took a fresh look at the masterpiece – and noticed something in her eyes.

Hidden in the dark paint of her pupils are tiny letters and numbers, placed there by the artist Leonardo da Vinci and revealed only now thanks to high-­magnification techniques.

Speaking of secrets, I’ve been looking into the status of Credit Derivatives since Frank-Dodd passed and the NY Times had an article up on Sunday on secret meetings of  a secret Derivatives Dealers Club of 9 on Sunday.  FiscalLiberal and I have been trying to figure out if all the news actually actually reveals anything.    The Financial Times did an update on the area that is an interesting read but doesn’t really say anything’s been solved or changed.

Yet like one of those teenaged vampires on television, the CDS market keeps coming back to life. For example, activity in sovereign CDS is up by a third this year, as speculators and hedgers bet they know more than their counterparties about the probability or timing of Greek or Irish defaults. And no, the sovereign CDS tail is not wagging the sovereign bond dog. For example, there are about $25bn of outstanding CDS on Italy, compared with some $2,000bn of actual Italian bonds.The essential point to remember is that credit derivatives don’t matter very much in determining the state of the real world. The industry, worldwide, almost certainly doesn’t employ more than 10,000 people. It is intended to be a zero-sum business.

The original, modest, purpose of CDS was to provide a low-transaction-cost means of distributing illiquid credit risks around European banks, so as to reduce their risk concentration. Then, the justification became the ease and low cost of hedging credit by buying protection through CDS, rather than going through the expense and uncertainty of maintaining short positions in bonds.

We would all be better off if there were laws to make the majority of these things exchange-traded but  it won’t happen unless governments write the laws.  BostonBoomer knew I’ve been trying to write about this and pointed me to the KO show last night and an interview with Matt Taibbi.  You may want to watch the video at the link.  They talk about the nine dealers from the NY Times link above.  These guys have been blocking the formation of exchanges and lobby hard to keep these things opaque.  You may have read me talk about how information asymmetry relieve messes up a market.  This is a prime example. This KO-Taibbi conversation is easily understood.  I was pretty impressed by what it covered.   KO also throws a gratuitous slam at Obama and Orzag so you might want to watch that just to see how the worm has turned.  Hopefully, I’ll figure out a way to explain this thing simply and have the complete post later.  I’m still trying to get more details.  In my doctoral program, every one saves their one C for the Derivatives Theory course.  Pricing is based on a really complex mathematical model and the language of the deal is written by lawyers. It’s the stuff nightmares are made of!  The math proofs even makes the guys with masters in physics quake. It’s not an easy thing to explain, teach, study or figure out.  I think they like it that way. Like I said, information asymmetry.  Also, KO brings up some nasty stuff about Senator Scott Brown and donations too. Go check it out.

Speaking of nasty stuff, here’s a blast from the past from Slate and Christopher Hitchens. The title alone titillates: ‘How Can Anyone Defend Kissinger Now?  The Nixon tapes remind us what a vile creature Henry Kissinger is’.

Chatting eagerly with his famously racist and foul-mouthed boss in March 1973, following an appeal from Golda Meir to press Moscow to allow the emigration of Soviet Jewry, Kissinger is heard on the tapes to say:

The emigration of Jews from the Soviet Union is not an objective of American foreign policy. And if they put Jews into gas chambers in the Soviet Union, it is not an American concern. Maybe a humanitarian concern.

(One has to love that uneasy afterthought …)

In the past, Kissinger has defended his role as enabler to Nixon’s psychopathic bigotry, saying that he acted as a restraining influence on his boss by playing along and making soothing remarks. This can now go straight into the lavatory pan, along with his other hysterical lies. Obsessed as he was with the Jews, Nixon never came close to saying that he’d be indifferent to a replay of Auschwitz. For this, Kissinger deserves sole recognition.

It’s hard to know how to classify this observation in the taxonomy of obscenity. Should it be counted as tactical Holocaust pre-denial? That would be too mild. It’s actually a bit more like advance permission for another Holocaust. Which is why I wonder how long the official spokesmen of American Jewry are going to keep so quiet. Nothing remotely as revolting as this was ever uttered by Jesse Jackson or even Mel Gibson, to name only two famous targets of the wrath of the Anti-Defamation League. Where is the outrage? Is Kissinger—normally beseeched for comments on subjects about which he knows little or nothing—going to be able to sit out requests from the media that he clarify this statement? Does he get to keep his op-ed perch in reputable newspapers with nothing said? Will the publishers of his mendacious and purloined memoirs continue to give him expensive lunches as if nothing has happened?

Just a suggestion from me.  Drink your coffee before you go read that one. You may feel the need to spit at the screen.

One last depressing thing from the Wonk Room for advocates of GLBT rights.

This afternoon, White House Press Secretary Robert Gibbs refused to say that President Obama would call on the Senate to stay in session until it brought up the stand-alone measure to repeal Don’t Ask, Don’t Tell. In a series of passive replies to the Washington Blade’s Chris Johnson and the Advocate’s Kerry Eleveld, Gibbs didn’t directly urge the Senate to consider the measure, but said, “our hope is that the Senate will take this up again and we’ll see this done by the time the year ends.” “Don’t Ask, Don’t Tell and DREAM, along with government funding, are all in a basket of issues that are likely to come after” START, he argued earlier in the press briefing.

Asked by Eleveld why Obama has pledged to stay in DC until the Senate passed START but not DADT, Gibbs replied that the President would wait for the Senate to adjourn before leaving. Gibbs also refused to say if the administration was considering alternatives to legislative repeal …

Guess there’s more important things to do, like say, pass the Paris Hilton Inheritance Windfall Tax Breaks.

So, what’s on your reading and blogging list today?

37 Comments on “Tuesday Reads”

  1. bostonboomer says:

    WaPo: Why is the gov’t looking to prosecute Assange instead of those who leaked the material? Should Bob Woodward also be prosecuted?

    http://voices.washingtonpost.com/spy-talk/2010/12/wikileakss_assange_gains_influ.html

    • Sima says:

      I’m astounded at the comments I read on the local news threads about Assange. It’s like everyone has bought the government line without questioning. When someone does question, they are attacked by the mob.

      Obviously the government is after Assange because it’s more effective than trying to go for the leakers. It more effectively stifles free speech.

  2. Pat Johnson says:

    Christmas vacation is the annual trek to Hawaii for Obama and family. Musn’t keep the plane waiting.

    I know I am not alone in suggesting that this is the most inefficient, incompetent administration ever on record. Like it or not, Bush got things done. They may have been odious, criminal, and disgraceful, but he managed to get his way.

    Had we had a hearing for UHC instead of the “junk” that was produced from this so called “reform”, Obama’s singular claim to fame might not be in jeopardy today as seen by yesterday’s court ruling.

    The smell of “failure” in the morning. Can’t say I love though.

    • bostonboomer says:

      I heard last night that Obama is planning to stay in DC until the tax cuts for the rich are passed. He can’t rest easy until he takes care of his base (same as Bush’ base).

      • Woman Voter says:

        😆 You said it, but the Gulf of Mexico wokers had to wait 50 Days to meet with President Obama. Yup, the RICH Millionaires and Billionaires get that special lovin treatment.

  3. cwaltz says:

    Depressing as Hades! Apparently the antidote to a stimulus bill that failed because it was laden with too many tax cuts is to pass a somewhat secondary stimulus including those same tax cuts plus some more tax cuts. Hand meet head. These people are past idiotic. We need a new term for the kind of dumb these people are. I have a really hard time believing that Obama’s economic crew actually studied economics. They don’t seem to be able to read data at all.

    • HT says:

      Agree with everything you typed. Yes – desk meet forehead.

    • bostonboomer says:

      The only stimulus in the bill that I know of is the unemployment extension–which could have been passed separately. Boehner and McConnell have both admitted it would have passed eventually.

      I assume much of the unemployment stimulus will be offset by the fact that individuals making under $20,000 and families under $40,000 are getting a tax hike. Not only that, there is at least one other program that didn’t get extended in the bill that will mean loses of up to half-a-million jobs. I hope to write more about that today.

      As Kat wrote last night, the payroll tax holiday is only going to reduce unemployment overall as well as take money out of the Social Security fund.

    • dakinikat says:

      I think the fact the economists are leaving the building is an indication that they’ve decided they can’t impact the process and are just defending the indefensible. I think they’re trying to leave before their credentials are completely trashed.

      • Sima says:

        This could very well be true. It’s obvious no-one in the White House has a lick of sense.

        I really do think we are seeing the American equivalent of a tin pot dictator. Good grief.

  4. Woman Voter says:

    No Pelosi Hearings, and the payola will will set Cheney free:

    dredeyedick Dave Manchester
    Halliburton reportedly agrees to pay Nigeria $250 million to drop bribery charges against Cheney, firm | R… http://disq.us/us7fw (@rawstory)

    Mean while Assange is busy trying to get this friend and that activist to get enough pence to make bail. I guess there aren’t too many millionaire and billionaire Free Speech supporters.

    • purplefinn says:

      If you pay them to drop bribery charges, isn’t that a bribe? Oh no, it’s a settlement. So glad to know that my favorite people Cheney, and the Halliburton executives will not be held accountable. Another job for karma.

  5. Woman Voter says:

    Assange makes bail, with a pence here and a pence there, an electronic monitor and police check daily check in by 6 pm.

    wikileaks_pp wikileaks_pp
    #Wikileaks Julian #Assange granted bail. Conditions are: electronic tag, curfew and surrendering passport gu.com/p/2yzaf/tw

    Assange will have a permanent address for the first time in years…

    Pence collection, was 250£

    • Woman Voter says:

      Assange makes 250 £ bail, but maybe not for long:

      BBCWorld BBC Global News
      by YoshidaSuzuka
      #WikiLeaks founder Julian Assange to remain in jail for at least 48 hours after prosecutors filed appeal against his release on bail

  6. Woman Voter says:

    US diplomat Richard Holbrooke dies (Secretary of State Hillary R. Clinton offers her condolence on his passing and praised his work.)

  7. Boo Radly says:

    More “good” stuff from the BO’s, Obama signs bill cutting 2.2 billion from food stamps.
    Compliments of Ebenezer’s wife Michelle. Not Your Sweetie has a great write up including photo of MO. This couple cannot stop emptying every social program coffers.

    http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=439×309

    Like this comment at the link – So even a bill to try and make the food our children eat healthier is really just another large pile of shit. Thank you for the bang up job Mr. President.- Thank gawd I usually have low blood pressure.

    • Sima says:

      I’m gobsmacked, completely gobsmacked.

      I knew it was all a shell game, but do they have to be so frapping obvious about it?

    • bostonboomer says:

      LOL

      Of course, delay now is better than an immediate tax hike. But because the extension is only temporary, a large portion of the investment and job growth that characteristically accompanies low taxes will be lost. When entrepreneurs and employers make decisions to start or expand an enterprise, uncertainty about tax rates translates directly into a reduced propensity to invest and to hire.

      Excuse me, but the tax cuts didn’t create any jobs in the 10 years they have been in effect. Why should that happen now, even if the cuts were made permanent?

  8. Minkoff Minx says:

    Bernie Sanders Quotes Jeff Immelt: “I am a Nut on China” | Emptywheel

    Remember that “Big Money Summit” tomorrow? That is one thing I am looking forward to…I want to see exactly who BObama will be meeting with. I like the last sentence of this post:

    “Though the companies of the CEOs who have been publicly invited–Google, Cisco, IBM, AmEx, Dow, and Pepsi–have been all pushing into China.

    On Sunday, Masaccio described this entire CEO summit as just Obama’s effort to outsource the effort the government should, instead, be leading: job creation. I guess Obama has gone to the experts on that front!”

    • bostonboomer says:

      If only Wikileaks could get a microphone into that room!

      • Minkoff Minx says:

        You got that right BB, I would love to be a fly on the wall, but Obama would probably smash me between his capable hands with such precise expertise, as he has already shown he can…

        I would guess that Obama’s choice to replace LaLa Summers is just going to be a move to appease these group of CEOs.

  9. joanelle says:

    I just got an email from Al Franken’s office – his explaination of why he voted for the bill
    A lot of people are unhappy that the President punted on first down, and I’m one of them. Extending the Bush tax breaks for the super-wealthy will explode our deficit over the next two years without doing anything to help our economy. It’s bad policy.

    But for Minnesota’s middle class, struggling to get by in a tough economy, there’s a lot in this bill that will really help: tax cuts for working families, a payroll tax holiday, energy tax credits, and the extension of Recovery Act initiatives that are already making a difference.

    And for the Minnesotans truly suffering right now—men, women, and children on the edge of economic disaster—the alternative is simply unacceptable. If we let Republicans block unemployment benefits, even temporarily, there will be a lot more pain for working families, a lot more homeless kids spending Christmas in a shelter or a car.

    If this is the prelude of a permanent extension of the Bush tax breaks for the super-wealthy, we’re in big trouble. We’ll lose our ability to make the investments we need to grow our way out of long-term budget deficits: education, infrastructure, and research and development. And I am taking the President at his word that he will fight harder to put an end to these wasteful tax breaks in 2012 than he did in 2010.

    This isn’t a great deal by any stretch of the imagination. But I got into this line of work because I wanted to stand up for Minnesota families trying to put food on the table and build a better life for their kids. And, for them, the only thing worse than a bad deal would be no deal at all. That’s why I voted yes yesterday—and why I will continue my fight for economic policies that create jobs, address our deficit problem, and build new opportunities for Minnesota.

    But as the email states we may be saddled with this for a long time and never be able to dig our way out of this mess because of this action. Yes, Al, we are in Big Trouble!

    • bostonboomer says:

      I don’t think he gave any good reasons for voting for the thing. Especially since it would have passed even if he voted against it.

  10. Outis says:

    I got this from Bernie Sanders. Notice the difference.

    [i]I want to take this opportunity to thank you very much for contacting my office regarding the recent tax deal struck between President Obama and the Republican leadership. Frankly, the response from Vermonters and Americans all across the country – like you – was far beyond anything we could have imagined. As of this writing, we received a total of more than 10,000 phone calls and 9,324 e-mails. More than 98 percent of the responses were in opposition.

    In my view, this huge outpouring of concern was not just about this harmful bill. It went deeper than that. It was a cry from the middle class who are deeply worried about the future of our country and where this agreement, and similar type bills, will lead us in the years to come.

    At a time when we have a $13.7 trillion national debt and the most unfair distribution of income in the industrialized world, why are we giving huge tax breaks to millionaires and billionaires? Is there no end to their greed? And does anyone really believe that this will only be a two-year agreement with no future extensions?

    Why should we be significantly lowering rates on the estate tax when it applies only to the very, very richest people in this country, the top 0.3 percent? The richest 1 percent already owns more wealth than the bottom 90 percent. Isn’t that enough?

    With the American people deeply worried about the future of Social Security, why are we diverting $112 billion from the Social Security trust fund in order to provide a ‘payroll tax holiday?’ Why is a Democratic president adopting this position, which has long been held by Republicans who want to eventually destroy Social Security by choking off its funds? With the Republicans coming to power in the House in a few weeks, why should anyone not think that this ‘one-year’ diversion will be made long-term or permanent? According to one major senior citizen organization, this action could be the beginning of the end for Social Security – the most successful anti-poverty program in the history of the United States.

    It goes without saying that we must extend unemployment benefits for the millions of working families who, in the midst of this terrible recession, are about to see them expire. But why is this considered a ‘concession’ when for the last four decades Democrats and Republicans have always worked together and agreed that benefits must be continued when the unemployment rate is higher than 7.2 percent. This is not a ‘concession’ on the part of the Republicans. This is a continuation of long-held, bipartisan policy.

    In conclusion, I believe that we could have reached and should reach a better agreement that represents the interests of middle class and working families of our country.

    Let’s keep working together. [/i]

    And my senator, Barbara Boxer is not on the list of nays. What is the difference between her and Carly again?

    • cwaltz says:

      Even worse, IMO is Reid. I almost wish I had lived in AZ to vote for Angle. He’s a worthless party leader. How much do you want to bet that now that the GOP is back in charge of the House we get lots of bad legislation through thanks to Harry and his coalition of DINOs

      • dakinikat says:

        I think you mean Nevada. I still can’t imagine voting for Angle under any circumstances. I think she really is certifiably crazy.

        • cwaltz says:

          I’m almost convinced that certifiable is better than corrupt at this point. I’m thinking Reid is going to do alot of damage and he’ll be doing it for 6 years time. Apparently he learned NOTHING from having such a close race with a loon.

  11. Minkoff Minx says:

    Lame-as-F@#k Congress | Video Cafe

    The Daily Show’s tribute to Republican senators who find comfort and advantage in invoking the heroes of 9/11 but refuse to give them health care.

    EDIT: As Media Matters points out though none of the networks bothered to mention this:

    … none of the evening news telecasts on ABC, CBS or NBC covered the news about the 9/11 first responders bill. And the rest of the mainstream media didn’t show much interest either. In the 48 hours following the vote, according to TVeyes.com, the phrase “first responder” was mentioned 10 times on CNN, nine on MSNBC and just one time on Fox News.

    ***I mentioned this before so I wanted to update my post from Sunday…I can’t stand these GOP Basturds…

  12. dakinikat says:

    OMG! Why doesn’t Obama just bid out economic policy to the highest wall street investment bank?

    I can’t believe two of three of these guys to replace Summers. How could he find a worse adviser than LaLa?

    They should just replace the Democratic Donkey mascot with the Monopoly game dude.

    As Larry Summers nears the end of his term as director of the National Economic Council, the list of potential replacements has been whittled down to three, according to Obama administration officials familiar with the deliberations: Treasury adviser Gene Sperling, Wall Street banker Roger Altman and Yale president Richard Levin.

    The three represent a range of ideologies, from sympathy for Wall Street to vigilant consumer protection. At this critical point in the economic debate, the president’s choice will send a powerful signal about the administration’s leanings. If it’s Sperling or Altman, critics say, the country can likely expect a continuation of a Wall Street-sympathetic approach to policy for the next two years.

    The stakes are high, both for how the administration is perceived and how it determines policy. As Peter Orszag, Obama’s former director of the Office of Management and Budget, has taken a senior position at Citigroup, pundits like Joe Klein and Jim Fallows are griping about the government’s ties to Wall Street.

    “This move only reinforces my growing sense that the Democratic party has to pry control of its economic policy away from the Wall Street caucus — the Rubin, Summers, Geithner, Rattner and now Orszag etc. gang,” Klein writes.

  13. Minkoff Minx says:

    I think that one of our commenters yesterday, mentioned Moody’s? Anyway, check this out: Moody's Blues: How to Kill any Economic Recovery | MyFDL

    What Hess should tell us is the truth: The problem the deal creates for US deficits is that the tax cuts are mostly a waste of hundreds of billions, because they’re the least effective way to boost the economy. That means we don’t get nearly the stimulus we could have gotten from intelligent deficit spending on things that actually boost demand and create jobs, and thus reduce government spending for safety-net programs and boost government revenues.

    I know this will make Dana Milbank and Mark Penn cry, but the way to improve the picture is to fix the package in ways Obama’s liberal critics are demanding. And we should stop praising Obama for agreeing with people who insist hacking federal revenues by nearly a trillion dollars doesn’t impact the deficit. Every third grade math student knows this is nuts.