Saturday 6 August 2011
Robert Wilbur, Truthout | Book Review
http://www.truth-out.org/peoples-rogue-fdr-vs-nine-old-men/1312315217
Throughout American history, Supreme Court justices have enjoyed undeserved reverence, which has allowed them, by and large, to be water boys (and girls) for the forces of money and power. The vaunted system of checks and balances is skewed in favor of the Supremes, and, inexplicably, ordinary men and women do not seem to realize that they're being rolled. The present political gridlock as a proximate result of the Supreme Court's Citizens United decision recalls the situation FDR confronted In Jeff Sheshol's new book, "Supreme Power: Franklin Roosevelt vs. the Supreme Court."
The president must have been savoring that afternoon of December 26, 1936. Tea was served, and the president entertained his attorney general with meandering reminiscences of his month-long tour through Latin America, wondering aloud which mementos to donate to the Smithsonian and which to keep in the White House. Eventually he got to the point. Go ahead, he told his A.G. Tell me what you have in mind. The A.G. began with a request: Do not laugh at me when I say that I have the solution. With this, as Shesol recounts, both men broke out laughing.
What Franklin Delano Roosevelt and Homer Cummings found so entertaining was a plan, hatched in the Justice Department, to neuter Chief Justice Charles Evans Hughes and the five other conservatives on the Supreme Court. The plan called for the kind of serious political mischief that brought out the devil in FDR. What made it all the more exciting was that the stakes could not be higher: New Dealers versus robber barons; checks and balances versus the power to govern a country on the verge of death throes.
When FDR assumed the presidency in March 1933, writes Shesol:
the cry was not "justice" but "relief." What was at stake was not simply the eventual return of prosperity. It was the survival of democracy. Could representative government, with its checks and balances, with its suspicion and fragmentation of power, respond quickly to mass hunger, unemployment, desperation, and rage? And if not, could such a system endure much longer? The experience of Germany, Italy, and Japan suggested that it could not.
Even before the very first of the hundred days, even before Roosevelt and Cummings were sworn in, New Dealers had a premonition that, sooner or later, there would be a clash between the executive branch and Hughes and his "old fossils." Anticipating this contingency - this inevitability - senator-elect William McAdoo of California proposed to Cummings a plan to pack the court and, "get the antiquated judges off the bench." Cummings liked the idea. So, according to McAdoo, did president-elect Roosevelt.
The daring experiments of the hundred days evolved with fewer cries from the political right than might have been expected, because small businessmen were hurting too, and they were inclined to give FDR a chance to assuage their pain. A chance, that is, until the New Deal came up against the traditional way of conducting business: sweatshops, long hours, measly wages, union busting, child labor, and other outrages.
It is true that the Justice Department did not scrutinize every piece of New Deal legislation with the care it would have done in ordinary times. But it is also true that the Hughes court scrutinized the same legislation with almost preternatural attention to constitutional nuance and precedent, unearthing rulings that had been forgotten for 50 years or more. So, when the Hughes court struck, it dealt FDR a body blow. First it shot down the blue eagle, symbol of the National Recovery Administration (NRA). Next, it rescinded the firing of a disruptive Republican member of the Federal Trade Commission. And for good measure, it struck down the Frazier-Lemke Farm Mortgage Moratorium Act (actually a bill pushed by rabble-rouser Huey Long, but signed by FDR anyway, and so identified with the New Deal). All three by a vote of 9 to 0, and all on the same day: Black Monday, May 27, 1935, just as the New Deal was finally getting a foothold.
At the dawn of the New Deal era, about 70 percent of judges, from the Supreme Court to night court, were Republicans, thanks to decades of GOP rule in Washington, the statehouses and municipalities. Emboldened by Black Monday, the courts picked off child labor laws, minimum wages and mortgage relief; the plaintiffs were seemingly "little people" who did not want government meddling in their affairs. The reality was that they were stooges for conservative "vigilante committees" bankrolled by the likes of Rockefeller, DuPont and Mellon. The right was on a roll, and like many on a winning streak, they did not know when to stop. On January 6, 1936, by a vote of 6 to 3, the Supreme Court put to death the Agricultural Adjustment Act (AAA), striking a devastating blow at hard-pressed farmers - and setting in motion the plan that would take Cummings to his fateful tea with FDR a year later.
The court-packing bill is often perceived as a legislative freak. This is not correct. By the time the Supreme Court struck down the AAA - with lower courts killing progressive legislation at every opportunity - almost all Democrats and progressives, and some enlightened Republicans, realized that something had to be done to reign in the judiciary - starting at the top. This was all the more important because two crucial bills were waiting in the wings: the Wagner Act, which gave unions the right of collective bargaining, and the jewel in the New Deal crown, Social Security. Legislators, scholars and activists had no shortage of plans in store for the courts, including numerous constitutional amendments to limit judicial review and other powers, bills to force judges into retirement at age 70 or 75, and various ingenious plans for court packing.
There is nothing in the Constitution that sets the number of Supreme Court judges at nine. Originally, there were six; for a while, there were ten; but for decades before the era of FDR, there were nine Supreme Court justices. Though several presidents had tried to pack the court with justices to their own liking, only one was successful: Ulysses S. Grant, who was able to tilt the balance in his favor by adding a single judge. It is doubtful that Roosevelt, Cummings, and their fellow plotters would ever acknowledge Grant, of all presidents, as a soul-brother in jurisprudence.
Nevertheless, the situation in the country was exigent. An amendment to the Constitution, favored by Professor Felix Frankfurter of Harvard, would take too long to pass at a time when Americans were starving. Similar considerations applied to bills that set an age limit on judges. To FDR and his eager attorney general, court packing was the quick and decisive way to go. There were, in fact, a number of court-packing schemes to choose from. The responsibility for reviewing these and putting together a bill was, incredibly, given to a young lawyer in the solicitor general's office named Warner W. Gardner, who worked closely with Cummings. The solicitor general himself avoided the pair because he found the scheme unsavory.
The 1934 midterm elections underscored FDR's popularity - and defied conventional wisdom that the president's party loses seats in the House and Senate. On the contrary, the voters swept the remaining Republicans into the Potomac, seemingly giving FDR an ironclad grip on the legislature. Cummings and Gardner had a court-packing bill ready for FDR, with the dark twist that appealed to him: starting from the premise that court dockets, from the Supreme Court on down, were so overloaded that they imposed an excessive burden on judges, and an especially heavy burden on the nine aging men of the Supreme Court, the bill increased the number of judges throughout the federal judiciary and, in particular, increased the number of Supreme Court judges to 15.
A major problem with the bill, however, was its central premise, which was false - willfully false. Court dockets were not overloaded. A second immediate problem was that FDR waited until February 5 to present his bill to Congress - an astounding blunder in timing, for FDR had allowed the members of his own party to campaign for constitutional amendments and other measures when, in fact, their party leader already had a plan that he did not see fit to share. It would certainly have been understandable if FDR had wished to keep the mechanics of such an explosive plan a secret, but, as Shesol points out, he could have spared Democrats a great deal of embarrassment with a cautionary whisper to candidates not to campaign against the Supreme Court.
The bill stirred scant enthusiasm - especially not among the members of Congress with egg on their chins, nor among many of Roosevelt's advisers. Nor - if the primitive polls of the day are to be believed - among the public at large, probably because Americans did not apprehend how sweeping this bill was. On the other hand, Americans were so programmed to believe in the sanctity of the judiciary, and especially that of the Supreme Court, that the right was quite successful in portraying this bill as a lethal attack on the Constitution itself. As Roosevelt's team sought to garner support for the bill, fellow Democrats continued to introduce constitutional amendments to rein in the court. It turned out that, when it came to the court-packing bill, Roosevelt was not as popular as the recent electoral results suggested. Roosevelt had to make a Faustian pact.
To keep his grip on the Senate, Roosevelt needed Majority Leader Joseph Robinson, to whom he had promised a Supreme Court seat when he was running for president. No one knows whether Roosevelt ever intended to keep this promise, for although Robinson seemed to be a loyal New Dealer, most New Dealers were convinced that he was a closet reactionary. Now, however, Roosevelt had to reiterate his promise: if Robinson would help the president to ratchet the Supreme Court up to 15 justices, one seat would be Robinson's.
On the Supreme Court, surprisingly, events began to break in Roosevelt's favor. In a twofold triumph for the New Deal, the court upheld the constitutionality of both Social Security and the Wagner Act, and the tide was beginning to turn also in Roosevelt's favor in lower courts across the country. Some of Roosevelt's advisers told him what seems obvious today: with the victories for Social Security and the Wagner Act, the swing votes on the court - Hughes and Owen Roberts - understood that not only the court-packing bill, but the Democratic campaign oratory of the recent election, as well as the flood of amendments and bills, boded ill for the power of the Supreme Court should it continue to overturn virtually every progressive bill that came before it. Hughes, a former governor of New York, Secretary of State, presidential candidate (and near-winner) and a masterful lawyer for moneyed interests, took the measure of the forces arrayed against him; he and Roberts knew it was time to back down. Roosevelt's more percipient aides advised him to withdraw the court-packing bill and to leave it hanging over Hughes' head like the sword of Damocles; the bill could always be revived if the court swung back to the right, and in the meantime, Roosevelt could claim a crushing victory.
The political arithmetic showed the fate of the bill on the floor of the Senate was a dead heat in the days before the vote. Without Robinson to make promises and twist arms, the bill would be history. And, just a couple of crucial days before the vote, Roosevelt lost Robinson in a way that this generally most astute of presidents could not have predicted: Robinson complained of pain in his chest and left the Senate early; the next morning his maid found him on his bedroom floor, dead, with his glasses and a copy of the Congressional Record just beyond the reach of his hand.
Now Roosevelt's aides pressed him hard to withdraw the bill. How to explain it? The fashionable explanation was - and almost certainly in most quarters still is - hubris. Shesol's explanation is more nuanced, more insightful. It is undoubtedly true that Roosevelt misconstrued the results of the midterm election, at least when it came to the court-packing bill. And it is also true that, as Shesol writes, Roosevelt had an iron will, though it generally was tempered by excellent judgment. But how unsound was that judgment of his in the present instance? Was it really correct that the court-packing bill would hang over Hughes' head like a sword? The bill was unpopular now - would it become any more popular in the months to come? And specifically, would it suddenly acquire popularity if Hughes or Roberts were to goose-step back to the right? Roosevelt may well have thought, correctly, that the bill stood its best chance of passage while his own popularity was, so it seemed, at its peak.
Roosevelt did not withdraw the bill, which was defeated by an astounding 80-20, with almost all of the nays from Democrats, because the Republicans had already been reduced to a handful. Southern Democrats voted against the bill because many of them were in the pocket of its foes, and because they feared a Roosevelt court would abolish Jim Crow and lynching. Moderates saw little reason to stir up a mares' nest so long as the Hughes court was behaving itself. Even on the left, support for the bill was weaker than one might think because of civil liberties issues. And senators of all denominations knew that the bill was predicated on a myth. Absent a national emergency, the Senate was not prepared to upset a precarious system of checks and balances for a reason that defied the facts.
None would deny that the court-packing bill delivered Roosevelt a humiliating slap in the face, but Shesol, like most historians who have written on this issue, overestimates its significance and duration. By 1937, FDR had succeeded in passing most of the signature legislation of the New Deal. Of course, Roosevelt would continue to govern, but in the domestic arena, there would be no more bills as sweeping as the Wagner Act or Social Security; subsequent legislation would be more targeted, more closely focused on less all-embracing issues. And soon after the start of his third term, FDR would become increasingly preoccupied with foreign affairs. Soon, FDR would wield more power than ever before, the failure of his court-packing scheme notwithstanding - and he would wield it more judiciously than the other two wartime presidents with whom he is compared, Lincoln and Wilson.
Shesol is surely wrong to attribute the court-packing affair to the beginning of the Democratic Party's abandonment by Southerners. Southerners controlled the key committees for decades thereafter, and the Solid South remained solid until Lyndon Johnson rammed through his civil rights legislation and Nixon welcomed the Southerners with open arms.
Shesol has written an engrossing, witty, and carefully researched history of a Supreme Court out of control and a President's fight to contain it. Shesol inclines toward the view that Hughes and his fellow conservatives had only themselves to thank; he clearly appreciates the magnitude of the economic and human catastrophe of the Great Depression. Shesol suggests that the crisis tempered Hughes and Roberts, yielding consistently more liberal verdicts. It seems more probable that FDR prevailed by brute political force, losing the battle but winning the war. Had FDR not rung the fighting juices out of these two aged reactionaries, Social Security might still be a progressive's fantasy.
Robert Wilbur did research in biological psychiatry for many years. He also writes for popular magazines and newsletters. He is active in progressive politics, especially opposition to the Middle East wars and capital punishment, and fighting for animal rights.
Showing posts with label FDR. Show all posts
Showing posts with label FDR. Show all posts
Thursday, August 11, 2011
Wednesday, December 1, 2010
The Story Behind Obama’s Remarks on FDR
http://www.newdeal20.org/2010/11/18/the-story-behind-obamas-remarks-on-fdr-27539/
The Story Behind Obama’s Remarks on FDR
Thursday, 11/18/2010
Thomas Ferguson
What really went on in the first few months after FDR was elected?
“We didn’t actually, I think, do what Franklin Delano Roosevelt did, which was basically wait for six months until the thing had gotten so bad that it became an easier sell politically because we thought that was irresponsible. We had to act quickly.” - President Obama
Sometimes a chance remark trains a searchlight on aspects of the historical record that would otherwise be shrouded in Stygian blackness for a generation. So I think it was yesterday when in the Huffington Post, Leo J. Hindery, Jr. quoted from a transcript of President Obama’s remarks to a group of liberal bloggers who were querying his handling of the financial crisis.
Many readers responded in shocked disbelief: The President can’t mean what he said. He must have misspoken — he can’t really be claiming that Roosevelt sat on his hands, deliberately letting the Depression get worse and worse.
Perhaps it was just a slip. But in 2010, even slips can be revealing — and this one comes from a definite part of the political spectrum. The President was repeating a canard that goes back to the circle of die hards around President Herbert Hoover as he exited the White House in a cloud of bitterness in 1933. In recent years, as a vast campaign against the memory of the New Deal has gathered steam, such claims have gone mainstream. For example, take the carefully hedged version recently put forward by Amity Shlaes in her study of the New Deal, “The Forgotten Man“: “But Roosevelt was not interested in cooperation. We will never know all his motives, but it was clear that a crisis now could only strengthen his mandate for action come inauguration in March.”
We are unlikely ever to know for sure. But as President Obama took office, the Council on Foreign Relations was cranking up a remarkably one-sided conference purporting to be a “Second Look at the Great Depression and the New Deal.” Ms. Shlaes was a prominent participant, as was the Council’s co-chair, one Robert Rubin, whose myriad protégés thronged the Obama Treasury and economic councils.
Whether our highly intellectual president picked up the idea by reading it or hearing somebody else say it, it was, and is, in the air. And you can be sure that his words will now be rattling around for years to come and likely cited as proof of Franklin D. Roosevelt’s “irresponsibility.”
So it makes sense to look more closely at what really happened between Roosevelt and Hoover. This is not too easy to do, though one or two studies, notably Elliot Rosen’s “Hoover, Roosevelt, and the Brains Trust“, have written with insight on the subject.
I often joke that North America is the true “Dark Continent.” We probably know more about tribes in the Amazon jungle than we do about the real nature of power in the United States. Neither political science, nor history, nor economics do very well on this. If you want to understand what really happened between Hoover and Roosevelt between November 1932, when FDR won the election by a landslide, and March 1933, the old inauguration day before passage of the 20th Amendment to the Constitution, you need to comb through the papers of private bankers and the material in more easily available public sources such as the splendid Roosevelt Library in Hyde Park, New York. I have been engaged in this over more decades than I now care to admit. The bottom line is this: Hoover and a substantial bloc of New York bankers wanted Roosevelt to commit to staying on the gold standard and US participation in the upcoming London Economic Conference. These commitments would have meant continued austerity and completely destroyed any chance of fundamental reform — which was why the banks and Hoover were so insistent. In effect, they were hoping to continue with Hoover’s policies, if not Hoover himself.
Roosevelt exchanged some messages with them, but finally refused the whole package. He and his advisers correctly concluded that the idea was to suck them into a foolish set of commitments. FDR was simply not willing to make the kind of arrangements with bankers that President Obama was. That’s the heart of the matter.
Thomas Ferguson is Senior Fellow at the Roosevelt Institute and Professor of Political Science at the University of Massachusetts, Boston. He is the author of many books and articles, including Golden Rule: The Investment Theory of Party Competition and the Logic of Money-Driven Political Systems.
The Story Behind Obama’s Remarks on FDR
Thursday, 11/18/2010
Thomas Ferguson
What really went on in the first few months after FDR was elected?
“We didn’t actually, I think, do what Franklin Delano Roosevelt did, which was basically wait for six months until the thing had gotten so bad that it became an easier sell politically because we thought that was irresponsible. We had to act quickly.” - President Obama
Sometimes a chance remark trains a searchlight on aspects of the historical record that would otherwise be shrouded in Stygian blackness for a generation. So I think it was yesterday when in the Huffington Post, Leo J. Hindery, Jr. quoted from a transcript of President Obama’s remarks to a group of liberal bloggers who were querying his handling of the financial crisis.
Many readers responded in shocked disbelief: The President can’t mean what he said. He must have misspoken — he can’t really be claiming that Roosevelt sat on his hands, deliberately letting the Depression get worse and worse.
Perhaps it was just a slip. But in 2010, even slips can be revealing — and this one comes from a definite part of the political spectrum. The President was repeating a canard that goes back to the circle of die hards around President Herbert Hoover as he exited the White House in a cloud of bitterness in 1933. In recent years, as a vast campaign against the memory of the New Deal has gathered steam, such claims have gone mainstream. For example, take the carefully hedged version recently put forward by Amity Shlaes in her study of the New Deal, “The Forgotten Man“: “But Roosevelt was not interested in cooperation. We will never know all his motives, but it was clear that a crisis now could only strengthen his mandate for action come inauguration in March.”
We are unlikely ever to know for sure. But as President Obama took office, the Council on Foreign Relations was cranking up a remarkably one-sided conference purporting to be a “Second Look at the Great Depression and the New Deal.” Ms. Shlaes was a prominent participant, as was the Council’s co-chair, one Robert Rubin, whose myriad protégés thronged the Obama Treasury and economic councils.
Whether our highly intellectual president picked up the idea by reading it or hearing somebody else say it, it was, and is, in the air. And you can be sure that his words will now be rattling around for years to come and likely cited as proof of Franklin D. Roosevelt’s “irresponsibility.”
So it makes sense to look more closely at what really happened between Roosevelt and Hoover. This is not too easy to do, though one or two studies, notably Elliot Rosen’s “Hoover, Roosevelt, and the Brains Trust“, have written with insight on the subject.
I often joke that North America is the true “Dark Continent.” We probably know more about tribes in the Amazon jungle than we do about the real nature of power in the United States. Neither political science, nor history, nor economics do very well on this. If you want to understand what really happened between Hoover and Roosevelt between November 1932, when FDR won the election by a landslide, and March 1933, the old inauguration day before passage of the 20th Amendment to the Constitution, you need to comb through the papers of private bankers and the material in more easily available public sources such as the splendid Roosevelt Library in Hyde Park, New York. I have been engaged in this over more decades than I now care to admit. The bottom line is this: Hoover and a substantial bloc of New York bankers wanted Roosevelt to commit to staying on the gold standard and US participation in the upcoming London Economic Conference. These commitments would have meant continued austerity and completely destroyed any chance of fundamental reform — which was why the banks and Hoover were so insistent. In effect, they were hoping to continue with Hoover’s policies, if not Hoover himself.
Roosevelt exchanged some messages with them, but finally refused the whole package. He and his advisers correctly concluded that the idea was to suck them into a foolish set of commitments. FDR was simply not willing to make the kind of arrangements with bankers that President Obama was. That’s the heart of the matter.
Thomas Ferguson is Senior Fellow at the Roosevelt Institute and Professor of Political Science at the University of Massachusetts, Boston. He is the author of many books and articles, including Golden Rule: The Investment Theory of Party Competition and the Logic of Money-Driven Political Systems.
Tuesday, November 16, 2010
Jim Webb on Democrats and Wall Street
http://www.salon.com/news/opinion/glenn_greenwald/2010/11/09/webb/index.html
Tuesday, Nov 9, 2010
Jim Webb on Democrats and Wall Street
Glenn Greenwald
In an interview with Real Clear Politics, Democratic Sen. Jim Webb provides just the latest whiff of what the Democratic Party has become:
Webb is a Reagan Democrat who returned home. He was Ronald Reagan's Navy secretary. Almost two decades later, he was the Democrat who scrapped out a win in Virginia.
Webb seems less at home today. He identifies himself as a Democrat. But he has few Democratic leaders to identify with. . . .
Webb's one of the last FDR Democrats. An economic populist. Liberals also admire the populist Webb. The same cannot be said for the Democratic establishment. Webb has pushed for a onetime windfall profits tax on Wall Street's record bonuses. He talks about the "unusual circumstances of the bailout," that the bonuses wouldn't be there without the bailout.
"I couldn't even get a vote," Webb says. "And it wasn't because of the Republicans. I mean they obviously weren't going to vote for it. But I got so much froth from Democrats saying that any vote like that was going to screw up fundraising.
"People look up say, what's the difference between these two parties? Neither of them is really going to take on Wall Street. If they don't have the guts to take them on, and they've got all these other programs that exclude me, well to hell with them. I'm going to vote for the other people who can at least satisfy me on other issues, like abortion. Screw you guys. I understand that mindset."
Undoubtedly, some of the motivation for this complaint is political: Webb barely won in 2006, and just watched as his state, which voted for Obama a mere two years ago, turned almost completely red in this last election. He obviously knows that he has no chance of being re-elected unless he seriously separates himself from the Party and the White House. Still, what caused Jim Webb to switch in the first place to the Democratic Party was (1) his vehement opposition to the Iraq War and (2) his perception that the GOP had become the party-servants of Wall Street and was ignoring (and trampling upon) the interests of working class Americans. That he is now emphatically complaining that Democrats are just as guilty of (2) ought to be taken quite seriously.
One other point about this article: the author (David Paul Kuhn), previously of Politico, included this exceedingly strange though revealing and typical passage:
Yet liberals often seem to view Webb's breed of Democrat more like frenemies. There was Glenn Greenwald, typical among many liberal writers the morning after the election, explaining why he viewed "last night's Blue Dog losses with happiness." This is par for partisan flanks. We saw it on the right this year, when tea party activists savored the defeat of Delaware moderate Republican Mike Castle, though it cost Republicans a critical Senate seat.
Leave to the side the fact that Webb is one of the politicians I've most lavishly praised (see here: "There are few things rarer than a major politician doing something that is genuinely courageous and principled, but Jim Webb's impassioned commitment to fundamental prison reform is exactly that" and here: "in a rational or honorable world, those who knowingly subjected themselves to an onslaught of vicious attacks from all corners for having been so right, such as Jim Webb -- and Howard Dean -- would be heralded as the serious and wise leaders whose judgment can be trusted"). Also leave to the side the trite, anti-democratic Beltway contempt for supporting only those politicians who advocate views one likes, while opposing those with views one dislikes, regardless of party identity (ironically, the willingness to oppose such politicans from "one's own party" -- such as Blue Dogs -- is the exact opposite, by definition, of what those on the "partisan flanks" would do); that's more or less the topic I hope to discuss with Lawrence O'Donnell tonight if he can free himself from the type of substance-free, self-centered, personalized drama in which he seems to be wallowing.
What's most notable and bizarre about this passage is that Kuhn equates Webb's anti-Wall-Street economic populism with "Blue Dogs," and thus understands "Webb's breed of Democrat" to be Blue Dogs. Blue Dogs are the very opposite of that. They are not moderates or centrists or even conservatives; above all else, they are Wall Street and corporate servants, loyalists to the lobbyist class, which is why they've been so well-funded. Jim Webb's anger with the Democratic Party for being so servile to Wall Street doesn't make him a Blue Dog; it makes him an anti-Blue-Dog. Webb's grievances with the Party's economic policies are grounded in everything the Blue Dogs (though by no means only them) represent and do. To equate Webb's anti-Democratic-Party critique with the "ideology" of Blue Dogs is to evince an extraordinary (though quite common) confusion about the debates and divisions within the Democratic Party.
Tuesday, Nov 9, 2010
Jim Webb on Democrats and Wall Street
Glenn Greenwald
In an interview with Real Clear Politics, Democratic Sen. Jim Webb provides just the latest whiff of what the Democratic Party has become:
Webb is a Reagan Democrat who returned home. He was Ronald Reagan's Navy secretary. Almost two decades later, he was the Democrat who scrapped out a win in Virginia.
Webb seems less at home today. He identifies himself as a Democrat. But he has few Democratic leaders to identify with. . . .
Webb's one of the last FDR Democrats. An economic populist. Liberals also admire the populist Webb. The same cannot be said for the Democratic establishment. Webb has pushed for a onetime windfall profits tax on Wall Street's record bonuses. He talks about the "unusual circumstances of the bailout," that the bonuses wouldn't be there without the bailout.
"I couldn't even get a vote," Webb says. "And it wasn't because of the Republicans. I mean they obviously weren't going to vote for it. But I got so much froth from Democrats saying that any vote like that was going to screw up fundraising.
"People look up say, what's the difference between these two parties? Neither of them is really going to take on Wall Street. If they don't have the guts to take them on, and they've got all these other programs that exclude me, well to hell with them. I'm going to vote for the other people who can at least satisfy me on other issues, like abortion. Screw you guys. I understand that mindset."
Undoubtedly, some of the motivation for this complaint is political: Webb barely won in 2006, and just watched as his state, which voted for Obama a mere two years ago, turned almost completely red in this last election. He obviously knows that he has no chance of being re-elected unless he seriously separates himself from the Party and the White House. Still, what caused Jim Webb to switch in the first place to the Democratic Party was (1) his vehement opposition to the Iraq War and (2) his perception that the GOP had become the party-servants of Wall Street and was ignoring (and trampling upon) the interests of working class Americans. That he is now emphatically complaining that Democrats are just as guilty of (2) ought to be taken quite seriously.
One other point about this article: the author (David Paul Kuhn), previously of Politico, included this exceedingly strange though revealing and typical passage:
Yet liberals often seem to view Webb's breed of Democrat more like frenemies. There was Glenn Greenwald, typical among many liberal writers the morning after the election, explaining why he viewed "last night's Blue Dog losses with happiness." This is par for partisan flanks. We saw it on the right this year, when tea party activists savored the defeat of Delaware moderate Republican Mike Castle, though it cost Republicans a critical Senate seat.
Leave to the side the fact that Webb is one of the politicians I've most lavishly praised (see here: "There are few things rarer than a major politician doing something that is genuinely courageous and principled, but Jim Webb's impassioned commitment to fundamental prison reform is exactly that" and here: "in a rational or honorable world, those who knowingly subjected themselves to an onslaught of vicious attacks from all corners for having been so right, such as Jim Webb -- and Howard Dean -- would be heralded as the serious and wise leaders whose judgment can be trusted"). Also leave to the side the trite, anti-democratic Beltway contempt for supporting only those politicians who advocate views one likes, while opposing those with views one dislikes, regardless of party identity (ironically, the willingness to oppose such politicans from "one's own party" -- such as Blue Dogs -- is the exact opposite, by definition, of what those on the "partisan flanks" would do); that's more or less the topic I hope to discuss with Lawrence O'Donnell tonight if he can free himself from the type of substance-free, self-centered, personalized drama in which he seems to be wallowing.
What's most notable and bizarre about this passage is that Kuhn equates Webb's anti-Wall-Street economic populism with "Blue Dogs," and thus understands "Webb's breed of Democrat" to be Blue Dogs. Blue Dogs are the very opposite of that. They are not moderates or centrists or even conservatives; above all else, they are Wall Street and corporate servants, loyalists to the lobbyist class, which is why they've been so well-funded. Jim Webb's anger with the Democratic Party for being so servile to Wall Street doesn't make him a Blue Dog; it makes him an anti-Blue-Dog. Webb's grievances with the Party's economic policies are grounded in everything the Blue Dogs (though by no means only them) represent and do. To equate Webb's anti-Democratic-Party critique with the "ideology" of Blue Dogs is to evince an extraordinary (though quite common) confusion about the debates and divisions within the Democratic Party.
Saturday, November 6, 2010
Obama Blames Insufficient Stimulus on Ben Nelson and Olympia Snowe
http://firedoglake.com/2010/10/28/obama-blames-insufficient-stimulus-on-ben-nelson-and-olympia-snowe-suggests-fdr-was-irresponsible
Obama Blames Insufficient Stimulus on Ben Nelson and Olympia Snowe, Suggests FDR was “Irresponsible”
Blue Texan
Thursday October 28, 2010
President Obama sat down with some progressive bloggers yesterday for a Q&A, and this was one of his more puzzling responses:
"I mean, if folks think that we could have gotten Ben Nelson, Arlen Specter and Susan Collins to vote for additional stimulus beyond the $700 billion that we got, then I would just suggest you weren’t in the meetings.
This notion that somehow I could have gone and made the case around the country for a far bigger stimulus because of the magnitude of the crisis, well, we understood the magnitude of the crisis. We didn’t actually, I think, do what Franklin Delano Roosevelt did, which was basically wait for six months until the thing had gotten so bad that it became an easier sell politically because we thought that was irresponsible. We had to act quickly."
Obama’s narrative doesn’t exactly jibe with reporting about the stimulus:
"Summers did not include Romer’s $1.2-trillion projection [for the stimulus]. The memo argued that the stimulus should not be used to fill the entire output gap; rather, it was “an insurance package against catastrophic failure.” [...]
He [Summers] believed that filling the output gap through deficit spending was important, but that a package that was too large could potentially shift fears from the current crisis to the long-term budget deficit, which would have an unwelcome effect on the bond market. In the end, Summers made the case for the eight-hundred-and-ninety-billion-dollar option."
Larry Summers’ conclusions about the size of the stimulus can’t be blamed on President Snowe. And it’s much closer to the $787B the administration finally got than the $1.2T Romer and people like Paul Krugman were recommmending:
"The president’s willingness to ask for too little was, it turns out, a huge strategic error. It allows his opponents to argue that the Democrats had what they wanted, which then failed. If the president had failed to get what he demanded, he could argue that the outcome was not his fault."
When the stimulus passed, the White House celebrated. There was not the slightest hint that Nelson, Snowe, and Collins were hampering the recovery and putting the country in jeopardy. For Obama now to insist it was their fault that it was too small doesn’t ring true (not to mention that they could’ve passed a larger bill via reconciliation), and in any event, just makes him look weak.
But I really think the President’s remarks about FDR are just bizarre.
Here is a time-line of the “100 Days.”
March 4: Inauguration Day. Franklin Delano Roosevelt becomes President of the United States.
March 5: The President proclaims four-day Bank Holiday with the suspension of banking transactions and gold and currency exports.
March 9: Hundred Days Congressional session begins.
Congress passes the Emergency Banking Act.
March 15: Congress passes the Economy Act
March 31: Congress passes the Reforestation Relief Act, (establishing the Civilian Conservation Corps).
April 19: The President announces US departure from the gold standard.
May 12: Congress passes the Emergency Farm Mortgage Act.
Congress passes the Federal Emergency Relief Act.
The President signs the Agricultural Adjustment Act.
May 18: Congress establishes the Tennessee Valley Authority.
May 27: Congress passes the Federal Securities Act.
June 6: Congress passes the National Employment System Act.
June 13: Congress passes the Home Owners Refinancing Act.
June 16: The end of the Hundred Days session.
Congress passes the National Industrial Recovery Act, (setting up the National Recovery Administration), the Farm Credit Act, and the Banking Act of 1933.
Now that’s some change we can believe in — all in about 3 months! And that doesn’t include the repeal of Prohibition.
The merits of the legislation aside, it’s more than a little jarring to hear a Democratic President accuse FDR of acting irresponsibly in the face of the Great Depression. Moreover, had the Obama administration acted more like Roosevelt’s, they would not be in the situation they find themselves in.
Obama Blames Insufficient Stimulus on Ben Nelson and Olympia Snowe, Suggests FDR was “Irresponsible”
Blue Texan
Thursday October 28, 2010
President Obama sat down with some progressive bloggers yesterday for a Q&A, and this was one of his more puzzling responses:
"I mean, if folks think that we could have gotten Ben Nelson, Arlen Specter and Susan Collins to vote for additional stimulus beyond the $700 billion that we got, then I would just suggest you weren’t in the meetings.
This notion that somehow I could have gone and made the case around the country for a far bigger stimulus because of the magnitude of the crisis, well, we understood the magnitude of the crisis. We didn’t actually, I think, do what Franklin Delano Roosevelt did, which was basically wait for six months until the thing had gotten so bad that it became an easier sell politically because we thought that was irresponsible. We had to act quickly."
Obama’s narrative doesn’t exactly jibe with reporting about the stimulus:
"Summers did not include Romer’s $1.2-trillion projection [for the stimulus]. The memo argued that the stimulus should not be used to fill the entire output gap; rather, it was “an insurance package against catastrophic failure.” [...]
He [Summers] believed that filling the output gap through deficit spending was important, but that a package that was too large could potentially shift fears from the current crisis to the long-term budget deficit, which would have an unwelcome effect on the bond market. In the end, Summers made the case for the eight-hundred-and-ninety-billion-dollar option."
Larry Summers’ conclusions about the size of the stimulus can’t be blamed on President Snowe. And it’s much closer to the $787B the administration finally got than the $1.2T Romer and people like Paul Krugman were recommmending:
"The president’s willingness to ask for too little was, it turns out, a huge strategic error. It allows his opponents to argue that the Democrats had what they wanted, which then failed. If the president had failed to get what he demanded, he could argue that the outcome was not his fault."
When the stimulus passed, the White House celebrated. There was not the slightest hint that Nelson, Snowe, and Collins were hampering the recovery and putting the country in jeopardy. For Obama now to insist it was their fault that it was too small doesn’t ring true (not to mention that they could’ve passed a larger bill via reconciliation), and in any event, just makes him look weak.
But I really think the President’s remarks about FDR are just bizarre.
Here is a time-line of the “100 Days.”
March 4: Inauguration Day. Franklin Delano Roosevelt becomes President of the United States.
March 5: The President proclaims four-day Bank Holiday with the suspension of banking transactions and gold and currency exports.
March 9: Hundred Days Congressional session begins.
Congress passes the Emergency Banking Act.
March 15: Congress passes the Economy Act
March 31: Congress passes the Reforestation Relief Act, (establishing the Civilian Conservation Corps).
April 19: The President announces US departure from the gold standard.
May 12: Congress passes the Emergency Farm Mortgage Act.
Congress passes the Federal Emergency Relief Act.
The President signs the Agricultural Adjustment Act.
May 18: Congress establishes the Tennessee Valley Authority.
May 27: Congress passes the Federal Securities Act.
June 6: Congress passes the National Employment System Act.
June 13: Congress passes the Home Owners Refinancing Act.
June 16: The end of the Hundred Days session.
Congress passes the National Industrial Recovery Act, (setting up the National Recovery Administration), the Farm Credit Act, and the Banking Act of 1933.
Now that’s some change we can believe in — all in about 3 months! And that doesn’t include the repeal of Prohibition.
The merits of the legislation aside, it’s more than a little jarring to hear a Democratic President accuse FDR of acting irresponsibly in the face of the Great Depression. Moreover, had the Obama administration acted more like Roosevelt’s, they would not be in the situation they find themselves in.
Monday, August 16, 2010
FDR's Grandson Debunks "Mythology of Fear" About Social Security
http://crooksandliars.com/node/38844
FDR's Grandson Debunks "Mythology of Fear" About Social Security
karoli
Saturday Aug 07, 2010
James Roosevelt, FDR's grandson, spoke at the National Press Club today about Social Security, past, present and future. He had some pretty serious things to say about those who think attacking Social Security in the name of deficit reduction is wise. In fact, he spent a good deal of his 30-minute speech speaking to the attacks on Social Security coming from the Deficit Commission.
Roosevelt wasted no time coming to the heart of the matter. In his view, the only crisis Social Security faces is one manufactured by its opponents, who have created a "mythology of fear" around the single most successful and valuable social program ever created.
Now let's take a true measure of where we are. Social Security has been the most effective government program; it has been the most responsible government program. Social Security costs are funded out of its own dedicated revenue stream. It does not and cannot borrow money to finance its operations.
There is no deficit financing. Social Security is the epitome of Yankee frugality. It could not be better managed. Social Security returns more than 99 cents to beneficiaries on every dollar collected. I dare you to find a private investment plan that can claim that.
By the end of calendar year 2009, the Social Security trust fund had a positive balance of $2.54 trillion dollars. Let me repeat -- a two point five four trillion dollar surplus. It is estimated that Social Security revenues, including interest on the trust fund, will continue to exceed expenditures through 2024. As a result of interest earned on the trust fund balances, the trust fund surplus will continue to expand to approximately $4.3 trillion dollars in 2003 [sic] (ed. note: correct reference is 2030).
After that year the balances in the Social Security trust fund will begin to decline. Still, reserves will be sufficient to pay full benefits through the year 2037. After the year 2037, Social Security would still be able to pay 76% of benefits.
Now since when is it news that a program is completely solvent for 27 years? If it's not bad news, it's not news at all in the way news is typically reported.
Even in year 2038 and thereafter, it could still pay three quarters of anticipated benefits. This is decidedly not a program that is going broke.
It's not a program that is broke and it's not a program that won't be there when current contributors retire.
In fact, what this is is quite a remarkable achievement. I think if Americans really understood its true financial picture, those poll numbers suggesting people are not counting on Social Security would be reversed.
Doubt would give way to confidence; fear to security.
Roosevelt then carefully enumerated the various myths and knocked them down with facts, admonishing the audience to do the same, via op-ed, speeches, writing and other means to communicate the truth to Americans. He also had some words for the Deficit Commission; specifically, Alan Simpson and other purveyors of the myths.
The United States does not have a social security crisis. It never did. What we do have is fear of a crisis. It is fear that has been fed by the propagation and accumulation of myths about the program. If we let our fears rule our judgment we will undo the greatest government program in our history, one that has eliminated poverty for millions of Americans and supported millions of families in time of need.
This brings us to the current National Commission on Fiscal Responsibility and Reform. While I am deeply supportive of President Obama's efforts to control the burgeoning federal deficit, I am deeply concerned that he has instructed that everything has to be on the table, including Social Security. It's not that I think Social Security is sacred compared to other worthy government programs, although I have a rather personal stake in its continuance.
It doesn't belong on the table because it's different than other programs. By law, the receipts and disbursements of social security trust funds are excluded from the President's budget and the budget resolution passed by Congress. Social Security has its own revenue source, it's prohibited from borrowing funds or going into debt and it can only pay benefits from its own funds.
Social Security should be out of the reach of the Budget Deficit Commission because it is not part of the Federal budget. Since Social Security has not contributed in any way to the deficit, it makes no sense to consider it as part of the solution.
I'm afraid that by placing Social Security under the purview of the Deficit Commission we are contributing to the mythology of fear around Social Security. That mythology says the program is heading for bankruptcy and is unsustainable. That mythology says the program will not be there for our children and our children's children.
I am concerned that although Social Security contributes nothing to the deficit it will be targeted by its enemies on the commission. Its enemies have failed on their frontal assault on Social Security but now they have been given cover by a Deficit Commission.
The opponents of Social Security have been biding their time waiting for an opportunity to attack Social Security without being seen as attacking it. The Deficit Commission could be that opportunity. Quote: (and this one I'm making up) "We love Social Security but we can't afford it." will be their battle cry.
The recent tirade by Deficit Commission co-chair Alan Simpson only confirms my suspicions. Lest anyone think I'm being overly alarmist, facts have not gotten in the way of his determination to target Social Security. Let's examine some of his statements.
Alan Simpson says "Social Security will go broke in 2037." That's a quote. The reality is that Social Security will be able to pay 76% of benefits after 2037, even if we do nothing to adjust it.
Alan Simpson says "There's no surplus in there; it's just a bunch of IOUs." The reality is those IOUs are US Treasury bonds, which have the backing of the full faith and credit of the United States government. Investors all over the world continue to invest in US Treasury bonds. There is simply no more secure asset on the face of the planet.
But Mr. Simpson would have individuals invest their hard-earned money in the stock market. In the long run the stock market may be a good investment but in the short run the value of an individual's private retirement account can change dramatically. I for one am glad that I'm not retiring any time soon, given the battering my 401k has taken in the last few years.
Further evidence of the prudence of the Social Security system is found in the legal requirement that the Treasury pay interest on bonds held by the Social Security trust fund that is equal to the highest rate that it pays on any bonds at the time of their issue.
Mr. Simpson would also have us believe that there is more going out than is coming in to the Social Security trust fund. Again, the reality is that the trust fund has a surplus of $2.4 trillion. That surplus is projected to grow for the next 13 years despite all those baby boomers starting to receive monthly checks.
As Paul Krugman recently pointed out on his blog, the deficit hawks want to have it both ways when it comes to Social Security. They want to treat Social Security as just another program in the federal budget so they don't need to credit it for the quarter century and billions of dollars worth of surpluses it has accumulated. Surpluses which of course, are denominated in those worthless IOUs anyway.
But they want to view Social Security as a program unto itself when the times come that its payments exceed its annual revenues, which we said before is projected to occur in 2017 so they can claim it is going broke.
It is completely nonsensical and deceitful to try to have it both ways.
As a retirement plan professional, I have assisted countless employees and small employers in the planning and administration of their retirement plans. I have always factored in Social Security, and when someone would claim Social Security wouldn't be there for them, I would insist otherwise, using similar facts. These ARE facts. They are not inventions, nor are they prettily dressed statistics made to support one argument or the other.
But people don't hear the truth because no one is reporting it. Social Security does not create or contribute to the deficit. It is solvent. It is reliable. It is not driving the United States into bankruptcy, and it is time to stop using it as a scapegoat and budget wedge.
Let doubt give way to confidence; fear to security.
FDR's Grandson Debunks "Mythology of Fear" About Social Security
karoli
Saturday Aug 07, 2010
James Roosevelt, FDR's grandson, spoke at the National Press Club today about Social Security, past, present and future. He had some pretty serious things to say about those who think attacking Social Security in the name of deficit reduction is wise. In fact, he spent a good deal of his 30-minute speech speaking to the attacks on Social Security coming from the Deficit Commission.
Roosevelt wasted no time coming to the heart of the matter. In his view, the only crisis Social Security faces is one manufactured by its opponents, who have created a "mythology of fear" around the single most successful and valuable social program ever created.
Now let's take a true measure of where we are. Social Security has been the most effective government program; it has been the most responsible government program. Social Security costs are funded out of its own dedicated revenue stream. It does not and cannot borrow money to finance its operations.
There is no deficit financing. Social Security is the epitome of Yankee frugality. It could not be better managed. Social Security returns more than 99 cents to beneficiaries on every dollar collected. I dare you to find a private investment plan that can claim that.
By the end of calendar year 2009, the Social Security trust fund had a positive balance of $2.54 trillion dollars. Let me repeat -- a two point five four trillion dollar surplus. It is estimated that Social Security revenues, including interest on the trust fund, will continue to exceed expenditures through 2024. As a result of interest earned on the trust fund balances, the trust fund surplus will continue to expand to approximately $4.3 trillion dollars in 2003 [sic] (ed. note: correct reference is 2030).
After that year the balances in the Social Security trust fund will begin to decline. Still, reserves will be sufficient to pay full benefits through the year 2037. After the year 2037, Social Security would still be able to pay 76% of benefits.
Now since when is it news that a program is completely solvent for 27 years? If it's not bad news, it's not news at all in the way news is typically reported.
Even in year 2038 and thereafter, it could still pay three quarters of anticipated benefits. This is decidedly not a program that is going broke.
It's not a program that is broke and it's not a program that won't be there when current contributors retire.
In fact, what this is is quite a remarkable achievement. I think if Americans really understood its true financial picture, those poll numbers suggesting people are not counting on Social Security would be reversed.
Doubt would give way to confidence; fear to security.
Roosevelt then carefully enumerated the various myths and knocked them down with facts, admonishing the audience to do the same, via op-ed, speeches, writing and other means to communicate the truth to Americans. He also had some words for the Deficit Commission; specifically, Alan Simpson and other purveyors of the myths.
The United States does not have a social security crisis. It never did. What we do have is fear of a crisis. It is fear that has been fed by the propagation and accumulation of myths about the program. If we let our fears rule our judgment we will undo the greatest government program in our history, one that has eliminated poverty for millions of Americans and supported millions of families in time of need.
This brings us to the current National Commission on Fiscal Responsibility and Reform. While I am deeply supportive of President Obama's efforts to control the burgeoning federal deficit, I am deeply concerned that he has instructed that everything has to be on the table, including Social Security. It's not that I think Social Security is sacred compared to other worthy government programs, although I have a rather personal stake in its continuance.
It doesn't belong on the table because it's different than other programs. By law, the receipts and disbursements of social security trust funds are excluded from the President's budget and the budget resolution passed by Congress. Social Security has its own revenue source, it's prohibited from borrowing funds or going into debt and it can only pay benefits from its own funds.
Social Security should be out of the reach of the Budget Deficit Commission because it is not part of the Federal budget. Since Social Security has not contributed in any way to the deficit, it makes no sense to consider it as part of the solution.
I'm afraid that by placing Social Security under the purview of the Deficit Commission we are contributing to the mythology of fear around Social Security. That mythology says the program is heading for bankruptcy and is unsustainable. That mythology says the program will not be there for our children and our children's children.
I am concerned that although Social Security contributes nothing to the deficit it will be targeted by its enemies on the commission. Its enemies have failed on their frontal assault on Social Security but now they have been given cover by a Deficit Commission.
The opponents of Social Security have been biding their time waiting for an opportunity to attack Social Security without being seen as attacking it. The Deficit Commission could be that opportunity. Quote: (and this one I'm making up) "We love Social Security but we can't afford it." will be their battle cry.
The recent tirade by Deficit Commission co-chair Alan Simpson only confirms my suspicions. Lest anyone think I'm being overly alarmist, facts have not gotten in the way of his determination to target Social Security. Let's examine some of his statements.
Alan Simpson says "Social Security will go broke in 2037." That's a quote. The reality is that Social Security will be able to pay 76% of benefits after 2037, even if we do nothing to adjust it.
Alan Simpson says "There's no surplus in there; it's just a bunch of IOUs." The reality is those IOUs are US Treasury bonds, which have the backing of the full faith and credit of the United States government. Investors all over the world continue to invest in US Treasury bonds. There is simply no more secure asset on the face of the planet.
But Mr. Simpson would have individuals invest their hard-earned money in the stock market. In the long run the stock market may be a good investment but in the short run the value of an individual's private retirement account can change dramatically. I for one am glad that I'm not retiring any time soon, given the battering my 401k has taken in the last few years.
Further evidence of the prudence of the Social Security system is found in the legal requirement that the Treasury pay interest on bonds held by the Social Security trust fund that is equal to the highest rate that it pays on any bonds at the time of their issue.
Mr. Simpson would also have us believe that there is more going out than is coming in to the Social Security trust fund. Again, the reality is that the trust fund has a surplus of $2.4 trillion. That surplus is projected to grow for the next 13 years despite all those baby boomers starting to receive monthly checks.
As Paul Krugman recently pointed out on his blog, the deficit hawks want to have it both ways when it comes to Social Security. They want to treat Social Security as just another program in the federal budget so they don't need to credit it for the quarter century and billions of dollars worth of surpluses it has accumulated. Surpluses which of course, are denominated in those worthless IOUs anyway.
But they want to view Social Security as a program unto itself when the times come that its payments exceed its annual revenues, which we said before is projected to occur in 2017 so they can claim it is going broke.
It is completely nonsensical and deceitful to try to have it both ways.
As a retirement plan professional, I have assisted countless employees and small employers in the planning and administration of their retirement plans. I have always factored in Social Security, and when someone would claim Social Security wouldn't be there for them, I would insist otherwise, using similar facts. These ARE facts. They are not inventions, nor are they prettily dressed statistics made to support one argument or the other.
But people don't hear the truth because no one is reporting it. Social Security does not create or contribute to the deficit. It is solvent. It is reliable. It is not driving the United States into bankruptcy, and it is time to stop using it as a scapegoat and budget wedge.
Let doubt give way to confidence; fear to security.
Wednesday, July 14, 2010
The Elites Have Deficit Fever And Social Security Is The Target
http://crooksandliars.com/susie-madrak/elites-have-deficit-fever-and-social
The Elites Have Deficit Fever And Social Security Is The Target. Don't Count On Obama To Protect It.
Susie Madrak
Friday Jul 02, 2010
It's a cynical political strategy almost beyond belief, but it's becoming obvious that President Obama and the Democratic leaders plan to let the Republicans do what they've tried to do since the days of FDR: Cut Social Security.
Members of President Obama's deficit commission huddled behind closed doors Wednesday despite pleas from the left and right that they hold all their meetings in public.
The move only heightens suspicion that rather than forging a national consensus on future spending priorities, the commission's work will consist of backroom dealings in which members of the Washington aristocracy find high-minded excuses for cutting the social safety net.
[...] Reed said the "actual deliberations are going to be in public, at the full commission meetings."
Uh huh. Right. And I have a bridge in Brooklyn I'd like to sell you.
When I wrote about this last week, some readers insisted it would "never" happen, and questioned whether there was any logical reason Obama would support benefit cuts. So I talked to a couple of D.C. Social Security activists this week and posed that very question. I was told that Obama's reelection strategy was based on allowing Social Security cuts to win over independent voters. (Apparently it polls well with the Tea Party crowd.)
Now, in case you haven't been following this, the Catfood Commission bypasses Congressional line-item input (this alone should be enough to make you worry) and will get an up or down vote in December -- after the elections. So a lame-duck Congress (where some members may be looking for lucrative new jobs) will have to vote on it.
Now, seriously. How can any intelligent person convince themselves that the Obama administration isn't backing this? The commission is stacked with deficit hawks; the national deficit is on track to be more fiscally sound if they let the Bush tax cuts expire; and Social Security, which is a tax-transfer program, doesn't have a damned thing to do with the deficit.
But deficit hawks aren't grounded in reality. They just like inflicting pain on the people who didn't cause our economic crisis.
Ted Marmor, a professor emeritus of public policy and management at Yale writes:
It is crucial to understand how devious such arguments are. They are ideological stances searching for plausible occasions to celebrate what they presume. This ploy is obvious in the case of Social Security pensions, which are not suffering worrisome fiscal imbalances now or later.
The deficit hawks say they are worried about future years - 2037 or 2042 - when there might be some shortfall in Social Security revenues against claims, according to the Congressional Budget Office. But why are they focusing on future decades when the near-term federal deficit is the problem?
Duh! Because the "think about the grandchildren!" line makes it easier to sell!
Now, I suspect Obama also wants to use the Social Security cuts to force Republicans to accept some kind of tax increases -- because it's just so typical of how he operates. "I'll give away economic security for our base if you'll agree to upset your base by accepting new taxes."
This is absolutely the wrong approach. This is the proverbial downward slope. Void the Social Security contract, and it's the beginning of the end for what tattered pieces of the safety net ordinary working people still have.
You want to cut the deficit, Mr. President? It's the war, stupid.
The Elites Have Deficit Fever And Social Security Is The Target. Don't Count On Obama To Protect It.
Susie Madrak
Friday Jul 02, 2010
It's a cynical political strategy almost beyond belief, but it's becoming obvious that President Obama and the Democratic leaders plan to let the Republicans do what they've tried to do since the days of FDR: Cut Social Security.
Members of President Obama's deficit commission huddled behind closed doors Wednesday despite pleas from the left and right that they hold all their meetings in public.
The move only heightens suspicion that rather than forging a national consensus on future spending priorities, the commission's work will consist of backroom dealings in which members of the Washington aristocracy find high-minded excuses for cutting the social safety net.
[...] Reed said the "actual deliberations are going to be in public, at the full commission meetings."
Uh huh. Right. And I have a bridge in Brooklyn I'd like to sell you.
When I wrote about this last week, some readers insisted it would "never" happen, and questioned whether there was any logical reason Obama would support benefit cuts. So I talked to a couple of D.C. Social Security activists this week and posed that very question. I was told that Obama's reelection strategy was based on allowing Social Security cuts to win over independent voters. (Apparently it polls well with the Tea Party crowd.)
Now, in case you haven't been following this, the Catfood Commission bypasses Congressional line-item input (this alone should be enough to make you worry) and will get an up or down vote in December -- after the elections. So a lame-duck Congress (where some members may be looking for lucrative new jobs) will have to vote on it.
Now, seriously. How can any intelligent person convince themselves that the Obama administration isn't backing this? The commission is stacked with deficit hawks; the national deficit is on track to be more fiscally sound if they let the Bush tax cuts expire; and Social Security, which is a tax-transfer program, doesn't have a damned thing to do with the deficit.
But deficit hawks aren't grounded in reality. They just like inflicting pain on the people who didn't cause our economic crisis.
Ted Marmor, a professor emeritus of public policy and management at Yale writes:
It is crucial to understand how devious such arguments are. They are ideological stances searching for plausible occasions to celebrate what they presume. This ploy is obvious in the case of Social Security pensions, which are not suffering worrisome fiscal imbalances now or later.
The deficit hawks say they are worried about future years - 2037 or 2042 - when there might be some shortfall in Social Security revenues against claims, according to the Congressional Budget Office. But why are they focusing on future decades when the near-term federal deficit is the problem?
Duh! Because the "think about the grandchildren!" line makes it easier to sell!
Now, I suspect Obama also wants to use the Social Security cuts to force Republicans to accept some kind of tax increases -- because it's just so typical of how he operates. "I'll give away economic security for our base if you'll agree to upset your base by accepting new taxes."
This is absolutely the wrong approach. This is the proverbial downward slope. Void the Social Security contract, and it's the beginning of the end for what tattered pieces of the safety net ordinary working people still have.
You want to cut the deficit, Mr. President? It's the war, stupid.
Wednesday, June 30, 2010
That ’30s Feeling
http://www.nytimes.com/2010/06/18/opinion/18krugman.html
That ’30s Feeling
PAUL KRUGMAN
June 17, 2010
Suddenly, creating jobs is out, inflicting pain is in. Condemning deficits and refusing to help a still-struggling economy has become the new fashion everywhere, including the United States, where 52 senators voted against extending aid to the unemployed despite the highest rate of long-term joblessness since the 1930s.
Many economists, myself included, regard this turn to austerity as a huge mistake. It raises memories of 1937, when F.D.R.’s premature attempt to balance the budget helped plunge a recovering economy back into severe recession. And here in Germany, a few scholars see parallels to the policies of Heinrich Brüning, the chancellor from 1930 to 1932, whose devotion to financial orthodoxy ended up sealing the doom of the Weimar Republic.
But despite these warnings, the deficit hawks are prevailing in most places — and nowhere more than here, where the government has pledged 80 billion euros, almost $100 billion, in tax increases and spending cuts even though the economy continues to operate far below capacity.
What’s the economic logic behind the government’s moves? The answer, as far as I can tell, is that there isn’t any. Press German officials to explain why they need to impose austerity on a depressed economy, and you get rationales that don’t add up. Point this out, and they come up with different rationales, which also don’t add up. Arguing with German deficit hawks feels more than a bit like arguing with U.S. Iraq hawks back in 2002: They know what they want to do, and every time you refute one argument, they just come up with another.
Here’s roughly how the typical conversation goes (this is based both on my own experience and that of other American economists):
German hawk: “We must cut deficits immediately, because we have to deal with the fiscal burden of an aging population.”
Ugly American: “But that doesn’t make sense. Even if you manage to save 80 billion euros — which you won’t, because the budget cuts will hurt your economy and reduce revenues — the interest payments on that much debt would be less than a tenth of a percent of your G.D.P. So the austerity you’re pursuing will threaten economic recovery while doing next to nothing to improve your long-run budget position.”
German hawk: “I won’t try to argue the arithmetic. You have to take into account the market reaction.”
Ugly American: “But how do you know how the market will react? And anyway, why should the market be moved by policies that have almost no impact on the long-run fiscal position?”
German hawk: “You just don’t understand our situation.”
The key point is that while the advocates of austerity pose as hardheaded realists, doing what has to be done, they can’t and won’t justify their stance with actual numbers — because the numbers do not, in fact, support their position. Nor can they claim that markets are demanding austerity. On the contrary, the German government remains able to borrow at rock-bottom interest rates.
So the real motivations for their obsession with austerity lie somewhere else.
In America, many self-described deficit hawks are hypocrites, pure and simple: They’re eager to slash benefits for those in need, but their concerns about red ink vanish when it comes to tax breaks for the wealthy. Thus, Senator Ben Nelson, who sanctimoniously declared that we can’t afford $77 billion in aid to the unemployed, was instrumental in passing the first Bush tax cut, which cost a cool $1.3 trillion.
German deficit hawkery seems more sincere. But it still has nothing to do with fiscal realism. Instead, it’s about moralizing and posturing. Germans tend to think of running deficits as being morally wrong, while balancing budgets is considered virtuous, never mind the circumstances or economic logic. “The last few hours were a singular show of strength,” declared Angela Merkel, the German chancellor, after a special cabinet meeting agreed on the austerity plan. And showing strength — or what is perceived as strength — is what it’s all about.
There will, of course, be a price for this posturing. Only part of that price will fall on Germany: German austerity will worsen the crisis in the euro area, making it that much harder for Spain and other troubled economies to recover. Europe’s troubles are also leading to a weak euro, which perversely helps German manufacturing, but also exports the consequences of German austerity to the rest of the world, including the United States.
But German politicians seem determined to prove their strength by imposing suffering — and politicians around the world are following their lead.
How bad will it be? Will it really be 1937 all over again? I don’t know. What I do know is that economic policy around the world has taken a major wrong turn, and that the odds of a prolonged slump are rising by the day.
A version of this op-ed appeared in print on June 18, 2010, on page A29 of the New York edition.
That ’30s Feeling
PAUL KRUGMAN
June 17, 2010
Suddenly, creating jobs is out, inflicting pain is in. Condemning deficits and refusing to help a still-struggling economy has become the new fashion everywhere, including the United States, where 52 senators voted against extending aid to the unemployed despite the highest rate of long-term joblessness since the 1930s.
Many economists, myself included, regard this turn to austerity as a huge mistake. It raises memories of 1937, when F.D.R.’s premature attempt to balance the budget helped plunge a recovering economy back into severe recession. And here in Germany, a few scholars see parallels to the policies of Heinrich Brüning, the chancellor from 1930 to 1932, whose devotion to financial orthodoxy ended up sealing the doom of the Weimar Republic.
But despite these warnings, the deficit hawks are prevailing in most places — and nowhere more than here, where the government has pledged 80 billion euros, almost $100 billion, in tax increases and spending cuts even though the economy continues to operate far below capacity.
What’s the economic logic behind the government’s moves? The answer, as far as I can tell, is that there isn’t any. Press German officials to explain why they need to impose austerity on a depressed economy, and you get rationales that don’t add up. Point this out, and they come up with different rationales, which also don’t add up. Arguing with German deficit hawks feels more than a bit like arguing with U.S. Iraq hawks back in 2002: They know what they want to do, and every time you refute one argument, they just come up with another.
Here’s roughly how the typical conversation goes (this is based both on my own experience and that of other American economists):
German hawk: “We must cut deficits immediately, because we have to deal with the fiscal burden of an aging population.”
Ugly American: “But that doesn’t make sense. Even if you manage to save 80 billion euros — which you won’t, because the budget cuts will hurt your economy and reduce revenues — the interest payments on that much debt would be less than a tenth of a percent of your G.D.P. So the austerity you’re pursuing will threaten economic recovery while doing next to nothing to improve your long-run budget position.”
German hawk: “I won’t try to argue the arithmetic. You have to take into account the market reaction.”
Ugly American: “But how do you know how the market will react? And anyway, why should the market be moved by policies that have almost no impact on the long-run fiscal position?”
German hawk: “You just don’t understand our situation.”
The key point is that while the advocates of austerity pose as hardheaded realists, doing what has to be done, they can’t and won’t justify their stance with actual numbers — because the numbers do not, in fact, support their position. Nor can they claim that markets are demanding austerity. On the contrary, the German government remains able to borrow at rock-bottom interest rates.
So the real motivations for their obsession with austerity lie somewhere else.
In America, many self-described deficit hawks are hypocrites, pure and simple: They’re eager to slash benefits for those in need, but their concerns about red ink vanish when it comes to tax breaks for the wealthy. Thus, Senator Ben Nelson, who sanctimoniously declared that we can’t afford $77 billion in aid to the unemployed, was instrumental in passing the first Bush tax cut, which cost a cool $1.3 trillion.
German deficit hawkery seems more sincere. But it still has nothing to do with fiscal realism. Instead, it’s about moralizing and posturing. Germans tend to think of running deficits as being morally wrong, while balancing budgets is considered virtuous, never mind the circumstances or economic logic. “The last few hours were a singular show of strength,” declared Angela Merkel, the German chancellor, after a special cabinet meeting agreed on the austerity plan. And showing strength — or what is perceived as strength — is what it’s all about.
There will, of course, be a price for this posturing. Only part of that price will fall on Germany: German austerity will worsen the crisis in the euro area, making it that much harder for Spain and other troubled economies to recover. Europe’s troubles are also leading to a weak euro, which perversely helps German manufacturing, but also exports the consequences of German austerity to the rest of the world, including the United States.
But German politicians seem determined to prove their strength by imposing suffering — and politicians around the world are following their lead.
How bad will it be? Will it really be 1937 all over again? I don’t know. What I do know is that economic policy around the world has taken a major wrong turn, and that the odds of a prolonged slump are rising by the day.
A version of this op-ed appeared in print on June 18, 2010, on page A29 of the New York edition.
Sunday, March 22, 2009
Barack 'Hoover' Obama
http://rense.com/general85/hoov.htm
Barack 'Hoover' Obama
Bruce Marshall
3-11-9
The American people must quickly understand this one reality: that the economic policies of Barack H. Obama are essentially identical to those of Herbert Hoover's ill-starred Reconstruction Finance Corporation, which bailed out bankrupt banks in a totally futile exercise between 1931 and 1933.. Obama is doing the same thing as Hoover ; bailing out a hopelessly bankrupt zombie banking system, this time with trillions of dollars, while further destroying the productive economy of the United States in this insane giveaway to those who caused the crisis. Unlike Hoover, Obama has put some popular programs up as camouflage for the massive giveaway to the derivatives mafia that is going on in the background under the auspices of Geithner, Summers, Bernanke, and Volcker.
The present problem is that Obama is more dangerous than Hoover . This is because Obama has people fooled into thinking that he will initiate New Deal policies and leadership akin to FDR to deal with the present financial meltdown crisis and depression. Consider that the stimulus package offers a measly $45 billion towards infrastructure projects with very limited $20 billion increase in food stamps and a microscopic $18 billion of welfare benefits needed in this crisis. These crumbs allow Obama to continue to present the image that he is some sort of populist from the left, while Obama provides massive welfare for the 'Zombie banks" on Wall Street to the tune of 10 Trillion, no questions asked.
Here is the breakdown of the giveaway: Federal Reserve $8 trillion, $5.5 trillion, Bush-Paulson TARP- $.7 trillion, Obama-Geithner derivatives bailout $.75 trillion, carbon cap and trade tax scam $.65 trillion - the next bubble. Geithner's undisclosed phase 2 will be at least at least $750 billion, but will soon spiral into the trillions. Thus the beginning of Obama's era of his 'responsibility' to the derivatives speculators first.
To keep the charade going Obama has launched into an attack on the reactionary Rush Limbaugh, Wall Street's right wing enforcer, who is all to eager to continue to mislead people about the true nature of the present crisis. Obama and Rush are working together, in a false polemic that divides people and prevents real solutions from being discussed and implemented. Rush provides Obama with the left label and cover that he needs to implement policies that Rush and the right could never deliver for their same Wall Street masters. Yes, both are creatures of Wall Street, Obama the Keynsian Malthusian, and Rush the Austrian School free market Malthusian. Rush will freak out about increases for food stamps and the paltry help that Obama will give to a fraction of the foreclosed, but not a word about the real problem: the $ 1.8 quadrillion dollar derivatives bubble black hole which Obama is feeding with the U.S taxpayer and economy as collateral. Why is Rush not freaking out about this real tax increase and enslavement? The answer is that he really approves of it.
Derivatives are at the center of this financial meltdown and economic depression. Derivatives are financial instruments that are based upon a fictitious reality that does not correspond with activities that yield tangible wealth and economic progress. Derivatives are essentially exotic betting practices that involve real money, thrown into a huge pool. We are talking quadrillions of dollars, sums of money that can never be repaid, even by the combined GDP of the world. Obama is giving the "Zombie banks" trillions, where nothing will satiate the speculative derivatives black hole, while at the same time it is estimated that trillions are needed to keep people in homes and factories producing. The fact already seen is that the trillions from the Fed, the TARP's have done nothing to stop the economic depression. That money will never be recovered as it is already lost to derivatives speculation.
The only solution is to outlaw all derivatives once again. They were once illegal, until 1982 when options trading in commodities was introduced and later in the 1990's when Fed Chair Alan Greenspan created and fed the fictitious derivatives racket.
Along with outlawing derivatives, the responsible approach to this crisis is to force the derivatives investment houses, the Wall Street banks and hedge funds, into bankruptcy organization, wiping out the bad dept with one stroke of the pen. Instead of doing this as he could and should have, Obama has instead rewarded these criminals with more trillions of taxpayer money, money that should be invested in infrastructure, by the trillions.
The fact of the matter is that Obama has proven that he is no FDR, but a Hoover money vacuum for Wall Street derivatives 'zombie' banks, to which he blows the nation's wad, and thus the chance for a real economic recovery.
Barack 'Hoover' Obama
Bruce Marshall
3-11-9
The American people must quickly understand this one reality: that the economic policies of Barack H. Obama are essentially identical to those of Herbert Hoover's ill-starred Reconstruction Finance Corporation, which bailed out bankrupt banks in a totally futile exercise between 1931 and 1933.. Obama is doing the same thing as Hoover ; bailing out a hopelessly bankrupt zombie banking system, this time with trillions of dollars, while further destroying the productive economy of the United States in this insane giveaway to those who caused the crisis. Unlike Hoover, Obama has put some popular programs up as camouflage for the massive giveaway to the derivatives mafia that is going on in the background under the auspices of Geithner, Summers, Bernanke, and Volcker.
The present problem is that Obama is more dangerous than Hoover . This is because Obama has people fooled into thinking that he will initiate New Deal policies and leadership akin to FDR to deal with the present financial meltdown crisis and depression. Consider that the stimulus package offers a measly $45 billion towards infrastructure projects with very limited $20 billion increase in food stamps and a microscopic $18 billion of welfare benefits needed in this crisis. These crumbs allow Obama to continue to present the image that he is some sort of populist from the left, while Obama provides massive welfare for the 'Zombie banks" on Wall Street to the tune of 10 Trillion, no questions asked.
Here is the breakdown of the giveaway: Federal Reserve $8 trillion, $5.5 trillion, Bush-Paulson TARP- $.7 trillion, Obama-Geithner derivatives bailout $.75 trillion, carbon cap and trade tax scam $.65 trillion - the next bubble. Geithner's undisclosed phase 2 will be at least at least $750 billion, but will soon spiral into the trillions. Thus the beginning of Obama's era of his 'responsibility' to the derivatives speculators first.
To keep the charade going Obama has launched into an attack on the reactionary Rush Limbaugh, Wall Street's right wing enforcer, who is all to eager to continue to mislead people about the true nature of the present crisis. Obama and Rush are working together, in a false polemic that divides people and prevents real solutions from being discussed and implemented. Rush provides Obama with the left label and cover that he needs to implement policies that Rush and the right could never deliver for their same Wall Street masters. Yes, both are creatures of Wall Street, Obama the Keynsian Malthusian, and Rush the Austrian School free market Malthusian. Rush will freak out about increases for food stamps and the paltry help that Obama will give to a fraction of the foreclosed, but not a word about the real problem: the $ 1.8 quadrillion dollar derivatives bubble black hole which Obama is feeding with the U.S taxpayer and economy as collateral. Why is Rush not freaking out about this real tax increase and enslavement? The answer is that he really approves of it.
Derivatives are at the center of this financial meltdown and economic depression. Derivatives are financial instruments that are based upon a fictitious reality that does not correspond with activities that yield tangible wealth and economic progress. Derivatives are essentially exotic betting practices that involve real money, thrown into a huge pool. We are talking quadrillions of dollars, sums of money that can never be repaid, even by the combined GDP of the world. Obama is giving the "Zombie banks" trillions, where nothing will satiate the speculative derivatives black hole, while at the same time it is estimated that trillions are needed to keep people in homes and factories producing. The fact already seen is that the trillions from the Fed, the TARP's have done nothing to stop the economic depression. That money will never be recovered as it is already lost to derivatives speculation.
The only solution is to outlaw all derivatives once again. They were once illegal, until 1982 when options trading in commodities was introduced and later in the 1990's when Fed Chair Alan Greenspan created and fed the fictitious derivatives racket.
Along with outlawing derivatives, the responsible approach to this crisis is to force the derivatives investment houses, the Wall Street banks and hedge funds, into bankruptcy organization, wiping out the bad dept with one stroke of the pen. Instead of doing this as he could and should have, Obama has instead rewarded these criminals with more trillions of taxpayer money, money that should be invested in infrastructure, by the trillions.
The fact of the matter is that Obama has proven that he is no FDR, but a Hoover money vacuum for Wall Street derivatives 'zombie' banks, to which he blows the nation's wad, and thus the chance for a real economic recovery.
Tuesday, November 11, 2008
Obama's First Appointment - An Ominous Portent
http://rense.com/general84/bark.htm
Obama's First Appointment -
An Ominous Portent
Barky's First Choices - No Seat At The Table For Labor And The Third World
By Webster G. Tarpley
11-7-8
WASHINGTON DC -- Obama's first appointments have confirmed the grimmest suspicions about the new regime.
The naming of the vicious thug Rahm Emanuel as the new Martin Bormann of the regime has caused much consternation, even among the netroots or nutroots crowd over at the Daily Kos. Rahm is a former member of the Israeli Defense Force whose ruling passion is that he is a warmonger. In 2006, when Rahm ran the Democratic congressional money machine, he made sure that only warmongers committed to the open-ended prosecution of the Afghan and Iraq wars could get any Democratic Party financing for their races. Many contests were lost as a result. A tragic case was that of grass-roots antiwar activist Christine Cegelis of Ohio, who was defeated in the Democratic primary by Tammy Duckworth, an Iraq war veteran who advocated endless hostilities there. Duckworth lost to the Republican by several points. If the $300,000 Rahm gave Duckworth had been shared with anti-war candidate Bob Bowen in Florida, a Democratic seat could easily have been added. Rahm is also a product of the filthy and corrupt Illinois bipartisan Combine, which I have described in my books.
A co-chair of the transition team is Valerie Jarrett, who served as Barky's travelling schoolmarm during the campaign. Jarrett also comes from the Daley wing of the Illinois combine. She has provided graft and related support for Michelle Obama's foundation-funded operations. Jarrett is also an integral part of the Chicago housing graft community, a region also inhabited by Barky's original godfather, the convicted felon and thief Tony Rezko. Jarrett is discussed in detail in my Obama biography. She is joined on the transition team by John Podesta, a Clinton-era retread who worked for Sen. Tom Daschle, the senator from Citibank, the biggest employer in South Dakota. Podesta also worked for Sen. Patrick Leahy of Vermont, a close personal friend of Weatherman terrorist bombers Bill Ayers and Bernardine Dohrn.
Another Daschle-Citibank retread is transition co-chair Tom Rouse, who was the chief of staff for Daschle when he was the weakest Democratic majority leader in recent memory, surrendering to Bush on point after point. Chief strategist remains David Axelrod of the corrupt Illinois Combine, who was taught his mindbending skills in the infamous "1313" Rockefeller-funded think tank at the University of Chicago.
BANKERS ONLY: NO VOICE FOR LABOR, RETIREES, SMALL BUSINESS, WOMEN
Obama's transitional council of economic advisers is also notable. The dominant figures here are all Wall Street derivatives merchants and their quackademic apologists and politician clients. The key people here are plutocrat Warren Buffet, Obama moneybags and Hyatt heiress Penny Pritzker, Goldman Sachs-Citibank alum Robert Rubin, woman-hating thug and failed Harvard president Larry Summers, Google spook Eric Schmidt, and Roger Ferguson, the former vice president of the Federal Reserve board. The most obscene is Trilateral Commission bigwig Paul Adolf Volcker, the bringer of the 22% prime rate of 1981 and the destroyer of the US indsutrial base. What is truly notable about this list is that there is not one single labor leader. No Sweeney of the AFL-CIO, no Hoffa of the Teamsters, no UAW, not even the unsavory Andy Stern of the SIEU, all big Obama backers. Note the difference to the New Deal, when labor reps were indispensable. With Barky, only derivatives monsters and their stooges need apply. Also notable by their absence are leaders of women's groups, small business associations, the congressional black caucus, retirees groups like the AARP there is not even a token face representing any of these groups, all of which have a vital interest in economic policy. Read the ill omens if you have eyes to see. The Obama regime is shaping up as of the bankers, by the bankers, for the bankers. This is not the FDR New Deal this is the Mussolini fascist corporate state.
WASHINGTON ECONOMIC CONFERENCE: THE DERIVATIVES BLOC VS. THE ANTI- DERIVATIVES BLOC
We are also told that Barky has been on the phone to foreign leaders about matters of economic. Let us read the tea leaves: whom did Barky call? Here is the list: Australia, the British, Canada, France, Germany, Israel, Japan, Mexico, and South Korea.
Notice now who is NOT on the list. Start with the great world powers who have been snubbed: Russia and China, both of whom are bigger holders of US Treasury bonds than most of those who are on the list. Saudi Arabia, who might have needed reassurance that Barky is not a commie, are also snubbed. Forget ideology, and behold the ineptitude. Most glaring of all is the lack of any phone call to a leading third world or developing sector country, other than Mexico, which is a branch of NAFTA. No calls were made to Brazil, Argentina, South Africa, Nigeria, Algeria, India or a long list of other leading states. Nobody in Africa, nobody in south Asia, and nobody in South America got a call. Not even those who will be coming to the pseudo-Bretton Woods conference set for Washington later this month. The best we can hope for regarding that conference is that it end in a stalemate, dividing the world between a US-UK dominated derivatives bloc and a Brazil-India- Russia-China-South Africa anti-derivatives bloc interested in real physical commodity production, not fictitious capital.
Obama, in summation, is acting just like the abject puppet of the Wall Street derivatives merchants and warmongers which we have argued him to be.
Webster G. Tarpley is the author of Obama - The Postmodern Coup: The Making of a Manchurian Candidate, and Barack H. Obama: The Unauthorized Biography, both available from amazon.com.
Obama's First Appointment -
An Ominous Portent
Barky's First Choices - No Seat At The Table For Labor And The Third World
By Webster G. Tarpley
11-7-8
WASHINGTON DC -- Obama's first appointments have confirmed the grimmest suspicions about the new regime.
The naming of the vicious thug Rahm Emanuel as the new Martin Bormann of the regime has caused much consternation, even among the netroots or nutroots crowd over at the Daily Kos. Rahm is a former member of the Israeli Defense Force whose ruling passion is that he is a warmonger. In 2006, when Rahm ran the Democratic congressional money machine, he made sure that only warmongers committed to the open-ended prosecution of the Afghan and Iraq wars could get any Democratic Party financing for their races. Many contests were lost as a result. A tragic case was that of grass-roots antiwar activist Christine Cegelis of Ohio, who was defeated in the Democratic primary by Tammy Duckworth, an Iraq war veteran who advocated endless hostilities there. Duckworth lost to the Republican by several points. If the $300,000 Rahm gave Duckworth had been shared with anti-war candidate Bob Bowen in Florida, a Democratic seat could easily have been added. Rahm is also a product of the filthy and corrupt Illinois bipartisan Combine, which I have described in my books.
A co-chair of the transition team is Valerie Jarrett, who served as Barky's travelling schoolmarm during the campaign. Jarrett also comes from the Daley wing of the Illinois combine. She has provided graft and related support for Michelle Obama's foundation-funded operations. Jarrett is also an integral part of the Chicago housing graft community, a region also inhabited by Barky's original godfather, the convicted felon and thief Tony Rezko. Jarrett is discussed in detail in my Obama biography. She is joined on the transition team by John Podesta, a Clinton-era retread who worked for Sen. Tom Daschle, the senator from Citibank, the biggest employer in South Dakota. Podesta also worked for Sen. Patrick Leahy of Vermont, a close personal friend of Weatherman terrorist bombers Bill Ayers and Bernardine Dohrn.
Another Daschle-Citibank retread is transition co-chair Tom Rouse, who was the chief of staff for Daschle when he was the weakest Democratic majority leader in recent memory, surrendering to Bush on point after point. Chief strategist remains David Axelrod of the corrupt Illinois Combine, who was taught his mindbending skills in the infamous "1313" Rockefeller-funded think tank at the University of Chicago.
BANKERS ONLY: NO VOICE FOR LABOR, RETIREES, SMALL BUSINESS, WOMEN
Obama's transitional council of economic advisers is also notable. The dominant figures here are all Wall Street derivatives merchants and their quackademic apologists and politician clients. The key people here are plutocrat Warren Buffet, Obama moneybags and Hyatt heiress Penny Pritzker, Goldman Sachs-Citibank alum Robert Rubin, woman-hating thug and failed Harvard president Larry Summers, Google spook Eric Schmidt, and Roger Ferguson, the former vice president of the Federal Reserve board. The most obscene is Trilateral Commission bigwig Paul Adolf Volcker, the bringer of the 22% prime rate of 1981 and the destroyer of the US indsutrial base. What is truly notable about this list is that there is not one single labor leader. No Sweeney of the AFL-CIO, no Hoffa of the Teamsters, no UAW, not even the unsavory Andy Stern of the SIEU, all big Obama backers. Note the difference to the New Deal, when labor reps were indispensable. With Barky, only derivatives monsters and their stooges need apply. Also notable by their absence are leaders of women's groups, small business associations, the congressional black caucus, retirees groups like the AARP there is not even a token face representing any of these groups, all of which have a vital interest in economic policy. Read the ill omens if you have eyes to see. The Obama regime is shaping up as of the bankers, by the bankers, for the bankers. This is not the FDR New Deal this is the Mussolini fascist corporate state.
WASHINGTON ECONOMIC CONFERENCE: THE DERIVATIVES BLOC VS. THE ANTI- DERIVATIVES BLOC
We are also told that Barky has been on the phone to foreign leaders about matters of economic. Let us read the tea leaves: whom did Barky call? Here is the list: Australia, the British, Canada, France, Germany, Israel, Japan, Mexico, and South Korea.
Notice now who is NOT on the list. Start with the great world powers who have been snubbed: Russia and China, both of whom are bigger holders of US Treasury bonds than most of those who are on the list. Saudi Arabia, who might have needed reassurance that Barky is not a commie, are also snubbed. Forget ideology, and behold the ineptitude. Most glaring of all is the lack of any phone call to a leading third world or developing sector country, other than Mexico, which is a branch of NAFTA. No calls were made to Brazil, Argentina, South Africa, Nigeria, Algeria, India or a long list of other leading states. Nobody in Africa, nobody in south Asia, and nobody in South America got a call. Not even those who will be coming to the pseudo-Bretton Woods conference set for Washington later this month. The best we can hope for regarding that conference is that it end in a stalemate, dividing the world between a US-UK dominated derivatives bloc and a Brazil-India- Russia-China-South Africa anti-derivatives bloc interested in real physical commodity production, not fictitious capital.
Obama, in summation, is acting just like the abject puppet of the Wall Street derivatives merchants and warmongers which we have argued him to be.
Webster G. Tarpley is the author of Obama - The Postmodern Coup: The Making of a Manchurian Candidate, and Barack H. Obama: The Unauthorized Biography, both available from amazon.com.
Forget JFK, Obama could be the next Jimmy Carter
http://www.telegraph.co.uk/finance/comment/3393741/Obama-must-lower-expectations-to-raise-hopes-of-a-recovery.html
Forget JFK, Obama could be the next Jimmy Carter
Barack Obama and his supporters have been drinking from a bottle of elixir labelled Hope. But the President-Elect knows as well as everyone else that there are gallons of bitter medicine to be swallowed if the economy is to be saved.
By Adrian Michaels, Group Foreign Editor
06 Nov 2008
To be as responsible as he has promised, he has to change the behaviour of consumers, of government and of regulators that has led America into a period of declining growth and employment.
If he is successful, he could create so much resentment that he will be booted out of the White House after just one term. Obama's supporters may imagine their man to be the next Roosevelt or Kennedy. But instead of BHO to follow FDR and JFK, he could end up being the next Jimmy Carter.
Fixing the economy pitches Obama into two big battles. The first will be with many of the Americans who have just voted for him. They have responded to a promise of "change you can believe in" - and they had better start believing that they have to accept falling house prices and a pervasive feeling of being less wealthy.
The Democratic-controlled Congress is Obama's second battle. If the economy starts to grow again, then Democratic politicians had better believe that spending must be cut heavily and that they will not be able to fulfil campaign promises.
It is hard to imagine that a new president with a thumping majority in the electoral college will start to lower expectations quickly. But Obama must. American consumers had only one of the starring roles in the financial and economic crisis, but it was important.
Goaded by cheap credit they spent more of their income. They took out ludicrously unsafe mortages and ran up big balances on their credit cards. Their overborrowing was mirrored by private equity groups that overpaid for businesses. Such deals encouraged shares to go up as investors foresaw being bought out at crazy rates. Higher share values made people feel wealthier: it must be time for another cruise, or car.
Now all that credit has been withdrawn, house prices must continue to fall until people who are not taking unsustainable risks can afford to pay them. People are starting already to spend less. Their reduced economic activity will drive down asset prices.
Obama must tell Americans that this is necessary. A painful recession is inevitable. He can promise help from the government with targeted spending of its own until the economy picks up.
There isn't much money around, but interest rates are low and the government can probably afford to borrow and increase its projected $1 trillion deficit for now. It is interesting to reflect that it was consumers attracted by cheap money that helped to create the crisis. Paradoxically it is the availability of cheap money that could show the way out.
Congress will pass an economic stimulus package and attempt to arrest price falls, or else deflation would last too long and sap the morale of a generation. Infrastructure plans and other projects could fill the gap in demand and reduce unemployment.
And if all that goes according to plan, then Obama somehow has to stop a rampant Congress from believing that a more bloated and invasive government was more than a temporary measure to combat a deep recession. Governments believe that increasing spending in a downturn is probably a good measure, but they find it impossible to cut expenditure when an economy recovers.
Cutbacks will be hard because the Democrats controlling Congress want to spend on far more than anti-recession measures. President-Elect Obama has huge spending plans, and has not told us how they have been affected by the economic crisis.
Decreased government spending in an upturn is a necessity because private enterprise generally knows better what to do with money than government. Businesses and individuals need to be encouraged to invest in projects of their own, when they can, rather than in government bonds.
But will Obama be able to face down a runaway Congress? The House and Senate may pass spending bills, but they can be vetoed by the president. Too many vetoes and the president looks out of touch - after all, Congressmen and women were elected too.
I found this online, from Time magazine in June 1977: "Determined to balance the budget by the end of his first term, Carter, the fiscal conservative, is clipping away at congressional spending. The more liberal Congress is on the verge of passing three bills that could exceed his spending plans...the White House seems to be virtually itching to veto the [plans] ... when [they reach] ... Carter's desk."
And so the seeds of Democratic civil war and electoral disaster were sown.
In the battles to come, with his people and then his party, Obama will have numerous opportunities to mess up. If an economic stimulus is spent on tax cuts that simply encourage more consumer spending then all will be lost. He must also play a leading role in framing a new architecture for the world economy. Badly-drawn regulations will create more problems than they solve.
The President-Elect's team must agree on goals and a plan. Its members did that well in the campaign. They need to keep their discipline in the years ahead. An elixir called brandy will come in useful.
Forget JFK, Obama could be the next Jimmy Carter
Barack Obama and his supporters have been drinking from a bottle of elixir labelled Hope. But the President-Elect knows as well as everyone else that there are gallons of bitter medicine to be swallowed if the economy is to be saved.
By Adrian Michaels, Group Foreign Editor
06 Nov 2008
To be as responsible as he has promised, he has to change the behaviour of consumers, of government and of regulators that has led America into a period of declining growth and employment.
If he is successful, he could create so much resentment that he will be booted out of the White House after just one term. Obama's supporters may imagine their man to be the next Roosevelt or Kennedy. But instead of BHO to follow FDR and JFK, he could end up being the next Jimmy Carter.
Fixing the economy pitches Obama into two big battles. The first will be with many of the Americans who have just voted for him. They have responded to a promise of "change you can believe in" - and they had better start believing that they have to accept falling house prices and a pervasive feeling of being less wealthy.
The Democratic-controlled Congress is Obama's second battle. If the economy starts to grow again, then Democratic politicians had better believe that spending must be cut heavily and that they will not be able to fulfil campaign promises.
It is hard to imagine that a new president with a thumping majority in the electoral college will start to lower expectations quickly. But Obama must. American consumers had only one of the starring roles in the financial and economic crisis, but it was important.
Goaded by cheap credit they spent more of their income. They took out ludicrously unsafe mortages and ran up big balances on their credit cards. Their overborrowing was mirrored by private equity groups that overpaid for businesses. Such deals encouraged shares to go up as investors foresaw being bought out at crazy rates. Higher share values made people feel wealthier: it must be time for another cruise, or car.
Now all that credit has been withdrawn, house prices must continue to fall until people who are not taking unsustainable risks can afford to pay them. People are starting already to spend less. Their reduced economic activity will drive down asset prices.
Obama must tell Americans that this is necessary. A painful recession is inevitable. He can promise help from the government with targeted spending of its own until the economy picks up.
There isn't much money around, but interest rates are low and the government can probably afford to borrow and increase its projected $1 trillion deficit for now. It is interesting to reflect that it was consumers attracted by cheap money that helped to create the crisis. Paradoxically it is the availability of cheap money that could show the way out.
Congress will pass an economic stimulus package and attempt to arrest price falls, or else deflation would last too long and sap the morale of a generation. Infrastructure plans and other projects could fill the gap in demand and reduce unemployment.
And if all that goes according to plan, then Obama somehow has to stop a rampant Congress from believing that a more bloated and invasive government was more than a temporary measure to combat a deep recession. Governments believe that increasing spending in a downturn is probably a good measure, but they find it impossible to cut expenditure when an economy recovers.
Cutbacks will be hard because the Democrats controlling Congress want to spend on far more than anti-recession measures. President-Elect Obama has huge spending plans, and has not told us how they have been affected by the economic crisis.
Decreased government spending in an upturn is a necessity because private enterprise generally knows better what to do with money than government. Businesses and individuals need to be encouraged to invest in projects of their own, when they can, rather than in government bonds.
But will Obama be able to face down a runaway Congress? The House and Senate may pass spending bills, but they can be vetoed by the president. Too many vetoes and the president looks out of touch - after all, Congressmen and women were elected too.
I found this online, from Time magazine in June 1977: "Determined to balance the budget by the end of his first term, Carter, the fiscal conservative, is clipping away at congressional spending. The more liberal Congress is on the verge of passing three bills that could exceed his spending plans...the White House seems to be virtually itching to veto the [plans] ... when [they reach] ... Carter's desk."
And so the seeds of Democratic civil war and electoral disaster were sown.
In the battles to come, with his people and then his party, Obama will have numerous opportunities to mess up. If an economic stimulus is spent on tax cuts that simply encourage more consumer spending then all will be lost. He must also play a leading role in framing a new architecture for the world economy. Badly-drawn regulations will create more problems than they solve.
The President-Elect's team must agree on goals and a plan. Its members did that well in the campaign. They need to keep their discipline in the years ahead. An elixir called brandy will come in useful.
Friday, March 21, 2008
FDR's answer to loan mess would prove useful
http://www.signonsandiego.com/news/business/calbreath/20080120-9999-mz1b20dean.html
Dean Calbreath
FDR's answer to loan mess would prove useful today
UNION-TRIBUNE
January 20, 2008
Once upon a time, there was a nation where, during an era of prosperity, large numbers of citizens used short-term, interest-only loans to purchase their homes. They were apparently unaware that once the good times ended, they would be saddled with unbearable debt. Which is exactly what happened in America roughly 75 years ago.
During the Roaring '20s, the typical mortgage was an interest-only loan that ended with a massive balloon payment. That bears a slight resemblance to the adjustable interest rates that were so popular in recent years.
As the country lurched into the Depression, banks froze up and could no longer dole out credit – sometimes not even to the most qualified of borrowers. Because homeowners could not refinance, their only recourse was the soup line. By 1933, the year that President Roosevelt took office, many of those payments were coming due, resulting in 1,000 foreclosure filings a day.
Which is why Roosevelt felt compelled to create a program that could have some useful applications today.
During his first year in office, Roosevelt created the Home Owners Loan Corp., or HOLC, to help debt-laden borrowers pay off their mortgages. The HOLC took borrowers out of their high-interest loans and put them into 15-year loans – financed through federal bonds – with rates fixed at about 5 percent. Unlike many government bureaucracies, this was specifically designed to be a short-term program, intended to extend loans for three years and then oversee those loans for an additional 15 years.
With the HOLC and the Federal Housing Administration, the Roosevelt administration virtually created the long-term loan, which soon evolved into the 30-year, fixed-rate mortgage.
The loans took some getting used to. Nat Rogan, who headed the HOLC operations in San Diego and Imperial counties, took pains to explain to borrowers that they needed to pay the principal as well as the interest on their loans.
“This policy is in keeping with sound mortgage lending and in the real interests of the homeowner borrower, as proved by generations of experience among financial institutions,” Rogan said.
The local business community had nothing but praise for the program, which not only helped people keep their homes, but also funded home-renovation projects that provided employment for construction workers.
“San Diego's not to be counted as a laggard in matching up with this opportunity,” said the city's Merchants Association. “No other single enterprise will employ so much useful labor.”
From 1933 to 1936, more than 1 million people relied on HOLC loans, covering one out of five mortgaged homes. Close to 80 percent of the borrowers made good on their payments and kept their houses. When the HOLC shut down in 1951, it returned a slight profit to the government.
“It was a huge success,” said Leonard Rosen, who heads the Pitbull Mortgage School in La Jolla. “It was one of the things that Roosevelt did that he never got enough credit for, because it wasn't sexy. His real goal (with the HOLC) was twofold: to create stability from both an economic and social perspective.”
Rosen said that many of the elements of the Home Owners Refinancing Act, which created the HOLC, would be useful today.
In San Diego County, the number of defaults more than tripled from 8,843 in 2006 to 28,984 in 2007, according to data released this month by Default Research, a real estate tracking firm in Pennsylvania. Although foreclosure rates of the early 1930s still tower over today's rates, foreclosures and defaults are advancing at a dangerous pace, as borrowers struggle to keep up with their adjustable-rate mortgages, lending mechanisms that were not available in the Roaring '20s.
“Our problems of today do not begin to approach those of 1933,” Kevin Pollock, a fellow at the conservative American Enterprise Institute, told Congress last year. “But I suggest that HOLC could be usefully studied by anybody thinking about this issue.”
Jack Guttentag, a Wharton School economist who was formerly chief of the domestic research division at the Federal Reserve Bank of New York, said the HOLC has greater strengths than some of the mortgage fixes being proposed by the White House, Congress or the Federal Reserve.
Guttentag said the Bush administration's main proposal has been for lenders to voluntarily freeze adjustable-rate mortgages for borrowers who have not missed a payment on their loans but who would have problems making payments once the rates adjust upward.
Economists estimate that Bush's proposal would help as little as 7 percent of troubled borrowers. “That takes a little pressure off, but it's only for people who meet a very difficult standard,” Guttentag said. Moreover, the proposal would keep borrowers in adjustable-rate mortgages rather than transfer them to more stable fixed rates.
Unlike Bush's proposal, a HOLC-like fix to today's mortgage crisis would essentially extend prime loans to subprime borrowers, putting them into long-term, fixed rates rather than the temporarily frozen adjustable rates promulgated by the White House.
HOLC loans would also be open to far more borrowers than Bush's narrowly crafted proposal. Under Roosevelt, after all, HOLC loans often went to help borrowers who had lost their homes buy them back out of foreclosure. Few people in the White House, Federal Reserve or Congress would envision enacting such a daring program today. But the fact is, it worked.
The proposals from the Federal Reserve and Congress so far have mostly concentrated on tightening mortgage-lending standards, which is like closing the barn door after the cows have already been slaughtered and served up on the dinner table.
Among the proposals are plans to require more documentation from borrowers, to ban or severely limit the use of adjustable rates and to clamp down on subprime lending. While those proposals might have helped a year or two ago, the problem now is that credit is too tight, rather than too loose.
“Those are counterproductive ideas,” Guttentag said. “The market has changed so dramatically that clamping down on lending requirements has done no good whatsoever and may do some harm.”
Dave McDonald, president of the San Diego chapter of the California Association of Mortgage Brokers, agreed.
“The Federal Reserve is tightening up the guidelines at absolutely the wrong time,” McDonald said. “It's a reactive policy instead of a proactive policy. As it is now, a lot of people who are paying their bills and got into their lending programs rationally won't have a loan program to go into (after their interest rates rise).”
Although academics praise the HOLC, they doubt that it will be re-created in today's political environment. “It won't meet the Bush administration's requirement that little or no government funding be involved (in a mortgage fix),” Guttentag said.
But maybe Gov. Arnold Schwarzenegger, with his newfound affinity for Roosevelt, might be willing to make a stab at reviving the HOLC.
In his State of the State speech this month, Schwarzenegger said he drew inspiration from Roosevelt.
“FDR did not ignore the problems of the Depression because times were tough,” he said. “No, he addressed those problems in big visionary ways because times were tough. He saw the problems, and he acted on behalf of the people and the nation.”
Well, here's one Roosevelt program he could consider. Not only did it address a problem in a big visionary way, but it even turned a profit in the end – something that cannot be said of many government programs.
Dean Calbreath: (619) 293-1891; dean.calbreath@uniontrib.com
Dean Calbreath
FDR's answer to loan mess would prove useful today
UNION-TRIBUNE
January 20, 2008
Once upon a time, there was a nation where, during an era of prosperity, large numbers of citizens used short-term, interest-only loans to purchase their homes. They were apparently unaware that once the good times ended, they would be saddled with unbearable debt. Which is exactly what happened in America roughly 75 years ago.
During the Roaring '20s, the typical mortgage was an interest-only loan that ended with a massive balloon payment. That bears a slight resemblance to the adjustable interest rates that were so popular in recent years.
As the country lurched into the Depression, banks froze up and could no longer dole out credit – sometimes not even to the most qualified of borrowers. Because homeowners could not refinance, their only recourse was the soup line. By 1933, the year that President Roosevelt took office, many of those payments were coming due, resulting in 1,000 foreclosure filings a day.
Which is why Roosevelt felt compelled to create a program that could have some useful applications today.
During his first year in office, Roosevelt created the Home Owners Loan Corp., or HOLC, to help debt-laden borrowers pay off their mortgages. The HOLC took borrowers out of their high-interest loans and put them into 15-year loans – financed through federal bonds – with rates fixed at about 5 percent. Unlike many government bureaucracies, this was specifically designed to be a short-term program, intended to extend loans for three years and then oversee those loans for an additional 15 years.
With the HOLC and the Federal Housing Administration, the Roosevelt administration virtually created the long-term loan, which soon evolved into the 30-year, fixed-rate mortgage.
The loans took some getting used to. Nat Rogan, who headed the HOLC operations in San Diego and Imperial counties, took pains to explain to borrowers that they needed to pay the principal as well as the interest on their loans.
“This policy is in keeping with sound mortgage lending and in the real interests of the homeowner borrower, as proved by generations of experience among financial institutions,” Rogan said.
The local business community had nothing but praise for the program, which not only helped people keep their homes, but also funded home-renovation projects that provided employment for construction workers.
“San Diego's not to be counted as a laggard in matching up with this opportunity,” said the city's Merchants Association. “No other single enterprise will employ so much useful labor.”
From 1933 to 1936, more than 1 million people relied on HOLC loans, covering one out of five mortgaged homes. Close to 80 percent of the borrowers made good on their payments and kept their houses. When the HOLC shut down in 1951, it returned a slight profit to the government.
“It was a huge success,” said Leonard Rosen, who heads the Pitbull Mortgage School in La Jolla. “It was one of the things that Roosevelt did that he never got enough credit for, because it wasn't sexy. His real goal (with the HOLC) was twofold: to create stability from both an economic and social perspective.”
Rosen said that many of the elements of the Home Owners Refinancing Act, which created the HOLC, would be useful today.
In San Diego County, the number of defaults more than tripled from 8,843 in 2006 to 28,984 in 2007, according to data released this month by Default Research, a real estate tracking firm in Pennsylvania. Although foreclosure rates of the early 1930s still tower over today's rates, foreclosures and defaults are advancing at a dangerous pace, as borrowers struggle to keep up with their adjustable-rate mortgages, lending mechanisms that were not available in the Roaring '20s.
“Our problems of today do not begin to approach those of 1933,” Kevin Pollock, a fellow at the conservative American Enterprise Institute, told Congress last year. “But I suggest that HOLC could be usefully studied by anybody thinking about this issue.”
Jack Guttentag, a Wharton School economist who was formerly chief of the domestic research division at the Federal Reserve Bank of New York, said the HOLC has greater strengths than some of the mortgage fixes being proposed by the White House, Congress or the Federal Reserve.
Guttentag said the Bush administration's main proposal has been for lenders to voluntarily freeze adjustable-rate mortgages for borrowers who have not missed a payment on their loans but who would have problems making payments once the rates adjust upward.
Economists estimate that Bush's proposal would help as little as 7 percent of troubled borrowers. “That takes a little pressure off, but it's only for people who meet a very difficult standard,” Guttentag said. Moreover, the proposal would keep borrowers in adjustable-rate mortgages rather than transfer them to more stable fixed rates.
Unlike Bush's proposal, a HOLC-like fix to today's mortgage crisis would essentially extend prime loans to subprime borrowers, putting them into long-term, fixed rates rather than the temporarily frozen adjustable rates promulgated by the White House.
HOLC loans would also be open to far more borrowers than Bush's narrowly crafted proposal. Under Roosevelt, after all, HOLC loans often went to help borrowers who had lost their homes buy them back out of foreclosure. Few people in the White House, Federal Reserve or Congress would envision enacting such a daring program today. But the fact is, it worked.
The proposals from the Federal Reserve and Congress so far have mostly concentrated on tightening mortgage-lending standards, which is like closing the barn door after the cows have already been slaughtered and served up on the dinner table.
Among the proposals are plans to require more documentation from borrowers, to ban or severely limit the use of adjustable rates and to clamp down on subprime lending. While those proposals might have helped a year or two ago, the problem now is that credit is too tight, rather than too loose.
“Those are counterproductive ideas,” Guttentag said. “The market has changed so dramatically that clamping down on lending requirements has done no good whatsoever and may do some harm.”
Dave McDonald, president of the San Diego chapter of the California Association of Mortgage Brokers, agreed.
“The Federal Reserve is tightening up the guidelines at absolutely the wrong time,” McDonald said. “It's a reactive policy instead of a proactive policy. As it is now, a lot of people who are paying their bills and got into their lending programs rationally won't have a loan program to go into (after their interest rates rise).”
Although academics praise the HOLC, they doubt that it will be re-created in today's political environment. “It won't meet the Bush administration's requirement that little or no government funding be involved (in a mortgage fix),” Guttentag said.
But maybe Gov. Arnold Schwarzenegger, with his newfound affinity for Roosevelt, might be willing to make a stab at reviving the HOLC.
In his State of the State speech this month, Schwarzenegger said he drew inspiration from Roosevelt.
“FDR did not ignore the problems of the Depression because times were tough,” he said. “No, he addressed those problems in big visionary ways because times were tough. He saw the problems, and he acted on behalf of the people and the nation.”
Well, here's one Roosevelt program he could consider. Not only did it address a problem in a big visionary way, but it even turned a profit in the end – something that cannot be said of many government programs.
Dean Calbreath: (619) 293-1891; dean.calbreath@uniontrib.com
Wednesday, February 13, 2008
Big Table Fantasies
Robalini's Note: Though this comes from last December, it is even more relevant now than ever, as Krugman nailed then that the Obamafraud was a false hope choice against the establishment and that John Edwards was the real choice, which is why the korporate media tried to ignore him all along...
http://www.nytimes.com/2007/12/17/opinion/17krugman.html
December 17, 2007
Op-Ed Columnist
Big Table Fantasies
By PAUL KRUGMAN
Broadly speaking, the serious contenders for the Democratic nomination are offering similar policy proposals — the dispute over health care mandates notwithstanding. But there are large differences among the candidates in their beliefs about what it will take to turn a progressive agenda into reality.
At one extreme, Barack Obama insists that the problem with America is that our politics are so “bitter and partisan,” and insists that he can get things done by ushering in a “different kind of politics.”
At the opposite extreme, John Edwards blames the power of the wealthy and corporate interests for our problems, and says, in effect, that America needs another F.D.R. — a polarizing figure, the object of much hatred from the right, who nonetheless succeeded in making big changes.
Over the last few days Mr. Obama and Mr. Edwards have been conducting a long-range argument over health care that gets right to this issue. And I have to say that Mr. Obama comes off looking, well, naïve.
The argument began during the Democratic debate, when the moderator — Carolyn Washburn, the editor of The Des Moines Register — suggested that Mr. Edwards shouldn’t be so harsh on the wealthy and special interests, because “the same groups are often responsible for getting things done in Washington.”
Mr. Edwards replied, “Some people argue that we’re going to sit at a table with these people and they’re going to voluntarily give their power away. I think it is a complete fantasy; it will never happen.”
This was pretty clearly a swipe at Mr. Obama, who has repeatedly said that health reform should be negotiated at a “big table” that would include insurance companies and drug companies.
On Saturday Mr. Obama responded, this time criticizing Mr. Edwards by name. He declared that “We want to reduce the power of drug companies and insurance companies and so forth, but the notion that they will have no say-so at all in anything is just not realistic.”
Hmm. Do Obama supporters who celebrate his hoped-for ability to bring us together realize that “us” includes the insurance and drug lobbies?
O.K., more seriously, it’s actually Mr. Obama who’s being unrealistic here, believing that the insurance and drug industries — which are, in large part, the cause of our health care problems — will be willing to play a constructive role in health reform. The fact is that there’s no way to reduce the gross wastefulness of our health system without also reducing the profits of the industries that generate the waste.
As a result, drug and insurance companies — backed by the conservative movement as a whole — will be implacably opposed to any significant reforms. And what would Mr. Obama do then? “I’ll get on television and say Harry and Louise are lying,” he says. I’m sure the lobbyists are terrified.
As health care goes, so goes the rest of the progressive agenda. Anyone who thinks that the next president can achieve real change without bitter confrontation is living in a fantasy world.
Which brings me to a big worry about Mr. Obama: in an important sense, he has in effect become the anti-change candidate.
There’s a strong populist tide running in America right now. For example, a recent Democracy Corps survey of voter discontent found that the most commonly chosen phrase explaining what’s wrong with the country was “Big businesses get whatever they want in Washington.”
And there’s every reason to believe that the Democrats can win big next year if they run with that populist tide. The latest evidence came from focus groups run by both Fox News and CNN during last week’s Democratic debate: both declared Mr. Edwards the clear winner.
But the news media recoil from populist appeals. The Des Moines Register, which endorsed Mr. Edwards in 2004, rejected him this time on the grounds that his “harsh anti-corporate rhetoric would make it difficult to work with the business community to forge change.”
And while The Register endorsed Hillary Clinton, the prime beneficiary of media distaste for populism has clearly been Mr. Obama, with his message of reconciliation. According to a recent survey by the Project for Excellence in Journalism, Mr. Obama’s coverage has been far more favorable than that of any other candidate.
So what happens if Mr. Obama is the nominee?
He will probably win — but not as big as a candidate who ran on a more populist platform. Let’s be blunt: pundits who say that what voters really want is a candidate who makes them feel good, that they want an end to harsh partisanship, are projecting their own desires onto the public.
And nothing Mr. Obama has said suggests that he appreciates the bitterness of the battles he will have to fight if he does become president, and tries to get anything done.
http://www.nytimes.com/2007/12/17/opinion/17krugman.html
December 17, 2007
Op-Ed Columnist
Big Table Fantasies
By PAUL KRUGMAN
Broadly speaking, the serious contenders for the Democratic nomination are offering similar policy proposals — the dispute over health care mandates notwithstanding. But there are large differences among the candidates in their beliefs about what it will take to turn a progressive agenda into reality.
At one extreme, Barack Obama insists that the problem with America is that our politics are so “bitter and partisan,” and insists that he can get things done by ushering in a “different kind of politics.”
At the opposite extreme, John Edwards blames the power of the wealthy and corporate interests for our problems, and says, in effect, that America needs another F.D.R. — a polarizing figure, the object of much hatred from the right, who nonetheless succeeded in making big changes.
Over the last few days Mr. Obama and Mr. Edwards have been conducting a long-range argument over health care that gets right to this issue. And I have to say that Mr. Obama comes off looking, well, naïve.
The argument began during the Democratic debate, when the moderator — Carolyn Washburn, the editor of The Des Moines Register — suggested that Mr. Edwards shouldn’t be so harsh on the wealthy and special interests, because “the same groups are often responsible for getting things done in Washington.”
Mr. Edwards replied, “Some people argue that we’re going to sit at a table with these people and they’re going to voluntarily give their power away. I think it is a complete fantasy; it will never happen.”
This was pretty clearly a swipe at Mr. Obama, who has repeatedly said that health reform should be negotiated at a “big table” that would include insurance companies and drug companies.
On Saturday Mr. Obama responded, this time criticizing Mr. Edwards by name. He declared that “We want to reduce the power of drug companies and insurance companies and so forth, but the notion that they will have no say-so at all in anything is just not realistic.”
Hmm. Do Obama supporters who celebrate his hoped-for ability to bring us together realize that “us” includes the insurance and drug lobbies?
O.K., more seriously, it’s actually Mr. Obama who’s being unrealistic here, believing that the insurance and drug industries — which are, in large part, the cause of our health care problems — will be willing to play a constructive role in health reform. The fact is that there’s no way to reduce the gross wastefulness of our health system without also reducing the profits of the industries that generate the waste.
As a result, drug and insurance companies — backed by the conservative movement as a whole — will be implacably opposed to any significant reforms. And what would Mr. Obama do then? “I’ll get on television and say Harry and Louise are lying,” he says. I’m sure the lobbyists are terrified.
As health care goes, so goes the rest of the progressive agenda. Anyone who thinks that the next president can achieve real change without bitter confrontation is living in a fantasy world.
Which brings me to a big worry about Mr. Obama: in an important sense, he has in effect become the anti-change candidate.
There’s a strong populist tide running in America right now. For example, a recent Democracy Corps survey of voter discontent found that the most commonly chosen phrase explaining what’s wrong with the country was “Big businesses get whatever they want in Washington.”
And there’s every reason to believe that the Democrats can win big next year if they run with that populist tide. The latest evidence came from focus groups run by both Fox News and CNN during last week’s Democratic debate: both declared Mr. Edwards the clear winner.
But the news media recoil from populist appeals. The Des Moines Register, which endorsed Mr. Edwards in 2004, rejected him this time on the grounds that his “harsh anti-corporate rhetoric would make it difficult to work with the business community to forge change.”
And while The Register endorsed Hillary Clinton, the prime beneficiary of media distaste for populism has clearly been Mr. Obama, with his message of reconciliation. According to a recent survey by the Project for Excellence in Journalism, Mr. Obama’s coverage has been far more favorable than that of any other candidate.
So what happens if Mr. Obama is the nominee?
He will probably win — but not as big as a candidate who ran on a more populist platform. Let’s be blunt: pundits who say that what voters really want is a candidate who makes them feel good, that they want an end to harsh partisanship, are projecting their own desires onto the public.
And nothing Mr. Obama has said suggests that he appreciates the bitterness of the battles he will have to fight if he does become president, and tries to get anything done.
Tuesday, September 4, 2007
The Plot to Seize the White House
http://www.buzzflash.com/store/reviews/750
The Plot to Seize the White House: The Shocking True Story of the Conspiracy to Overthrow FDR (Paperback)
By Jules Archer
BUZZFLASH REVIEWS
A BuzzFlash reader alerted us to this book:
"Might I suggest "The Plot to Seize the White House" by Jules Archer as a perfect BuzzFlash premium.
It's an incredible 1974 book, re-released earlier this year (2007, about the conspiracy of US financial barons to stage a military coup to overthrow FDR in 1934. The connections to current corporate ambitions make it very pertinent to US politics today. And it's a very good read, very detailed and well researched by historian Archer.
Hope to see it on the BuzzFlash list soon.
Tristram Lozaw
Boston MA
BuzzFlash has covered this plot through a recent long BBC piece that detailed it, through the book "War is a Racket" by the military hero who disclosed the coup plans, Smedley Butler, and through other articles posted on BuzzFlash. This is not some conspiracy theory; it is a true story. (And Prescott Bush was, apparently, a co-conspirator. Figures.)
From the publisher:
"Most people will be shocked to learn that in 1933 a cabal of wealthy industrialists—in league with groups like the K.K.K. and the American Liberty League—planned to overthrow the U.S. government in a fascist coup. Their plan was to turn discontented veterans into American “brown shirts,” depose F.D.R., and stop the New Deal. They clandestinely asked Medal of Honor recipient and Marine Major General Smedley Darlington Butler to become the first American Caesar. He, though, was a true patriot and revealed the plot to journalists and to Congress. In a time when a sitting President has invoked national security to circumvent constitutional checks and balances, this episode puts the spotlight on attacks upon our democracy and the individual courage needed to repel them."
From the original book jacket:
The fact that the plot was a failure and our present government is still a democracy, is directly attributable to Major General Smedley Darlington Butler, one of the most remarkable generals in American history. A veteran of 35 years in the Marine Corps and twice a recipient of the Congressional Medal of Honor, Butler finally decided that "war is a racket!" His reputation for patriotism, integrity, and dedication to democracy, coupled with his proclivity to speak the truth as he saw it irrespective of official policy, made him a seemingly perfect front for the men who hated Roosevelt. They were people with a determination, if it were impossible to replace the president, to manipulate him through the person of an American Mussolini. Their short-sightedness prevented their realizing that Butler was obviously the wrong choice for the job.
Jules Archer quotes testimony from the McCormack-Dickstein House Committee on Un-American Activities hearings (including testimony that was subsequently censored from public record) that details how Butler was approached by representatives of the arch-conservative American Liberty League; how they tried to persuade him to lead an army of veterans in demonstration against Roosevelt's silver standard; how Butler quickly concluded that the silver standard controversy was being used as a subterfuge to lead American veterans against Washington for truly sinister purposes; and how this hero, patriot, and Republican democrat, upon uncovering the full dimensions of the conspiracy, determined to go to Washington and blow it wide open.
John L. Spivak, a reporter assigned to cover the committee hearings, calls the story "one of the most fantastic plots in American history. . . . What was behind the plot was shrouded in a silence which has not been broken to this day. Even a generation later, those who are still alive and know all the facts have kept their silence so well that the conspiracy is not even a footnote in American histories. It would be regrettable if historians neglected this episode and future generations of Americans never learned of it."
The Plot to Seize the White House: The Shocking True Story of the Conspiracy to Overthrow FDR (Paperback)
By Jules Archer
BUZZFLASH REVIEWS
A BuzzFlash reader alerted us to this book:
"Might I suggest "The Plot to Seize the White House" by Jules Archer as a perfect BuzzFlash premium.
It's an incredible 1974 book, re-released earlier this year (2007, about the conspiracy of US financial barons to stage a military coup to overthrow FDR in 1934. The connections to current corporate ambitions make it very pertinent to US politics today. And it's a very good read, very detailed and well researched by historian Archer.
Hope to see it on the BuzzFlash list soon.
Tristram Lozaw
Boston MA
BuzzFlash has covered this plot through a recent long BBC piece that detailed it, through the book "War is a Racket" by the military hero who disclosed the coup plans, Smedley Butler, and through other articles posted on BuzzFlash. This is not some conspiracy theory; it is a true story. (And Prescott Bush was, apparently, a co-conspirator. Figures.)
From the publisher:
"Most people will be shocked to learn that in 1933 a cabal of wealthy industrialists—in league with groups like the K.K.K. and the American Liberty League—planned to overthrow the U.S. government in a fascist coup. Their plan was to turn discontented veterans into American “brown shirts,” depose F.D.R., and stop the New Deal. They clandestinely asked Medal of Honor recipient and Marine Major General Smedley Darlington Butler to become the first American Caesar. He, though, was a true patriot and revealed the plot to journalists and to Congress. In a time when a sitting President has invoked national security to circumvent constitutional checks and balances, this episode puts the spotlight on attacks upon our democracy and the individual courage needed to repel them."
From the original book jacket:
The fact that the plot was a failure and our present government is still a democracy, is directly attributable to Major General Smedley Darlington Butler, one of the most remarkable generals in American history. A veteran of 35 years in the Marine Corps and twice a recipient of the Congressional Medal of Honor, Butler finally decided that "war is a racket!" His reputation for patriotism, integrity, and dedication to democracy, coupled with his proclivity to speak the truth as he saw it irrespective of official policy, made him a seemingly perfect front for the men who hated Roosevelt. They were people with a determination, if it were impossible to replace the president, to manipulate him through the person of an American Mussolini. Their short-sightedness prevented their realizing that Butler was obviously the wrong choice for the job.
Jules Archer quotes testimony from the McCormack-Dickstein House Committee on Un-American Activities hearings (including testimony that was subsequently censored from public record) that details how Butler was approached by representatives of the arch-conservative American Liberty League; how they tried to persuade him to lead an army of veterans in demonstration against Roosevelt's silver standard; how Butler quickly concluded that the silver standard controversy was being used as a subterfuge to lead American veterans against Washington for truly sinister purposes; and how this hero, patriot, and Republican democrat, upon uncovering the full dimensions of the conspiracy, determined to go to Washington and blow it wide open.
John L. Spivak, a reporter assigned to cover the committee hearings, calls the story "one of the most fantastic plots in American history. . . . What was behind the plot was shrouded in a silence which has not been broken to this day. Even a generation later, those who are still alive and know all the facts have kept their silence so well that the conspiracy is not even a footnote in American histories. It would be regrettable if historians neglected this episode and future generations of Americans never learned of it."
Subscribe to:
Posts (Atom)
Posts
