broadcast: Monday, March 9, 2009 from Tampa
by Olberblogger
Which of these Countdown highlights from Monday
will you be OlberBlogging about
whenever the Olberblogger decides to post them?
#5: Just Say D’oh
Imagine you’re the paper boy. You don’t pay attention and throw the morning Republican-Democrat into a front window. When the screaming homeowner emerges in his bathrobe, you blame the newspaper publisher for the negligence. If it weren’t for the newspaper in the first place, you wouldn’t have had anything to throw that could possibly cause any damage.
Somehow that’s how I see the Republicans in their attacks on the Obama Administration for the worsening economy. They’re the paper boy and Obama publishes the newspaper. Not only is this convoluted “kill the messenger thinking” it overlooks the true culprit in this damage — the paper and ink manufacturers. If everyone had a Kindle, no windows ever would be broken.
The Republicans (with help of the Demos who must have been drinking on the job) busted our economy beginning in the Reagan years. Back then, the game was not eyeball-to-eyeball with the Soviets but military pocketbook-to-pocketbook hoping the other guy would spend his last nickel first. Gorby lost. The Demos did a bit of sopping up, but the Bushies came and bought the Iraqi war on taxpayers’ credit cards. Reaganomics also promoted financial de-regulation and commercial outsourcing of government services.
Now the Republican Congress wants its pals, the bankers, to fail (Just as Rush Limbaugh wishes the same for the Obama Administration). Both Senator John McCain and Senator Richard Shelby. As McCain said “I don‘t think they‘ve made the tough decisions. Some of these banks have to fail.” John, that’s not what you said when you left Letterman in the lurch when you “suspended” your campaign to prevent just such a scenario. Nor was that the case when you did your damnedest to make sure that your pal Charles Keating’s savings and loan didn’t fail in the 1980s.
And the GOP rails against Obama’s “socialism” but exactly to what socialism do they protest too much? The part that suggests that wealth and power are concentrated in a small segment of society — those making way more than $250,000 a year? Or that the economy should be regulated so that the powerful few cannot take advantage of the lowly majority? Or how about that the state should lead economic planning — such as a Federal budget with earmarks for the powerful few? Or that part about all individuals should be equal in society and fairly compensated for their efforts? And whose “socialism” is the “evil” one: Obama’s, Great Britain’s, the Israeli kibbutz? How about those government make-work projects that help keep key manufacturers alive — and I’m not talking GM or Citicorp — the Iraqi War or the space program?
The ever feisty Richard Wolffe pegged it well,
You know, it‘s just—it‘s so amazing that people throw the word around and they have, obviously, no idea what it actually ever meant. You just got to be grateful that this Congress isn‘t dealing with the Soviet Union because, otherwise, they would have threatened Sweden with nuclear annihilation.
#5: Addendum: Breaking The System of Rules
mini “special comment” summarized the current economic situation elegantly. I wish that his summary included some graphics to make it easier to understand as economics always threw me academically.
So, if our economic predicament is not President Obama‘s fault, whose then is it? The answer is not just President Bush. The question is not at all academic because, unless Americans see what happened, the same people who broke the system then will succeed in keeping it broken now for their own gain. The key here that financial firms and their executives are not synonymous, that executives got rich by risking their companies, not so much by breaking the system of rules but rather by breaking the system of rules, systematically rewriting them over decades, hoping to muddy the waters about culpability now, to prevent the return of those rules later.
I’ll attempt to outline KO’s summary. Please read the transcript for the complete overview:
1.)Wall Street executives paid enormous sums — more than $5 billion during the last 10 years — to get Washington off its back. This included banks, security firms, private equity, hedge funds, insurance and real estate. They also put former politicos on their payrolls and often had their former officials in important government jobs or areas of influence.
2.) In 1998, Citibank merged with insurance giant Travelers, although technically that was illegal. Citibank got an exception and a year later Congress killed the Glass-Steagall Act of 1933, established to control financial institution speculation and other mismanagement that led to the Great Depression. The Capitalistic Congressional GOP believed that financial institutions mergers created a system “too big to fail” made such reforms unnecessary.
3.) Loosening regulations allowed the financials to create new money-making and risky investment such as derivatives. New regulations pushed by Wall Street allowed the banks to keep those investments “off the books” which meant they did not need to have enough money on hand to cover potential losses.
4.) When Democrats took control of the White House and Congress, the Clinton Administration expressed concern about the lack of derivative oversight, but Bill’s own Treasury Secretary Robert Rubin, an ex-Goldman Sachs executive nixed any regulation
5.) In 2000, Texas GOP Senator Phil Gramm (a McCain campaign economic advisor) pushed legislation that freed the derivative markets from almost all regulation. President George W. Bush later ended a 20-year-old rule requiring banks to have cash on hand to cover investment losses. Now, thanks to Goldman Sachs Chairman Henry Paulson, later Bush’s Treasury Secretary and bailout guru, banks alone decided how much CYA cash to keep in the vault.
6.) Free from regulation, Wall Street turned anything into off-the-book derivatives including mortgages. Consumers with lousy credit or no credit were pushed into mortgages they could not afford (predatory lending) which were turned into derivatives which could be sold to another investor. Because Wall Street executives had nothing to risk and billions of bonuses to earn, greed fueled the housing bubble.
7.) In 2001, Enron a giant hedge fund and derivative company among other things went bankrupt. President George W. Bush denied ever knowing “Kenny Boy” Lay although the Enron chief spearheaded his Daddy’s 1992 GOP National Convention in Houston. (NOTE: KO didn’t mention the Enron connection which was the first burp in this derivative bubble).
8.) Despite the impending financial crisis Enron foreshadowed, the Federal Reserve under Bush took only three actions against the sub-prime predatory lenders. And Dubya’s Administration pushed legislation to stop states from enforcing their own consumer protection laws — that from the non-socialist GOP promoters of “state’s rights.”
9.) The Wall Street’s prostitution with Washington doesn’t end with the Bushies. The Obama Treasury Secretary Tim Geithner has a former Goldman Sachs lobbyist in a key position and Gary Gensler, another G-S veteran who opposed derivative reform, is Obama’s choice to head the very agency that would oversee them.
To Be Continued…
Folks, the issue isn’t capitalism, socialism, communism, democracy, cubism or pantheism — the issue is the world’s economy risks major depression and someone must administer the proper treatment or we’ll end up killing ourselves (literally and figuratively).
#4: Stemming the celling out of science
Obama reverses the Bush policy that banned federal funding for expanded stem cell research. Now instead of being destroyed, this “potential” human life will serve the purpose of helping to save real human life.
As Obama said during the signing ceremony:
Promoting science isn‘t just about providing resources, it‘s also about protecting free and open inquiry. It is about letting scientists like those who are here today do their jobs, free from manipulation or coercion, and listening to what they tell us, even when it is inconvenient, especially when it‘s inconvenient.
Speaking of inconvenience, if the GOP leadership and their pro-life religious right base would read their Bibles, they would discover that in the Old Testament a fetus is not considered a “person” until it breathes air. Otherwise, the fetus is considered an extension of the mother’s body. Thus, embryos would not be “life” in the Biblical sense. Of course, these same pro-life radicals enjoy ham at Easter and venerate Ronald Reagan regardless of Nancy’s beliefs on stem cell research.
#3: Newt vs Rush
All I can say is, let them duke it out. So much better for the rest of us.

Newt

Rush
#2: Best Worsts:
Michael Wolf, whose book looks inside the Murdoch empire, suddenly gets the Page Six maliciousness treatment with attacks on his private life. Welcome to the Club!
#1: Take Me To Kent Brockman
First came Ben Affleck, then Craig Ferguson, now The Simpsons parody Keith Olbermann. Before you let the imitation go to your head, KO, remember The Simpsons took on Fox News before you first “counted.”
Best OddBall
If you live where I do when the wind blows from a certain direction, that smell comes from Texas City.
Best Bests:
The show biz idiom “break a leg” gains new gravitas
Best STILL Bushed:
I cannot say it better than Keith does,
Such signing statements were used sparingly for 200 years. Bush the great exception. Mr. president, the separation of powers is pretty clear here. If you are good with it, sign it. If you think it harmful or unconstitutional, veto the whole thing. If you don‘t plant on forcing part of it, get a new plan.
Best Fashion Statement:
Keith, loved the suit jacket and the shirt. Ditch the tie and get better lighting when traveling.
MaET = 2130
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