Thursday, June 18, 2009

Last Call

Sir Allen Stanford has finally surrendered to the FBI this evening.
Allen Stanford has surrendered to the FBI in Viriginia, according to his attorney. CNBC has also learned that other top executives of Stanford Financial have been indicted by a federal grand jury in Houston over an alleged $8 billion Ponzi scheme.

Because a U.S. Magistrate placed the indictment under seal pending arrests, it was not immediately clear if Texas billionaire Allen Stanford is named in the indictment.

However, sources had told CNBC an indictment of Stanford could come as early as today.

Informed of the indictment by CNBC, Stanford's criminal defense attorney Dick DeGuerin said: "If there is an indictment, he will appear and surrender and post bond," adding, "There's no need for them to make a big show of it."

DeGuerin said that upon hearing rumors of a possible indictment today, he wrote to prosecutors offering that Stanford would turn himself in. He says the government did not respond.

A Justice Department spokesman was not immediately available for comment.

Much like Bernie Madoff, I hope this guy pleads guilty.

Palliative Care

The more being said about health care by members of Congress, the less likely it looks like anything at all will pass.
At the Atlantic, Marc Ambinder notes the alarm bells from Klein and Cohn, and can’t resist pointing out the irony that “the honest numbers [from the CBO] — and maybe the tougher-than-expected numbers — are the result of Orszag’s determination to get health care financing right — from the POV of the legislative branch.”

That would be Peter Orszag, previous head of the CBO, now the president’s budget director.

According to a report by Kaiser Health News quoted by Ambinder, Orszag did some heavy lifting at CBO to insure it was ready for the health care debate:

Orszag, anticipating the big push by the new president for health care legislation, beefed up the agency’s staff with health care economists and ordered a new, high-speed computer to run a complex health insurance microsimulation model that analyzes health care proposals and their budget impact.

All of which apparently means CBO can deliver numbers that have inspired another run at the plan to use reconciliation process for passing reform. As Ambinder reports, “a group of centrist House Democrats and Republicans will hold a joint press conference today to formally oppose using budget reconciliation rules to pass the financing portion of reform.”

Once the president’s reputed allies in Congress are teaming up with his opponents, it brings the conversation back around to the usual question: What’s Obama going to do now?

At the Democratic Strategist, Ed Kilgore says, “It’s becoming increasingly obvious that the President will need to spend some serious political capital in convincing both Congress (especially nervous Democrats) and the public that we can’t afford to put off health care reform any longer.”

In another post at the Democratic Strategist, former Clinton pollster Stan Greenberg concurs:

At the moment, the country is tilting toward enacting Obama’s reforms, and it will do so more enthusiastically if Obama learns from the Clinton experience and rises to the educative role that he relishes. He must respect the thoughts, feelings and calculations of ordinary citizens who are not easily spun on important issues. People will take out their calculators when he lays out his plan, and he can’t avoid speaking candidly about its costs and consequences. And he can’t forget that he has a big story to tell about a changed America, one in which health care is but a pile of bricks in the new foundation he is laying.

Obama has scheduled a nationally televised town hall on health care next Wednesday, June 24. And as Nate Silver at Fivethirtyeight notes, the public is still with him on reform. But it is going to take a bigger effort, says Silver, than just one meeting:

So far, there is no sign of erosion in the public’s support for health care reform. And the Administration appears poised to begin doing some more explicit advocacy for the legislation, beginning with a one-hour national forum on June 24th. But it had better be prepared for that town hall meeting to be a start of a trend, because history suggests that leaving a health care bill unattended before Congress is just about the worst place for it to be. . . .

This has been an extremely cautious White House to date; they have scrupulously avoided doing anything that might ruffle Congressional or public feathers and they are probably afraid of gambling on a specific plan and losing. But as Neville Chamberlain learned long ago, and Spock learned in the latest version of Star Trek, caution does not always equate with safety. It is time for the White House to take hold of this debate and not let go.
And let's face it, Obama's record on getting Democrats to go along on things they are jumpy about is next to zilch...cramdown, Gitmo, DADT...all are stalled or dead. His record on actual reform so far, judging from his job on the financial sector? Equally disappointing.

Three quarters of Americans want a public health care option if only for the government to keep the insurers honest (and the insurers' profit motivation to keep the government plan honest.) But the insurance giants will never tolerate it, and the GOP knows if it passes, they're the minority party until 2032 or something.

It's increasingly looking like the Democrats don't want the plan either. 76% of Americans want a public insurance option. But what America wants doesn't's what the insurance companies and Big Pharma can get out of Congress. In the end, it's the Democrats who will kill health care reform, not the Republicans. We're seeing Obama lose control of the argument. Much like the stimulus package, he's going to have to throw everything he has and more at his own party to get them to do America's business.

[UPDATE] Bob Cesca nails it in one.
Another fascinating number from the NBC/WSJ poll. These are the people the Democrats appear to be afraid of:
25 percent hold a favorable view of the Republican Party, which is an all-time low for it in the poll. 45 percent hold a favorable view of the Democratic Party.

So here we have a public health insurance plan which 76 percent of the American people support. The Republicans, who are against the plan, have a 25 percent approval. And the Democrats, meanwhile, don't give a rip about the 76 percent who want it, they're afraid of the 25 who don't want it.

And that's just sad. If we can't pass health care with 60 Senate votes and a 70+ margin in the House and a President with a 60%+ approval rating, when Republicans are literally as unpopular as they have ever been, then there really is no hope for reform.

Big Pharma owns Congress. Big Finance owns Congress. What the American people overwhelmingly want does not matter to our elected representitives in Congress. It's up to Obama now, for whatever that's worth.

What's That Ticking Sound?

It's the sound of millions of option ARM mortgages resetting to usurious rates and backbreaking monthly payment levels. And in a just world, it's the sound of Jim Cramer's career expiring in ignominy. Hey, Jim, about that prediction...
Call it son of subprime. Experts warn that a new wave of mortgage foreclosures may be coming soon and could rival the default rates for subprime mortgages and slow efforts to find bottom in a prolonged national housing slump.

The mortgages in question are $230 billion of option adjustable-rate mortgages, creative lending products that flourished at the height of the housing boom. In an option ARM, a borrower can opt to pay less than his or her monthly balance due, and the difference is tacked onto the outstanding loan balance.

Many experts had expected an explosion of defaults in the springtime on these roughly 564,000 outstanding mortgages. However, interest rates dropped to historic lows, and that delayed the detonation of what many housing analysts still see as a ticking time bomb.

"They're probably going to default at a rate that makes subprime look like a walk in the park," warned Rick Sharga, senior vice president for RealtyTrac, a foreclosure research firm in Irvine, Calif.

But remember, Cramer says we've hit bottom in the housing market!

The bulk of outstanding option ARMs — a product no longer available to homebuyers — were issued between 2004 and 2007. Monthly payments on these mortgages are due to reset to a higher lending rate between 2009 and 2012.

"They're going to have a loan they cannot afford on a house that's probably way underwater and not have a lot of good options on how to avoid foreclosure proceedings," Sharga said.

While a smaller number than subprime mortgages, option ARMs grew from 3 percent of all mortgages bundled and sold to investors in 2004 to 14 percent by 2007.

They pose risks for the broader U.S. economy because they threaten to add inventory to a depressed housing market and could hasten the blistering pace of foreclosure filings — more than 1 million from March to May alone.

So much more pain ahead, folks. So much more pain ahead. Millions more foreclosed houses on the market aren't going to raise prices, folks.

Froomkin Gets Axed

Politico is reporting that the WaPo has fired Dan Froomkin. Double G weighs in:
Notably, Froomkin just recently had a somewhat acrimonious exchange with the oh-so-oppressed Krauthammer over torture, after Froomkin criticized Krauthammer's explicit endorsement of torture and Krauthammer responded by calling Froomkin's criticisms "stupid." And now -- weeks later -- Froomkin is fired by the Post while the persecuted Krauthammer, comparing himself to endangered journalists in Venezuela, remains at the Post, along with countless others there who think and write just like he does: i.e., standard neoconservative pablum. Froomkin was previously criticized for being "highly opinionated and liberal" by Post ombudsman Deborah Howell (even as she refused to criticize blatant right-wing journalists).

All of this underscores a critical and oft-overlooked point: what one finds virtually nowhere in the establishment press are those who criticize Obama not in order to advance their tawdry right-wing agenda but because the principles that led them to criticize Bush compel similar criticism of Obama. Rachel Maddow is one of the few prominent media figures who will interview and criticize Democratic politicians "from the Left" (and it's hardly a coincidence that it MSNBC's decision to give Maddow her own show -- rather than the endless array of right-wing talking hosts plaguging the television for years -- which prompted a tidal wave of "concern" over whether cable news was becoming "too partisan"). In general, however, those who opine from the Maddow/Froomkin perspective are a very endangered species, and it just became more endangered as the Post fires one if its most popular, talented, principled and substantive columnists.

Of course, Froomkin was a Villager, but at least he was one who did his damn job once in a while.

We'll see where he ends up. I'd almost say that it looks like Double G is giving him a job reference at Salon. Oh, and for the record, I attack Obama from the left too, mainly because I'm too poor to have an agenda.

Public Option To Prevent Public Fleecing

Expanding on yesterday's post on Obamacare and how health insurance companies are in the business of making money, not saving lives, Digby finds some truly nasty evidence that there's plenty of money to be made off sick people.
Those of you who are struggling to pay for your generic medicines or wondering why the doctor is charging you a $5.00 co-pay, give some thought to these facts about how our health care dollars are allocated. At the end of this post, there is a list of 23 health companies I found on, what the CEO was paid in 2005, and the average paid to the CEO in the past five years.

Imagine adding vice presidents, Board of Directors, stock holders and the other 200-300 other companies all cashing in on your health to that total at the bottom...
And that total at the bottom for combined average pay of the healthcare insurance company CEOs? 14.7 billion dollars. As the post says, add in all the other execs, board members and all the other companies NOT listed in Forbes, and you suddenly have a very, very clear idea that not only is a public option badly needed to prevent such profiteering, but that putting health insurance companies out of business (the main complaint of the anti-public option folks) doesn't exactly fill one with sympathy.

And hey, we could use that money to you know, pay for health care.

Remember, any insurance claim adjuster's job is to find a way to deny the claim. This is how insurance companies stay in business, by paying less out for claims then they take in by collecting premiums.

In health insurance, when you deny the claim, you either bankrupt or physically harm (up to killing) the policyholder. Keep that in mind when you see Serious Washington Centrists like Tom Daschle say President Obama will have to abandon a public health care option in order to "get the votes".

73% of Americans want it. This should be a no-brainer. And yet everyone in the Village pretends America will never go for a public health care option.

[UPDATE] It's one thing for the GOP to try to use the "60 votes" threshold to kill health care reform. It's entirely another thing for the Blue Dog Democrats to help them.

[UPDATE 2] Daschle's counter plan is a series of regional health care co-ops, which is inane to the point of despair. The whole point of a federal public health care option is the Law of Large Numbers, the more people in the health care plan, the more bargaining power it has. If regional health co-op A has California (the most populous state) , and region B has Minnesota and the Dakotas (among the healthiest states), and region C has Alabama and Mississippi (the most out-of-shape states) then the rates for those public plans for those states are going to differ greatly because of their differing levels of bargaining power. This means the existing health care companies will be more competitive from the start, meaning they have much less impetus to change.

It also means that private insurers can charge more in smaller regional co-op areas. It would be even worse for 50 individual state plans, which would turn into budget nightmares held hostage by state Republicans who will do everything to gut and destroy the plans. Think California, multiply by 50.

A Good Idea

As Atrios points out, this idea is so blindingly obvious that it borders on EPIC WIN. Yes, I would like to see this go national.

Better LOLing Through Technology

Poor Pete Hoekstra. He's gone from grouchy GOP backbencher in a blue, blue state (Michigan) to becoming an embarrassing internet meme.

Technology. The GOP is doing it wrong. Now, I don't have a Twitter account (the blog is enough for me, thank you) but the Republicans seem bound and determined to use Twitter as "140 Character Public Kvetching Tool That Produces Things Will Be Taken Completely Out Of Context."

Tweet != Sound Bite, guys.

If It's Thursday...

608,000 new jobless claims, still bad. A drop in continuing unemployment claims is therefore good, yes? Those fell by 148,000 to 6.69 million...except for a weekly drop that big, that suddenly with claims remaining over 600k a week means people fell off the long-term unemployment benefit rolls and ran out of unemployment insurance.

It just means we've reached something of an equilibrium point on continuing claims: new people will get benefits, and people who have been on benefits will run out and join the U-6 crowd. The recession has gone on so long that people are beginning to exhaust their unemployment benefits, even with the extensions Obama signed as part of the stimulus.

You Re-Elected Her, Not Me

Ahh, Michele Bachmann...the gift that keeps on giving. This week's babbling inanity may be costly however, as she revealed on talk radio that she's planning to break the law:

Outspoken Republican Rep. Michele Bachmann says she's so worried that information from next year's national census will be abused that she will refuse to fill out anything more than the number of people in her household.

In an interview Wednesday morning with The Washington Times "America's Morning News," Mrs. Bachmann, Minnesota Republican, said the questions have become "very intricate, very personal" and she also fears ACORN, the community organizing group that came under fire for its voter registration efforts last year, will be part of the Census Bureau's door-to-door information collection efforts.

"I know for my family the only question we will be answering is how many people are in our home," she said. "We won't be answering any information beyond that, because the Constitution doesn't require any information beyond that."

It may not, but federal laws state that falsifying or omitting data on a Census form is in fact a federal offense punishable by up to a $5,000 fine.

So, you do that Michele. Keep protesting your own employer and embarrassing the people of Minnesota, and for sure, keep announcing those plans to break federal laws as a federal lawmaker.

Elbow Grease

Hillary Clinton fell and broke her elbow last night. She's fine apparently, but I'm personally waiting for the usual suspects to weigh in with the misogyny and Hillary Hatred. Trust me, before the end of the day, somebody in Wingnutworld (I have $10 on El Rushbo) will cross a big thick red line on Hillary's injury, and then tomorrow or this weekend we'll get 20 paragraphs from another Winger (I'll guess Hugh Hewitt) on how that remark was perfectly innocent, but Letterman's crack on Sarah Palin makes him the most vile human being on Earth and how the Left is nothing more than a bunch of hypocrites on sexism.

No, really, that's the entire plan. Watch how this plays out.

Stopped Clock Is Right Alert

Every now and again something a conservative blowhard says makes actual sense, and today's contestant is bad ol' Pat "Southern Strategy" Buchanan on the U.S. staying out of Iran.
What should we do now? Wait for the dust to settle.

No U.S. denunciation of what took place in Iran is as credible as the reports and pictures coming out of Iran. Those reports, those pictures are stripping the mullahs of the only asset they seemed to possess -- that, even if fanatics, they were principled, honest men.

Like Hamas, it was said of them that at least they were not corrupt, that at least they did not cheat the people.

No more. Today, in the streets of Tehran and other cities, they call to mind "Comrade Bob" Mugabe in Harare, Zimbabwe.

Mahmoud Ahmadinejad will never recapture that revolutionary purity he once seemed to possess as the man of the people who was elected president in the upset of 2005. Today, he appears, as The New York Times puts it, "as the shrewd and ruthless front man for a clerical military and political elite that is more unified and emboldened than at any time since the 1979 revolution."

There are other reasons Obama should not heed the war hawks howling for confrontation now.

When your adversary is making a fool of himself, get out of the way. That is a rule of politics Lyndon Johnson once put into the most pungent of terms. U.S. fulminations will change nothing in Tehran. But they would enable the regime to divert attention to U.S. meddling in Iran's affairs and portray the candidate robbed in this election, Mir-Hossein Mousavi, as a poodle of the Americans.

When Nikita Khrushchev bathed the Hungarian revolution in blood, Ike did not break relations. Khrushchev was at Camp David three years later. When Deng Xiaoping and Co. ordered the tanks into Tiananmen Square, George Bush I did not break relations. When Moscow ordered Warsaw to crush Solidarity, Ronald Reagan did not let that act of repression deter him from seeking direct talks to reduce nuclear weapons.

Again, let us wait for the dust to settle.

Buchanan may be a racist asshole, but he's 100% correct on Obama's response to Iran: nothing.

This too, will pass. Like it or not, Iran is going to have to work this out, and there's basically nothing we can do about it that won't make the situation worse on the ground in Tehran.


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