From The Hill: DeMint will force readings of START Treaty and omnibus bill

For some reason, the 2000 pages of the Tax Bonuses for Billionaires plan isn’t germane to discussions of deficits and national security but the START treaty and the ominibus spending bill are fodder for ideological  temper tantrums.

From TPM: Kyl: Reid Disrespecting Christians By Suggesting Post-Christmas Senate Votes

(Psst Kyl:  the Reason for the Season is Mithros’ the Bull God’s birthday.   Read your Roman History.  The reason for Sunday services is The Sun God.  Read your Roman History. You were had a long time ago by Constantine and the Nicene Council. Read the historical records of the Council set up by Constantine to establish a Roman religion and get off your friggin, butt and do your job!)

Oh, speaking of mythology, try THIS one on for size from the NYTimes:   G.O.P. Panelists Dissent on Cause of Crisis.  I’m going to spend some time on this because it’s just the best example of what is wrong with POLITICIANS.  Congress was completely duplicitous in the crisis and yet, all the want to do is blame Federal Regulators.

Democrats have emphasized factors like fraudulent practices by mortgage lenders and reckless risk-taking by Wall Street banks and other financial institutions, while Republicans have focused on poor oversight of Fannie Mae and Freddie Mac, the entities that supported the secondary market for mortgages, and decades of government efforts to encourage homeownership.

“While the housing bubble, the financial crisis, and the recession are surely interrelated events, we do not believe that the housing bubble was a sufficient condition for the financial crisis,” the document states. “The unprecedented number of subprime and other weak mortgages in this bubble set it and its effect apart from others in the past.”

Unbelievable.  Yes, that happened. Yes, it was a problem.  But what drove the demand for subprime and weak mortgages was the demand for those wacky unregulated credit derivatives. It was all part of the same pattern of negligence and wishful thinking.   You can’t unlink the systemic problems and the symptoms.  Fannie and Freddie got into those things and drowned, but it wasn’t exactly their idea to begin with.  Congress should’ve stopped them from going there.  But the driving factor was still the demand for credit derivatives.  Every institution was churning those things out in this country and in others.  The delusion is worse than I thought.

From Yves at Naked Capitalism:

This whole line of thinking is garbage, the financial policy equivalent of arguing that the sun revolves around the earth. Yes, the US and other countries provide overly generous subsidies to housing, and curtailing them over time would not be a bad idea. But that’s been our policy for decades. Calling that a major, let alone primary, cause of the crisis, is simply a highly coded “blame the poor” strategy, In reality, both the runup to the crisis and its aftermath were on of the greatest wealth transfers from the citizenry at large to a comparatively small group of rentiers in the history of man. (If you want to read the long form debunking of this thesis, go straight to Barry Ritholtz, a Republican who has shredded this brand of class warfare, or as he calls it, “one giant clusterfuck of imbecility,” repeatedly on his blog.)

The intent is pretty transparent: to discredit an effort at fact finding into the roots of the crisis, what was hoped to be a Pecora Commission, by making it appear partisan and launching an alternative narrative to muddy the waters. And the reason is clear. Even though FCIC is certain not to have the same effect that the Pecora Commission did, of discrediting major financial services industry figures and exposing various forms of chicanery, it appears that even lesser forms of criticism of the banksters must be sandbagged (the bizarre part of this drama is that at least some Democrats and very selectively, Republicans in office are willing to call out the predatory, extractive behavior of the large banks. But no one has the guts to buck an industry that is a major paymaster in a very serious way).

From HuffPo:

Experts agree that while Fannie and Freddie and the federal government’s push to encourage homeownership played a significant role in causing the crisis, actions by Wall Street magnified the fallout and caused a crisis that led to the Great Recession. Economists from the Federal Reserve, as well as bank regulators first appointed by Republicans, agree that the Community Reinvestment Act played virtually no role in causing the financial crisis.

But the Republicans’ report will largely focus on the role played by the federal government. It will note that a crisis was averted after the government bailed out Bear Stearns and facilitated its absorption by JPMorgan Chase, according to people familiar with the matter. The crisis roared back after the government allowed Lehman Brothers to fail, scaring nervous investors. A bigger and more protracted downturn was avoided when policy makers essentially bailed out the entire financial system.

Exactly. It’s never EVER been the Community Reinvestment Act and to even insert it into the report is odious and false.  I never got how the CRA got connected to the Fannie/Freddie mess from the outset other than through political memes.   I remember getting blog wacked by some from the left because I said Fannie and Freddie were part of the problem.  I never ONCE mentioned the CRA; only that Frannie and Freddie did what all the financial instituions did except on a much larger scale.  They packaged and sold poorly underwritten mortgages that were eventually going to make some one homeless sooner or later.  Fannie and Freddie’s roll was complicit and huge only because of their size and importance in the mortgage market.  They’d have never dreamed of doing what they did if it wasn’t for the fact they could package and sell the things–just like Countrywide and a bunch of other now defunct private entities–to stupid investors who were mislead by high ratings and the belief that due diligence was done on mortgage underwriting. The deal is that Congress could’ve stopped all of that–especially Fannie and Freddie–but they did nothing.  They could’ve prevented the underwriting of many of those predator loans.

Couple that with this travesty via the Birmingham News and AL.com.

Bachus, in an interview Wednesday night, said he brings a “main street” perspective to the committee, as opposed to Wall Street.

“In Washington, the view is that the banks are to be regulated, and my view is that Washington and the regulators are there to serve the banks,” he said.

…

In his quiet campaign for the chairmanship, Bachus promoted an agenda to end taxpayer subsidies for mortgage giants Fannie Mae and Freddie Mac, repeal those parts of the Wall Street reforms that he thinks still leave the door open for taxpayer bailouts of financial institutions or their creditors, and increase oversight of President Barack Obama’s administration.

Then, we have Congressman Out-of-touch-with-reality Ron Paul who will be in charge of the subcommittee in Congress that deals with the FED. This is another example of putting some one in charge of oversight that want’s to just plain abolish the reality.  He’ll be so stuck in ideologue land that oversight will just go by the way side.  It’s like putting a Flat Earther in charge of NASA.

In a move that may seem to some like putting the fox in charge of the hen house, Rep. Ron Paul (R-Texas) has been named to head the House subcommittee that oversees the Federal Reserve.

Paul, 75, is a longtime critic of the central bank and, as Bloomberg pointed out, has even written a book called “End the Fed.” He will lead the domestic monetary policy subcommittee of the House Financial Services panel.

In announcing Paul’s appointment Thursday, chairman-elect Spencer Bachus (R-Ala.) said the Texan would add to the team that “crafted the first comprehensive financial reform bill to put an end to the bailouts, wind down the taxpayer funding of Fannie Mae and Freddie Mac, and enforce a strong audit of the Federal Reserve.”

Paul told Bloomberg last week he plans to call for hearings on U.S. monetary policy and will continue to press for a full accounting of the Fed’s functions. In the past, Paul has introduced legislation to abolish the central bank.

There are a lot of people realizing that Congress is not acting in the interest of the American people.   The American Interest journal has a series of articles–including an important one on Income Inequality by Tyler Cowen–on inequality and democracy.  The front page of the Magazine–featured and linked to on the right–asks the most relevant question I can think of today. “Are Plutocrats Drowning our Republic?” A subsidiary question could well be “Why is every one in Congress intent on helping them do it?”

Congress did not get the message from this election.  Here’s a clue from another link at that AI site. They just seem intent and recreating the same scenarios and the same problems over and over and over again.

Many Americans are still furious that their government helped the rich and politically connected few while leaving the rest hung out to dry. The government bailed out Wall Street financiers who live in the top tenth of the top hundredth of the income distribution. Meanwhile, almost one quarter of families with mortgages remains stuck with negative equity in their homes.

Let’s return to that bit on the Republicans on the crisis panel.  I’ll borrow some analysis from Paul Krugman in his blog thread:  ‘Invincible Ignorance’.

So Republican members of the Financial Crisis Inquiry Commission are going to issue their own report, placing primary blame on the government — because it’s always the government’s fault.

And according to reporting at the Huffington Post,

all four Republicans voted in favor of banning the phrases “Wall Street” and “shadow banking” and the words “interconnection” and “deregulation” from the panel’s final report, according to a person familiar with the matter and confirmed by Brooksley E. Born, one of the six commissioners who voted against the proposal.

Yep. It was all Fannie and Freddie, which somehow managed to cause housing bubbles in Ireland, Iceland, Latvia, and Spain as well as the United States; and the repo market had nothing to do with it.

And bear in mind that this wasn’t one Republican; it was all of them.

We consistently get people in congress that appear to live in a reality of their own making.  They ignore science.  They ignore history.  They ignore economics.  They ignore nearly everything to push partisan power, curry favor with the donor and the bonus class, and spin tails to deluded followers that have no basis in fact, evidence, or theory.  They even run campaigns based on denying scientific theories that are well prove–like evolution–and promoting failed hypothesis–like all of Reaganomics–even when the majority of people who would know try to give them the facts.

What is it about our political process that seems to put policy in the hands of complete whack jobs and unemployable lawyers?   My one dash at the Nebraska Unicameral convinced me that only pathological narcissists and liars and ideologues capable of denying reality can get through the process.  Those folks are surrounded and supported by equally pathological narcissists, liars, and ideologues and they’re all bought up by a plutocracy that pays to play.

We are so F’d.  I am so frightened for and disheartened about  the future of this country.  How is it that Congress can get such low approval numbers but go right back to ruining the country in the same manner post-elections?  Both parties have their on unique style that achieves the same end.  What can we do to stop this?  It has to be the gerrymandered districts and the money.   But, how can we change the laws when the foxes are in charge of all the hen houses?

UPDATE: Senate approves tax cut deal; House Dems weigh amending estate tax

The Senate on Wednesday approved a sweeping tax package negotiated by the White House and congressional Republicans, and House leaders – who were looking to amend the measure in a way that would satisfy liberals without unraveling the deal altogether – said a House vote could follow as soon as Thursday.

The Senate passed the package by a vote of 81 to 19.

Before senators began debating the $858 billion package in late morning, President Obama urged lawmakers in both houses to pass it “as swiftly as possible.” He called the plan “an essential ingredient in spurring economic growth over the short run.”

Speaking before a meeting with business leaders, Obama said: “I am absolutely convinced that this tax cut plan, while not perfect, will help grow our economy and create jobs in the private sector.” He acknowledged that lawmakers of both parties object to different aspects of the plan but said, “That’s the nature of compromise.” He added that “we can’t afford to let it fall victim to either delay or defeat.”

In other news:  Obama announces his Faith Based VooDoo economics initiative based on advice from the ghost of Ronald Reagan … We are still so F’d.

that is all.