Last Call

You knew Bill Kristol had to weigh in on Cordoba House and Mike Bloomberg's defense of it.  It's typical drivel, but it's notable for a line that has to be the winner of Wingnut Stupidity of the Year:

His remarks will be read with curiosity by future generations of Americans, who will look back in astonishment at the self-deluding pieties and self-destructive dogmas that are held onto, at once smugly and desperately, by today’s liberal elites. 

Only Bill Kristol would consider the First Amendment's clause that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof" as a self-deluding piety or a self-destructive dogma.

I would think future generations would look at Bill Kristol, Sarah Palin, Newt Gingrich and the rest of the GOP bigotry squad and ask why we were so hateful to gays and lesbians, Muslims, science, and you know, fact.  That is if there are future generations, which if the GOP gets back in control so they can continue to strip the treasury and cook the planet, well...

Don't Have A Leg To Stand On

This afternoon Judge Vaughn Walker took the notion of issuing a stay on California's gay marriages out back and beat the ever loving crap out of, going so far to say that the folks behind Prop 8 had no legal standing to even request a stay, an amazing ruling in and of itself.

A federal judge Thursday refused to permanently stay his ruling overturning Proposition 8 but extended a temporary hold to give supporters time to appeal the historic ruling.

U.S. District Judge Vaughn R. Walker, who overturned the measure on Aug. 4, agreed to give its sponsors until Aug. 18 to appeal his ruling to the U.S. 9th Circuit Court of Appeals. No new marriages can take place until then.

Gov. Arnold Schwarzenegger and Atty. Gen. Jerry Brown, the state's highest officials and named defendants, have told Walker that his ruling declaring Proposition 8 unconstitutional should be enforced immediately.

In his ruling Thursday, Walker said the sponsors of the measure do not have legal standing to appeal his order because they were not directly affected by it.

"As it appears at least doubtful that proponents will be able to proceed with their appeal without a state defendant, it remains unclear whether the Court of Appeals will be able to reach the merits of proponents' appeal," Walker wrote.

In other words, since the Governor (Arnold Schwarzenegger) and Attorney General (Jerry Brown) don't plan to appeal themselves in their capacity as officers of the State of California, Judge Walker is basically saying that the Prop 8 folks cannot represent the state because the case is, after all, Perry vs. Schwarzenegger, not Perry vs. The People Who Were Behind Prop 8.

That's astounding.  Really.  They have until 5 PM PDT Wednesday afternoon to file an appeal, or the law is overturned and California can once again perform gay marriages, which is what the Governator and Moonbeam want to do in the first place.

As bmaz over at Emptywheel notes, this will force a 9th Circuit decision very, very quickly.

So now the question is which three judges will be assigned to the panel that will consider and rule on the appeal, because the makeup of the appellate panel is absolutely critical to the process and potential outcome. There has not yet been a formal panel assigned to the appeal, but just as with the court protocol I used to predict Walker’s decision ahead of time, there is a tradition and protocol generally followed in the 9th Circuit that may give us an idea of the panel that will be deciding this seminal case.

In the 9th Circuit, when a case goes up on appeal, and it has been there before to a given panel on any issue, that panel has the option of taking the full appeal when it is filed. Well, the Perry case has indeed already been up to the 9th previously on an interlocutory appeal of a discovery issue during the trial process, and that appeal was decided by a panel consisting of Judges Wardlaw, Fisher and Berzon. I think there is a very decent chance the standard 9th protocol is followed here and the full appeal is assigned to the previous panel of Wardlaw, Fisher and Berzon, which makes sense in terms of judicial economy since they are already up to speed on the parties and the case facts and posture.

So who are these judges, and what is the book on them? Well, that is where the fun comes in. They are all three Clinton appointees, and two of them, Marsha Berzon and Ray Fisher, clerked for Justice Brennan. Solid liberal credentials for sure, and Kim Wardlaw may actually be even more enlightened. If the appeal gets assigned to this panel, it would be in excellent hands and I would like very much the chances for upholding Judge Walker’s decision in favor of marriage equality for all.

And such a decision would ensure passage to the Supreme Court.  Will the 9th Circuit issue a stay?  Odds are close to 100% would be my guess.  We'll see.

Exciting New Horizons In Obama Derangement Syndrome

The reality:  Obama's not doing so bad.

Still, Obama's approval rating is a bit higher [47%] than the 44 percent approval Clinton scored in August of 1994 and it's also higher than the 42 percent Ronald Reagan got in August, 1982 and the 42 percent George W. Bush got in August, 2006.

The spin: The Obama presidency is effectively over.

There are an array of reasons behind the stunning decline and political fall of President Obama, chief among them fears over the current state of the US economy, with widespread concern over high levels of unemployment, the unstable housing market, and above all the towering budget deficit. Americans are increasingly rejecting President Obama’s big government solutions to America’s economic woes, which many fear will lead to the United States sharing the same fate as Greece.

They're already referring to him as irrelevant and in the past tense with the postmortems and epitaphs after just 19 months.  Obama Derangement Syndrome:  Catch it!

Rand Off On Hands Off

When it comes to the Kentucky Senate race in the mountain counties, Rand Paul's deregulate and defund approach to drug enforcement isn't going over well in some of the state's hardest-hit meth and pot areas where Democrat AG Jack Conway is coming across as the strong law and order candidate.

Paul, a tea party favorite, espouses a plan that would put the onus for drug enforcement on state and local governments. His Democratic opponent, Jack Conway, favors using federal money.

"I don't think it's a real pressing issue," Paul told The Associated Press, suggesting that voters will decide who to support based on broader fiscal and social concerns.

"I think we're going to do very well in eastern Kentucky," he said. "They're socially conservative out there, so am I. Jack's not. They're fiscally conservative. I am. Jack's not. ... I think we'll swamp him."

Paul is counting on winning all of Kentucky's rural vote, including the Appalachian region, and keeping the race close in the state's two largest cities, Louisville and Lexington, where voters tend to favor Democrats. Conway, a Louisville resident, has been trying to cut into Paul's rural base by taking him to task on the drug issue.

"Rand will handcuff local sheriffs trying to combat the drug epidemic, and I will make sure Kentucky's law enforcement has the tools they need to protect our families," Conway said. "That's my record as attorney general, and that's what I'll do in Washington."

I'm not really sure how well this will play in out in the far reaches of the Bluegrass state.  After all, "Get that revenuer off my land" is still ingrained where I grew up in the mountains of NC and it's even more so in some parts of Kentucky.  But let's not kid ourselves, Rand Paul's plan as Senator is to cut, cut, cut, cut.

Paul hasn't been shy about speaking his mind on the drug enforcement issue, telling local leaders during a political forum last month that involving Washington in the matter leads to waste. "I think issues like drug use and abuse are best dealt with at the local level," he said.

But Paul hasn't said where state and local governments would get the money needed to fund the drug efforts.

Well that's your problem, rural Kentucky.  Don't have the tax money to enforce drug laws?  Too bad.  The free market reigns supreme. Rand Paul doesn't give a damn.  That's your problem, not his.

Why There's No Sense Of Emergency, Part 2

When all you see in Washington circles is a 5% unemployment rate among college grads, you tend to miss the fact that the rest of us are hurting badly, and that the poorest Americans are in a full-blown depression in places like Georgia.

East Point housing officials began accepting Section 8 applications 90 minutes early Thursday morning after crowds of people showed up to turn in the forms.

A day after a crowd of 30,000 mobbed the housing authority offices to pick up the forms, a small crowd of less than a dozen people began lining up around 5 a.m. The group was dispersed by East Point police about an hour later. But shortly after 7 a.m., officials allowed people to line up on the sidewalk adjacent to the building. There were about 50 people in line at 7:30, when officials brought out boxes and began to accept the applications. That process had been scheduled to begin at 9 a.m. Applications will be accepted until 5:30 p.m.

30,000 people were out in the Georgia heat yesterday to pick up an application for HUD Section 8 housing.  Thirty thousand people showed up just to get an application to get onto a waiting list for a housing project apartment.

Applicants came from all over the metro area and some came from other states. Since the program is a federal program, applications are not limited to East Point residents, Lemish said.

The current process is being conducted because, while all housing units are filled, the waiting list is depleted and the current group of applicants will be put on a new waiting list. There are a total of 655 housing spots available -- 200 public housing units and 455 vouchers for rent assistance in private housing. East Point currently has five housing developments, but three of them will be closed or sold.

Lemish said it will likely be six months before any vacancies arise and that people could spend up to 10 years on the waiting list.

Section 8 housing apartments are being closed or sold all across the country because cities and counties don't have the money anymore.  Thirty thousand people showed up to get on a list for 655 spots here.  We're in the process of creating a new, permanent underclass in this country:  excruciatingly poor, uneducated, and no city, county, or state funds to help them.  It's not millions are "falling through the cracks", it's millions are "being pushed into the chasm by bulldozers".

It's going to get brutal in the next couple of years, folks.  You will see a lot more of this in the coming months, and things are going to start getting a lot less civil when it does.

Taibbi On The Bankster Bill

Matt Taibbi gets the final say on the Wall Street "reform" bill and his analysis is dead on.  The biggest winners here are the megabanks, and when the next financial crisis comes -- and it's coming very, very soon -- we're going to find out just how inadequate this bill is.

It's not that there's nothing good in the bill. In fact, there are many good things in it, even some historic things. Sen. Bernie Sanders and others won a fight to allow Congress to audit the Fed's books for the first time ever. A new Consumer Financial Protection Bureau was created to protect against predatory lending and other abuses. New lending standards will be employed in the mortgage industry; no more meth addicts buying mansions with credit cards. And in perhaps the biggest win of all, there will be new rules forcing some varieties of derivatives – the arcane instruments that Warren Buffett called "financial weapons of mass destruction" – to be traded and cleared on open exchanges, pushing what had been a completely opaque market into the light of day for the first time.

All of this is great, but taken together, these reforms fail to address even a tenth of the real problem. Worse: They fail to even define what the real problem is. Over a long year of feverish lobbying and brutally intense backroom negotiations, a group of D.C. insiders fought over a single question: Just how much of the truth about the financial crisis should we share with the public? Do we admit that control over the economy in the past dec­ade was ceded to a small group of rapacious criminals who to this day are engaged in a mind-­numbing campaign of theft on a global scale? Or do we pretend that, minus a few bumps in the road that have mostly been smoothed out, the clean-hands capitalism of Adam Smith still rules the day in America? In other words, do people need to know the real version, in all its majestic whorebotchery, or can we get away with some bullshit cover story? 

In passing Dodd-Frank, they went with the cover story.

Do read the whole thing.  The megabanks are in charge more now than they were even a few years ago, and the raid of the US treasury is now on.

Worst of all, some analysts warn that the failure to rein in Wall Street makes another meltdown a near-certainty. "Oh, sure, within a decade," said Johnson, the MIT economist. "The question: Is it three years or seven years?"

Johnson was part of a panel sponsored by the nonpartisan Roosevelt Institute – including Nobel Prize-winning economist Joseph Stiglitz and bailout watchdog Elizabeth Warren – that concluded back in March that the reform bill wouldn't do anything to stop a "doomsday cycle." Too-big-to-fail banks, they said, would continue to borrow money to take massive risks, pay shareholders and management bonuses with the proceeds, then stick taxpayers with the bill when it all goes wrong. "Risk-taking at banks will soon be larger than ever," the panel warned.

Without the Volcker rule and the ­Lincoln rule, the final version of finance reform is like treating the opportunistic symptoms of AIDS without taking on the virus itself. In a sense, the failure of Congress to treat the disease is a tacit admission that it has no strategy for our economy going forward that doesn't involve continually inflating and reinflating speculative bubbles. Which sucks, because what happened to our economy over the past three years, and is still happening to it now, was not an accident or an oversight, but a sweeping crime wave unleashed by a financial industry gone completely over to the dark side. The bill Congress just passed doesn't go after the criminals where they live, or even make what they're doing a crime; all it does is put a baseball bat under the bed and add an extra lock or two on the doors. It's a hack job, a C-minus effort. See you at the next financial crisis.

It may be sooner than three, frankly.  But sometime in the next decade, we're going to be right back where we were in September 2008.  And when that happens, there will not be an easy way out.

Say Hello To My Little Friend

Japanese toy plus Obama equals just awesome.



"I've got your spending cuts RIGHT HERE!"

(h/t Charles Davis)

An Old School Beatdown

Over at BJ, Mistermix points out that the Baby Boomers approaching retirement and the elderly already there will happily throw younger Americans under the bus and embrace the New Republican Austerity Plan to get their entitlements.

I grew up in a small town with an aging population, and I live in a suburb that’s a bit older than the area average. Even though the senior citizens in each town put their kids through the local schools, the school budget is always in danger of failing at election time. A few years ago, for example, the current parents and the senior citizens in my suburb engaged in a standoff. After the bond issue for the new library (the seniors’ pet project) was voted down, the budget authorization for the schools was voted down. A big PR campaign/forced love-in ensued and both issues passed the next election, but it was a pretty ugly example of how the last generation of parents is ready to hold the current generation hostage to get what they want.

Similarly, the partial dismantling of programs for the elderly that Ryan envisions won’t affect the current generation of retirees. Ryan and the Republicans are betting that their older base, which turns out reliably, will be happy to cut the retirement benefits of the next generation as long as the current generation gets theirs. I think they’ll find a pretty receptive audience for those cuts, and it might be a short-term winning strategy that leverages an ugly side of human nature.

Hey, leveraging the ugly side of human nature is what the Republicans are all about these days, from Islamophobia to xenophobia to racism to homophobia and everything in between.  It's all about gathering the coalition of Us Versus The Other.  And yes, it comes back to "I Got Mine, Screw You."  Republicans aren't stupid, just cynical.

And frankly, it's working.  It will continue to work as long as our economy continues to fall apart and people are scared about losing their jobs to undocumented workers, losing their culture to another religion, losing their health care to the poor, and losing their status as majority to a country of minorities.

The D Word

D-D-D-Deflation is finally being uttered openly by the financial press, and with good reason.

While pockets of inflation may be cropping up in food and low-priced items, deflation could be just as much of a concern for sellers of appliances and vehicles, which are often the first items to be struck off shopping lists in a difficult economy.

Grim data on economic growth, consumer spending and housing, along with stubbornly high unemployment, have fanned fears of a deflationary environment where weak consumer demand forces a steady fall in prices of goods.
Moody's Analytics chief economist Mark Zandi sees a one in six chance of outright deflation in the U.S. economy, while some others said the odds could be as high as 50 percent.

"No industry suffers more from deflation than retailers," Zandi said, since they already operate on thin margins.
The timing of a bout of deflation could not be worse.

After offering mega-discounts to boost spending in the trough of the recession, retailers are struggling to retrain Americans to buy goods at full price.

If consumers postpone purchases, inventory builds up, forcing retailers to drop prices, said Kronos Chief Economist Robert Yerex.

That's why the durable goods numbers are so important.  Right now they're starting to indicate that dishwashers, refrigerators, flat-screen TVs and washers and dryers are staying on store shelves.  This holiday shopping season people are going to be expecting big, big discounts.  Fewer and fewer retailers are going to be able to give them.  That's bad all the way around for the economy.

We're getting to the point where something's going to have to give and when it goes, it's going to leave a crater.  And that brings us to the other D word:  depression.

If It's Thursday...

New jobless claims up a smidge to 484k, continuing claims down to 4.45 million.

We're getting closer to that 500k mark, and heading the wrong way.  But there's still no sense of emergency in Washington.

Foreclosing On A Dream, Part 2

After falling over the spring due to the tax credit, foreclosures are now back on the rise in the latest signal Obama's economic measures just aren't enough.

After having declined for 4 months in a row, July foreclosure activity once again took a leg up, increasing by 4% from the prior month to 325,229 in July according to RealtyTrac. There was deterioration across all three foreclosures categories: default notices, foreclosures auctions and bank repossessions (REO). “July marked the 17th consecutive month with a foreclosure activity total exceeding 300,000,” said James J. Saccacio, chief executive officer of RealtyTrac. “Declines in new default notices, which were down on a year-over-year basis for the sixth straight month in July, have been offset by near-record levels of bank repossessions, which increased on a year-over-year basis for the eighth straight month.” Of note is the ongoing increase in bank repossessions as banks seems increasingly less motivated to put foreclosed properties in auctions lists. Per RealtyTrac: "Lenders foreclosed on 92,858 U.S. properties in July, a 9 percent increase from the previous month and a 6 percent increase from July 2009. July’s bank repossession (REO) total was the second highest monthly total since RealtyTrac began tracking REO activity in April 2005 and was 1 percent below the monthly REO activity peak of 93,777 in May 2010." 

We're now in a self-sustaining deflationary spiral.   Foreclosures reduce demand, reduced demand leads to layoffs and cutbacks, and layoffs lead to more foreclosures.  I also don't see any way to break out of this spiral anytime soon.

The latest Fed action to buy up some $300 billion in treasuries isn't going to help this problem at all.  Obama's HAMP program has been a miserable and complete failure by all accounts, and as such we're now locked into deflationary ruin.

Drastic action by the Fed will be undertaken soon and I'm not sure if we'll make it to Election Day before it happens.  I'm betting on it coming sooner rather than this winter.  Keep an eye on the bond market.

He's An Aqua Buddha Man

Greg Sargent scored an interview with the woman who accused Rand Paul of "kidnapping" her and while she definitely clarifies the kidnapping part by saying she went along willingly, the drug use and the whole Aqua Buddha thing got a whole lot weirder.

The woman -- who was made available to me for an interview by GQ reporter Jason Zengerle in response to the Paul campaign's denunciations of his article -- said she didn't mean to imply that she was kidnapped "in a legal sense."

"The whole thing has been blown out of proportion," she told me. "They didn't force me, they didn't make me. They were creating this drama: `We're messing with you.'"

The woman said that much of the subsequent coverage of her allegations missed a key nuance: As a participant in a college ritual, where lines between acquiescence and victimization are often blurry, she was largely playing along with the notion that she was being forced to follow Paul's orders.

"I went along because they were my friends," she said. "There was an implicit degree of cooperation in the whole thing. I felt like I was being hazed."

That characterization of events supports Paul's claim that, as he told Fox News yesterday, "No, I never was involved with kidnapping. No, I never was involved with forcibly drugging people."

But in her conversation with me, the woman stood by the general outline of her earlier account.
"[They] came over to my house as friends that I knew," she told me. "They immediately said, `We're going to tie you up and go for a ride.'"

She reiterated that they took her to a room filled with pot smoke and told her to partake, but she emphasized that she hadn't been forced. "He did not drug me," she said. "He did not force me physically in any way."

She said they then "took me out to this creek and made me worship Aqua Buddha." And she added that the whole thing was so "weird" that afterwards she ended relations with Paul and his friends.

Personally I'm waiting for the wingers dedicated to destroying this woman's career and her life to emerge.  I figure by the end of the week we'll know everything about her and the hate mail and phone calls will begin as they try to get her fired for daring to bring this up.

And yeah, Rand Paul is weird.  Nothing wrong with that, frankly.  But it's still creepy.

StupidiNews!

• The ruling on whether or not Judge Vaughn Walker will allow gay marriages to go forward in California while the case goes to appeal comes down this afternoon.
• Texas is suing the federal government over the offshore oil drilling moratorium, claiming the state was never contacted or consulted.
• New rules on bank overdraft fees go into effect today, meaning that customers will have to opt-in to overdraft protection and costly overdraft fees.
• Wheat and corn prices are on the rise as Russian drought and worldwide demand affect supply.
• Viacom has appealed its billion-dollar lawsuit against Youtube to the Second Circuit.