Thursday, June 9, 2011

Last Call

Republican operative Walter Russell Mead unveils the GOP's "new" strategy for winning in 2012 based on the economy.

Democrats, watch out.

The Republican Party and especially its Tea Party wing have just acquired a new weapon of mass destruction — and it has nothing to do with any of Congressman Wiener’s rogue body parts.  If they deploy this weapon effectively in the next election cycle — a big if — then they have the biggest opportunity to move the country rightward since Ronald Reagan took the oath of office back in 1981.

The Tea Party WMD stockpile is currently stored in book form:  Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon. By Gretchen Morgenson, one of America’s best business journalists who is currently at The New York Times, and noted financial analyst Joshua Rosner, Reckless Endangerment gives the best available account of how the growing chaos in the mortgage and personal finance markets and the rampant bundling of dubious loans into exotically toxic securities plunged the world, and millions of American families, into the gravest financial crisis since World War Two. It is gripping reading as well, and its explanations are clear enough that readers without any background in finance will have no trouble following the plot.  The villains?  An unholy alliance between Wall Street, the Democratic establishment, community organizing groups like ACORN and La Raza, and politicians like Barney Frank, Nancy Pelosi and Henry Cisneros.  (Frank got a cushy job for a lover, Pelosi got a job and layoff protection for a son, Cisneros apparently got a license to mint money bilking Mexican-Americans of their life savings in cheesy housing developments.)

Yep, all they have to do is convince voters that it wasn't Wall Street's fault at all, but Democrats and those damn minorities who ruined the economy.  Goldman Sachs?  Innocent as newly fallen snow.  BooMan has fun with this.

Before we can get to any Democratic complicity in this, we first have to assign blame to the people who actually had the power to do something. Of course, Gretchen Morgenson served as Steve Forbes's press secretary and is known for writing hyped and slanted opinion pieces posing as analysis. She also likes to steal bloggers' work without giving attribution. We know how her bread is buttered. As for Rosner, he was prescient about the housing crisis, but he didn't blame Barney Frank and ACORN for the impending doom. He blamed the rating agencies and the SEC for failing to do due diligence on the collateralized mortgage bonds. If he now has found new villains, it just means he has a book to sell. But, in truth, I don't think Mr. Mead is giving a fair and balanced portrait of the book, which has won the praise of people like Bill Moyers. It sounds to me like it has a lot of villains that were conveniently left out of this review.

But, yeah, if the Republicans could convince people that they're underwater on their mortgage and out of work because the Democrats gave free houses to blacks and Latinos, the Democratic Party would be toast

I've documented many, many times before that the whole "Community Reinvestment Act forced banks to give subprime loans to minorities who couldn't pay" theory was total and complete baloney.  Loans given under the CRA were to minorities that were in better average financial shape than the average subprime borrower.  If anything, minorities who had better credit than the average subprime borrower were forced by greedy banks into subprime loans, even though they should have qualified for better mortgage rates.  In fact, the vast majority of mortgage lenders that went under in the subprime housing disaster were not banks large enough to be covered by the CRA at all, so they made zero CRA loans and still collapsed.  In fact, banks went out of their way to foreclose on minorities who had good credit and fell victim to bad loans pushed by the banks.

So it's not like this is a "new" strategy at all, it's blame blacks and Latinos for the entire housing depression, and in turn the entire economic depression.  Because yes, minorities wrecked the economy on purpose because they wanted an unemployment rate of 17% plus.

All the GOP has to do to win is convince voters that minorities caused the economic collapse and not Bernie Madoff and Jaime Dimon and Hank Paulson.  Go for it, guys.  If that's your big plan for 2012, let 'er rip.

Nuked Gingrich, Part 4

In more "his campaign is over before it started" news, several senior Newt Gingrich (remember him?) campaign staffers have resigned in a massive desertion that all but seals the deal that Newtie is done.  Chris Cillizza:

Former House Speaker Newt Gingrich’s presidential campaign imploded Thursday afternoon with virtually his entire senior staff leaving en masse, according to multiple sources familiar with the moves.

“When the campaign and the candidate disagree on the path, they’ve got to part ways,” said Rick Tyler a longtime Gingrich spoksman who was among those who left the campaign today.

Tyler as well as Rob Johnson, Gingrich’s campaign manager, Dave Carney and Katon Dawson, senior strategists to the effort and media consultant Sam Dawson have all stepped aside. Much of his early state operation was also headed for the exits, according to a one senior campaign source.

And more than a few of Newt's crew are former staffers from other Republicans:

Carney and Johnson are longtime aides to Texas Gov. Rick Perry who has said in recent days that he is contemplating a run for president himself in 20120. The Carney and Johnson resignations will fuel speculation that Perry is moving toward the race.

Newt out, Mr. "Texas should secede from the union" in?  This should be good.

No Dealing On The Debt Ceiling, Part 16

Rep. Paul Ryan is joining the ranks of Republicans who are trying to convince America that permanently higher interest rates across the board and permanently losing America's AAA credit rating is not a big deal, saying this to CNBC:

If a bondholder misses a payment for a day or two or three or four — what is more important is you are putting the government in a materially better position to better pay its bills going forward.

Right.  When Americans miss credit card payments for a day or two or three or four does it put you in a better position?  No, because your credit card company kicks your interest rates up to the much higher penalty rate, and because the credit card issuer sees you as a risk for missing more payments in the future, you end up paying much, much more in the long run, plus it trashes your credit score.

Replace "credit card company" with "treasury bond market" and "credit score" with "America's sovereign debt rating" and you see the problem with what the Republicans are trying to sell here.

And remember, just a few months ago Ryan was saying that America couldn't play games with defaulting.

Ryan has changed his tune regarding the debt ceiling significantly over the last several months. Back in January, Ryan admitted that failing to raise the debt ceiling was “unworkable.” “Yes, you can’t not raise the debt ceiling. Default is the unworkable solution,” he said during an appearance at the National Press Club. Earlier this month, he began to take a more radical line, saying that the ceiling wouldn’t be raised without concessions from Democrats. “It won’t happen, I’m serious about this,” he said. Now it seems he’s gone full-in with the fringe of his party in actually inviting a default.

Yesterday, the credit rating agency Fitch warned that even a short-term default that resulted in some missed payments — exactly what Ryan is advocating — would do real damage to the U.S. creditworthiness. “If the Treasury missed a payment on its debts, even for a short period, Fitch would lower the nation’s credit rating — adding that it would be ‘unlikely’ the government could return to AAA after such a default,” The Hill reported.

America remains the only major country never to default on sovereign debt payments.  But Republicans are trying to tell you that it's no big deal if we do, and the bigger issue is they are confident Dems will cave to their hostage situation plan and cut trillions from social give that money to the super-rich in tax breaks and to corporations who already pay 0% tax because of loopholes that Republicans refuse to close, in fact raising the deficit and the national debt.

And what would a default mean to consumers, and to the country at large?  How about even a short default period adding $1.2 trillion to our national debt in increased borrowing costs over the next decade for starters?

Because interest rates on bonds determine how much it costs the US government to secure more debt, even seemingly slight changes can affect the long term deficit on a large scale. A 1% rise in interest rates, or 100 basis points, would grow the deficit by over $400 billion over the next five years and $1.2 trillion from 2012-2021, according to the CBO. Given that the agency's baseline assumes a number of tax cuts that Congress typically extends will expire, it's likely that more debt would be affected and push the number even higher. 

Oh, and it gets worse at the consumer level.

Nor would the problem be confined to US debt -- a report by the left-leaning Center for American Progress suggests the damage to the housing market may be even more severe. According to their research, past shocks in the bond market have resulted in outsized increases in mortgage rates, which are based on treasury interest rates. They estimate that interest on home lands could rise 0.66% in response to 0.5% rise in interest on treasury bills as a result, which would depress home sales by discouraging buyers from taking on loans.

"If Congress fails to raise that ceiling then the U.S. housing market would most likely experience a severe double-dip contraction marked by much lower home sales and depressed house prices," author Christian Weller wrote. "That in turn would spark a return of the economic pain of the past few years for many families as foreclosures would remain at or near record highs, and jobs in key sectors, such as construction, would disappear again."

As bad as our housing depression is, even a short default, like the one Paul Ryan is calling for, will absolutely ruin the housing market and raise mortgage rates for all borrowers across the board.  Thar rate rise will affect credit cards, loans, all kinds of borrowing.  In short, even a technical default will pretty much push us right back into a recession.

And Republicans seems to be absolutely okay with that.  In fact, as worried about the deficit and the debt as they seemingly are, they apparently have no problem making both worse.

But the Republicans are the party of fiscal responsibility, right?

Banking On Hillary

Reuters is reporting Hillary Clinton has been in talks for some time now to take over the World Bank when current director Robert Zoellick leaves next year.

The former first lady and onetime political rival to President Barack Obama quickly became one of the most influential members of his cabinet after she began her tenure at State in early 2009.

She has said publicly she did not plan to stay on at the State Department for more than four years.

Associates say Clinton has expressed interest in having the World Bank job should the Bank's current president, Robert Zoellick, leave at the end of his term, in the middle of 2012.

"Hillary Clinton wants the job," said one source who knows the secretary well.

A second source also said Clinton wants the position.

A third source said Obama has already expressed support for the change in her role. It is unclear whether Obama has formally agreed to nominate her for the post, which would require approval by the 187 member countries of the World Bank.

The White House declined to comment.

Well, Hillary has said all along she wouldn't be Secretary of State in an Obama second term, but announcing she's seeking a new job a year plus ahead of time seems awfully strange.  Perhaps the confirmation process will take that long, I don't know.  At this point, the Clinton camp is denying everything, both her personal spokesperson and the State Department are completely, categorically calling this story false.

If it is true, it's a hell of a strange process, but there you are.  Perhaps she's putting an end to the whole "Primary Obama!" fantasy well ahead of time, or perhaps this move is necessary to set up shuffling the deck ahead of time.  Maybe Hillary will depart sooner rather than later, one theory is that Joe Biden would then move to State and Obama would name a new VP, another has that John Kerry would take over at State.

Either way, there's more to this story than meets the press release right now, I'm betting...if it's even true.

This Week In GOP Pants On Fire Lies

This week's PolitiFact Pants on Fire Liar?  GOp Presidential...umm..."hopeful" Herman Cain.

On "The Glenn Beck Program" radio show May 24, the Republican presidential hopeful tried to rebut accusations that in March he said he would not appoint Muslims to Cabinet positions or federal judgeships in a potential Cain administration.

"I did not say that I would not have them in my Cabinet. Because if you look at my career, I have hired good people regardless of race, religion, sex, gender or orientation and this sort of thing," Cain told Beck.  

Only one problem.  Three, actually.  Herman Cain indeed said he would not appoint a Muslim to his cabinet, and said it three separate times.

He said it here to Think Progress:

He said it again to our old pal Bryan Fischer of the American Family Association on Fischer's show:

And he said it a third time to Neil Cavuto on FOX.

Three times Herman Cain clearly said he would not appoint a Muslim to his cabinet, and he went on in those instances to explain exactly why:

"And based upon the little knowledge that I have of the Muslim religion, you know, they have an objective to convert all infidels or kill them," Cain said.

But he's not a bigot.

"No, I will not," Cain replied. "And here’s why. There is this creeping attempt, there’s this attempt to gradually ease Sharia law and the Muslim faith into our government. It does not belong in our government."

But remember, not a bigot.

"A reporter asked me ‘Would I appoint a Muslim to my administration?’ I did say ‘no,’ " Cain told Cavuto.

"And here’s why ... I would have to have people totally committed to the Declaration of Independence and the Constitution of the United States. And many of the Muslims, they’re not totally dedicated to this country," he said.  

And you're the bigot if you think Hermain Cain has an irrational hatred of Muslims.  He's totally qualified for President with statements like this.

New tag:  Herman Cain Is Just Misunderstood.

Really? REALLY?

Okay, I'm going to go into this letting you know I am furious. The more I write, the more angry I become.  This is partly a vent and partly an open letter to all the holier-than-thou jackasses who think that their beliefs give them the right to trample other people.

An anti-gay Christian group is spending $7,000 to fly planes over Orlando, Fla., dragging giant banners that read, “Warning Gay Day at Disney.” The campaign is part of the group’s boycott and protest of the annual event.
Florida Family Association claims thousands of people enter the park each year during “Gay Day” only to turn around and leave when they realize gay people and same-sex couples are present. The group says it wants Disney to reschedule Gay Day at night after the park closes.
The Florida Family Association says patrons of the event wear T-shirts that “promote homosexuality” and dress in drag. The groups also charges that gay couples publicly kiss, hug and grope each other – behavior the group’s leaders believe will turn children gay if they witness it.

So let me make sure I got this.  The gay population should be forced to attend at night, dress "normal" and not in any way be who they are because a small group of people just don't believe that anything not approved by them can be okay.  The rest of the year is for the shiny Christian folks (theoretically) but a small event to acknowledge and celebrate those who are different just can't be tolerated.

Really?  It's a small damn world indeed.

Okay, kids.  I'm gonna start with the big stuff and work down.  First, those bigots sure like their queers hidden in darkness, right?  No reason we should let those weird folks enjoy a family park in the daytime.  I guess if you swish your wrists or your haircut isn't feminine enough for their standards, you should be turned away at the gates, right?  I mean, when they're not saving your souls against your will, you still gotta have the fashion police.

Second, are people still really afraid kids will "catch the gay" if they see someone out and about?  The fact that a group can treat a huge population like crap based on something that isn't even their business in the first place is amazing.  That they don't see the irony and misguided hate they are teaching their kids is criminally negligent.  On one hand they claim "thousands" are tricked into entering the park, then they say the gay crowd wears T-shirts that promote homosexuality.  I'm not sure how wearing one's opinion on a T-shirt is being sneaky, but okay.  In the meantime, what if someone finds their "Got Jesus?" or scripture T-shirts offensive?  If all beliefs are weighed equal, doesn't that mean those shirts should be removed?  If not, by what standard are they given privileges over other people?  And I suppose it's okay to let your butt crack hang out of your Daisy Dukes as long as you're straight, right?  No thanks, I'd rather my child be gay than a righteous jerk with low self-esteem who takes frustration out on people they consider "lesser" humans.

Third: do you think Jesus would rather see you wave a flag that spreads hate disguised as a "warning" or take that $7,000 and feed the needy?  Jesus preached kindness and compassion.  How many times did he rebuke followers for judging and bringing hate on others?  Even when their hearts were in the right place, the disciples continued to fail to get the welcoming message of Jesus.  If you're going to use religion as a bullying tool, at least get your freaking facts straight.  Don't forget that handy bit about removing the plank from your own eye before removing the speck from your brother's eye.  If these people held themselves to the same standards they hold others to, the world really would be a better place.

Finally: not all families come in the ideal Christian package.  Sometimes kids aren't born into a unit with a perfect mother and father.  Some families have two mothers or dads, and a park that caters to families is recognizing that.  Whether biological or adopted, kids love their parents despite their differences.  If that is so offensive, then I have a cheaper idea.  Just don't go. Anything less is going out of one's way to attack kids and their parents at a family park.  There is no logic there, just hate and oppression.  Inexcusable, petty, and shameful to boot.

If they want the gay population to be separate from those who might be uncomfortable in their presence, I have an idea.  Let's give them a special day.  Oh wait...

Good For The Soul: Rawr Edition

Forest officials in northern India say a male tiger appears to be caring for two orphaned cubs in an extremely rare display of paternal feeling.
The cubs lost their mother in February in the Ranthambore tiger reserve. Officials there say they believe the male tiger, named T25, is their father.
Wildlife experts say cubs are usually raised by their mothers and male tigers often kill cubs they come across.
Officials believe there is no recorded evidence of males behaving like this.
Even nature can display mercy.  While tigers face shrinking numbers (I still can't wrap my mind around the idea of extinction) this is a good thing.


Taxing America's Patience, Part 2

If Bloomberg News is to be believed, the White House has just bought the GOP "corporate tax cuts will save the economy!" nonsense.

President Barack Obama’s advisers have discussed seeking a temporary cut in the payroll taxes businesses pay on wages as they debate ways to spur hiring amid signs that the recovery is slowing, according to people familiar with the matter.

The idea, which is in preliminary stages of discussion, is among several being talked about at the White House as the economy holds center stage for the administration and Congress, the people said on condition of anonymity to discuss internal deliberations. The unemployment rate in May rose to 9.1 percent, the highest level this year.

The talks reflect the political constraints the White House is operating under with the Republican majority in the U.S. House pushing to cut federal spending. A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses. 

Republicans will either reject the measure saying it needs to be made permanent, or support the measure but demand something else for more hostage-taking fun (probably both, the usual routine.)  Let's remember that Obama was saying just a few months ago that American businesses were sitting on nearly $2 trillion in balance sheet assets (a claim Politifact rated as Mostly True, it's just not all liquid investable cash.)  Businesses could be hiring but they're not.  Tax cuts freeing up more assets to invest isn't the issue when businesses are sitting on records amount of balance sheet assets before the tax cuts.

Now apparently the President's economic team has bought the Republican argument that businesses are afraid to expand because of "high taxes and regulations" so the White House is now considering a payroll tax break on employers (not employees).

It's very possible that this is the only thing the Republicans will allow as far as stimulative action for the economy.  It's also proof that Republicans don't care about the deficit, which is why I think Republicans will only go along if the payroll tax cut is matched by -- you guessed it -- an equal or larger spending cut.

If that's the case, then what this actually turns out to mean is that the Republicans have all but completely won the messaging war on the economy, and that only Republican tax and spending cuts will be in the cards, something of course that will make the economy steadily worse...and Republicans will simply blame Obama for not cutting enough.

It's a terrible hand to be holding for the White House to actually play.   If this happens, the debt ceiling argument is totally lost to the Dems...and so is the economy.

Land Of The Rising Core Temperature, Part 34

Japanese officials are now finally admitting to the scenario I warned about nearly three months ago:  that not only have reactors 1, 2, and 3 at Fukushima Daiichi gone through total meltdowns, but that the slagged fuel rods have melted through the reactor pressure containment vessels and have most likely been contaminating the area around the plant for months.

Molten nuclear fuel in three reactors at the Fukushima Daiichi power plant is likely to have burned through pressure vessels, not just the cores, Japan has said in a report in which it also acknowledges it was unprepared for an accident of the severity of Fukushima.

It is the first time Japanese authorities have admitted the possibility that the fuel suffered "melt-through" – a more serious scenario than a core meltdown.

The report, which is to be submitted to the International Atomic Energy Agency (IAEA), said fuel rods in reactors No 1, 2 and 3 had probably not only melted, but also breached their inner containment vessels and accumulated in the outer steel containment vessels.

The plant's operator, Tokyo Electric Power (Tepco), says it believes the molten fuel is being cooled by water that has built up in the bottom of the three reactor buildings.

In other words, only the seawater flooding the reactor areas, now highly radioactive and largely uncontainable, is keeping the molten fuel from melting through the outer steel containment vessels and going directly into the environment.

This situation is now near absolute worst case scenario.  The molten reactor fuel and the contaminated seawater will somehow have to be dealt with, removed, contained, or sealed up.  Meanwhile, every day that passes assures more radioactive material leaks into Japan's ecosystem.  The cumulative damage from this mess could take generations to repair

I don't see any way to deal with the water or the heavily damaged containment vessels short of entombing the entire facility...and that's if the steel outer containment shells for the reactor aren't breached in some way, which, given the amount of radiation in the reactor areas has to be the case.  If that's the reality, then the whole place will have to be buried under tons and tons of concrete and the area around the plant will have to be written off.

The worst part is that the plant's proximity to seawater means the concrete option may not be 100% effective if the radioactive material has gotten into the ground and the adjacent ocean, meaning that whole area of the Pacific may have to be put off limits for an indefinite time period.

TEPCO stock has fallen to a new low and the stock is in trouble of being delisted from the Tokyo exchange.  Bankruptcy and recievership cannot be far behind, and that means Japanese taxpayers are going to be footing a tremendous cleanup effort.

I initially put the total damage to Japan's economy at the $1 trillion mark.  I may be closer to the real total than anyone imagined, including myself.

Cutting A. Weiner In Half

In the last 24 hours a not-insignificant number of Democrats have come forward saying it's time for Anthony Weiner to resign.

The Democratic dominoes are starting to fall for embattled Rep. Anthony Weiner (D-NY). Rep. Allyson Schwartz (D-PA), who serves among the leadership of the DCCC, told Politico Wednesday afternoon that it's time for Weiner to go. Schwartz' office confirmed the news to TPM.

As Wednesday evening went on, more Democrats joined the Weiner resignation bandwagon. Sen. Patrick Leahy (VT) and Reps. Nikki Tsongas (MA) and Joe Donnelly (IN) called on Weiner to step down from Congress, as did Reps. Mike Michaud (ME), Mike Ross (AR) and Larry Kissell (NC). 

Most of these guys are Blue Dogs who can kiss my black ass and aren't worthy of attention, but Patrick Leahy calling on Weiner to go is a major blow.  Leahy is one of the big voices on the D side, and he doesn't speak out unless he feels it's damn important, he's been in the game forever.  If Weiner has lost someone of Leahy's level this publicly, he's in serious trouble among his colleagues.

And did I mention Weiner's wife is pregnant?

Tuesday night I would have told you Weiner would survive this.  Now I'm not nearly as sure.  Do I think it's fair that Weiner is getting pummeled while David Vitter is still a Senator?  Of course not, as Rachel Maddow discusses with all people, Michael Steele.

But again, it's one thing for knuckleheads like Reince Preibus and Eric Cantor to defend David Vitter and let him get away with it.  It's another thing entirely to have Patrick Leahy not defend Anthony Weiner.

Maybe I'm going to burn for this, but Anthony Weiner is being held to a higher standard than the Republican party, and while that's unfair that he's being held to that, I'm having difficulty saying it's completely 100% a bad thing to be held to a higher standard than the Republicans.

Even the Village is admitting there's a double standard here.

"This is a massive overreaction and I don't understand it," said Melanie Sloan, executive director of Citizens for Responsibility and Ethics in Washington.

Sloan pointed to the recent ethics case of another New York congressman, Charles Rangel, as an example of the double standard being pushed by some Democrats for Weiner.

The House Ethics Committee found Rangel -- the former chairman of the powerful Ways and Means Committee, which writes the nation's tax laws -- guilty of improper fundraising, inappropriate possession of multiple rent-controlled apartments and failure to pay taxes on a vacation home, among other charges.

"There were very few calls on Rangel to resign and he was censured of serious misconduct involving his office – really serious things that had potential for criminal charges," Sloan said. "We don't have anything remotely like that in the Weiner case."

Sloan explained that the mounting pressure on Weiner may stem in part from the early precedent set by House Speaker John Boehner when, at the first sign of sexual misconduct, he urged Reps. Mark Souder (R, Ind.) and Chris Lee (R, N.Y.) to resign, even though their behavior didn't appear to involve any abuse of their office.

"A lot of people really hate Weiner, too," she said, referring to Weiner's colleagues in the House, some of whom are said to have been rankled by his personality and frequent media appearances. 

So yes, there's a legitimate argument that Democrats should hold Anthony Weiner to a higher standard of conduct.  And yes, Republicans Chris Lee and Mark Souder both resigned after making similar mistakes, and I wasn't sorry to see either of them go.  I think the argument that Weiner should resign over this is outweighed by the circumstances, but I really can't see myself disagreeing anymore with those who are calling for him to step down.

And especially in the light that Democrats are bringing attention to anti-woman legislation from the GOP, Weiner may find himself without a chair to sit in when the music stops.

We'll see how this turns out.

[UPDATE] Anthony Weiner's wife, Huma Abedin, says her husband will remain in Congress.  She is currently traveling with Secretary of State Clinton on her latest trip to the Middle East.


Related Posts with Thumbnails