“Are there any adults left in the Democratic Party?”

So, the first thing I want to say is that I am an independent. The second thing is that the header is in quotes because it’s the punchline to a Harper’s Magazine essay written by John R. MacArthur. Harper’s Magazine is the second oldest magazine in the country. It was first published in 1850. It has a long place in US journalism history for publishing thoughtful essays and fiction of some of America’s greatest writers. John “Rick” MacArthur is its president and grandson of the founder of the magazine. You may frequently see the bug for the MacArthur foundation on all kinds of PBS programs like Frontline. The title of his essay is “President Obama Richly Deserves To Be Dumped”.

Wow.

The essay begins by quoting Bill Moyer’s recent comments about the Presidential speech in Osawatomie, Kansas. MacArthur characterized Moyer’s speech to Public Citizen as one that “puts the lie to our barely Democratic president’s populist pantomime, acted out last week in a Kansas speech decrying the plight of “innocent, hardworking Americans.” He then continues to quote Ron Suskind’s “Confidence Men” as an example of showing how Obama is basically a product of a neoliberal system who has a penchant for picking the wrong people for the most important jobs on purpose.  His argument is that picking plutocratic functionaries is actually what Obama was placed in the White House to do.  He is a tool of the plutocracy that’s residing in the Democratic Party. MacArthur is most concerned about an Obama that rails against bankers on TV and then invites them to a mega fundraiser the next night.  This is concern from a man that was born into the 1 percent.  He believes that this hypocrisy should put an end to the presidency of Obama and argues that dems of the little d should start a movement to replace him immediately.  This is the second time we’ve heard this call.

BostonBoomer offered up some similar evidence to this profile in a Politico piece that quotes Obama as saying that he had no idea about the full extent of the economic crisis. This is ridiculous on all levels. Obama had ongoing advice from Warren Buffet and Paul Volcker as well as many many insiders in Wall Street as early as 2007.  The Confidence Men narrative is full of examples of how much Obama knew and to what extent the entire thing was minimized or just whiffed because of a lack of credible leadership. The backroom wranglings of Rahm and Geithner to thwart Sheila Bair and other regulators meant to hold account Citibank in particular just completely blows this quote right out of the realm of truthfulness. Bair was prepared to bust up Citibank ala what happened to GM and–if Suskind’s account is true–Obama felt that was the correct way to go.  It is also evident from the book that Christie Romer couldn’t get Obama’s ear on her analysis of the crisis.  Obama walked out of a meeting on the economic crisis at one point and left the decision making to Geithner, Emmanuel, and Summers.  He actually told them to work it out amongst themselves and get back to him later. The book shows a President who did anything but attempt to grasp the depth of the crisis and make his staff handle Wall Street appropriately.

President Barack Obama said Tuesday he wishes he knew the full extent of the economic crisis when he took office, if only so he could have let Americans know just how tough the coming years would be.

“I think we understood that it was bad, but we didn’t know how bad it was,” Obama said in an interview with KIRO in Seattle. “I think I could have prepared the American people for how bad this was going to be, had we had a sense of that.”

MacArthur characterizes the Osawatomie speech as “a new standard in deception” and calls the President a functionary for party and party donor interests.

But Obama’s hypocrisy in Osawatomie, Kansas, set a new standard in deception. Among other things, his speech blamed “regulators who were supposed to warn us about the dangers of all this [the unfettered sales of bundled mortgages], but looked the other way or didn’t have the authority to look at all. It was wrong. It combined the breathtaking greed of a few with irresponsibility all across the system.”

What’s truly breathtaking is the president’s gall, his stunning contempt for political history and contemporary reality. Besides neglecting to mention Democratic complicity in the debacle of 2008, he failed to point out that derivatives trading remains largely unregulated while the Securities and Exchange Commission awaits “public comment on a detailed implementation plan” for future regulation. In other words, until the banking and brokerage lobbies have had their say with John Boehner, Max Baucus, and Secretary of the Treasury Tim Geithner. Meanwhile, the administration steadfastly opposes a restoration of the Glass-Steagall Act, the New Deal law that reduced outlandish speculation by separating commercial and investment banks. In 1999, it was Summers and Geithner, led by Bill Clinton’s Treasury Secretary Robert Rubin (much admired by Obama), who persuaded Congress to repeal this crucial impediment to Wall Street recklessness.

MacArthur fails to mention that Confidence Men also details the gutting of the Volcker Rule and the Consumer Protection Act by Chris Dodd with tacit approval from the White House. I don’t buy this reviewer’s take that it was just Democratic Senators who supported this effort.

Suskind’s reporting on what happened next is stunning: While the country endured a nail-biting period of doubt and even terror over the economy’s spiral,  Democratic senators seemed not to have the best interests of the nation and their newly elected president in mind. The Dodd-Frank Wall Street Reform and Consumer Protection Act was denuded by Sen. Christopher Dodd, himself. Without the young and inexperienced president’s knowledge, Dodd “had discreetly gutted the Volcker Rule.

“Many were critical of the lame-duck senator (Dodd) for not being more aggressive in his reforms, alleging that his interests were inexorably linked with the lobby he so closely served. But Dodd remained steadfast, arguing that he simply wanted to produce the strongest possible bill that could feasibly withstand a vote.

“The Volcker Rule, with teeth, was dead,” Suskind writes.

Obama, already bloodied from more than a year of contentious attempts at repair and reform, and the Democrats took a “shellacking” in the 2010 midterm elections, losing the House of Representatives to the Republicans. With unemployment hovering around 10 percent, the lack of job creation hurt the president. “People liked the president, but only 32 percent felt real confidence in him as a leader,” Suskind writes.

A stream of wealthy traders and CEOs people this story of confidence run amok, including a JPMorgan investment banking head. After picking up the bill at an expensive extended family dinner, his 80-something steelworker father takes him aside: “Bill, is what you’re doing legal? I don’t see how it can be.” The banker retires and gets involved with financial reform — in London.

MacArthur continues his rant with a bit on Afghanistan which is interesting in the context of the President winding down the Iraq War on Bush’s terms and not his own.  You may recall that Bush signed the agreement to get us out of Iraq right now.  The announcement of that signing was met with two shoes from a journalist. Obama tried to negotiate further US presence.   He is undoubtedly going to take credit for this too, however, as witnessed by his “mission accomplished’ presser complete with the requisite prop soldiers today.  You can read more on that from Juan Cole at Informed Consent.

MacArthur’s essay calls for a Dump Obama movement akin to the Dump LBJ movement of 1967.  He believes that a modern day Allard Lowenstein could arise and change the current dynamics of 2012.

You may say it’s too late, that Obama is impregnable. Consider Gene McCarthy’s obscurity on November 30, 1967, when he announced his insurgent crusade. At the time, many Americans confused him with Senator Joe McCarthy (R., Wis.), the notorious communist hunter, and in January 1968 a Gallup poll showed him winning just 12 percent of the votes in a presidential election. But on March 12, McCarthy nearly beat Johnson in the New Hampshire primary. The opposition was galvanized, Robert Kennedy jumped into the race, LBJ announced he would not seek re-election, and American democracy was revived.

Granted, there are big differences between 1968 and 2012 — for one thing, there’s no military draft to frighten the young — but the great issues are the same: an immoral war and a merciless money power. Moreover, high unemployment and the dominance of Wall Street do frighten the young. They need a tribune.

I was struck by this Eugene McCarthy quote.

“Party unity is not a sufficient excuse for silence”

Of course, RFK eventually became the frontrunner in that race until his assassination. (I have to admit to being too young to really grasp all of this at the time but I know that many of our readers can give fuller accounts than me so I’ll defer to them.)  While the McCarthy run ushered in the Nixon era and is considered a huge black period in the time of the Democratic Party, the lesson here is that no one need accept an incumbent president as inevitable.  Just as Republicans struggle with their terrible, horrible, awful, very bad choices in the Republican party, the Democrats provide no choice at all but a severely weakened and demonstrably inept incumbent President.

The most irritating thing is that any independent run is likely to be a gadfly like Donald Trump or NY Mayor Donald Bloomberg.  Party entrenchment is killing the US during its most vulnerable time since the run up to World War 2.  Are these folks really the only choices a country as big, educated, and powerful as the US can come up with?  Just as the right wing media  is attack the Gingrich insurgency, is there really any way for independents and fed up partisans to create a movement to get a real choice?  I, for one, desperately would like a real choice. As far as I am concerned, the only people that are running for President right now are ones that I’d rather see completely out of public life. Is there anyway that a real leader could actually launch an authentic insurgent candidacy in this age of crony capitalists and pols?


Financing Politics and Democracy: the ultimate one percent

A recent examination of political donors by the Sunlight Foundation has found some extremely disturbing numbers on how campaigns are financed. I knew it would be bad but it’s worse than I personally imagined. Nearly all political donations are made by a select few and those donors are not ordinary citizens.  There is a sliver of folks/institutions that fund campaigns and they do so with huge amounts of funds and impact.  It is difficult to imagine that democracy can survive under these circumstances.

In the 2010 election cycle, 26,783 individuals (or slightly less than one in ten thousand Americans) each contributed more than $10,000 to federal political campaigns. Combined, these donors spent $774 million. That’s 24.3% of the total from individuals to politicians, parties, PACs, and independent expenditure groups. Together, they would fill only two-thirds of the 41,222 seats at Nationals Park the baseball field two miles from the U.S. Capitol. When it comes to politics, they are The One Percent of the One Percent.

A Sunlight Foundation examination of data from the Federal Election Commission and the Center for Responsive Politics reveals a growing dependence of candidates and political parties on the One Percent of the One Percent, resulting in a political system that could be disproportionately influenced by donors in a handful of wealthy enclaves. Our examination also shows that some of the heaviest hitters in the 2010 cycle were ideological givers, suggesting that the influence of the One Percent of the One Percent on federal elections may be one of the obstacles to compromise in Washington.

The One Percent of the One Percent are not average Americans. Overwhelmingly, they are corporate executives, investors, lobbyists, and lawyers. A good number appear to be highly ideological. They give to multiple candidates and to parties and independent issue groups. They tend to cluster in a limited number of metropolitan zip codes, especially in New York, Washington, Chicago, and Los Angeles.

There is little wonder in my mind about the role of this type of campaign finance concentration in the ever-increasing march to plutocracy.  It is no wonder that most laws reflect self-dealing and monopoly protection to these same interests.  It is also why we continue to see bail outs for these folks and usound economic policy during recessions.  There is no room for common sense when policy priorities can be bought.  These folks are savvy.  Their money is going to Super PACS to represent their interests.  We know that Grover Norquist sits on an incredible amount of bucks and is accountable to no one.  We also know that his deep pockets have bought off many a republican.  He is just one example.

In the 2010 election cycle, the average One Percent of One Percenter spent $28,913, more than the median individual income of $26,364

At the top of this elite group are individuals such as Bob Perry, CEO of Perry Homes, who gave $7.3 million to Karl Rove’s American Crossroads in 2010 and $4.4 million to Swift Vets and POWs for Truth in 2004, and Wayne Hughes, owner and chairman of Public Storage Inc., who gave $3.25 million to American Crossroads in 2010, and Fred Eshelman, CEO of Pharmaceutical Product Development who spent $3 million in 2010 on his own group, RightChange. Sunlight’s Ryan Sibley writes more about the top donors here.

Unlike the other 99.99% of Americans who do not make these contributions, these elite donors have unique access. In a world of increasingly expensive campaigns, TheOne Percent of the One Percent effectively play the role of political gatekeepers. Prospective candidates need to be able to tap into these networks if they want to be taken seriously. And party leaders on both sides are keenly aware that more than 80% of party committee money now comes from these elite donors.

Campaign finance reform is one of those things that doesn’t get much press.  It goes no where in Congress.  Lobbyists fight it tooth and nail.  It appears the stranglehold of big, monied interests is a sure thing.  It can only lead to more social unrest since there are no traditional ways to remove it.  The Supreme Court has upheld the rights of institutions to act as individuals.  Courts have generally been the only bastion of counter measures.  This is the kind of thing that sent many tea party and Occupy participants to the streets.  Unfortunately, these statistics show that no one is listening.


The Pack turns on the Grinch

I wrote a bit this morning about Willard using Attack Barbie Anne Coulter against the Newster in Iowa. Well, there’s a sh#t storm of right wing media celebs ganging up to stop his big Mo going into January. You gotta love it when the pit bulls of the right turn on each other. Mind my links because most of them are going straight into the dog pounds of right blogosphere.

First up, Glenn Beck says that he’ll support Ron Paul in a third party run for president if Gingrich takes the Republican nomination.

Glenn Beck said this morning on his radio show that if Newt Gingrich is the nominee and Ron Paul runs third party, he’d consider voting for Ron Paul over Newt Gingrich, and he hates Ron Paul’s policies on the Middle East:

Michale Savage has offered the Grinch a million dollars to quit the race. Mind the caps, they come straight from both ends of the horse.

THE REASONS WHY GINGRICH CANNOT SUCCEED IN AN ELECTION AGAINST OBAMA:

WHEN HE WAS SPEAKER OF THE HOUSE, GINGRICH FAILED TO DELIVER ON HIS SO-CALLED CONTRACT WITH AMERICA.
HE MADE ADS WITH NANCY PELOSI PROMOTING THE FALSE THEORY OF GLOBAL WARMING.
HE’S IN FAVOR OF AMNESTY FOR ILLEGAL ALIENS.
HE’S TAKEN HUNDREDS OF THOUSANDS OF DOLLARS FROM FANNIE MAE AND FREDDIE MAC, TWO OF THE MOST CORRUPT FINANCIAL INSTITUTIONS IN HISTORY.
HE’S CHEATED ON TWO WIVES AND LEFT BOTH OF THEM WHILE THEY WERE BOTH SERIOUSLY ILL, WHICH WILL DESTROY HIS CHANCES AMONG FEMALE VOTERS.
HE CALLED THE REPUBLICAN PLAN TO REFORM MEDICARE “RIGHT WING SOCIAL ENGINEERING.”
IN A PRESIDENTIAL DEBATE AGAINST OBAMA, REGARDLESS OF HOW WELL HE DOES, ON TELEVISION, HE WILL COME OFF BADLY COMPARED TO OBAMA AND LOOK LIKE NOTHING MORE THAN WHAT HE IS: A FAT, OLD, WHITE MAN.

George Will reminded every one of his Newtness in the 90s. This quote is from his Sunday appearance on This Week

“Newt Gingrich was a shooting star in this town, this prominent Republican from 1994 to 1998. He was, at that point, the most disliked politician in America, probably, and he was deposed by his own party. He says, ‘I’m the most electable.’”

Will called Gingrich a “rental politician” in the previous week’s This Week.

Gingrich’s is an amazingly efficient candidacy, in that it embodies almost everything disagreeable about modern Washington. He’s the classic rental politician. People think his problem is his colorful personal life. He’s gonna hope people concentrate on that, rather than on, for example, ethanol. Al Gore has recanted ethanol. Not Newt Gingrich, who has served the ethanol lobby. Industrial policy of the sort that got us Solyndra – he’s all for it. Freddie Mac, he says, hired him as a “historian.” He’s not a historian. Hire Sean Wilentz, hire Gordon Wood if you want a historian.

Huffpo has a gallery of who’s who of the Republican Political Punditry that’s out against Newt.

Prominent conservatives like Ann Coulter, George Will and David Brooks have started to voice concerns about the former Speaker of the House, comparing Gingrich to everything from a hand grenade to a 1960s-style reveler.

Peggy Noonan, writing in Saturday’s Wall Street Journal, posited that most observations about Newt are accurate.

“Ethically dubious? True. Intelligent and accomplished? True. Has he known breathtaking success and contributed to real reforms in government? Yes. Presided over disasters? Absolutely. Can he lead? Yes. Is he erratic and unreliable as a leader? Yes. Egomaniacal? True. Original and focused, harebrained and impulsive — all true,” she wrote.

I bet this delightful turn of events is enough to make David Pflouffe believe in Santa Claus.  I’m just getting a huge belly laugh out of the whole thing.


Monday Reads

Good Morning!

We’ve had some cold gloomy weather down here in New Orleans.  I hope all those bowl game tourists brought their coats. It’s made for a depressing weekend.  It seems like most of the news I’ve been finding matches the weather too.  Another presidential election year is upon us and we’re looking at the Grinch getting the Republican nomination. Soon, all poor children will be required to mine the coal so the Grinch can place them in every one’s stockings. Well, that’s the east coast poor children.  Those poor children in the middle of the country will be fattening up turkeys for the 1 percent to eat.  I’ll bet Mitch can make a $10,000 bet on which of the kids will have it worse!

First up is an interesting read from the Business Insider that once again shoots down the meme that the rich create jobs.  There are so many economic fairy tales around these days it’s hard to know which one to shoot down next. The bottom line is pretty much something we’ve talked about for some time.  If you build it and no one comes, you don’t create anything but one more bankruptcy.  It’s the consumer demand that creates economic growth.

The most important reason the theory that “rich people create the jobs” is absurd, argues Nick Hanauer, the founder of online advertising company aQuantive, which Microsoft bought for $6.4 billion, is that rich people do not create jobs, even if they found and build companies that eventually employ thousands of people.

What creates the jobs, Hanauer astutely observes, is the company’s customers.

The company’s customers create demand for the company’s products, which, in turn, creates the need for the employees to produce, sell, and service those products. If those customers go broke, the demand for the company’s products will collapse. And the jobs will disappear, regardless of what the entrepreneur does.

That’s actually some good common sense but it’s backed up by economic theory.  Supply without demand just rots in the fields and molds in the warehouse.  Which brings me to Paul Krugman who says it’s time to call this economic situation a depression.  That’s also something we’ve bandied about here.  I’d say skydancers are pretty prescient, wouldn’t you?

It’s time to start calling the current situation what it is: a depression. True, it’s not a full replay of the Great Depression, but that’s cold comfort. Unemployment in both America and Europe remains disastrously high. Leaders and institutions are increasingly discredited. And democratic values are under siege.

On that last point, I am not being alarmist. On the political as on the economic front it’s important not to fall into the “not as bad as” trap. High unemployment isn’t O.K. just because it hasn’t hit 1933 levels; ominous political trends shouldn’t be dismissed just because there’s no Hitler in sight.

Krugman takes the rest of the column outlining some of the abysmal politics and economics in Europe.  I just keep checking the calendar to see if we some how time tripped back to the 1930s and some how forget what we learned the last time out.  Looking at things from a war build-up point a view, there’s this link to “Obama Raises the Military Stakes: Confrontation on the Borders with China and Russia” from Global Research. This is how some leftwing thinkers see the latest in US outreach in Asia.

November 2011 is a moment of great historical import: Obama declared two major policy positions, both having tremendous strategic consequences affecting competing world powers.

Obama pronounced a policy of military encirclement of China based on stationing a maritime and aerial armada facing the Chinese coast – an overt policy designed to weaken and disrupt China ’s access to raw materials and commercial and financial ties in Asia . Obama’s declaration that Asia is the priority region for US military expansion, base-building and economic alliances was directed against China , challenging Beijing in its own backyard. Obama’s iron fist policy statement, addressed to the Australian Parliament, was crystal clear in defining US imperial goals.

“Our enduring interests in the region [Asia Pacific] demands our enduring presence in this region … The United States is a Pacific power and we are here to stay … As we end today’s wars [i.e. the defeats and retreats from Iraq and Afghanistan]… I have directed my national security team to make our presence and missions in the Asia Pacific a top priority … As a result, reduction in US defense spending will not … come at the expense of the Asia Pacific” (CNN.com, Nov. 16, 2011).

The precise nature of what Obama called our “presence and mission” was underlined by the new military agreement with Australia to dispatch warships, warplanes and 2500 marines to the northern most city of Australia ( Darwin ) directed at China . Secretary of State Clinton has spent the better part of 2011 making highly provocative overtures to Asian countries that have maritime border conflicts with China . Clinton has forcibly injected the US into these disputes, encouraging and exacerbating the demands of Vietnam , Philippines , and Brunei in the South China Sea . Even more seriously, Washington is bolstering its military ties and sales with Japan , Taiwan , Singapore and South Korea , as well as increasing the presence of battleships, nuclear submarines and over flights of war planes along China ’s coastal waters. In line with the policy of military encirclement and provocation, the Obama-Clinton regime is promoting Asian multi-lateral trade agreements that exclude China and privilege US multi-national corporations, bankers and exporters, dubbed the “Trans-Pacific Partnership”. It currently includes mostly smaller countries, but Obama has hopes of enticing Japan and Canada to join …

Obama’s presence at the APEC meeting of East Asian leader and his visit to Indonesia in November 2011 all revolve around efforts to secure US hegemony. Obama-Clinton hope to counter the relative decline of US economic links in the face of the geometrical growth of trade and investment ties between East Asia and China .

Pakistan is threatening to shoot down all US drones. Tis the season to be jolly!!!

According to the new Pakistani defense policy, “Any object entering into our air space, including U.S. drones, will be treated as hostile and be shot down,” a senior Pakistani military official told NBC News.

The policy change comes just weeks after a deadly NATO attack on Pakistani military checkpoints accidentally killed 24 Pakistani soldiers, prompting Pakistani officials to order all U.S. personnel out of a remote airfield in Pakistan

I wonder if people in North Dakota have the same option?  Here’s the Daily Mail headline on your Daily Moment of Orwell: Local cops using Predator drones to spy on Americans in their own backyards.

One of the only confirmed uses of predator drones by local law enforcement came in June when a sheriff near Grand Forks, North Dakota, went looking for six stolen cattle.

When he arrived at the farm of Rodney Brossart, he was threatened by three men with guns and forced to retreat.

The Brossarts were known for being armed, anti-government separatists. So Sheriff Kelly Janke, who patrols a county of just 3,000 people, called in a Predator drone to look out over the 3,000-acre farm where the family was armed with rifles and shotguns.

With the help of a drone, summoned from nearby Grand Forks Air Force Base where it was patrolling the US-Candida border, the sheriff was able to watch the movements of everyone on the farm from a handheld device that picked up the aircraft’s video footage.

He and his deputies waited until they could see the Brossarts put down their weapons. Then they stormed the compound and arrested Rodney Brossart, his daughter and his three sons on a total of 11 felony charges. No shots were fired.

And he recovered the cattle, valued at $6,000.

The sheriff says that might not have been possible without the intelligence from the Predators.

‘We don’t have to go in guns blazing. We can take our time and methodically plan out what our approach should be,’ Sheriff Janke told the Times.

All of the surveillance occurred without a search warrant because the Supreme Court has long ruled that anything visible from the air, even if it’s on private property, can be subject to police spying.

Back to the Grinch that’s stealing Willard’s inevitability.

The NBC News-Marist polls showed Gingrich leading Romney in South Carolina by 42 percent to 23 percent. An October poll by the same organizations showed Gingrich at 7 percent in the Palmetto State. In Florida, Gingrich leads Romney 44 percent to 29 percent. There Gingrich has gained 38 percentage points since October.

The rapid movement highlights the remarkable rise of Gingrich as the caucuses and primaries near. Republican voters have shifted allegiances repeatedly this year and a number of state polls have shown that they are not firmly locked in behind any candidate at this point.

In New Hampshire on Sunday, Romney picked up the endorsement of Manchester Mayor Ted Gastas. But he was the target of a scathing editorial in the Union Leader, which earlier endorsed Gingrich. The headline read “Romney’s desperate hours.”

January’s coming and sooner or later, some of these folks are going to run out of money.  There seems to be quite a few irrelevant candidates in the race right now.  Maybe super Jeb is waiting in the wings? So here’s a good way we now MIttens is tres desperate.  Here’s the TPM headline: Romney Presses Ann Coulter Into Surrogate Duty.

Turn on the radio here and you’re going to get a taste of how hard Mitt Romney is working to stamp out Newt Gingrich’s support with conservatives.

In a new radio ad launched by the Romney campaign in Iowa last week, Romney turns to conservative fire-breather Ann Coulter to make the case that he’s the most electable candidate in the Republican race. Having made a living off saying things that no politician would likely wish to be closely associated with, it’s an interesting choice — and a sign that Romney is going all out to cast himself as the more pure conservative choice to Gingrich.

Coulter endorsed Romney a month ago (after dissing him before that) and the Romney ad grabs a clip of her talking up her candidate on Fox and Friends in November.

Here’s a ghost of nightmares past.  Noriega has been extradited to Panama for trial. The link goes to a BBC TV report.

The former leader of Panama, General Manuel Noriega, has returned to his home country 22 years after being forcibly removed from power by the US.

The 77-year-old was extradited from France, where he had been in prison on money laundering charges.

He is likely to spend the rest of his life in jail after being convicted in absentia for murder, corruption and embezzlement while he was in power.

OOOH, baby it’s cold outside.


What’s on your reading and blogging list today?


What he said …

I keep talking about the utter audacity of the political class these days and how they completely ignore everything we know about economics and finance in pursuit of self-dealing and getting political donations from the FIRE industries. I particularly hate that we’ve got this complete twisted notion of “free” trade and “free” markets thanks to a bunch of really ignorant right wingers and mouthpieces like Rush Limbaugh,  Fox News, Larry Kudlow, etc. etc. etc.. These folks are out to line their own pockets and they are pitching nonsense to low information zombies.

I also really hate to just wholesale copy and paste another blog–in this case Washington Blog at The Big Picture–but some times you just have to  let the voice of the source speak for itself and hope it stands up to the ideals of fair use. Thanks go to Fiscal Liberal for pointing  me to this list and its readable wonky links of proof.  It’s called ‘The Financial Crisis was Entirely Foreseeable’ but it might as well be labelled ‘Idiots in the Beltway are spewing memes and setting us up for a big ol’ repeat of the global financial meltdown’.  Idiots in Europe are doing likewise.  Why are they all bailing ut gambling bankers over their households and real businesses?  Where’s a politician that really knows his stuff when it comes to authentic finance and economics?

We’ve Known for Thousands of Years

We’ve known for literally thousands of years that debts need to be periodically written down, or the entire economy will collapse. And see this.

We’ve known for 1,900 years that that rampant inequality destroys societies.

We’ve known for thousands of years that debasing currencies leads to economic collapse.

We’ve known for hundreds of years that the failure to punish financial fraud destroys economies.

We’ve known for hundreds of years that monopolies and the political influence which accompanies too much power in too few hands is dangerous for free markets.

We’ve known for hundreds of years that trust is vital for a healthy economy.

We’ve known since the 1930s Great Depression that separating depository banking from speculative investment banking is key to economic stability. See this, this, this and this.

We’ve known since 1988 that quantitative easing doesn’t work to rescue an ailing economy.

We’ve known since 1993 that derivatives such as credit default swaps – if not reined in – could take down the economy. And see this.

We’ve known since 1998 that crony capitalism destroys even the strongest economies, and that economies that are capitalist in name only need major reforms to create accountability and competitive markets.

We’ve known since 2007 or earlier that lax oversight of hedge funds could blow up the economy.

And we knew before the 2008 financial crash and subsequent bailouts that:

  • The easy credit policy of the Fed and other central banks, the failure to regulate the shadow banking system, and “the use of gimmicks and palliatives” by central banks hurt the economy
  • Anything other than (1) letting asset prices fall to their true market value, (2) increasing savings rates, and (3) forcing companies to write off bad debts “will only make things worse”
  • Bailouts of big banks harm the economy
  • The Fed and other central banks were simply transferring risk from private banks to governments, which could lead to a sovereign debt crisis

Given the insane levels of debt, rampant inequality,  currency debasement, failure to punish financial fraud, growth of the too big to fails, repeal of Glass-Steagall, refusal to rein in derivatives, crony capitalism and other shenanigans … the financial crisis was entirely foreseeable.

Okay, so let’s just end that last part by taking out “the financial crisis was entirely foreseeable” and by replacing it with “the next big financial crisis is entirely foreseeable and getting more likely every day”.   If you need any proof of further inevitability just listen to ANY Republican these days and most of the Democratic Caucus.  They are resplendent with VooDoo Economics and Finance believers and enablers. It’s just like with climate science and evolution.   An entire group of people who embrace ideology over reality just can’t seem to get out of the flat earth theories.  Watching the Republican debates alone has been like watching the march of ignorance personified.  I’m waiting for them to start announcing the earth is only a few thousand years old, gravity doesn’t exist or need to because god’s hand holds us in place, and 1 + 1 is really 3. If only the media would act like the set of fact checkers they could be instead of mouthpieces for corporate interests we might actually be able to get through to a few zombies and bring them back to life.  Until then, get ready for the next big one.