Maybe lousy columns are the reason for the WaPo's troubles

The sage Richard Cohen:

The auto industry is not only late to the table, it comes with a bad rep. We may not understand what AIG did -- what's a credit-default swap, anyway? -- but we sure as hell know what GM did: It made a lot of lousy cars. So did Ford and Chrysler. They made cars with utter contempt for the customer. The industry at one time even opposed seat belts and air bags, and it designed cars that were not safe. I know things have changed, but I remember. I remember.

Cohen should just tweet. 140 characters is about the limit of his attention span ("what's a credit-default swap, anyway?"), his arguments, and his readers' patience. After a lot of populist blatherings about torchlight parades and pitch reserved for AIG and GM, he writes that the American car companies build lousy cars.

Which they did. Some time ago. Not long after they'd built some pretty bitchin' ones, but the Reagan years were tough on a lot of things.

My point is, it isn't lousy cars that brought them to this pass. It was big ones. Specifically SUVs and trucks. Which they sold one hell of a lot of just a few years ago, at very handsome profits. But first oil prices went through the roof last summer and then the economy fell through the floor last fall while credit for their finance companies (where the real profits can be found) froze. So they stopped selling the SUVs and the trucks that were subsidizing the fuel efficient vehicles that are way smaller in margin as well as size.

Truth is, bad management decisions such as deciding to go all in on trucks and SUVs, destroying longterm sustainability for the quick rush of big profits ultimately did them in. CAFE "standards" that abetted their dependence on luxury land liners fueled (no pun...) their greed. A dealer system propped up by state governments forces them to keep in place a pre-Internet sales model and an overcapacity of dealerships. And yes, a reputation for building cars that weren't Toyotas or Hondas that they could never overcome, no matter how many JD Powers statues.

Whether GM or Chrysler deserves more government funding is debatable (and you might say that the conditions cited in the previous paragraph indicate that the problem is practically hopeless). But let's at least be honest about what the real reasons are for Detroit's problems these days. It ain't because they're put together by a shitty workforce, as the column implies.

Oh, and by the way, that paragon of automotive quality, Toyota, isn't selling many cars these days either. Because, you may have noticed, Dick, people aren't buying cars right now. The Japanese car companies just happened to be better managed, have fewer legacy costs (retirees, U.S. dealerships, brands), and far better at "rainy day" saving then Detroit, in large part because they don't have to fund health care for their workers. And that -- health care -- may be the biggest problem of all; one being conveniently ignored by pretty much all of the critics of the car makers and the UAW such as Cohen and this lying dweeb.



I need a cigarette.

They want health care? A pension? Outrageous!

I've been meaning to shine a light on this recipient of wingnut welfare since it aired last night. The lies and distortions are obvious enough and it is disappointing that Marketplace, in its eternal goal to counter Robert Reich, permits pure bullshit to ride the radio waves. But two kind of obvious things are at work here: As one commentor notes, labor costs represent only 10% of the price of a car; and people haven't chosen not to buy American cars because of their cost.

If you want to argue that UAW leadership should have to walk right along with the GM CEO, then that's worth a discussion. If you want to argue that GM should file for bankruptcy, I'll listen. But for Marketplace to air this type of attack on union workers... well, it's getting old.

The bottom

If Case-Schiller Composite indices are any indication, then housing prices are along way from declining to their historical norms.

Petraeus delivers

A smackdown on Cheney, that is.

Petraeus has maintained for some time that he has no intentionof seeking either Party's nomination in 2012, but such denials tend to be pro forma at such an early date and would not be held against him should he change his mind as 2012 nears. However, in an appearance on CNN yesterday, Petraeus made comments that ran afoul of one of the modern GOP's litmus tests: Petraeus suggested that he opposes the use of torture, and that he disagrees with Vice President Cheney when the latter asserts that abstaining from torture makes our country less safe.

When presented with Cheney's assertion to that effect, Petraeus said the following (via Think Progress):

Well, I wouldn’t necessarily agree with that. I think in fact that there is a good debate going on about the importance of values in all that we do. I think that if one violates the values that we hold so dear, that we jeopardize [our troops]...We think for the military, in particular that camp, that’s a line [torture] that can’t be crossed. [...]

It is hugely significant to us to live the values that we hold so dear and that we have fought so hard to protect over the years.

Outrageous workers' costs at GM

No, not the union workers, the exiting CEO.

WASHINGTON — As the Obama administration tries to rein in sky-high executive compensation at firms that are getting billions in taxpayer funds, ousted General Motors Chief Executive Rick Wagoner is due to walk away with a pension and benefits that total $23 million.

Wagoner, whose company is on tap to get a nearly $30 billion bailout to help it restructure, is unaffected by the cap on compensation that's now levied on banks other financial firms and is expected to be extended to the automakers.

Hit me baby, one more time

Via alert reader, Kathleen, we find this sad and terrible story of the wife of an AIG "geek," whose husband was abused, screamed at, worked 24/7 and not permitted to read bedtime stories to his kids as they settled in their "modest house" in Connecticut.

And when the guy who had done all the screaming and abusing -- one Joe Cassano -- asked her husband to relocate to London her response was "When and how."

These people are strange. Very strange.

They say they don't want our sympathy or our pity. But they have mine. Not because they lost their job or their bonus (which in this case, they didn't) or because Andrew Cuomo is all over their asses. But because they are like abused spouses who are still pining for the guy who beat them up every day.

I do appreciate the irony that the husband complains that his 401k has crashed. Damn shame, that.

...made in Heaven

With all due respect to the Obama gearhead division, but a Jackson wedding merger of the automaking abilities of Chrysler and Fiat is like merging the baseball operations of the Washington Senators and the St. Louis Browns.

Fools

One has to appreciate that the G20 summit will begin with dinner on April Fool's Day. But Simon Johnson sees a glimmer of hope.

It’s an uphill struggle to force Europe to save itself, but with the discussion around the IMF, the President has a chance to move things in the right direction — and to back Secretary Geithner with actions as well as words (for more on this, see TNR online from March 28). The Europeans do not respond to sweet talk; only tough pressure will bring results.

As I suggest in my latest piece (this morning) in The New Republic online, the Europeans have left themselves open to effective confrontation on a key point; if the President can seize the day and really push the Europeans hard on this dimension - and tell me if you see other ways he can make European complacency painfully evident - we might actually make some progress.

Money makes the world go 'round

Nate Silver wonders why Diane Feinstein, who's generally been pro-union during her Senate career, not only won't co-sponsor EFCA, she may, in fact, oppose it?

His self-generated answer? She's running for governor.

A shout out to the LATimes readership

I don't know much about the newpaper industry, but I'd guess that it's probably not wise to publish op eds designed specifically and exclusively to insult its readership while promoting a product.

Blue Monday, Dolly Parton edition

If only because it's so much fun to type "Blue Monday, Dolly Parton edition."

The American oligarchs

You've probably seen other links to the Simon Johnson essay in The Atlantic this month. I don't do the "must read" fever-blogging much, but this one's an exception. What's getting most people's attention is his comparison of U.S. financial industry titans to the Russian oligarchs, but his conclusion is the most terrifying thing. Basically, that the "best case scenario" would be for the financial industry rescue plan to fail so that we can finally admit the rot in our financial institutions, diminish the power of the banking CEOs, and find the political will -- out of absolute necessity -- to reform the industry.

Boris Fyodorov, the late finance minister of Russia, struggled for much of the past 20 years against oligarchs, corruption, and abuse of authority in all its forms. He liked to say that confusion and chaos were very much in the interests of the powerful—letting them take things, legally and illegally, with impunity. When inflation is high, who can say what a piece of property is really worth? When the credit system is supported by byzantine government arrangements and backroom deals, how do you know that you aren’t being fleeced?

Our future could be one in which continued tumult feeds the looting of the financial system, and we talk more and more about exactly how our oligarchs became bandits and how the economy just can’t seem to get into gear.

The second scenario begins more bleakly, and might end that way too. But it does provide at least some hope that we’ll be shaken out of our torpor. It goes like this: the global economy continues to deteriorate, the banking system in east-central Europe collapses, and—because eastern Europe’s banks are mostly owned by western European banks—justifiable fears of government insolvency spread throughout the Continent. Creditors take further hits and confidence falls further. The Asian economies that export manufactured goods are devastated, and the commodity producers in Latin America and Africa are not much better off. A dramatic worsening of the global environment forces the U.S. economy, already staggering, down onto both knees. The baseline growth rates used in the administration’s current budget are increasingly seen as unrealistic, and the rosy “stress scenario” that the U.S. Treasury is currently using to evaluate banks’ balance sheets becomes a source of great embarrassment.

Under this kind of pressure, and faced with the prospect of a national and global collapse, minds may become more concentrated.

What makes this whole thing even more terrifying is that for as bad as the banking execs in the U.S. seem to be, their counterparts in Europe seem to be in even greater denial, with the European governments abetting them in the charade.

Smart guys

You can agree or disagree with Freeman Dyson's views on climate change ("It could be beneficial!"). You can criticize the New York Times Mag story about him for not presenting much in the way of arguments refuting his views, merely noting that he is considered "a crank" by the climate change "experts" Dyson so derides. But to criticize the writer -- or the Times editor's choice of the writer, I'm not sure which -- as Media Matters does, because the subject of his four books have mostly been about baseball, is absurd. Baseball and physics have always had a mutual admiration. And the story is more a profile of a brilliant, aging man who's always had some pretty loopy ideas, than about the science of climate change. Hia wife Imme, after all, gets the last word. And besides, one of writer Nicholas Dawidoff's books was about Moe Berg.

At least you can eat beans

Roy, as always, putting it best on the GOP's numberless budget:

The alterna-budge is a bag of magic Reagan beans. No one on God's green earth believes in them or wants them. Adding numbers to it would be like assigning a horsepower rating to Hot Wheels.

"This is the excellent foppery of the world"

I didn't expect to spend three hours watching PBS the other night, but I could not turn away. Sir Ian McKellan's performance is mind bending and that Shakespeare guy is pretty good.

It's hard

Shorter Michael Kinsley:

The financial rescue plan won't work because I don't understand it.

No offense to Mr. Kinsley, whom I generally like, but saying that it would be simpler and easier for us to simply buy the "bad debts" and bury them ("in Yucca Mountain!") is a little too...well...simplistic. And can you imagine the populist rage if we simply used tax payer money to erase the financial institution's bad bets, which is what he's proposing?

The problem, unmentioned in Kinsley's column, is what are those "toxic assets" actually worth. Buying them at face value and the tax payer takes a bath. "Undervaluing" them -- whatever that might mean -- and the firms won't sell.

Look, I have no expertise in these matters and no idea if Geithner's cunning plan will work. But it's not all that hard to understand.

UPDATE: Maybe, though, Kinsley is channeling Hamilton?

Real plumbers

...hate fake ones.

It's global

Wonky, but important and fascinating.

Laura Tyson also explained why Europe seems less eager to aggressively spend it's way out of the recession as the U.S. is doing. We've a lot more to lose.

Wonder how you manage to make ends meet.

Stooges

I have no great hopes for Sean Penn as "Larry," but if you're looking for some laughs, here ya go.

Maybe we really should "Release the hounds!"

These guys are rich, literally and figuratively.

Wall Street To Washington: "I Want My Campaign Contributions Back"
By Moe Tkacik - March 25, 2009, 1:33PM

Yes, that was an actual sentence spoken -- or more specifically "groused" -- by an anonymous Wall Street executive concerned for his "personal safety," though not enough to be dissuaded from attending or talking to a reporter at yesterday's Wall Street Journal 'Future Of Finance' Conference, where the future sounded like it had gone back in time and purchased a hundred billion dollars worth of extra credit protection, which is to say suspiciously like Finance Past.

It looks like Wall Street, no doubt emboldened by the recent 20% runup in the S&P 500, the fourteen bucks in matching leverage the government is offering them for every dollar they invest in toxic/"legacy" assets and the prospect of better-than-awful numbers at Citigroup and Credit Suisse, got its hubris back along with its proverbial groove. In the six months since it nearly triggered global financial Armageddon, the investment banking community has seemed, if not quite chastened, at least somewhat subdued amidst the nation's ever-heightening awareness that their industry engineered the ever-intensifying economic morass. But not anymore!

Similarly, Justin Fox notes the fascinating similarities between Wall Street's increasing loathing for the guys trying very hard not to nationalize their firms in 2009, and the guys who called FDR a traitor to his class in 1933.

This quote from Richard Hofstadter's The American Political Tradition, by way of historian Eric Rauchway, is awfully interesting:

He was surprised and wounded at the way the upper classes turned on him…. Consider the situation in which he came to office. The economic machinery of the nation had broken down…. People who had anything to lose were frightened; they were willing to accept any way out that would leave them still in possession…. Although he had adopted many novel, perhaps risky expedients, he had avoided vital disturbances to the interests. For example, he had passed by an easy chance to solve the bank crisis by nationalization…. His basic policies for industry and agriculture had been designed after models supplied by great vested-interest groups. Of course, he had adopted several measures of relief and reform, but mainly of the sort that any wise and humane conservative would admit to be necessary….

Nothing that [he] had done warranted the vituperation he soon got in the conservative press or the obscenities that the … maniacs were bruiting about in their clubs and dining-rooms. Quite understandably he began to feel that the people who were castigating him were muddle-headed ingrates.

He's talking about FDR, of course. It made me think of a dinner party a couple of weeks ago with a Wall Street friend who complained that Barack Obama was out to get him and his kind. "What?!?!" I said. "He's doing what he can to protect you from the baying wolves."

Inhale? Isn't that the point?

President Obama took questions from "real America" today, submitted via the Internets.

If you're wondering (I know I was) Obama did end up taking one of the drug policy questions, which were largely focused on marijuana. The question wasn't actually asked by Bernstein, though -- the president brought it up on his own, and laughingly dismissed it.

"There was one question that was voted on that ranked fairly high and that was whether legalizing marijuana would improve the economy and job creation, and I don’t know what this says about the online audience." Obama said, adding that because it was so popular, he didn't want to ignore it, but saying, “The answer is no, I don’t think that is a good strategy to grow our economy.”

Nothing about industrialized hemp, though.

Dumb and dumber

Rep. Manzullo thinks AIG sells insurance on 401ks...or something.



It's not easy to flap the normally unflappable Ben Bernanke.

Rep. Bachman, after demanding to know where in the Constitution is the authority to bail out Bear Sterns then goes on to express her fears that we're abandoning the dollar in favor of some global currency, because someplace called "Kazikhistan" demands it.



Apparently some of our lawmakers do not understand what is being done in response to the collapse of the global economy, nor do they care to.

Teleprompted

It should be remembered that Ron Fournier, who this week worked hard to twit the new Rightwing meme that Obama can't communicated without a teleprompter, and now admits he doesn't know what the FDIC does, had his own "communication problems" just last summer. In the form of love notes to Karl Rove.

In one email, Rove asked, "How does our country continue to produce men and women like this?" Fournier responded: "The Lord creates men and women like this all over the world. But only the great and free countries allow them to flourish. Keep up the fight."

Fournier later expressed "regret" at the "breezy nature" of his sign-off. Bus as Media Matters noted, "Have a great weekend" is breezy, "Keep up the fight" is an expression of solidarity.

UPDATE: To clarify, it was a "problem" for Fournier last summer when the email was made public, but the email was actually sent in 2004...during the Bush re-election campaign...to the guy managing said campaign...by the guy the AP had assigned to cover said campaign.

Not all bad at AIG

You know, I'd like to sympathize with this guy, I really would. Some years back I knew a number of people at AIGFP and I don't recall them all having the stench of sulfur on them.

But I don't recall the NYTimes publishing any letters from auto workers forced to renegotiate their contracts, or retired auto workers wondering if the health care and pension promises they were given are now only as good as the paper they were written on.

And while not everyone at AIGFP was actively working to destroy the world's economy, there was always a sense there that something was not quite right. The money was beyond all proportion. I mean, was there some indication the place was crazy when the head guy had the marble tile in the mens room ripped out 'cause he just didn't like the color? Or when they rushed to populate the world's largest privately owned fish tank, only to have to repopulate it when the first round of fish died in water that hadn't been properly stabilized because the company's officers demanded it? Or maybe he might have noticed that Joe Cassano intimidated everyone who questioned him, including the chief legal counsel? And did it occur to him to wonder why the guys marketing the deals were pretty clearly running a casino on deals they didn't even understand? Or even when, as he put it, "most of those responsible" for the CDSs fled the company last fall?

And the pity party that he was "lied to" by AIG management. Well, please. Who now hasn't been lied to by AIG management?

Remember, without a U.S. taxpayer bailout of $180 billion, AIG would have gone bankrupt and its employees would have been standing at the very end of the creditors' line. Mr. DeSantis would never have received his "retention bonus" of the three quarters of a million dollars he now so graciously plans to donate to "organizations that are helping people who are suffering from the global downturn." You know, the "downturn" that his firm helped create even as his division continued to turn in big profits, year after year. He reaped huge amounts of money in the ten plus years he worked at AIGFP, all the while ignoring where all the money was coming from.

I don't hold him personnally responsible, and this isn't about anger, but I certainly ain't feeling sorry for the guy or impressed by his moral upstandishness in quiting the company now.

UPDATE: Roy runs down the sympathetic reaction to the plight of poor Mr. DeSantis and how his departure means that Liberty is Lost.

Larry, Curly and Moe?

Krugman sighs:

It’s a bit disappointing to see the Obama administration engaging in this sort of market-worship — hailing markets as a Good Thing in themselves, rather than as an often but not always useful means to an end. But I have reason to think that unlike the Bushies, they don’t really believe it; it’s just politics. Which is actually better than having genuine market fanatics running things, I guess.

Now there's some serious damning with faint praise.

And Ezra wishes the Obama econ team would open up the tent to some prominent dissenters.

You could argue, I guess, that Stiglitz and Krugman have uniquely bad personal relationships with the administration, and so their experience shouldn't be generalized. (Stiglitz has a longtime feud with Summers and Krugman's war with the Obama team dates back to the primary, when they stupidly tried to release an attack document discrediting the good professor.) But it would be nice if some prominent expert dissenter were being given the access and respect that's apportioned to, say, David Brooks. I'd really like to read the ultimate conclusions of a knowledgeable skeptic who'd been able to test his arguments against the Obama administration's thinking on these questions. But instead it's just been a lot of opaque briefings that misrepresent the points of the critics. Which in turn pisses the critics off. Which in turn seems to compel the White House to freeze them out further. Which in turn...

Which I don't disagree with, but which I also don't know to be true. While Summers is certainly known for plowing over dissent, Obama isn't. I don't think the president is simply nodding his head as Summers pontificates each morning. I can't imagine he's not doing a little reading himself and challenging Summers' and Geithner's assumptions. He has surrounded himself with a lot of smart, opinionated people (even Berkeley professors!) and has Paul Volcker on speed dial. I can't imagine they are all in lock-step with Summers and Geithner.

"Sleight of hand," indeed

"Sleight of hand" appears twice in this AP story regarding the budget. Curiously, no mention of the "sleight of hand" used when the tax break on wealthiest Americans in Bush's budget was set to expire in 2010 as well.

But this is rich.

Democrats point out that Obama inherited an unprecedented fiscal mess caused by the recession and the taxpayer-financed bailout of Wall Street. Rather than retrenching, however, they still promise to award big budget increases to education and clean energy programs, while assuming Obama's plans to overhaul the U.S. health care system advance.

The "unprecedented fiscal mess" was caused by the recession? As if the recession were a hurricane that could not have been predicted to drown a major American city...oh, wait.

Anti-depressants

Peggy Noonan explains the crash.

The sale of antidepressants and antianxiety drugs is widespread. In New York their use became common after 9/11. It continued through and, I hypothesize, may have contributed to, the high-flying, wildly imprudent Wall Street of the '00s. We look for reasons for the crash and there are many, but I wonder if Xanax, Zoloft and Klonopin, when taken by investment bankers, lessened what might have been normal, prudent anxiety, or helped confuse prudent anxiety with baseless, free-floating fear. Maybe Wall Street was high as a kite and didn't notice. Maybe that would explain Bear Stearns, and Merrill, and Citi.

And there you thought it was decades of widespread de-regulation that "lessened" their "normal, prudent anxiety. I am pretty sure Pegs was "high as a kite" when she wrote this.

Thoughts on the press conference: the media is awesome

Chuck Todd is either not very bright or simply inarticulate. Seems like a nice guy though.

The three most powerful White House correspondents are Chuck, Jake and Chip.

Finally: the press seemed determined to make sure that they pressed Obama on all the issues they refused to press Bush on. Brava.

Playing hardball on EFCA

Specter now opposes it. And FedEx has a gun. Of course, the overnight carrier may be using EFCA as a ploy to avoid having to pay for a bunch of jets they can no longer afford.

Just sayin'.

The go-to guy...now

I will say this about Paul Krugman. I wish the media had paid as much attention to him in 2000 and 2003 when he was calling "bullshit" on the Bush tax cut follies as they do now.

George Kell, RIP

He won the batting title in 1949 over Ted Williams in one of the closest finishes ever.

Kell played for the Tigers when he and Williams waged one of the closest batting races in baseball history.

"I beat him out, but not many people beat him out," Kell said years later. "That's why it was so fascinating. But it happened."

Kell was always proud of the way it happened. Cleveland pitched Bob Lemon in the finale against Detroit, then brought in future Hall of Famer Bob Feller in relief. Kell was in the on-deck circle in the ninth.

"The manager said he wanted to send a pinch-hitter in for me, but I said, 'I'm not going to sit on a stool and win the batting title,'" Kell told The Associated Press. "What Feller was doing in there in relief on the last day of the season I'll never know. They should have been trying some minor league prospect in there."

The final out was made before Kell had to hit, preserving his slim margin over Williams.

Reset this

Politico, which seems to have based its journalistic integrity on the Drudge Report, has uncovered the latest Hillary Clinton "drama" at the State Department.

State Department reporters and observers have been buzzing about the brewing conflict since her second foreign trip, earlier this month, to Europe and the Middle East. On that trip, her longtime Senate press secretary Philippe Reines – one of the combatants in Hillaryland’s long civil wars – took over as the political staffer charged with handling the press.

The trip was marked by tussles over information and access, but it became known for a high-profile blunder in Geneva on March 6. There, Clinton met Sergei Lavrov, the dour Russian Foreign Minister, and cheerily presented him with a large red button in a yellow case, with the words “Reset” and “Peregruzka” written on it.

“We worked hard to get the right Russian word. Do you think we got it?” Clinton asked.

“You got it wrong,” said Lavrov.

The error appalled some in the State Department, because the button – which was inscribed in Latin script, not Cyrillic – hadn’t been assembled with the help of State’s cadre of Russian speakers and professional translators, but rather by Clinton’s small political team. The day of the event, people involved said, Reines showed the finished product to officials who spoke Russian, but who weren’t native, or up-to-date enough to catch the error in a word out of computer terminology.

Let's review. For the last four years the Sect'y of State who, in her previous role as Nat'l Security Advisor, warned that failure to invade Iraq would lead to a mushroom-shaped smoking gun and on whose watch Georgia was egged on to take on Russia and Israel to invade Lebanon.

And a stunt gone mildly awry has "appalled" some at State. Oh. My.

But the story follows the template we've played off of oh these last 16 years. The ingredients are well worn by now: Hillary. Her henchmen pushing people around. Everything is politically calculated. Drama.

And in related news Mark Halperin reports on the Hasselback response to the banking plan.

Tantric choir

What Mickey Hart has been up to lately.

"[It's] a vocal miracle," says Mickey Hart, one of the former drummers of the Grateful Dead. He caught wind of Smith's tape in San Francisco in the late 1960s, and it excited him immediately. He couldn't wait to share it with his bandmates.

"I mean, wait'll Garcia hears this, he's not gonna believe it!" Hart pips. "My ear was filled with monks for many years."

Yet the sounds that thrilled Smith and Hart's ears were not, technically, consummate. Smith's 1967 tape is limited by several factors, primarily by the technology of the day, but also with the number of voices. Smith only heard the remnants of the choir — the few monks that survived the perilous trek into India after the Chinese invaded in 1959 and killed or imprisoned most of them. In the original Gyuto monastery, there were over a hundred monks in the choir.

"No one's really heard a hundred monks outside of Lhasa for many years," Hart notes.

People have heard smaller groups. Seven monks from the only other monastery that practices the chants won a Grammy recently. So, to re-create the sound of a full choir for this CD, Mickey Hart recorded each monk multiple times to make 10 voices sound like a hundred.

"We overdubbed, and now there's over a hundred-voice choir here, which has never really been sounded in the West," says Hart.

More on those damned banks

I am more or less with Ezra on this one. Perhaps Geithner's cunning plan is that when private investors pronounce Citi and BofA insolvent, then Treasury will have the credibility to nationalize, but they certainly don't have that now, even if wise men such as The Maestro are all for it. If the Obama administration had made nationalization priority number-one on Jan. 20, they may have rolled over the political speed bumps, but that day has come and gone.

And while it is certainly true that what is good for Wall Street is not necessarily what's good for the economy as a whole, I don't think we can simply discount the daily gyrations in lower Manhattan. It's one thing to be angry about bonuses and fat cats, it's quite another to be angry about that and watch the S&P 500 dive another 12 percent, taking your 401k along for the sickening ride.

Fifth, they could simply be afraid of the market. More so even than they fear pundits. Though plenty of folks talk about the need to ignore the daily whips of the Dow, Geithner certainly took a lot of damage from the market's reaction to his initial announcement, and you could argue that the administration economic hand remains weakened as a consequence of that damage. Maybe they feared a repeat and so built a bill they knew the market would like.

The administration needs to balance systemic crapulence in the banking financial industry, all sorts of Capitol Hill agendas, the stock market, and a public that is by turns angry and frightened.

UPDATE: The plan seems to be coming together, after all.

When he goes before a Congressional panel Tuesday morning, Timothy F. Geithner, the Treasury secretary, is expected to call for the Treasury Department to be granted greater powers to seize troubled financial institutions that aren’t banks.

“The United States government does not have the legal means today to manage the orderly restructuring of a large, complex nonbank financial institution that poses a threat to the stability of our financial system,” Mr. Geithner said in text of his opening statement, which was made available Tuesday morning on the Web site of the House Financial Services Committee.

This expanded authority would have given the government more options, and potentially more control, when it stepped in to save American International Group from collapse last fall, Robert Gibbs, a spokesman for the White House, said Tuesday morning before the hearing.

UPDATE II: Ambinder seems to have reached a similar conclusion to mine.

Homophobia, anyone?

Did Greg Gutfeld's obsession with men in capri pants begin at Serra High?

UPDATED to correct the link.

National Puppy Day

You need this. Trust me.

The drama queen

Curtis Montague Schilling announced his retirement. There is some talk that his entry to the Hall of Fame is debatable. As much as I can't stand the guy, he was just too dominant and his post season appearances are just too good for him to be denied.

And who else was preceded to Cooperstown by his dirty socks?

In which I finally understand The Twitter

Christopher Walken.

Engaging Iran and Israel

Richard Cohen is making sense. And although he doesn't explicitly say it, Obama's address to the Iranian people in commemoration of Nowruz had another intended audience: Israeli leadership.

One of the people involved in the review told me he had been bombarded by warnings from Israel and Sunni Arab states that engagement with Iran would lead nowhere. Of course they would say that; any Iran breakthrough will shake up current cozy U.S. relationships from Jerusalem to Riyadh.

Obama’s overture represented a victory not only over such lobbying but also over officials’ favoring tightened sanctions or delaying any American initiative until after Iran’s June presidential election.

The hard part has just begun.

Iran’s supreme leader, Ayatollah Ali Khamenei, responded to Obama with a scathing speech at the country’s holiest shrine in Mashad, recalling every past U.S. misdeed, describing prerevolutionary Iran as “a field for the Americans to graze in,” and demanding concrete steps — like a lifting of sanctions — rather than words.

View all that as an opening gambit. Khamenei also quieted the crowd when it began its ritual “Death to America” chant and he said this: “We’re not emotional when it comes to our important matters. We make decisions by calculation.”

That’s right: the mullahs are anything but mad. Calculation will demand that Iran take Obama seriously.

The country’s oil revenue has plunged, its economy is in a mess, its oil and gas installations are aging. It has deepening interests in a stable Iraq and an Afghanistan free of Taliban rule. Its nuclear program involves a measure of brinkmanship that must be carefully managed. Khamenei’s essential role is conservative — the preservation of the revolution. He can only be radical up to a point.

Iran’s apparent inclination to take up a U.S. invitation to attend a conference on Afghanistan later this month may be more significant than Khamenei’s words. In any event, overcoming a 30-year impasse will take time and consistency.

The clock is ticking — and Obama’s will not be the same as that of Israel’s prime minister designate, Benjamin Netanyahu.

Already divergent U.S. and Israeli approaches to Iran were evident in Israeli President Shimon Peres’s coupling of his own Nowruz address to the Iranian people (not its leaders) with a statement predicting that they would rise up and topple “a handful of religious fanatics.”

A senior Israeli official told me Iran has 1,000 kilos of low-enriched uranium and will have 500 more within six months, enough to make a bomb. It could then opt for one of three courses.

Rush for a bomb by shredding the nuclear nonproliferation treaty, adapting its centrifuges and producing enough highly enriched uranium within a year.

Move the process to a secret site, in which case getting a bomb would take longer, perhaps two years.

Or continue making low-enriched uranium so that “it would have enough for 10 bombs if it decides to rush at a later stage.”

And where, I asked, is Israel’s red line? “Once they get to 1,500 kilos, nonproliferation is dead,” he said. And so? “It’s established that when a country that does not accept Israel’s existence has such a program, we will intervene.”

I think there’s some bluster in this. Israel does not want Obama to talk, talk, talk, so it’s suggesting military action could happen in 2009, within nine months.

Still, this much is clear to me: Obama’s new Middle Eastern diplomacy and engagement will involve reining in Israeli bellicosity and a probable cooling of U.S.-Israeli relations. It’s about time. America’s Israel-can-do-no-wrong policy has been disastrous, not least for Israel’s long-term security.

Saab story

The last place I'd have expected to find neo-Hooverites would be in Sweden.

Admittedly, GM screwed up a great design and is now looking to dump the carcass of a great car company into the laps of the Swedish taxpayer, but passively allowing it to die seems...disproportionate.

Blue Monday, Big Mama Thornton edition

When economists go wild

Hilzoy has the list of the views of economists whose views I'm interested on Treasury's Banks R-us fixit plan. Brad deLong is seriously out-numbered.

I have no clue about such matters, but one thing I do find interesting. In reality, we have never faced a crisis quite the current one, have we? So why are economists tossing around "Mad Max" scenarios as an outcome if all of Geithner/Summer alchemy fails? Japan's economy has been in critical condition for years and while Mad Max style hair and fashion seem to be popular there, they haven't begun hoarding petrol. Hyperbole makes the dry toast of economic theory more interesting to read in a blog, but I'm not sure it's helping.

"Thank you, thank you. Try the veal"

First time in my memory I found the Leno show funny. Of course, I'm a fanboy so the cruel, mean-spirited joke he told at the expense of Special Olympians doesn't have the effect on me it has on conservatives concerned that it was not politically correct.

Deep thought

Doesn't Al Franken need to start thinking about his reelection campaign soon?

Giving it away

Katha Pollitt is right. Isn't the Times acting in exactly the same fashion as those strumpets that so turn Douthat off in the first place?

So who would I like to see in the Kristol slot? Actually, Kristol. I was livid when they gave him the job, but he was perfect: a dull, complacent apparatchik who set forth the Bush line in all its fact-free glory. His columns were like press releases--you could hardly remember them two minutes after reading them. But his presence on the page reminded readers that David Brooks is not really what Republicanism is all about. Frankly, though, I don't see why there must be two conservatives on the page. Does the Wall Street Journal, the Times's national competition, have two liberals? That the Times, the closest thing we have to a liberal paper, cedes so much turf to the opposition, as progressive bloggers applaud, shows the truth of Robert Frost's quip that a liberal is someone so open-minded he won't take his own side in an argument.

Really, Ross, can't you see the Times is just "masticating your neck?"

The WaPo -- by and for elites only

This has been another episode of "Go Read Dean Baker"

The Washington Post is Unhappy About Taxing Bailout Bonuses

Okay, this is not a surprise. After all, we're not talking about auto workers getting $57,000 a year.

The editorial's warning that the bonus tax may jeopardize the Geithner-Summers plan to subsidize zombie banks through the back door, could be viewed by some as an argument in favor of the tax.

Laugh, laugh

This day in clusterfucks

In celebration of March 19, 2003, the day the Bush administration launched what would be the overwhelming representation of its "greatest hits," if you will...

• launched with brazen mendaciousness that made the lies about his tax cuts look like gentle fibs
• an utter disregard for foresight -- and a malicious disregard for those who would suggest foresight is needed
• a "shit happens" response when lack of planning turns into a military, financial, and/or humanitarian disaster

...traits that would apply again and again as these evil fools careened from one foreign, domestic, and economic disaster to another, leaving us with two ongoing wars, a drowned American city, $trillion in deficits, and criminally rich AIG executives...

I give you, "Interview with a Vampire"

The Daily Show With Jon StewartM - Th 11p / 10c

Interview With a Vampire

Daily Show Full Episodes
Important Things w/ Demetri Martin

Political Humor
Jim Cramer

Anticipated moderation

According to the Times the other day,

Moderate Is Said to Be Pick for Court

[...]

The administration official said part of the reason for making the Hamilton nomination the administration’s first public entry into the often contentious field of judicial selection was to serve “as a kind of signal” about the kind of nominees Mr. Obama will select. The official spoke on the condition of anonymity because the nomination had not been officially made.

The White House is planning to announce a handful of other candidates over the next few weeks to fill some of the 17 vacancies on the appeals courts, which are just below the level of the Supreme Court. On most of the 12 regional appeals courts, including on the Seventh Circuit for which Judge Hamilton has been nominated, a majority of the sitting judges were appointed by Republican presidents.

Mr. Obama’s selections will be closely watched to see what role he tries to play in shaping the ideology of the federal courts, which have influence over some of the nation’s most intensely felt social issues. The administration official said the White House was hoping to reduce the partisan contentiousness of judicial confirmation battles of recent years.

“We would like to put the history of the confirmation wars behind us,” the official said.

A reasonable pick, so one would expect a reasonable response from the thoughtful Right.

It apparently started with a National Review item from Wendy Long, who wrote on Tuesday, "Hamilton was a fundraiser for ACORN (nice ACORN payback, Mr. President)."

And from there, the race was on to see who could be the most ridiculous.

Hamilton's purported ties to ACORN immediately worked its way into right-wing commentary on the nomination, being highlighted by Newbusters, Powerline, Curt Levey of the Committee for Justice, and the Family Research Council ... twice, which complained that ACORN was getting it very own judge.

The idea that President Obama's nomination of Hamilton was "payback" to ACORN quickly became the right-wing talking point of the day, with people claiming that he was "a big shot at ACORN" and leading to posts like this one written by Matthew Vadum at "The American Spectator" entitled "ACORN's Federal Judge":

"Giving the term judicial activism new meaning, President Obama has nominated an ACORN loyalist to the U.S. Court of Appeals for the Seventh Circuit, the Chicago Tribune reports ... The Judicial Confirmation Network notes that Hamilton previously worked as a fundraiser for ACORN, the radical direct-action group that not only resurrects the dead and gets them to the polls every election but also shakes down banks and pressures them to make home loans to people who can't afford to pay them back."

Ready for the punch-line? Judge Hamilton was a canvasser for ACORN -- in 1979. He spent a grand total of one month helping the group raise money the same year he graduated from college. He was 22 at the time.

Never underestimate their spittle flecked foolishness.

Stopping the raids

More change we can believe in.

WASHINGTON — Attorney General Eric H. Holder Jr. on Wednesday outlined a shift in the enforcement of federal drug laws, saying the administration would effectively end the Bush administration’s frequent raids on distributors of medical marijuana.

Speaking with reporters, Mr. Holder provided few specifics but said the Justice Department’s enforcement policy would now be restricted to traffickers who falsely masqueraded as medical dispensaries and “use medical marijuana laws as a shield.”

In the Bush administration, federal agents raided medical marijuana distributors that violated federal statutes even if the dispensaries appeared to be complying with state laws. The raids produced a flood of complaints, particularly in California, which in 1996 became the first state to legalize marijuana sales to people with doctors’ prescriptions.

Graham Boyd, the director of the American Civil Liberties Union drug law project, said Mr. Holder’s remarks created a reasonable balance between conflicting state and federal laws and “seem to finally end the policy war over medical marijuana.” He said officials in California and the 12 other states that have authorized the use of medical marijuana had hesitated to adopt regulations to carry out their laws because of uncertainty created by the Bush administration.

Mr. Holder said the new approach was consistent with statements made by President Obama in the campaign and was based on an assessment of how to allocate scarce enforcement resources. He said dispensaries operating in accord with California law would not be a priority for the administration.

Klub Klein, or, Meet the New Boss

As you may have learned recently, Ezra Klein is now the unabashed leader of the vast leftwing conspiracy of powerful bloggers and a biased media taking their directives from Kommanders Klein and Kos. Now, this blog continues its policy of absolutely never linking to Mickey Maus, so we'll have to take it on faith that the dome topped "contrarian" is not so much bothered by Ezra's tentacles as he is by not being invited to the club.

For the record, this humble blog is not a part of that fiendish cabal. To paraphrase that great philosopher and economic determinist, Groucho Marx, I would never join a club that would have me as a member.

The AIG opportunity

Marc Ambinder writes,

White House chief of staff Rahm Emanuel just had to scratch that itch. Speaking for the President and to the New York Times yesterday, he called the contretemps over the AIG news a "distraction" from the "main priority of getting the financial system stabilized." It is worth unpacking these words. Emanuel did not mean to betray an ambivalence about the outrage of the bonuses. Remember: the chief is supposed to be the longest-term thinker in the White House. He knows that the White House either rolls back on its heels, becomes defensive, and yields to the diversion, or Obama uses AIG as an example to catalyze public support for significant regulatory reform.

I read in a number of joints that Rahm's use of the term "distraction" showed an administration that didn't have its talking points together. Ambinder sees it as Emanual understanding that AIG is a tactic, not the focus.

This is more than tough rhetoric: I take this to mean that the administration will use the AIG crisis to take a more active role than it otherwise would have. Wall Street has been waiting for the Treasury Department's plan to mitigate the poison and the credit-market-locking effect of toxic assets held by major banks. The administration's economic commanders would prefer to create public-private partnerships to remove those assets from the books of especially troubled institutions; the government and corporations would share the risks. When Obama says explicitly - "My interest is not protecting the banks," he's scaring that capital away. Why would a hedge fund want to subject itself to the scrutiny that AIG is currently receiving?

One sign that Obama really means this: he called Tim Geithner the hardest-working Treasury Secretary since Alexander Hamilton and is standing by a man who is now thoroughly distrusted by the finance sector of the economy. Make no mistake: you can blame - or credit - CNBC with introducing the notion that, because Geithner doesn't inspire confidence, whatever that means, he might want to think about resigning.

Innerestin'.

"Terrific job"

GE employee and NBC Universal head honcho responds to Jon Stewart's critique of CNBC.

Zucker, speaking at the McGraw-Hill Media Summit in New York on Wednesday, said that CNBC's reporters and commentators had done a "terrific" job and the network remained a "go-to" place for financial news.

"It's unfair to CNBC and to the business media in general," Zucker said. "I don't think you can blame what happened here on the business media."

The CEO of NBC Universal, which also owns the NBC broadcast network, cable channels like Bravo and USA, theme parks and a film studio, among other businesses, said the public was tired of hearing the media blamed for its coverage of financial news.

"Frankly, I already think you're seeing a backlash," he said.

Indeed.

Aaron Boone

Here's to successful surgery and recovery for the improbable Yankee hero.

Sacrificing Dodd at the Treasury altar

It appears that the WH is walking back accusations (see Update II) that it was Sen. Chris Dodd, and not Timmeh and Larry Geithner who demanded that pre-existing executive compensation agreements be exempted in the stimulus bill. Which is good because the claim is verifiably untrue, and because sacrificing Chris Dodd to cover for Geithner is really politically stupid.

What turns young Times columnists off

As many of you know, the Times has chosen Ross Douthat of The Atlantic to replace Billy the Bloody Kristol in the William Safire Chair for Mendacious Conservatives. And, not surprisingly, despite all the good will Ross has been getting (since we liboruls are easily duped by seemingly self-reflective Republicans), he's...um...a little...off.

And, of course, there is the other point: here is a Reese Witherspoon look-alike who has offered Ross Douthat the extremely precious gift of wanting to make love to him, and he writes her into his book in this way with what look to be sufficient identifying details. You can write that paragraph in a way that is calculated to try to make her feel bad about herself should she ever read it; you can write that paragraph in a way that does not try to make her feel bad about herself should she ever read it; normal human sociability and empathy suggests that one should try to do the first second; Ross Douthat chooses to do the second first.

This, by the way, is Reese (albeit, not a "chunky" one).

This, by the way, is Ross.

UPDATE: The comments to Brad's original post are hilarious.

Pointing a finger

James Kwak of Baseline Scenario blames Allen "The Maestro" Greenspan.

Fourth, and most importantly, unlike every other blameworthy candidate I can think of, he could actually have done something about the bubble. If he had taken asset price inflation seriously, the answer would have been obvious: raise interest rates much earlier than he actually did. He wouldn't even have had to ask if there was a bubble or not. The way the Fed usually works, they look at the CPI -- if it is too high, they raise rates. They don't stop and think about whether there are fundamental reasons why inflation should be high; they just raise rates. If they had taken the same approach with asset prices, they would have raised rates earlier, which would have deflated the bubble.

Instead, he suggested at the time that people were fools not to take out ARMs.

Obviously, Greenspan committed no crime and he wasn't a crook. But Mr. Mitchell's reputation is sacrosanct and it deserves to get dirty.

How dare you say that to...the Vice President

I find it amusing that reporters and pundits can laugh and laugh at Joe Biden's "gaffes" yet gasp at the very notion of being "disrespectful" of the former Vice-President (and future war crimes defendant at The Hague).

How bizarre that Cheney can accuse of Obama of the most heinous acts (and, in my view, Cheney is perfectly within his rights as a citizen to do so), and the glorified gossip columnists who play the role of journalists on TV (what Walsh calls "prissy hall monitors") can hardly contain their anger over Gibbs' far more mild response.

More to the point: imagine what things might be like if TV journalists had shown just a fraction of the interest in, and outrage over, Dick Cheney's torture and chronic lawbreaking as they have for these petty offenses to his honor and good name.

Oh, and here's Cheney on Biden back in December.

WASHINGTON — Vice President Dick Cheney offered an unabashed defense of the Bush administration's claims of broad executive powers Sunday, mocking criticism from Vice President-elect Joe Biden and saying the president "doesn't have to check with anybody" before launching a nuclear attack.

In an interview with Chris Wallace on "Fox News Sunday," Cheney fired back at Biden's contention that Cheney was probably "the most dangerous vice president" in U.S. history. He also ridiculed Biden for mistakenly citing Article I of the U.S. Constitution, rather than Article II, in talking about executive branch powers during an October debate.

"If he wants to diminish the office of the vice president, that's obviously his call," Cheney said of Biden.

Get yer ballparks, here. Get yer ballparks!

Two new baseball stadiums opening in the same city in the same year is pretty much unheard of, but by golly this is New York!

Paul Goldberg appraises.

At the old Yankee Stadium, that place was from the elevated tracks of the Lexington Avenue subway, and one nice feature of the new stadium is that that, too, has been re-created. There is a break between the right-field stands and the scoreboard, and you can see the trains sliding by. The new stadium feels more tightly woven into the fabric of the city than the old one did. (It will feel even more so once a Metro-North station opens there, later this year, and once the city finally makes good on its obligation to replace the Macombs Dam Park facilities lost in construction of the new stadium with parkland on and around the site of the previous one.) If you approach it by driving along Jerome Avenue, you see a couple of the Bronx’s finest Art Deco apartment houses across the street from the west façade, and you get a hint of the subtle counterpoint that once existed between a baseball park and an urban setting. The stadium is bigger and more imposing than everything around it, of course, but it seems to grow out of its surroundings, and this somehow rescues the building from its own pomposity. In a way, the apartment houses on Jerome Avenue, the jumble of storefronts and bars under the elevated tracks on River Avenue, and the constant presence of street life shape the stadium as much as its designers have.

At Citi Field, conversely, the Ebbets Field façade, stuck in the middle of acres of parking (as Shea was), seems more like a theme park than it would if it were in the middle of the city. HOK has tried to make the stadium feel more urban by placing a long brick building, containing the Mets’ offices, just beyond right field, along 126th Street, where it faces a favela of auto-body shops in Willets Point. But, since the site is defined mainly by expressways and parking lots, the architects are fighting a losing battle. It’s a pity that the Mets didn’t build on the far West Side of Manhattan, where Colonel Ruppert first thought of putting Yankee Stadium, ninety years ago, and where the Jets recently tried to build a football stadium. A football stadium doesn’t need to be in the middle of a city, but a baseball park, smaller and used much more often, does.

A stadium is a stage set as sure as anything on Broadway, and it determines the tone of the dramas within. Citi Field suggests a team that wants to be liked, even to the point of claiming some history that isn’t its own. Yankee Stadium, however, reflects an organization that is in the business of being admired, and is built to serve as a backdrop for the image of the Yankees, at once connected to the city and rising grandly above it.

I've always wanted to dig my teeth into and blog about the financial deals the two organizations had with the city; the parks' effect on the surrounding neighborhood -- loss (supposedly temporary) of parks in the Bronx and (expected) auto repair livelihoods in Queens; and the travails of selling premium tickets in this environment, not to mention the travails of long-time season ticket holders to the old stadia; but I've never gotten around to it, I'm sorry to say.

Hope to see the new Yankee Stadium in person on April 4, though, and will report back on the experience.

A wing and a prayer

Bizarre lapse in judgment.

WASHINGTON — The Air Force has begun an investigation into whether an e-mail message from an Air Force commander in Europe directing air personnel under her command to an “inspirational” story on a Catholic Web site violated the military’s official position of religious neutrality.

The commander, Col. Kimberly Toney, who leads the 501st Combat Support Wing in Europe, sent the thousands of air personnel in her wing a message last month recommending that they “take a few minutes to enjoy the attached video and meet a truly inspirational individual.”

The video highlighted the life story of Nick Vujicic, now 26, who was born without arms or legs and who credited his faith in Jesus with helping him overcome his physical limitations.

Some Air Force personnel who watched the video said they believed that it breached the military’s ban on endorsing particular religious views. Some viewers said they were even more bothered by articles and commentary on the Catholic Web site, 4marks.com.

One image on the site satirized President Obama’s support for abortion rights by showing him wearing a Nazi uniform and waving a flag with a swastika in an image labeled “ObamaHitler.” Another article, also critical of Mr. Obama’s stance on abortion, called him “a veritable forerunner of the Antichrist.”

Some things never change.

Great moments in governing

Gov. Mark Sanford, R-SC, man of principle.

The Obama administration rejected Gov. Mark Sanford’s request to use $700 million in federal stimulus cash to pay down state debt. The White House budget director, Peter R. Orszag, said in a letter to Mr. Sanford, left, a Republican, that the federal stimulus law did not allow President Obama to make an exception for that cash. A Sanford spokesman, Joel Sawyer, had no immediate response, but the governor has said he would reject part of the stimulus money if Mr. Obama would not give him flexibility in spending it. The $787 billion stimulus legislation sets strict rules for the $53.6 billion being sent to help state budgets, Mr. Orszag wrote. It calls for 82 percent of the money to be used for public schools and colleges, and 18 percent on public safety and other government services. “Congress has not authorized the executive branch to waive any of the above statutory requirements,” Mr. Orszag’s letter said.

How else to explain his brave stance putting his ideology and future prospects in the GOP ahead of the people who elected him?

(Aiken Standard Via Acquire Media NewsEdge) Mar. 13--With the recession deepening and South Carolina now ranked second only to Michigan in unemployment, State Superintendent of Education Dr. Jim Rex is worried about morale among educators.

"Our school system has seen $370 million in cuts this year," he told Aiken County residents at a community meeting Thursday. "The school districts' budgets have been cut by 15 percent. When you get to that level, you're eventually going to have to get into personnel." Rex was invited by S.C. Rep. Bill Clyburn, R-Aiken, to discuss his education vision and the current budget woes facing the state.

The Aiken School District expects to displace around 90 teachers through an increase in class sizes and has told all retired teachers still on faculties that they may not be rehired for the next term.

Mark Sanford is an intellectual leader of the GOP. After Rush, of course.

AIG FP bonuses

Full disclosure, if it hadn't been for AIG FPs determination to keep its best people, Madame Cura and I would not be in the house we live in today, as we were able to take advantage of generous relocation offers when the subsidiary moved from Manhattan to Westport CT and MC's bosses wanted to keep her continuing to work 12-14 hour days.

Which is what makes the bonus scandal so painfully fascinating. The vast majority of those receiving bonuses are the admins and other worker bees who aren't paid all that well salary-wise, but are relied on to keep the trains running on time and, in turn, rely on those year-end bonuses. Now, those workers aren't promised those bonuses in a contract. Quite the contrary, they're told again and again that bonuses aren't guaranteed and depend on their individual performance and the performance of the unit. In other words, they'll get whatever is left over when the senior execs take care of themselves.

One expects that at the end of the negotiations, those people will be screwed out of their bonuses. Those that can least afford it. And the senior executives -- those who knew they were about to default on billions in rancid Credit Default Swaps-- did have contracts. They'll keep their bonuses. Cause we simply can't have the government ripping up contracts, can we?

Such heavy-handed government intervention might suck all the "trust" out of the financial sector, don't you know.

UPDATE: Oh, and if we, the shareholders of AIG, don't stand and deliver, they might blow it all up.

But what about the commitment to taxpayers? Here is the second, perhaps more sobering thought: A.I.G. built this bomb, and it may be the only outfit that really knows how to defuse it.

A.I.G. employees concocted complex derivatives that then wormed their way through the global financial system. If they leave — the buzz on Wall Street is that some have, and more are ready to — they might simply turn around and trade against A.I.G.’s book. Why not? They know how bad it is. They built it.

I think he just told Dick to "fuck off"

Speaking for most Americans, who would prefer that Dick Cheney retire to the worm hole he crawled out of sometime during the summer of 2000, Robert Gibbs had this to say about the former VP's latest teevee appearance with a CNmoroN.

In a caustic reply to criticism of Obama administration national security and economic policy from Vice President Dick Cheney, the White House Press Secretary Robert Gibbs likened Mr. Cheney to the king of right-wing radio and said that it would be the “best possible outcome” for Americans to ignore the former vice president’s advice on the economy.

“I guess Rush Limbaugh was busy so they trotted out the next most popular member of the Republican cabal,” Mr. Gibbs told reporters, when asked to respond to Mr. Cheney’s critiques over the weekend.

[...]

In his first television interview since leaving office, Mr. Cheney criticized Mr. Obama’s decision to close down the military prison at Guantanamo Bay. Mr. Cheney told CNN that Bush administration counterterrorism policies were “absolutely essential” to prevent a repeat of the Sept. 11 attacks.

“President Obama campaigned against it all across the country,” Mr. Cheney said. “And now, he is making some choices that in my mind will, in fact, raise the risk to the American people of another attack.”

Mr. Gibbs took umbrage during the press briefing on Monday. “The president has made quite clear that keeping the American people safe and secure is the most serious job that he has each and every day,” he said.

He refused to back down from the Rush Limbaugh line, after a reporter asked him whether he meant to sound so sarcastic given that he was talking about a former vice president. Acknowledging “sometimes I ask forgiveness, rather than for permission,” Mr. Gibbs said, “I hope my sarcasm didn’t mask he seriousness of my answer. For seven-plus years, the very perpetrators that the vice president says he’s concerned about weren’t brought to justice.”

But, as John King asks, quoting a Human Events Weekly headline, "Is the president trying to brazenly deceive the American people?"



Not so enquiring minds would very much like to know.

About those bonuses

This is curious.

AIG said there were two categories of payments: One was for senior executives, the other for 2008 retention bonuses for employees that the company agreed to pay before the federal bailout, the official said. AIG said the retention bonuses were legally required to be paid despite the bailout, a view the Obama administration concluded was correct after a review of the contracts.

Breaking those contracts would have led to greater costs for taxpayers, the official said.

Ok, I get the retention bonuses (which were necessary to keep people at the company when this douchebag left), but what about the other category: senior executives? You know, the guys running this scheme.

Our geek overlords

Okay, I realize Battlestar Gallactica is a cultural touchstone for a lot of bloggers. Tried it myself and, after initially liking it somewhat (mostly cause of the strong female characters), eventually came to conclude, eh. But this is truly absurd.

The United Nations and the Sci Fi Channel will present a panel discussion Tuesday evening on the social and political issues raised by the Sci Fi series “Battlestar Galactica,” which concludes on Friday night.

Moderated by Whoopi Goldberg!

And by invitation only!

"Happy" Vegacura Day

Given that it is Vegacura Day, it's fitting that the cover of the NY Times shows someone being beaten.

Blue Monday, Bob Dylan edition

This is especially true this morning.

Political bonuses

In some ways, it looks as though the administration's outlook for success in reversing the financial meltdown-- and certainly, the options they'll have with dealing with the fucked up financial industry -- rests on the bonuses of a handful of AIG executives and the firm's lawyers.

The administration is said to have been outraged when it heard of the bonus plan last week. Apparently Secretary of the Treasury Tim Geithner told AIG's chairman, Edward Liddy (who was installed at the insistence of the Treasury, in the first place) that the bonuses should not be paid. But it turns out that most will be paid anyway, because, according to AIG, the firm is legally obligated to pay them. The bonuses are part of employee contracts negotiated before the bailouts. And, in any event, Liddy explained, AIG needs to be able to retain talent.

AIG's arguments are absurd on their face. Had AIG gone into chapter 11 bankruptcy or been liquidated, as it would have without government aid, no bonuses would ever be paid (they would have had a lower priority under bankruptcy law that AIG's debts to other creditors); indeed, AIG's executives would have long ago been on the street. And any mention of the word "talent" in the same sentence as "AIG" or "credit default swaps" would be laughable if laughing weren't already so expensive.

This sordid story of government helplessness in the face of massive taxpayer commitments illustrates better than anything to date why the government should take over any institution that's "too big to fail" and which has cost taxpayers dearly. Such institutions are no longer within the capitalist system because they are no longer accountable to the market. To whom should they be accountable? As long as taxpayers effectively own a large portion of them, they should be accountable to the government.

But if our very own Secretary of the Treasury doesn't even learn of the bonuses until months after AIG has decided to pay them, and cannot make stick his decision that they should not be paid, AIG is not even accountable to the government. That means AIG's executives -- using $170 billion of our money, so far -- are accountable to no one.

The masters of the universe still think they are just that. And if the AIG bonus scandal -- and it is a scandal -- doesn't play out differently than it appeared to be over the weekend, then they're right. Forget the faux populism. We -- taxpayers -- have been burned again and again. This may have been the last match.

Downers

Now there's change we can believe in.

Friday Kaat blogging

Jim Kaat, the greatest pitcher in perhaps the greatest pennant race ever.

Like any good playoff race worth its salt, it came down to the end of the season. The schedule makers, in their infinite wisdom, had the Twins play the Red Sox in Fenway the last two games of the year. The Tigers were tied with Minnesota, with the Red Sox one game back and the White Sox finally dropped. Kaat, the world's best pitcher over the last month, had the start in the first game. Win, and he'd force out Boston and keep the pressure on Detroit.

Almost 33,000 crowded into tiny Fenway Park for the game. The Twins jumped out to the quick lead, scoring one before Kaat ever took the mound. He allowed two singles in the first, including one from (of course) Yaz, but got out of it without giving up a run. He allowed a leadoff single to George Scott in the second but seemed to work out any early-game jitters by retiring the next three, the last two by strikeout. Still staked to his slender 1-0 lead, he began the third by whiffing the first batter.

This was baseball drama at its finest. The hottest pitcher in all of baseball was facing off on the road before a partisan home crowd whose team had the best hitter after an absurdly brilliant pennant race with the entire season on the line. It was a tight one-run game and promised to stay close and tense, just like the entire year had been. The top of the order was about to come up again, and this had all the makings for one of the greatest games in baseball history. If he could hold on, Jim Kaat would be the stuff of legend.

But he was done. He had just faced his last batter of the season.

Doctors, scientists, and baseball fans may wonder what the maximum strain a pitcher can place on his arm, but for Jim Kaat 197 outs in 30 days was all his arm could take. Injured, the Twins had to take him out. The Red Sox won, 6-4. They won the pennant the next day as the Tigers lost again. Kaat's great run has been completely forgotten.

Sense and sensibility

I think this is an important distinction.

What Jon Stewart has done by exposing CNBC's inversion of its fundamental responsibilities towards the public is significant, and sadly unique. But make no mistake, critics like Stewart cannot replace what networks like CNBC are meant to do. Hopefully, they can help shame them into accepting their responsibilities. But the state of journalism in America would not be so desperate if all we needed were more critics like Jon Stewart. What we need is for reporters do to our job better.

I was thinking about this recently as it is what Joe "Doucheborough (as Stewart called him last night)" and others on the Right don't get, and what led Fox News and the creator of 24 to such epic fail when they tried to clone The Daily Show. The Daily Show is not a political satire show. It's a media satire show. Although, contrary to claims, Stewart has pilloried the Obama administration, those on the Right reflexively think he was tougher on Bush. What they fail to understand is Stewart's primary focus was being tough on a press that fawned over George W. Bush during his first term and cheerleaded a war.

Money Honey

For Maria and the rest of the CNBC gang.

Divine search

The pope realizes he should have used Der Google.

MADRID — The letter released Thursday in which Pope Benedict XVI admitted that the Vatican had made “mistakes” in handling the case of a Holocaust-denying bishop was unprecedented in its directness, its humanity and its acknowledgment of papal fallibility.

But it also contained two sentences unique in the annals of church history.

“I have been told that consulting the information available on the Internet would have made it possible to perceive the problem early on,” Benedict wrote. “I have learned the lesson that in the future in the Holy See we will have to pay greater attention to that source of news.”