Sunday, January 30, 2011

"Going Galt?" Anarchists = "Conservatives" "Ultra-Conservatives?" The Unleashing Before Election 2012

Having had someone call me an anarchist the other day (pretty funny, right?), I started thinking about whom the real current-day anarchists are. And from my early study in political science, literature, psychology and sociology of nihilists, anarchists and Randists, I conclude that . . . they are exactly those who pretend not to be: the full-bore media "conservatives" if not "ultra conservatives." The only thing I could ever see that they really wanted to conserve, as they had little or no thought of conserving the well-being of others or the natural environment, was their own power and money. From our friends at Boing, Boing:

Ayn Rand Took Government Assistance While Decrying Others Who Did the Same

Jan 28, 2011 Noted speed freak, serial-killer fangirl, and Tea Party hero Ayn Rand was also a kleptoparasite, sneakily gobbling up taxpayer funds under an assumed name [note: it might have been her legal name] to pay for her medical treatments after she got lung cancer. An interview with Evva Pryror, a social worker and consultant to Miss Rand's law firm of Ernst, Cane, Gitlin and Winick verified that on Miss Rand's behalf she secured Rand's Social Security and Medicare payments which Ayn received under the name of Ann O'Connor (husband Frank O'Connor). As Pryor said, "Doctors cost a lot more money than books earn and she could be totally wiped out" without the aid of these two government programs. Ayn took the bail out even though Ayn "despised government interference and felt that people should and could live independently. . . . She didn't feel that an individual should take help." But alas she did and said it was wrong for everyone else to do so.

She was rigorously against government health care too (except for that "special" time at the end of her life). (But aren't they all?) Try to snatch those government benefits from their fat fingers then as what they are really against is government programs that benefit anyone else. And on a more serious subject, we have a few words about what's probably in store for us from now until election time 2012, and who better to comment?

Frank Rich and Rachel Maddow discussed the very dark tone coming from the Republicans' response to the State of the Union address, what their strategy is going to be for the next two years, and whether it's going to resonate with most of the voters.

MADDOW: The State of the Union is being lauded as a statement of centrism. I think that‘s fair. And I also think that President Obama‘s version of the center is turning out to be a much more Democratic place than where Bill Clinton found the center, big “D” Democratic. What do you think about that?

RICH: I agree with you. I wish I could debate it with you, but I think — he‘s always been a centrist, but a little bit to the left of the triangulated Clinton. And he held firm on that last night. And the problem of the Republicans is they‘ve moved so far to the right. You know, your Eisenhower analogy, we forget that the John Birch Society, which still exists and is supporting the Tea Party, called Eisenhower a communist dupe -

MADDOW: Right.

RICH: - back when he was in the White House. So -

MADDOW: You know, you look at the Republican responses last night, and the thing that surprised me the most, I‘m not too much of a tone person, I tend to be the person who reads the transcripts rather than watches the tape, but the Republican responses were really dark, almost apocalyptic, I thought about, you know, America being a failure, nothing working now, nothing‘s going to work, we‘re reaching this point of no return.

Does that reflect a decision by Republicans to just sort of try to goose their base and not try to go for a broader audience? What did you make of that? RICH: It certainly doesn‘t go for a broad audience. What‘s really odd about it is they‘ve ceded Reagan optimism to Obama.


RICH: So, last night, he could talk about corporate profits hitting new records. He could talk, perhaps excessively about the beginnings of a recovery, but in a slightly over-optimistic way. And meanwhile, it‘s the apocalypse at hand and everything‘s gone to hell, and, you know, we‘re going to be Greece before we know it, and not the musical, the country.

MADDOW: Right. Because if we were “Grease” the musical, I would become a Republican.


MADDOW: I would sign up.

RICH: I‘m with you on that.

MADDOW: When the president made the case for investment, right, he didn‘t just say — he made the case about cutting spending, we need to take deficits and debt seriously. And that‘s fine.

But then he made what amounted to half the speech - long pitch for the government actually spending some money and doing stuff, for the role of government in investing in the economic health of the country, and investing — as the Republicans are correctly pointing out — does mean spending in a lot of cases. Was that sort of a core principles case for what Democrats think government is good for?

RICH: Yes, he really pulled it off. I think it was — finally, he was making this narrative about the government, or finally for recent times, whereas the other party was just saying, let‘s cut, let‘s do nothing.

I mean, Paul Ryan‘s speech basically said, except for national defense, and apparently, preventing abortion, there was no point to a federal government. You know, he even said that the safety net could turn into a hammock for the lazy and indolent Americans who don‘t deserve it. So, it was the most stripped down, pared down bunker version of government versus a — you know, a centrist version of essentially Democratic governance, that was not the era of big government is over or anything like that.

MADDOW: I was — the hammock line was sort of an eye opener. I think that‘s the thing that people are going to take away from this Republican response, if they take away anything. And that‘s a really specific attitude, that we‘ve seen from some parts of the Republican Party. We saw it when they not only were saying no to unemployment benefits, but we saw some Republicans float the idea of drug testing people if they want to get unemployment benefits.

We saw one Republican member of Congress saying that unemployment insurance was turning us into a nation of hobos. Sharron Angle talking about how it was taking away, essentially, our competitive spirit.

The sort of “kick the unemployed” thing, how does that work? Why — they keep doing it, so I think they think it works.

RICH: They must think it‘s a throwback to sort of the Reagan era‘s welfare queen rhetoric.


RICH: But it doesn‘t work now, because, first of all, that welfare world is over, because it was ended under Clinton. And now they‘re referring to, what, 16 percent of Americans, when all said and done, who are really unemployed, and including those who have stopped looking for work. So, they‘re really hitting people‘s, you know, cousins and uncles and brothers and sister across the board demographically, you know, white and black, every conceivable walk of life. So, I think it‘s stupid.

MADDOW: Well, one of the — one of the — I think there‘s a divide, in political science. And some people think that — in political science think that politics matter. And some people think that really politics is sort of a show that we put on, like a circus for the entertainment of the population. Sort of a way we get our yayas out about the culture war.

But, really, the thing that determines the elections is the unemployment rate. The number of people that are unemployed determines whether or not the party in power stays in power. Do you — what do you think on that?

RICH: I tend to feel that‘s the case. But if you have politics that are really nutty and a party that moves as for to the right as Republicans, it could, you know, vary that equation. But the economy is going to always be the most determinative factor.

But, you know, when you have people like Michele Bachmann walking around and giving these, you know, crazy remarks, the politics can have a factor — be a factor, too.

MADDOW: So, the lame-duck session was good for the president in terms of his approval ratings. It made not just the base happy, but the rest of the country sort of much — pretty happy with him, too. I think the State of the Union was, at least in the short-term, well-received, and the dueling Republican responses were — I think, in the long run, are not going to help them out.

I, sort of, feel like the Democrats are on a roll. If the Republicans are going to coe back again this year, how are they going to do it? What are they going to do that‘s going to turn this — turn their fortunes around?

RICH: I don‘t want see any idea out there that is moderate or that people could rally around. It‘s all about just balancing the budget and repealing Obamacare. If you look at any poll, health care isn‘t even a top priority, or health — you know, dealing with the health care bill or rescinding it or whatever doesn‘t even really register.

MADDOW: People see it as a done deal.

RICH: Yes.


RICH: And so — and furthermore, you have the other problems of the Republican Party, those who are running for the presidency, seriously are not, are almost all to the right of even the Republican leadership in Congress.

MADDOW: Right.

RICH: So they‘re going to have a lot of internal fighting as they‘re pulled further and further away from centrism, if you will.

MADDOW: I wonder, one of the things that will be interesting to watch is whether the Republican powers that be try to keep the Republican jockeying for the nomination, try to keep it kind of quiet and inside the party for a while because they think those politics aren‘t going to play with independents.

RICH: I think they‘re trying, but unfortunately, everyone has a contract with FOX.


MADDOW: Yes. That‘s right. It all happens out loud.

RICH: Yes.

MADDOW: That‘s the big problem.

Er, actually, how about Prof. David Michael Green's take on the SOTU speech?

He lends a little more realism to the discussion in my book. (Emphasis marks added - Ed.)

The Pseudo-State of the Pretend Union Barack Obama was supposed to be a transformational president. Remember that? He certainly marketed himself as such. He certainly – like an FDR or a Lincoln – was handed a context of crisis which simultaneously demanded of him and permitted him to be transformational as the leader of the country at this fraught historical moment.

Watching him deliver his state of the union address this week revealed anything but that, however. This is a shrunken president, playing small-ball at a moment of peril. Watching Obama talk before a global audience, I could not help but think of the weakness and irrelevance of this human platitude production machine, so out of touch with the threats and concerns of our time. Is it possible to imagine that people will be still talking about this speech twenty years from now? Were they even talking about it twenty minutes after he gave it? The measure of a presidency is the degree to which it responds, and responds effectively, to the issues before the country. This is why Lincoln is almost universally regarded as the greatest of American presidents. Faced with the greatest of American crises, he responded. (I actually happen to disagree with Lincoln’s violent response to secession, just as I opposed, and for the same bloody reasons, President Bashir’s violent initial reaction to secession in southern Sudan, but that’s another essay.)

Similarly, until nation-wrecker par excellence George W. Bush came on the world stage, Lincoln’s predecessor James Buchanan was largely regarded by history as the worst American president, precisely because he failed to deal with exactly the same crisis he would then bequeath to Lincoln. This is the test of presidents – Can you rise up to the challenges of your moment? – and it’s a fair one. And, given that benchmark, we can ask how history will evaluate Barack Obama. The way to answer that question is to catalogue our great challenges, and to ask how is the president addressing those? Some of these are obvious. Some are obvious, but less immediately threatening. And some, ironically, are so fundamental that they are generally not even perceived, like water is to fish. What was so amazing about Obama’s speech was his sheer gall in not addressing the most prominent and urgent questions in our political sphere, right here and right now. How is it that the guy can go on about the murderous killing spree in Tucson, and yet utter not a word about a solution? I mean, after all, only about 30,000 Americans die every year, year in and year out, from gun violence. I suppose the president is just waiting for it to get serious – then he’ll advocate for a solution? As long as the NRA doesn’t mind, that is (hint: they do).

Or how about Egypt? The country is exploding before our eyes, and the “Leader of the Free World” cannot use the occasion to tell “President” Mubarak to stand down? He can’t inform the Egyptian dictator that the massive amounts of American aid he receives are being cut off? Or does he even recognize Mubarak as such? I saw PBS anchor, Jim “Softball On Quaaludes” Lehrer, interviewing the Vice President, who couldn’t even admit that Mubarak is a dictator. I guess the Egyptian leader has just been extraordinarily lucky, winning landslide “elections” for thirty years running now. That can happen, you know. Well, at least the president was better in his speech when it came to the one thing Americans really care about right now (and, foolishly, that probably doesn’t include the proliferation of guns or US support for Middle Eastern potentates) – jobs, jobs, jobs. Did you catch the president’s jobs program in his speech? No? Golly, I didn’t either. I just heard endless platitudes about education, infrastructure and light rail. You know, that’s all really cool stuff, and maybe, if we’re lucky, it will raise GDP by six-tenths of a percent in the year 2040 (though, of course, if it did, all of that revenue will go to the rich, as it has for the last thirty years). But right now real humans are suffering the real pains of job loss and foreclosure, and all this president can muster in terms of a solution is the hiring of yet more Clinton administration retreads, the very same people who turned the Democratic Party into a Ladies Auxiliary of the GOP, and whose deregulatory fervor brought us precisely to where we are today.

Out goes Emanuel, in comes Daley. Out goes Summers, in comes Sperling. How inspirational. I’m gonna go start knocking on doors for the Obama-Biden 2012 campaign first thing tomorrow morning! We need real solutions in this country! Yes, coming soon to an election campaign near you: “Clinton II: The Folks Who Brought You WTO, the Annihilation of Welfare, and Bank Deregulation Now Carry the Hope and Change Flag!” Charles Blow noted in the New York Times this week that Obama’s State of the Union speech was only the second one by a Democratic president since Harry Truman in 1948 that did not mention the poor and the need to fight against poverty. This continues the trend started by Bill Clinton to pander to the middle class and that cohort’s insufferable and seemingly endless capacity for selfishness. Gone, in the 1990s, was the commitment to those most in need, and every reference instead was to serving the middle class, though in fact Clinton and his team were really looting them on behalf of the plutocracy, as Obama is now doing as well.

Blow goes on in his article to show the absolute inverse statistical correlation between income level and support for Obama in the 2008 election (The less money you make, the more likely you were to vote for Obama), which makes the president’s priorities even more egregious. There he is in his speech talking about the stock market “roaring” back, while ignoring the needs of the hardest hit Americans, who just happen also to be the ones that most ardently supported him when he wanted what he wanted – to be president. I’m quite sure the calculus in the White House is “What the hell do we care? Where’re these people going to go in 2012? What are they going to do, vote for Ralph Nader?” And, I guess if that whole morality thing isn’t an issue for you, then such a cynical political calculation is probably not so far off the mark. If, like Bill Clinton, you just want to be president at all costs, you probably should sell-out the poor, as Clinton did with the unconscionable welfare bill he signed in order to guarantee his reelection. Especially if you’re Obama, who can pretty much count on getting every black vote in the country, no matter what he does, along with a lot of white liberal guilt votes as well. But I suspect that Obama, even if he can pull out a second term, will wind up w(h)ere Clinton manifestly has, and it’s pathetic to see. Bad Bill gets all the adulation of a political Mick Jagger, and he gets to hang out in the Hamptons with all the real Mick Jaggers of this world. But you can see that he’s a profoundly unsatisfied man, now in the latter years of a life dwindling toward conclusion. He desperately wanted to be great, and he just wasn’t. Even if you leave out the tawdry stuff. Clinton, in what surely wins the world prize for the absolute pinnacle of narcissistic self-obsession, once lamented that he didn’t have the good fortune to have a crisis during his presidency, so that he could join the pantheon of Lincoln and FDR as one of the greats in American history.

George W. Bush will never have Clinton’s remorse problem, of course, because he drowns his insecurities in booze or the alcohol-free version of the same, otherwise known as religion.

But Obama is likely too introspective to avoid his fate. Clinton governed during more or less stable and munificent times. Bush was a crisis walking in the door, had a crisis on his watch, and turned everything he touched into crisis. Obama’s situation is a bit more subtle. He actual(ly) has multiple crises on his plate, but they are somewhat less obvious. Obama will know, when it’s all over, what he could have done, what he should have done, what history is screaming out needs to be done. And he – like Clinton, but lots more so because eight years of Bush have made these much more perilous times – will know what he did and especially didn’t do. You might think that the global warming issue was an obvious candidate for presidential leadership, now that we’ve noted that nine of the ten hottest years ever recorded occurred during the last decade-and-a-half. But the scepticism-for-fun-and-profit industry has managed to muddy the waters of public perception sufficiently so as to prevent anything remotely resembling a serious response to what is unquestionably the greatest crisis in all of human history.

If you look at what real scientists are saying about this, then it appears that we’re headed for a planetary catastrophe of epic proportions. This is here, and it is now. And, given the unfortunate opposing array of special interest profiteers and legitimate developing country desires to industrialize, it is going to take global leadership to wake people up to what we’re facing. But did the president even mention this greatest of all challenges in his speech? At home, we are a society sickened by a cancer of greed, which has rendered our political process broken and profoundly dishonest on a good day, and utterly predatory all the rest of the time.

And there aren’t many good days in American politics right now. Here’s a place where Obama could have really had a serious impact. Once again, what is required here is presidential, moral, bully pulpit leadership to define the problem, wag the finger, call our enemies our enemies, demand a solution, and push it across the goal line.

Given the direction that the Supreme Court has been going of late, it would appear that nothing short of a constitutional amendment will any longer suffice in breaking the death-grip of money on public policymaking in America. Politically, that is an extremely tall mountain to climb, though there may be enormous reserves of public support that could line up behind such an initiative. But it is almost wholly unimaginable today, in the absence of presidential leadership, for that to be successfully placed on the national agenda and then driven through. This is, in so many ways, the single key that unlocks all the doors to solutions for our various national ailments in the United States. If we could get special interest influence out of governing, we could deal with our spiraling debt, for example.

We would not have had this Great Recession we’re all living through (all living though except, of course, those who are dying). We could address global warming. We could get the guns off our streets. We could scale back our military and our wars dramatically. We could depopulate our for-profit prisons. We could end any reason for the Republican Party to continue to exist. And so on. The list is endless. This is the great issue of our time. It is hardly new, but the degree of institutionalized greed has reached astonishing proportions today, and a once fat context of American world dominance, unending resource availability, and relatively benign environmental consequences for plundering has ended. Our current practices are anything but sustainable, but nobody is talking about it. A great president would have made this debilitating greed the defining issue of his presidency. Indeed, a great president would have realized that by changing, at the beginning of his administration, the nature of who the political class in Washington actually serves, everything else would have become possible in subsequent years of his presidency. A Congress owned by Goldman Sachs will never pass meaningful financial system reform. But a Congress that actually serves its constituents instead would easily do so. A government owned by the NRA will never deal with gun violence. But a government answerable to the public interest rather than special interests would. And so on. We also fail to appreciate the level of danger entailed by the character and quantities of sick invective coursing through the veins of our political system. Even worse, if we do ever talk about that – as the Tucson shootings have caused us to do, for five minutes, anyhow – we get it entirely wrong, especially by imposing a false equivalence to the supposed sources of the problem. That would be ridiculous if it weren’t so pernicious.

There is no Glenn Beck of the left, nor a Rush Limbaugh, nor the equal of any of the other even more caustic freaks of right wing radio. The closest one could come to that (and still not get very close at all) would be Keith Olbermann, and look what happened to him. Amongst the political class, the same is true. There is no Satan Plain or Michelle Bachmann of the left. The rhetoric of these monsters, sustained over decades now, is incredibly corrosive to the national esprit de corps. The ramifications of this destructiveness will be felt powerfully, and for a long time to come. But the ascendance of such damaging lunacy has only been possible because of the silence of anyone and everyone carrying the flag of political sanity. When Democrats aren’t busy being coopted, they’re busy being cowardly, something I find especially remarkable given the sheer buffoonery of targets like those mentioned above. I mean, just how hard would it be to ridicule a serial-divorcee and drug addict like Limbaugh, when the guy runs around lecturing the rest of us on family values? Nobody fails this test quite like Obama, either. Even Clinton did better than this cat. Barack just seems to want to be liked, just wants to get along with everybody, even when they’re trashing his mama in public. There seems to be virtually nothing you can say about him – even if you’re a Republican leader in Congress – which he will not fail to respond to. Question his citizenship, his religion, his patriotism – it’s endless, and all too unfortunately, loads of numbies out there in Americaland believe this nonsense. On the other hand, if all Obama wants is a second term, then perhaps he is being strategically smart. As vacuous as his speech was, the response by GOP would-be wunderkind Paul Ryan turned out to be just another in the party’s continuing string of embarrassments (remember Bobby Jindal?). Ryan looked small and petty coming after Obama. And the amount of explicit and implicit deceit in his party’s newly-found hostility to debt (he seems to have conveniently forgotten Cheney’s “Reagan proved deficits don’t matter”, an indictment of all Republican administrations of the last thirty years) was only exceeded by that in Michelle Bachmann’s ludicrous tea bag rant. Unfortunately, what makes good politics for Obama makes disaster for the country. The GOP – either the Radical Mouthfoamer wing or the Even More Radical Mouthfoamer wing – is likely to continue making the president look sensible by comparison. Given that unemployment probably will not fall significantly between now and November 2012, the White House has probably figured out that being the less insane option for voters in that contest is their only prayer of winning reelection. They may be right, though it depends on who the GOP nominates. Traditionally, however, the economy is nine-tenths of the equation. An incumbent president sitting on top of a crappy economy is almost always heading for the door. But even if he wins, what for? Every time I look at this president, I wonder what the hell he wanted the job for. I mean, after all, we’ve already had James Buchanan.

Anarchism, anyone?

Cause it surely seems headed our way.

Hope we deal with it better than the French did. Suzan _______________

GET OFF OF FACEBOOK! Who’s Watching Whom? "Well Known Techniques To Alarm the Public, Create Sympathy and Get More Funding"

Think your personal data is private on Facebook?

Think again.

I've said it from the first: there is no way your private information is safe anywhere online. There is too much money to be made from knowing who (or whom) you are.

From our woman on the scene at that famous blog, Liberality (emphasis marks added - Ed.):

Facebook Sucks

Now you don't have a choice, you will advertise for products whether you want to or not. Plus, Facebook wants you to spill your guts and they want to make money off it. Then they try to trick you when you really do want to delete your account.

Tell Me Again. For Just Whom Does He Work?

Just today this article appeared in syndication from the St. Louis Post Dispatch newspaper (you won't believe what is floated on a daily basis in our local papers - unless you pay close attention):

Sterling's arrest shows how the government is moving with new urgency to block the flow of secrets to the public, said Steven Aftergood, an expert on government secrecy at the Federation of American Scientists.

This is an ' unprecedented' fifth prosecution during President Barack Obama's administration for unauthorized leaks of classified information, more than all previous administrations put together.

Although one would need to guess that what actually happened concerning such during the Cheney/Bush endtimes will not be known for years. (Emphasis marks added - Ed.)
WikiYou: Who’s Watching Who?
"CyberCom is a PR stunt by the Defense Department. . . . It's a marketing stunt." - John Young By Russ Baker Here’s an intriguing interview with the founder of the first “Leaks” site, Cryptome.

A few excerpts (emphasis marks added - Ed.):

“Beware of the Internet, which is a large-scale spying machine”

“Secrecy is the enemy of democracy; it’s way overdone.”

“Sites like ours . . . are left in place to watch who comes there . . . The reason we haven’t been shut down [by the government] is we’re useful to them to see what kind of attention is paid to this material. We think they actually feed us material to put up as they’re feeding material to WikiLeaks and many other sites . . . .”

“We know that we cannot keep any secrets about our site, and we tell our readers you should not expect us to protect you because we’re being watched and every other site is being watched just like WikiLeaks is being watched. So there’s no secrecy on the Internet . . . .”

“Governments leak more information than the rest of us for their own purposes..they run operations to leak secrets to test their own system. Their own disgruntled employees are encouraged to leak secrets to see what happens. They leave laptops around as if left by a drunk. They leave papers around. They put stuff on WikiLeaks. These are well known techniques to alarm the public, create sympathy and get more funding. This is a business.”

The Digest

Get off Facebook.

Suzan ___________________

Saturday, January 29, 2011

(Direct from Davos) "Ma! He's Looking At Me Funny!" (Bankers' Lament)

Paul Krugman tells us about the bankers' real worries. That's right, sweeties, their feelings have been hurt. (Emphasis marks added for your continuing amusement - Ed.)

January 29, 2011 MHLAMF in Davos From the FT: Governments around the world must stop banker-bashing and create the right environment for lenders to support economic growth, some of the world’s most powerful bankers will tell finance ministers on Saturday.

So “Ma! He’s looking at me funny!” is now at the core of the financial sector’s complaints. And the world’s top bankers feel that after bringing on a gigantic crisis that has left millions unemployed, being bailed out, and receiving huge paychecks all the while, they now have the right to demand that people stop saying critical things about them.

Oh, and substantively, they want interest rates to rise despite the persistence of high unemployment. 41 Comments

At least that's how their story goes. Suzan _________________

The Rich Reeeeaaaallllyy Don't Want to Hear About the Poor (No Kidding!) No Matter How Rich They Are, It's Not Rich Enough

And, no, they really don't care either as they believe in magic (just like the rest of the population), and a gentle, caring other from somewhere else will take care of all problems. Having known a few (okay, more than a few) I believe they're just indifferent to it (and thus lies the explanation of the national acceptance of the unspeakable torture of innocents for vague national purposes). Thus, you won't be surprised at how many U.S. presidents after JFK (and you remember what happened to him) dared to challenge the wealthy to do more for their country. No change here. The trick, of course, is to keep them watching "American Idiots" on the tubes long enough to make a clean getaway. Or such was the topic at Davos. (Emphasis marks added - Ed.)

Hard-Knock (Hardly Acknowledged) Life CHARLES M. BLOW January 28, 2011 President Obama made history on Tuesday.

It was only the second time since Harry S. Truman’s State of the Union address in 1948 that such a speech by a Democratic president did not include a single mention of poverty or the plight of the poor. The closest Obama got to a mention was his confirmation for “Americans who’ve seen their paychecks dwindle or their jobs disappear” that, indeed, “the world has changed. The competition for jobs is real.” I’m sure they appreciated that. The only other Democrat not to mention poverty in the speech was Jimmy Carter in 1980, but even he was able to squeeze in one reference to at least a portion of the poor and disenfranchised, stressing the continuation of jobs programs to “provide training and work for our young people, especially minority youth.” (Carter did mention the poor in a written version that he submitted to Congress.)

John F. Kennedy didn’t say the specific words “poor” or “poverty” in his first State of the Union, but he talked at length about providing “more food for the families of the unemployed, and to aid their needy children,” securing “more purchasing power for our lowest-paid workers by raising and expanding the minimum wage” and of a new housing program to address the problem of “cities being engulfed in squalor.”

So how is it that this Democratic president has the temerity to deliver a State of the Union address that completely neglects any explicit mention of the calamitous conditions now afflicting his staunchest supporters: the poor?

(In 2008, Obama won 73 percent of the vote of those earning less than $15,000 a year, 60 percent of those earning between $15,000 and $30,000 and 55 percent of the vote of those earning $30,000 to $50,000. Those were his widest margins of victory of any income group and helped to propel him to victory.)

He talked at length about education (the most inspiring part of the speech) and about civility and his repackaged bromides of global competitiveness and investments in the future. And, of course, there were cautious mentions of programs that benefit seniors and the need to protect and secure them. Can’t forget the plea to the old people.

Protecting programs for seniors strikes the right chord morally and politically, but the data show that seniors are not the ones feeling the majority of the pain these days.

According to data from the Census Bureau, the percent of people ages 18 to 64 who were living in poverty in 2009 was higher than it had been in any year since 1959, while the percent of seniors living in poverty was lower than it had been in any year since at least 1959. (By the way, voters over 65 were the only age group that Obama lost in 2008.)

I, for one, refuse to believe that this is an either-or proposition. We can make smart choices about protecting seniors and supporting younger Americans in need at the same time. We don’t have to ignore the Annies among us to court the Miss Daisys.

For the poor, this is the Obama Conundrum. He was obviously the best choice in 2008. And judging by the current cast of Republican presidential contenders, he could well be the best choice in 2012. But does that give him license to obviate his moral responsibility to his electoral devotees?

Can and should they take his snubs as a necessary consequence of political warfare as he makes every effort to tack back to the middle and reconnect with those whose opinion of him vacillates between contempt on a bad day and sufferance on a good one? Does keeping him in the White House dictate keeping them in the shadows?

And things could get even worse for the poor if the president feels the need to cut too many deals with the new Republican-led House in order to appear more centrist.

According to Brian Miller, the executive director of the nonpartisan and Boston-based group United for a Fair Economy and co-author of the group’s report entitled “State of the Dream 2011: Austerity for Whom?” released earlier this month, “austerity measures based on the conservative tenets of less government and lower taxes will ratchet down the standard of living for all Americans, while simultaneously widening our nation’s racial and economic divide.”

As Miller put it, deficits that tax cuts for the rich helped to create “are being used to justify a host of austerity measures that will harm Americans of all races but will hit blacks and Latinos the hardest.”

According to Miller, “With 42 percent of blacks and 37 percent of Latinos lacking the funds to meet minimal household expenses for even three months should they become unemployed, cutting public assistance programs will have devastating impacts on black and Latino workers.” (Obama won 95 percent of the black vote and 67 percent of the Hispanic vote in 2008.)

Even as my respect for this president as a shrewd politician has begun to rebound, my faith in him as a fervent crusader for the poor and disenfranchised has taken yet another nose dive.

One’s tone-deafness — or blatant indifference — to the poor has to be at Black American Express status to brag that “the stock market has come roaring back” and “corporate profits are up” and not even mention the unemployment rate or the continuing foreclosure crisis.

I want to believe that President Obama’s speech omissions were oversights, not acts of arrogance. But I’m not sure.

President Truman wrote in 1953 that, “ultimately, no President can master his responsibilities, save as his fellow citizens — indeed, the whole people - comprehend the challenge of our times and move, with him, to meet it.” But, it is sometimes hard to follow — indeed, to chase — a president who appears to be moving, often at a full sprint, away from the people who once carried him.

And yes, there are better ways in which to organize a smart country. The Europeans don't work the hours we do, and they are able to take vacations throughout the year to recharge those hard-working batteries (no matter what you've been told by trolls) (and have a pretty nice life because they have unions to represent them when bargaining with their employers). But don't believe me.
Vive la Difference!

Paul Krugman

GDP Per Capita, Here and There

I’ve been writing a fair bit about the US-European comparison; one comment that often arises here is that Europe must be doing something wrong, because it has much lower GDP per capita. And it’s true: French GDP per capita, adjusted for purchasing power, is only about 3/4 the US level.

But when you look behind that number, the story isn’t quite what you might think.

David Leonhardt recently pointed to a useful summary (pdf) produced by the BLS, which lets us break apart the factors between the GDP gap. I’m going to do this for France, not Europe more broadly, because that’s what the BLS gives us; but anyway, France is the country we have strong feelings about, right?

One more thing: I’m going to use 2008, not 2009. In 2009 US firms laid off lots of workers, while European firms didn’t; that produces a divergence in productivity that has more to do with short-run business cycle events than with fundamental trends. You can go back to the data source and roll your own for 2009, if you like, but I think this gives a better sense of the underlying differences.

So, here are some ratios of France to the United States:

* GDP per capita: 0.731

* GDP per hour worked: 0.988

* Employment as a share of population: 0.837

* Hours per worker: 0.884

So French workers are roughly as productive as US workers. But fewer Frenchmen and women are working, and when they work, they work fewer hours.

Why are fewer Frenchmen working? As I’ve pointed out, during prime working years they’re as likely to work as Americans. But fewer young people work (in part because of more generous college aid); and, mainly, the French retire earlier.

The latter is arguably the result of misguided policies: Mitterand made early retirement alarmingly attractive. But it’s not a problem of weak productivity or mass unemployment.

And why do the French work shorter hours? Probably for the most part because of government policies mandating vacation time.

The bottom line is that France is a society with the same level of technology and productivity as the US, but one that has made different choices about retirement and leisure.

Vive la difference!

Oui! Suzanne (Thanks for sending this, Trish!) ________________

Friday, January 28, 2011

Sarkozy Slaps JP Morgan Chase's Jamie Dimon Upside Head (and Calls "Stoopid!") - Davos

I just love news about the people in charge (master, please, may I, please, have a house?). Don't you? Seems like Sarkozy is not buying their line. (Emphasis marks added - Ed.)

JP Morgan Chase's Dimon, French President Sarkozy Clash at Davos


January 27, 2011 * Sarkozy says banks need tough regulation * Attacks bankers' behaviour * JP Morgan's Dimon says "unproductive" to attack banks DAVOS, Switzerland - French President Nicolas Sarkozy clashed with the chief executive of U.S. investment bank JP Morgan Chase at the Davos forum on Thursday, telling him bankers had done things which defied common sense.

JP Morgan boss Jamie Dimon had earlier in the day lashed out at persistent bank bashing nearly three years after the global credit crisis began, saying it was "unproductive and unfair".

But when he rose at a later session to ask Sarkozy a question about regulation of banks, the French president launched into a broadside blaming financiers for their behaviour, which he said had caused the crisis.

"The world has paid with tens of millions of unemployed, who were in no way to blame and who paid for everything," Sarkozy said to Dimon. " caused a lot of anger, Mr. President, a lot of anger."

Dimon was not given an opportunity to respond to Sarkozy's remarks. Credited with being one of the few U.S. bankers who steered his firm through the financial turmoil of 2007-08, he had earlier told a separate panel discussion not all banks made the same mistakes in the run-up to the crisis.

"Not all banks are the same and I just think that this constant refrain 'bankers, bankers, bankers' is just unproductive and unfair. People should just stop doing that," Dimon told a panel on "The Next Shock: Are We Better Prepared?"


But Sarkozy was having none of it.

"The world was stupefied to see one of five biggest U.S. banks collapse like a house of cards," he told a plenary session of the Davos Forum.

"We saw that for the last 10 years, major institutions in which we thought we could trust had done things which had nothing to do with simple common sense. That's what happened."

The United States government spent hundred of billions of dollars of public money to bail out financial institutions, after the dramatic failure of Lehman Brothers in 2008 through the controversial Troubled Asset Relief Program (TARP).

"There is a huge misconception. Not all banks needed that TARP. Not all banks would have failed," Dimon said at the earlier session. "A lot of banks were stabilising the problem - JP Morgan bought Bear Stearns because the U.S. asked us to."

Dimon closed the earlier session by saying his biggest current concern was that "bad policy" could make things worse as the banking industry was trying to recover.

He appealed to Sarkozy for flexibility in governments' approach to regulation, saying the rules should allow big banks to fail without bringing down the financial system but that it was important to get policies right.

Sarkozy said bankers were wrong to resist tough rules. "There is an ocean between flexibility and the scandal we saw," he said. "So if people present me as obsessed with regulation, it's because there is a need for regulation.

"I don't contest the principle of securitisation, but when one offshore country guaranteed 700 times its GDP, are we in the market economy or in a madhouse?"

Finally, the French president took aim at bank bonuses.

"Bonuses don't bother me, provided there are also . . . draw-downs when there are losses. When things don't work, you can never find anyone responsible. Those who got bumper bonuses for seven years should have made losses in 2008 when things collapsed." (Reporting by Paul Taylor and Lisa Jucca, writing by Michael Stott, editing by Mike Peacock)

Oh yeah! Made my day. Suzan ______________________

Thursday, January 27, 2011

Is It Just Crumbs We Expect? JPMorganChase Criminality Dissected - Liberal Feel Good & Keith Remembered

Friends, forgive me, but . . .

I may have been going too lightly yesterday on Obama's feel-good (hope so, anyway) state of the union chat (and you've gotta admit that it couldn't have been any warmer if he'd had a roaring fire lighted around him - but that's not really a good image is it?). As I've read other commentary I'm starting to feel that I should have accentuated the real state of the union far more than I did, but it never occurred to me after all I've written about it before that it was necessary.

Paul Krugman addresses one area of Obama's speech that was quite puzzling to me (but not to his neoLib buddies) as I was pretty sure already that he knew better than to be glib about something truly important. I was wrong it seems. (Emphasis marks added - Ed.)

President Obama has telegraphed his main theme: competitiveness. The President’s Economic Recovery Advisory Board has been renamed the President’s Council on Jobs and Competitiveness. And in his Saturday radio address, the president declared that “We can out-compete any other nation on Earth.”

This may be smart politics. Arguably, Mr. Obama has enlisted an old cliché on behalf of a good cause, as a way to sell a much-needed increase in public investment to a public thoroughly indoctrinated in the view that government spending is a bad thing.

But let’s not kid ourselves: talking about “competitiveness” as a goal is fundamentally misleading. At best, it’s a misdiagnosis of our problems. At worst, it could lead to policies based on the false idea that what’s good for corporations is good for America.

About that misdiagnosis: What sense does it make to view our current woes as stemming from lack of competitiveness?

It’s true that we’d have more jobs if we exported more and imported less. But the same is true of Europe and Japan, which also have depressed economies. And we can’t all export more while importing less, unless we can find another planet to sell to. Yes, we could demand that China shrink its trade surplus — but if confronting China is what Mr. Obama is proposing, he should say that plainly.

Furthermore, while America is running a trade deficit, this deficit is smaller than it was before the Great Recession began. It would help if we could make it smaller still. But ultimately, we’re in a mess because we had a financial crisis, not because American companies have lost their ability to compete with foreign rivals.

But isn’t it at least somewhat useful to think of our nation as if it were America Inc., competing in the global marketplace? No.

Consider: A corporate leader who increases profits by slashing his work force is thought to be successful. Well, that’s more or less what has happened in America recently: employment is way down, but profits are hitting new records. Who, exactly, considers this economic success?

Still, you might say that talk of competitiveness helps Mr. Obama quiet claims that he’s anti-business. That’s fine, as long as he realizes that the interests of nominally “American” corporations and the interests of the nation, which were never the same, are now less aligned than ever before.

Take the case of General Electric, whose chief executive, Jeffrey Immelt, has just been appointed to head that renamed advisory board. I have nothing against either G.E. or Mr. Immelt. But with fewer than half its workers based in the United States and less than half its revenues coming from U.S. operations, G.E.’s fortunes have very little to do with U.S. prosperity.

By the way, some have praised Mr. Immelt’s appointment on the grounds that at least he represents a company that actually makes things, rather than being yet another financial wheeler-dealer. Sorry to burst this bubble, but these days G.E. derives more revenue from its financial operations than it does from manufacturing — indeed, GE Capital, which received a government guarantee for its debt, was a major beneficiary of the Wall Street bailout.

So what does the administration’s embrace of the rhetoric of competitiveness mean for economic policy?

The favorable interpretation, as I said, is that it’s just packaging for an economic strategy centered on public investment, investment that’s actually about creating jobs now while promoting longer-term growth. The unfavorable interpretation is that Mr. Obama and his advisers really believe that the economy is ailing because they’ve been too tough on business, and that what America needs now is corporate tax cuts and across-the-board deregulation.

My guess is that we’re mainly talking about packaging here. And if the president does propose a serious increase in spending on infrastructure and education, I’ll be pleased.

But even if he proposes good policies, the fact that Mr. Obama feels the need to wrap these policies in bad metaphors is a sad commentary on the state of our discourse.

The financial crisis of 2008 was a teachable moment, an object lesson in what can go wrong if you trust a market economy to regulate itself. Nor should we forget that highly regulated economies, like Germany, did a much better job than we did at sustaining employment after the crisis hit. For whatever reason, however, the teachable moment came and went with nothing learned.

Mr. Obama himself may do all right: his approval rating is up, the economy is showing signs of life, and his chances of re-election look pretty good. But the ideology that brought economic disaster in 2008 is back on top — and seems likely to stay there until it brings disaster again.

So, speaking about the real state of the union and those now in charge to run it, we really need to look at that latest stellar pick as Chief of Staff (another politician named Daley), who seems to be the epitome of the guy you wouldn't want if you have any progressive values at all (you know, the Chicago-and-all-around-connected guy picked to replace the irreplaceable Rahmbo - the guy responsible for the Blue Dogs' election instead of real Democrats (and their subsequent defeats) and many of the tragic schemes ensuring the demise of the middle class heretofore under Obama and his friendlies on the "other" side).

Let's take a little look at his background with JPMorganChase where he's been providing leadership (for starters). First off, just let me say "No wonder those bonuses were so large!"

Yves Smith, creator of Naked Capitalism and one of the most erudite political/economics reporters is on the case. (And before you start in with how long this piece is (as I've included the comments), please just read it if you have time and then tell me it's unimportant.) (Emphasis marks and some editing inserted for your further enjoyment - Ed.)

Tuesday, January 25, 2011

Ambac Accuses JP Morgan of Fraud in Ongoing Mortgage Suit

One of the big reasons there have been so few fraud charges leveled against what looks like clear and widespread banking industry is that under the law, “fraud” is pretty difficult to prove. Needless to say, that puts commentators in a bit of a bind, because they can be depicted as being hysterical if they use the “f” words, since behavior that is often fraud by any common sense standard may be hard or impossible to prove in court.

The hurdle in litigation and prosecution is proving intent. Basically, the party who is being accused has to not only have done something bad, he has to have been demonstrably aware that he was up to no good. Thus po-faced claims of “I had no idea this was improper, my accountants/lawyers knew about it and didn’t say anything” or “everyone in the industry was doing it, so I had not reason to think this was irregular” is a “get out of jail free” card. Similarly, even if lower level employees knew that their company was up to stuff that stank, if the decision-makers can plausibly claim ignorance, again they can probably get away with it.

So it is gratifying in a perverse way to see a case in which the perp not only looks to have engaged in chicanery, but the facts make it pretty hard for him to say he didn’t know he was pulling a fast one. And even more fun, it involves JP Morgan, which has somehow managed to create the impression that it was better than all the other TARP banks, when on the mortgage front, there is plenty evidence to suggest that all the major banks have been up to their eyeballs in bad practices.

The case involves the bond insurer Ambac and the mortgage company EMC, which was the Bear Stearns conduit for buying mortgages to securitize and now thus part of JP Morgan. In 2010, reports surfaced that EMC had been falsifying mortgage data to keep its pipeline moving as fast as Bear wanted and contain costs.

But a suit by bond insurer Ambac alleges far more serious misbehavior. The discovery process in outstanding putback litigation has unearthed a scheme to defraud investors and Ambac and led the bond insurer to add fraud charges to its complaint. The Atlantic, which broke the 2010 story, gives a good overview:

According to the lawsuit, the Bear traders would sell toxic mortgage securities to investors and then sell back the bad loans with early payment defaults to the banks that originated them at a discount. The traders would pocket the refund, and would not pass it on to the mortgage trust, which was where it should have gone to be distributed to the investors who owned the bonds.

The [Tom] Marano-led traders [Marano was Senior Managing Director and Global Head of Mortgages for Bear and is now CEO of Ally's mortgage operations] also cut the time allowed for early payment defaults, without telling the bond investors. That way, Bear could quickly securitize defective loans, without leaving enough time for investors to do their own due diligence after the bonds were sold and put-back any bad loans to Bear.

The traders were essentially double-dipping — getting paid twice on the deal. How was this possible? Once the security was sold, they didn’t have a legal claim to get cash back from the bad loans — that claim belonged to bond investors — but they did so anyway and kept the money. Thus, Bear was cheating the investors they promised to have sold a safe product out of their cash. According to former Bear Stearns and EMC traders and analysts who spoke with The Atlantic, [Mike] Nierenberg [head of the adjustable-rate mortgage trading desk] and [Jeff] Verschleiser [another senior managing director on the same desk] were the decision-makers for the double dipping scheme, and thus, are named as individual defendants in the suit.

The complaint is duly indignant:

This evidenceobtained for the first time through discoverydemonstrates that at the same time that JP Morgan and EMC were touting to Ambac the quality of the Mortgage Loans and the rigorous procedures for verifying their quality, JP Morgan personnel understood that the loans underlying the transactions were in fact – to use one JP Morgan employee’s unequivocal if impolite words – a “sack of shit.”
And there is another layer of this ugly picture. A much smaller monoline, Sycora, had also insured some Bear mortgages. Bear was pushing the originator to take back some dud mortgages insured by Syncora while simultaneously refusing to let Syncora put them back.

FTAlphaville recounts how JP Morgan continued to rebuff putback claims, even when EMC found them to be legitimate:

Ambac says JPM barred Bear from fulfilling repurchase requests right after it snapped up in 2008. In doing so, a JPM executive director also went against a review by EMC, it is claimed, that said more than half of a set of loans were in breach of reps and warranties. That, Ambac says, enabled the exec to eliminate up to $14m in JPM liabilities and reduce accounting reserves for the loans by almost 50 per cent.
So it will be rather difficult for JP Morgan to claim it has clean hands on this one and merely picked up an outstanding mess when it bought Bear.

This suit is at a minimum a black eye for JP Morgan, which fought tooth and nail to keep it sealed, and may embolden other litigants, like the investors in Bear’s deals. But sadly, it also demonstrates that crime does pay. The executives named in this case as being at the heart of this scheme now run the mortgage businesses at Ally, JP Morgan, and Goldman. Readers comments:

Chirvani says: January 25, 2011 at 3:43 pm

Next the indictment of Ben is required for actively covering this fraud up by facilitating mergers with taxpayers’ money and when this was not enough by parking toxic assets on Fed’s balance sheet away from scrutiny. steelhead23 says: January 25, 2011 at 5:50 pm

You are right of course. But the stock market is up, the recovery is picking up steam, and the sun is rising. TPTB will claim that trying to “dig up the past” would merely delay the day when we can all eat our ice cream. And we dearly love ice cream.

Tao Jonesing says: January 25, 2011 at 9:11 pm

Common law fraud has always required scienter, i.e. both knowledge and intent to defraud. Taking a quick look, it seems that the securities lawas were changed to require a higher threshold for pleading securities fraud (i.e., there must be “a strong inference”), but I’m not limiting the discussion to securities fraud. Garden variety fraud appears to abound on Wall Street, and the fact that many of these fraudulent transactions occurred in the run up to securitizing mortgages does not necessarily make them subject to the securities laws.

I’ve never practiced criminal law, but taking a quick scan of the New York penal code and comparing it to Ambac’s allegations, it looks like there are potential charges of Insurance Fraud (most likely just a misdemeanor), Residential Mortgage Fraud (looks like a potential class B felony), Falsifying Business Records in the First Degree (class E felony), Conspiracy (potential felony), and Enterprise Corruption (the NY state version of RICO). Further, it is my understanding that these state law charges can form the basis of federal RICO charges.

Again, Bill Black is characterizing what’s (not) happening as “de facto decriminilazation,” not actual or “de jure” decriminalization.

Carol says: January 25, 2011 at 4:03 pm

Enron redux

DumpTheBankInfoJulian says:

January 26, 2011 at 12:28 am

Carol,This buries Enron.

readerOfTeaLeaves says: January 25, 2011 at 4:21 pm

So it is gratifying in a perverse way to see a case in which the perp not only looks to have engaged in chicanery, but the facts make it pretty hard for him to say he didn’t know he was pulling a fast one. Gratifying, indeed.

Looking forward to Thursday’s FCIC report. JPM’s actions appear to be part of what Black might call a ‘criminogenic’ environment.

Sunny says: January 25, 2011 at 5:27 pm

Just sickening! What’s the purpose of keeping it sealed till now? Whose interest got furthered? NOT certainly the those of investors or the public! Nothing is surprising any more. What’s surprising or should say shocking is that NONE of these perpetrators are behind bars or not even under indictment! The charade continues unabated and the Banksters still pocketing Millions in bonuses as if nothing happened. Teri Buhl says: January 26, 2011 at 2:49 pm

Sunny – I found JP Morgan’s ability to get the suit sealed an example of serious problems in our judicial process. I went on Russia Today TV – The Keiser Report in November to highlight this issue and challenge the courts to open the case. I have been covering this story since last April – it’s been amazing and sad to see the lengths JP Morgan’s outside counsel went to so(il) the discovery process and even strong arm a key witness to filp his testimoney. You can see some of my coverage at With all the evidence I’ve seen in the case, some of it not even filed in the courts yet, I just don’t see how Tom Marano and his mortgage trading team are not charged with criminal fraud.

Francois T says: January 25, 2011 at 5:30 pm

In a “criminogenic environment”, to use the expression of Prof. Black, it is safe to work under the hypothesis that for one coming to light, there are many more to be found. says: January 25, 2011 at 7:43 pm

I knew that Marano character was bad news from his testimony in front of the US House foreclosure fraud at the Nov hearing.

Joseph Stephens says: January 25, 2011 at 8:03 pm

I am a forensic loan auditor representing homeowners in Florida. Every day I average 12-15 federal lending violations per loan. Each bank, with the possible exception Suntrust is just over run with fraud. 94% of all loan audits performed to date have fraud from beginning to end. I would love to get a chance to share these cases with someone who make public this overwhelming abuse of the American people.

Tony Savoie says: January 25, 2011 at 9:29 pm

I am sure the folks at and and would love to help you share what you know.

MinnItMan says: January 25, 2011 at 8:14 pm

Q: Why is fraud hard to prove? A: “You can’t cheat an honest man.” Well, you can, but it’s a lot harder. It’s a lot easier if you can show he’s just as much a crook. Showing he’s inexcusably dense, greedy, or manipulative might work, too.

My problem with loosely using the term “fraud” is that what is really alleged here is theft or conversion. EMC accepted funds, almost certainly in trust, and didn’t pay the beneficiary. Somebody diverted these funds to someone or something.

The law, for whatever it’s worth, usually gets to the bottom of things. It’s not a stretch for me to say that the bottom of things is simply this: at the moment a true putback is required, it exceedingly unlikely to happen. The money is frequently gone.

And, if I’m following this correctly, EMC already had a shortage in it’s obligation to the securitized trust when it accepted a discounted price on the loan. What was it’s obligations in funding that shortgage? Yeah, eventually this looks like fraud, but it’s on top of a mountain of other illegality.

Michel Delving says: January 26, 2011 at 12:00 am

In addition to being Bear Stearns’ top mortgage trader, global head of mortgages and asset-backed securities, Thomas Marano was also a Director of Bear Stearns subsidiary mortgage servicer EMC Mortgage Corporation while EMC’s mortgage servicing fraud was being investigated by the FTC, resulting in a mere 28 million dollar settlement, September 2008. EMC’s egregious servicing added much toxicity to these mortgage securities. Helps to have a complicit servicer in pocket while rigging bets.

KnotRP says: January 26, 2011 at 1:16 am

Q: Why is fraud hard to prove? A: “You can’t cheat an honest man.” C: However, if you can get the trustee of the honest man’s pension fund to accept kickbacks in exchange for funding some really dicey MBS and derivatives, you in fact CAN cheat an honest man. They just don’t discover it until the money is all gone.

William Benedict says: January 26, 2011 at 4:08 am

The fraud is so blatant, so totally in your face that is it just bewildering. That not one banker has gone to prison simply confirms the legal system of the USA is of no value whatsoever. Basically it is every thief for himself now!

Brick says: January 26, 2011 at 4:38 am

Perhaps we should ask a different question. After 9/11 the FBI task force to combat financial fraud was severely depleted despite the FBI repeatedly reporting an increase in the need for securities and mortgage related fraud. It was reported that a number of high profile cases were shelved with investigators being re-allocated - The New York Times during the height of the crisis reported. Several former law enforcement officials said in interviews that senior administration officials, particularly at the White House and the Treasury Department, had made clear to them that they were concerned the Justice Department and the F.B.I. were taking an antibusiness attitude that could chill corporate risk taking.

The question is did those same attitudes affect the regulators and what does this say about the current attitude of business friendliness? Are you really surprised that there as been little reported investigation of fraud?

Alex says: January 26, 2011 at 10:31 am

Quick question for anyone with knowledge. The Atlantic article states that the the defective loans were sold back to the originators and the traders “pocketed” the the proceeds instead of passing it along to the trust. How is this in any way possible? Is this a misunderstanding by the Atlantic? Bear/JPM is a third party, so how would funds EVER hit their P&L and why would they act on behalf of the trustee? Something doesn’t sound right. Any comments? Teri Buhl says: January 26, 2011 at 2:56 pm

Alex – it’s not legally right but it’s possible because they did it. The last piece in the puzzle (I’m still working on sourcing it) is who at Countrywide, Wells Fargo, and some smaller originators was agreeing to buy back the EPD loans and not check that they’d already been securitized. There is cleary another person not named yet in the suit who aided in the fraud. Chico says: January 26, 2011 at 3:01 pm

There is definitely a difference on who gets prosecuted, based on class. It’s tough to prove a lot of things, but it doesn’t keep prosecutors from prosecuting (the poor).

For example, if you catch a poor black teenager with three joints in his possession, that’s “possession with intent,” because who needs more than one at a time? I’ve seen hundreds of prosecutions like this.

An ordinary schmuck stopped with a beer on his breath will be prosecuted for “operating under the influence,” even in the absence of an accident or even bad driving. It’s only when the potential defendant is rich that the difficulty of prosecution becomes predominant.

And, of course, I've saved the best for last as this type of philosophical dissection is my stock in trade (except that you've stopped reading by now, I'm betting - but, hey, just for fun - send me an email if you can't comment and you get this far!). (Emphasis marks added - Ed.)

Where Liberals Go to Feel Good Barack Obama is another stock character in the cyclical political theater embraced by the liberal class. Act I is the burst of enthusiasm for a Democratic candidate who, through clever branding and public relations, appears finally to stand up for the interests of citizens rather than corporations. Act II is the flurry of euphoria and excitement.

Act III begins with befuddled confusion and gnawing disappointment, humiliating appeals to the elected official to correct "mistakes," and pleading with the officeholder to return to his or her true self. Act IV is the thunder and lightning scene. Liberals strut across the stage in faux moral outrage, delivering empty threats of vengeance. And then there is Act V. This act is the most pathetic. It is as much farce as tragedy. Liberals-frightened back into submission by the lunatic fringe of the Republican Party or the call to be practical-begin the drama all over again.

We are now in Act IV, the one where the liberal class postures like the cowardly policemen in "The Pirates of Penzance." Liberals promise battle. They talk of glory and honor. They vow not to abandon their core liberal values. They rouse themselves, like the terrified policemen who have no intention of fighting the pirates, with the bugle call of "Tarantara!"

This scene is the most painful to watch. It is a window into how hollow, vacuous and powerless liberals and liberal institutions including labor, the liberal church, the press, the arts, universities and the Democratic Party have become. They fight for nothing. They stand for nothing. And at a moment when we desperately need citizens and institutions willing to stand up against corporate forces for the core liberal values, values that make a democracy possible, we get the ridiculous chatter and noise of the liberal class.

The moral outrage of the liberal class, a specialty of MSNBC, groups such as Progressives for Obama and, is built around the absurd language of personal narrative - as if Barack Obama ever wanted to or could defy the interests of Goldman Sachs, JPMorgan Chase or General Electric.

The liberal class refuses to directly confront the dead hand of corporate power that is rapidly transforming America into a brutal feudal state. To name this power, to admit that it has a death grip on our political process, our systems of information, our artistic and religious expression, our education, and has successfully emasculated popular movements, including labor, is to admit that the only weapons we have left are acts of civil disobedience.

And civil disobedience is difficult, uncomfortable and lonely. It requires us to step outside the formal systems of power and trust in acts that are marginal, often unrecognized and have no hope of immediate success.

The liberal class' solution to the bleak political landscape is the conference. This, along with letters and cries of outrage circulated on the Internet, is its preferred form of expression. Conferences, whether organized by Left Forum, Rabbi Michael Lerner's Tikkun or figures such as Ted Glick - who is touting a plan to lure progressives, including members of the Democratic Party, into something he calls a "third force" - are where liberals go to feel good about themselves again.

These conferences are not fundamentally about change. They are designed to elevate self-appointed liberal apologists who seek to become advisers and courtiers within the Democratic Party. The conferences produce resolutions no one reads. They build networks no one uses.

But with each conference liberals get to do what they do best - applaud their own moral probity. They make passionate appeals to work within systems, such as electoral politics, that have been gamed by the corporate state. And the result is to spur well-meaning people toward useless and ultimately self-defeating activity.

"What we need is an alliance which consciously incorporates elected Democrats as well as elected Greens and independents, as well as groups, or individual leaders and members of groups, like Progressive Democrats of America and the Green Party," Glick proposes. "More than that, this alliance eventually needs to support and work to elect candidates running both as Democrats and progressive independents, and maybe even an occasional Republican."

The Tikkun Conference held in Washington last June was another pathetic display of liberal apologists begging Obama to be Obama. The organizers called on those participating to "Support Obama to BE the Obama We Voted For - Not the Inside-the-Beltway Pragmatist/Realist whose compromises have led to a decrease in his popularity and opened the door for a revival of the just-recently-discredited Right wing."

Good luck.

The organizers of the Left Forum conference scheduled for this March at Pace University in New York City also communicate in the amorphous, high-blown moral rhetoric that is unmoored from the actual and real. The upcoming Left Forum conference, which has the vacuous title "Towards a Politics of Solidarity," promises to "focus on the age-old theme of solidarity: the moral act of imagination underpinning working-class victories everywhere. It will undertake to examine the new forms of far-reaching solidarity that are both necessary and possible in an increasingly global world."

. . . The conference agenda, which sounds like a parody of a course catalogue description, includes the requisite academic jargon of "moral act of imagination" and "chains of solidarity." This language gives to the enterprise a lofty but undefined purpose. And this is a specialty of the liberal class - to grandly say nothing.

The last thing the liberal class intends to do is fight back. Left Forum brings in a few titans, including Noam Chomsky, who is always worth hearing, but it contributes as well to the lethargy and turpitude that have made the liberal class impotent.

The only gatherings worth attending from now on are acts that organize civil disobedience, which is why I will be at Lafayette Park in Washington, D.C., at noon March 19 to protest the eighth anniversary of the invasion and occupation of Iraq. Veterans groups on March 19 will also carry out street protests in San Francisco, Los Angeles and Chicago. You can link to the protests here. Save your bus fare and your energy for events like this one.

Either we begin to militantly stand against the coal, oil and natural gas industry or we do not. Either we defy pre-emptive war and occupation or we do not. Either we demand that the criminal class on Wall Street be held accountable for the theft of billions of dollars from small shareholders whose savings for retirement or college were wiped out or we do not.

Either we defend basic civil liberties, including habeas corpus and the prosecution of torturers or we do not. Either we turn on liberal institutions, including the Democratic Party, which collaborate with these corporations or we do not. Either we accept that the age of political compromise is dead, that the corporate systems of power are instruments of death that can be fought only by physical acts of resistance or we do not.

If the liberal class remains gullible and weak, if it continues to speak to itself and others in meaningless platitudes, it will remain as responsible for our enslavement as those it pompously denounces. (Chris Hedges writes a regular column for Hedges graduated from Harvard Divinity School and was for nearly two decades a foreign correspondent for The New York Times. He is the author of many books, including: War Is A Force That Gives Us Meaning, What Every Person Should Know About War, and American Fascists: The Christian Right and the War on America. His most recent book is Empire of Illusion: The End of Literacy and the Triumph of Spectacle.)

Please read here for the whole article. And a final word on the departure of Keith Olbermann and what it means to US.


In nearly eight years at “Countdown,” Olbermann was the brave soul who charted the course for other mainstream media types to be even mildly critical of Bush. Olbermann modeled his style after legendary newsman Edward R. Murrow, who stood up to excesses by communist-hunting Sen. Joe McCarthy in the 1950s, even borrowing Murrow’s close: “Good night, good luck.”

But MSNBC’s parent company, General Electric, never seemed comfortable with Olbermann’s role as critic of the Bush administration, nor with the sniping between Olbermann and his Fox News rival, O’Reilly, who retaliated by attacking corporate GE on his widely watched show.

In 2009, the New York Times reported that GE responded to this pressure by having GE chairman Jeffrey Immelt strike a deal with Murdoch that sought to muzzle Olbermann’s criticism of O’Reilly, in exchange for O’Reilly muting his attacks on GE.

Olbermann later disputed that there ever was a truce and the back-and-forth soon resumed. But it was a reminder that GE, a charter member of the military-industrial complex and a major international conglomerate, had bigger corporate interests at play than the ratings for MSNBC’s evening programming. So, too, will Comcast, the cable giant that is assuming a majority stake in NBC Universal, which controls MSNBC.

The Washington Post reported on Saturday that sources at MSNBC quashed speculation that Olbermann’s departure was connected to the Comcast takeover, which was approved by federal regulators this week.

Media Orphans

The troubling message to progressives is that they remain essentially orphans when it comes to having their political interests addressed by any corporate news outlet. While the Right has built its own vast media infrastructure – reaching from newspapers, magazines and books to radio, TV and the Internet – the Left generally has treated media as a low priority. Though some on the Left saw hope in the MSNBC evening line-up, the larger reality was that even inside the world of NBC News, the other content ranged from the pro-Establishment centrism of anchor Brian Williams to the center-right views of MSNBC’s Joe Scarborough to CNBC’s mix of free-market extremism and corporate boosterism.

While gratified to be given a few hours each night on MSNBC, the Left surely had nothing to compare with Murdoch’s News Corporation and its longstanding commitment to a right-wing perspective on Fox News and News Corp.'s many other print and electronic outlets. As I wrote in an article last November, “Olbermann and the other liberal hosts are essentially on borrowed time, much the way Phil Donahue was before getting axed in the run-up to George W. Bush’s invasion of Iraq, when MSNBC wanted to position itself as a ‘patriotic’ war booster.“

Unlike News Corp. chairman Rupert Murdoch, who stands solidly behind the right-wing propaganda on Fox News, the corporate owners of MSNBC have no similar commitment to the work of Olbermann, Rachel Maddow and Ed Schultz. "For the suits at headquarters, it’s just a balancing act between the ratings that those shows get and the trouble they cause as Republicans reclaim control of Washington.”

Those corporate priorities also were underscored in the pre-Iraq invasion days when MSNBC dumped Donahue, then the network’s biggest draw. But Donahue had allowed on some guests critical of Bush’s planned war. After the invasion in March 2003, MSNBC’s coverage was barely discernable from that of Fox News, with both networks superimposing American flags on scenes from Iraq and producing pro-war promotional segments showing heroic images of U.S. soldiers being welcomed by happy Iraqis (with no scenes of the war’s carnage).

[See's "America's Matrix."] The ongoing significance of America’s media imbalance is that it gives the Right enormous capabilities to control the national debate, not only during election campaigns but year-round. Republicans can deploy what intelligence operatives call “agit-propaganda,” stirring controversies that rile up the public and redound to the GOP’s advantage.

These techniques have proved so effective that not even gifted political speakers, whether the savvy Bill Clinton or the eloquent Barack Obama, have had any consistent success in countering the angry cacophony that the Right can orchestrate.

One week, the Right's theme is “Obamacare’s death panels”; another week, it’s “the “Ground Zero Mosque.” The Democrats are left scrambling to respond – and their responses, in turn, become fodder for critical commentary, as too wimpy or too defensive or too something. The mainstream media and progressives often join in this criticism, wondering why Obama let himself get blind-sided or why he wasn’t tougher or why he can’t control the message.

For the Right and the Republicans, it’s a win-win-win, as the right-wing base is energized, more public doubts are raised about the President, and the Left is further demoralized. Like Clinton before him, Obama has reacted to this political/media landscape by shifting rightward toward the “center,” further alienating his liberal base.

Many on the Left respond by denouncing Obama as a sell-out and deciding to either sit out elections or vote for a third party. This dynamic has been instrumental to the Right’s political victories over the past three decades even as those policies – from Ronald Reagan to George W. Bush – have worsened the lives of middle- and working-class Americans. The sudden disappearance of Keith Olbermann from television is another ominous omen that this dynamic will continue.

Time to rethink?

As this is no secret from anyone.

Suzan __________________________