Ch..Ch..Ch..Changes

America spoke. In very large numbers.

A choice at the ballot box. Not by court order, not with the national guard, but by simple choice. America changed a bit today, and will continue to change tomorrow. Some will come along with joy, other will continue to drag their feet.

I don't go much for all the fancy rhetoric, the soaring imagery. My needs are simple;

Competent governance by responsible adults.
Transparancy
Respect for the Constitution

Let's see if we can make that work for awhile. Then we can go from there.

Remember To VOTE

Make a Difference

Bring about CHANGE

REMEMBER TO VOTE THIS NOVEMBER 4TH






.

OK. Lets try again......

So the 700 billion dollar bailout deal is dead. Republican lawmakers got their feelings hurt when big bad Nancy said mean things about them. (Plus, they are scared to death that they will get there butts voted out of office). So what do we do now?

Here's a pretty good idea from FireDogLake;

1) Buy up mortgages at a discount and give people new fixed rate mortgages. The government shares in further house appreciation (only fair since it bailed the homeowner out). This stabilizes mortgage prices and helps people and banks both. It is essentially identical to what FDR did with the Home Owners Loan Corporation (HOLC), and we know how to do it. Initial price tag? Probably around 20 billion.

2) Use the FDIC (the folks who take over failed banks) to take over failed mutual and money market funds, make sure the investors get as much money back as possible, liquidate the funds in an orderly fashion (or keep them operating if necessary) and if they are kept alive, kick the people who screwed them up to the curb and change how they do business.

3) Declare a national emergency, with judicial review (unlike Paulson's seizure of ultimate power) and use the authority to review all purchases of banks, to institute oil rationing if necessary (or simpler procedures like "every street now has a 55 mile an hour speed limit, if it is normally higher). Also allows release of oil from the reserve, if necessary.

4) Expand the safety net such as food stamps, employment insurance, welfare and so on. We know this is going to get worse no matter what we do, so why aren't we taking care of ordinary people?

Read the rest here.

Pay me to go away......

Seems the new WaMu CEO made out like a ban....uh, typical golden parachuted CEO. Matt also makes the great point that the real way to control CEO compensation is to tax it accordingly.

From Matther Yglesias;

My understanding is that even for the super-elite it normally takes a couple of months to wrack up tens of millions of dollars. But Alan Fishman gets the job done with super speed:

But the seizure and the deal with JPMorgan came as a shock to Washington Mutual’s board, which was kept completely in the dark: the company’s new chief executive, Alan H. Fishman, was in midair, flying from New York to Seattle at the time the deal was finally brokered, according to people briefed on the situation. Mr. Fishman, who has been on the job for less than three weeks, is eligible for $11.6 million in cash severance and will get to keep his $7.5 million signing bonus, according to an analysis by James F. Reda and Associates.

One friend suggests “Obama should suspend his campaign to go punch this guy in the kidney.” Indeed.

Part of what you’re seeing as some of this unfolds is that the idea of CEO pay controls specifically tied to the bailout, though good, is also a bit of a joke. A lot of the folks responsible for this mess left their jobs months ago and are current sitting in their multi-million dollar homes, wearing extremely expensive clothing, and laughing at you, me, Obama, McCain and all the rest. Laughing their asses off. You just need to have additional tax brackets for folks up at the millionaire and multi-millionaire level to make sure that the public gets a bigger slice of the pie. If that decreases the incentives for the sort of wild financial shenanigans that brought the country to this point, well, so what?

Trust Us...part duex

Eric D. Hovde is chief executive of Washington-based Hovde Capital and Hovde Acquisitions. He has a nice assessment of the players to blame for our current financial mess.

Money Quote;

Looking for someone to blame for the shambles in U.S. financial markets? As someone who owns both an investment bank and commercial banks, and also runs a hedge fund, I have sat front and center and watched as this mess unfolded. And in my view, there's no need to look beyond Wall Street -- and the halls of power in Washington. The former has created the nightmare by chasing obscene profits, and the latter have allowed it to spread by not practicing the oversight that is the federal government's responsibility.

I find it hard to stomach the fact that investment banks that caused this financial crisis immediately ran to the government asking for assistance, which Bear Stearns received and Lehman Brothers, thankfully, did not. This is one of many eerie parallels that the current meltdown bears to the Great Depression, when Washington and the taxpayers had to step up and take unprecedented action to stabilize the financial markets and the economy. Unfortunately, the government today has already put enormous taxpayer resources at risk -- bailing out investment firm Bear Stearns, mortgage giants Fannie Mae and Freddie Mac and insurer AIG, and proposing to buy risky assets from the banking system -- to stop the economy from plummeting into another depression. But these events only underscore the toxic relationship between Washington and Wall Street that has brought us to this point.

Read the rest here.

Third Time's the Charm?

A little background on our current financial mess, and how it dovetails into the earlier S&L and Enron collapses. "Deregulation" just another word for "Trust me". And we all know what "Trust me" means in politi-speak.

Who Gets Help......

OK. Let's make a deal. When this crisis is all said and done and all the bailouts have been created, defined, and put into action, let's circle back around and take a look see at how the taxpayer's money (which will be in the multiple billions of dollars) was used, and where it went.

Wanna bet the little middle class guy who lost his house, or his job, or his health care won't get squat? He'll be told to "pull himself up by his bootstraps" while the largest corporate welfare check in the history of the world gets written.

I'm just sayin......

The Blame Game

Matthew Yglesias sums this up pretty well I think. Regulation is only one piece of the puzzle. You can make all the rules and laws that you want, but the key peice is that you have to ENFORCE THEM.

Fannie Mae and Freddie Mac, the so-called Government-Sponsored Entities, really did have some serious problems that have contributed to the current financial crisis. They also really were, politically, generally closer to the Democratic Party. Thus it’s useful for Republicans to act, as John McCain did in his speech this morning, to focus on the tree GSE malfeasance rather than the forest of overall systemic failings. But it doesn’t really make sense. Consider the term “subprime mortgage” that you may have heard. Well, it turns out that what it means for a mortgage to be “subprime” is that it doesn’t meet Fannie or Freddie standards.

Beyond that, it’s impossible to say whether additional regulatory authority over the GSEs would have been necessary or sufficient to reduce the impact of this crisis because the existing regulators weren’t using their existing authority. Arguably, the authority they already had would have been sufficient had they used it. Indisputably, giving additional authority to people unwilling to use their existing authority wouldn’t have changed anything. And that set of regulators wasn’t the only set asleep at the switch — the Fed dragged its feet on the subprime issue despite Fed Governor Ed Gramlich’s warnings about problems here, and the SEC ignored the risks associated with the highly leveraged trades that were being made.

Problems existed with the regulatory oversight across the board. And of course part one crucial common thread here is that all of these agencies were headed up by conservative deregulators. The same people not enforcing environmental regulations and not enforcing civil rights law and not enforcing labor rights were also not doing their job at the financial regulatory agencies. Conservatives believe that the role of agency heads is to avoid using their regulatory authority in constructive ways.

I'll put my Social Security Money on 7...

Trusting your Social Security money to Wall Street

...not that long ago we had a rare political moment in this country, a moment where the public sat up and took notice of economic policy -- and spoke out and made its voice heard too. When George W. Bush made it to term #2, he decided to try to privatize social security to reward his supporters on Wall Street with a new source of capital, customers, and fees. (Those would be the same people whose firms are now cratering under the weight of the bad debt they recklessly took on while Republican regulators looked the other way.) But as it turned out, we Americans were not about to let our elected representatives turn over our social security taxes to Wall Street financiers to gamble with if it meant losing the guaranteed income that has allowed millions upon millions of American seniors to live out their sunset years with at least a basic measure of dignity.

But while ordinary Americans spoke out, John McCain stood with Bush (hugged him awkwardly in public, even), against the American people. In fact, just six months ago, McCain again let slip his fondness for privatization.

You can fool some of the people....

Despite an intense effort to distance himself from the way his party has done business in Washington, Senator John McCain is seen by voters as far less likely to bring change to Washington than Senator Barack Obama. He is widely viewed as a “typical Republican” who would continue or expand President Bush’s policies, according to the latest New York Times/CBS News poll.

The Real McCain

What Atrios sez;

The sad thing is that few of these people will acknowledge that they simply got played, and instead want to cast McCain as a character in a play about a man's tragic downfall. He was always an unprincipled hack, but for a very long time his political fortunes were the result of his understanding of and willingness to cater to the desires of elite Villagers. Now he has a different target.

The Point of No Return?

"I fear the government has passed the point of no return. We have the irony of a free-market administration doing things that the most liberal Democratic administration would never have been doing in its wildest dreams. It’s pure crisis management. It’s the Treasury and the Federal Reserve lurching from crisis to crisis without a clear statement on how financial failures will be handled in the future. They’re afraid to articulate such a policy. The safety net they are spreading seems to widen every day with no end in sight," - Ron Chernow, a leading American financial historian.

Hey Taxpayer, just shut up and pay your bills.....

From the NY Times;

The Army official who managed the Pentagon’s largest contract in Iraq
says he was ousted from his job when he refused to approve paying more than $1
billion in questionable charges to KBR, the Houston-based company that has
provided food, housing and other services to American troops.

Apparently you don't screw around with Dick's Halliburton $$$'s.

Fiddling while Rome burns......

"There sure are a lot of issues out there. We’re fighting in two wars abroad, losing one for sure, and perhaps the other one, too. There’s a mortgage crisis, a health care crisis, an environmental crisis, and a series of constitutional crises. There’s the fact that our government is torturing people contrary to international law. There’s the rise of China. There’s, well, you get the point.

“Good thing we’re about to have an election,” you might say, “so we can figure out what to do about all of it.” Well, you’d be right to say it, but wrong to expect it. George Stephanopoulos and Charles Gibson, together with all the network honchos who helped choose the content of their questions for the final Democratic debate, don’t think any of these issues are as important as wearing flag pins, playing six degrees of separation with 1960s terrorists, or getting rid of that pesky capital gains tax on people making $200,000 or more—approximately four percent of the country."

Read the rest of Eric Alterman's article here...