Oh, Now George Will Discovers A Spine

I'm sure I'm not the only one to roll my eyes after reading George Will's hyposkreedical wankertude in the WaPost today. Only the overwhelming minority -- the die-hard's still approving of the lame-shoe-ducker -- could possibly buy Will's B.S. after scanning this P.O.S. column bitching about the imperial nature of the White House.

Imagine the gall of the executive branch, ignoring Congress and giving the detroit auto-makers even more cash than the lawmakers debated -- then turned down! Either Will is emerging as a world-class satirist, or he's absolutely clueless.

For decades, imperatives of wars hot and cold, and the sprawl of the regulatory state, have enlarged the executive branch at the expense of the legislative. For eight years, the Bush administration's "presidentialists" have aggressively wielded the concept of the "unitary executive" -- the theory that where the Constitution vests power in the executive, especially power over foreign affairs and war, the president is immune to legislative abridgements of his autonomy.

The administration has not, however, confined its aggrandizement of executive power to national security matters. According to former representative Mickey Edwards in his book "Reclaiming Conservatism," the president has issued "signing statements" designating 1,100 provisions of new laws -- more designations than have been made by all prior presidents combined -- that he did not consider binding on him or any other executive branch official.

Still, most of the administration's executive truculence has pertained to national security, where the case for broad prerogatives, although not as powerful as the administration supposes, is at least arguable. With the automakers, however, executive branch overreaching now extends to the essence of domestic policy -- spending -- and traduces a core constitutional principle, the separation of powers.

Where was Will, let alone his fellow Villagers, when Still PresNitWit Bush issued the 1,100 signing statements Will notes? Where was the outrage when Bush ignored treaty after treat, from the A.B.M to Geneva. Why does it make one whit of difference whether the President acts the part of imperial despot on the international arena or on purely domestic issues?

GeeZuz George, these guys have been ignoring the Constitution from day one.

And why, suddenly, after the Fourth Estate either sat blithely by as Vice President Cheney proclaimed himself "FourthBranch," or led the cheering for an illegal war, shrugged it's collective shoulders over domestic spying and approvingly kept that under wraps until after the criminals were safely reelected, tut-tutted torture, disapprovingly sighed over corruption permeating the government, and witnessed an American city drown -- why now should they be shocked that President Bush does whateverthehell he wants?

Now that Bush decided to prevent a second city from drowning, this time under debt and a crumbling manufacturing base, George Will is drawing a line in the sand. Feh! I don't recall the outraged OpEds will could have wrote demonizing Nancy Pelosi for taking impeachment "off the table." Where did I put that editorial he wrote calling for a War Crimes trial of Rumsfeld? I'm certain Will must have written something, somewhere, calling Bush, Cheney, Condi and Colin Powell a disgrace for their consistently inept and petulant foreign policy.

Did Will note the transformation of the Department of Labor into the Department of Union Busting? If his line is the domestic/foreign policy divide, why doesn't Will call for an indictment against Gonzales and John Yoo for approving the extension of wiretapping to ALL American citizens.

How on earth is this all Congress's fault, yet members of Will's private club -- the above-it-all punditocracy -- get a pass? Maybe Will has decided to become a vertebrate for a while himself, at least so long as a Democrat lives at 1600 Pennsylvania Ave.

Auto Bailout Band Aid

The Plantation Caucus was temporarily outmaneuvered (no car-czar, no binding concessions until Obama takes over) as the White House pumped enough cash into GM and Chrysler for them to keep the doors open a couple months -- with the added benefit that maybe GMAC (through which the funding will flow) will have enough capital to make some car loans to all the folks who want and can afford to buy cars but were turned down by all the other banks that stole TARP money.

I'll probably have a lot more to say about this, like the idea that this was more like a "take it or leave it" offer than any kind of negotiation.  Meanwhile I'm back to digging out from last night's ice storm.  I'll just note for now that not every conservative hates this "deal."  Professional Bush apologist Hugh Hewitt, consistent with his lap-dog personality, is positive Bush did exactly the right thing in exactly the right way at exactly the right time because, well . . . it was Bush after all who did it.

Excuse me as I go and rinse the bile out of my throat.  On the bright side, since most of the right hates this thing (here's a typical example, and I'm watching Larry Kudrow on CNBC lose his mind), it must be a great thing.

Just 38 Scoffing Days Left

Earlier, CNBC-TV18 had reported that the auto makers had first asked for USD 25 billion and then two weeks later revised it to USD 34 billion. After two grueling days of being questioned at the Capitol Hill, the CEOs seem to have convinced the government representatives, though maybe partially, because what they are likely to get is USD 15 billion.

Anyone else find it a bit too convenient that George Bush played hardball with the auto-makers and House Democrats, whittling down their final request of $34 Billion down to $15 Billion and insisting it come out of the $25 Billion already earmarked for green-retooling the companies and not from the TARP -- only to find out that so far the Treasury has spent all but $15 Billion of the money's already appropriated to bailout the banks with zero oversight?

Treasury has already run through the TARP's first $335 billion, with just $15 billion left before he has to seek further authorization from Congress. That $15 billion might tide GM and Chrysler over until the new Congress convenes, but it will leave him with little running room to help out the banking system.

Seriously, this isn't just a dot to connect, a mere coincidence.  This is a clumsy a "tell" as you get.  Phoenix Woman at Firedoglake is close in her analysis, liking the whole charade as Kabuki Theater.  The "take their first shot against organized labor" memo outlines the closed-minded tactics involved (although any coherent strategy among the "Plantation Caucus" is conspicuously missing).

Bush and the Democrats came up with a deal that won bipartisan approval in the House, and then when Senate Republicans created a few obstacles to poison the deal, the Dems gave them almost everything they wanted.  But of course, this ISN'T what they wanted.  What they wanted was to have political cover for killing the deal, so they could pretend that the Dems were being unreasonable.  They had multiple reasons for not wanting this to pass, but they knew that it would hurt the party politically if they couldn't come up with some decent sounding excuse for why they were killing it.

Bush already signaled their "out," that they were covered for up to $15 Billion once he got Pelosi, et al. to lower their demand to less than half of what was barely adequate.  But the Senate GOPers overplayed their hand and now have nothing to show for all the criippling concessions demanded from the UAW.

You'll note that talk of tapping the TARP was out there almost immediately upon the death of the emergency loan in the Senate.  My guess is that knowing how fragile and volatile the markets are, they weren't going to risk even a day where the headlines would be full of the Rust Belt's obituaries. 

Bush is in legacy-fixing mode and it's care for his own worthless hide that is motivating him far more than refusing to watch Detroit go the way of post-Katrina New Orleans.  Presiding over the ghettoizing of the industrial mid-west would be the last straw. No gate-community retirement home could hide him.

What's funny is hearing Plantation Caucus spokesman, Bob Corker saying that it would be irresponsible for the President to unilaterally give the Big Three any cash without all the safeguards and conditions worked out in the House -- which he led the way to flush down the toilet.  These folks just don't know how to play a winning hand, went all in and got called only to find out they were the ones bluffing all along.

Briar Patch?

There's a theory/rumor/piece of wishful thinking floating 'round Blogtopia (yeah, Skippy, whatever) that faced with the not unlikely thousand point cliff-dive the DOW might take on the news of the collapse of the Detroit auto-makers loan, Bush will tap into the TARP and throw cash at GM, Ford and Dan Quayle, *with no more oversight than AIG got* in order to save Wall Street from imploding, and bringing along both Main Street and what's left of Telegraph Road along with it.

Bank bailout funds could be used for Detroit
Sources: White House warning GOP senators Wall Street bailout funds might be used for automakers now that auto loan package has failed.

As part of their full-court press to urge skeptical Republicans to back it, [Bush officials] made clear that if Congress didn't act, the White House would have to step in to save Detroit from collapse with funds from the $700 billion Troubled Asset Relief Program (TARP), according to the sources familiar with the conversations.

"I would only hope that the president, who has worked so well with us for the past several weeks, would now use consider using the TARP money," said Senate Majority Leader Harry Reid, D-Nev., after the vote.

One of the sources said the a White House official made clear to a GOP Senator that would be the worst option, because the loan could go to the auto companies with few or no requirements along with it.

Democrats had pressed the White House from the start to help Detroit by using some of the $700 billion for the financial sector, but the White House had refused.

At this stage, I'm not going to get my hopes up that Bush is capable of doing the right thing. It makes me laugh just to write those words. If that petulant little prick can figure out a way to spin this thing, he'll let the American auto industry simply die.

Hell, he's killed more people than will lose their jobs and homes if the big two-and-a-half fail. Why should he care if folks are just broke? I can't believe that he would let his last act be remembered as giving the Democrats and a union exactly what they want. Digby isn't holding her breath either.

If this really was the message that Cheney brought to Capitol Hill, that unless they went along with the program Bush's hand would be forced and he'd have to save Detroit with TARP funds, it backfired in a completely predictable way. It gives the GOP Senators an out.

See, they get to further distance themselves from Bush (always a good thing), and act the pigheaded louts their inbred constituency loves them for -- knowing that the dreaded consequences of their intransience will never occur. They don't get blamed for the manufacturing collapse fortold if they scuttle the bridge loan because they know it will never happen. The rest was just theater, waiting to see if Harry Ried calls their bluff or blinks, further humiliating the workers who've already bent over backwards.

With the TARP in play, the execs get to keep their ridiculous salaries and golden parachutes (if they can do it and still look in the mirror) just like AIG and Citibank, there won't be any car czar, nobody will be forced to retool unless they want to, and they can keep their stupid jets. Meanwhile, BushCo gets to play the reluctant hero, placing the blame for any further trouble the comparative pittance he'll throw Detroit's way doesn't cure squarely on the next administration.

Bastards

Josh Marshall on the GOP stopping the auto bailout: "In the future I think it will be difficult to explain why this happened, perhaps even more challenging to explain why this key national decision was left in the hands of lame duck senate Republicans."

GM is preping for a Chapter 11 filing.  By the time we get to the heart of what ails us, our sick health care system, it will be too late.  GM would have another $22 billion to play with if we worked under the same rules in every other civilized country.

The other econ news simply sucks.  Krugman is calling the jobs outlook a nosedive.  Unbelievable that someone can get away with a $50 billion ponzi scheme, for years, before the SEC catches the crook.

I swear we are just a nation of bandits in suits and ties, folks more than willing to turn millions of their fellow citizens out on the street in the name of cheap, disposable labor.  But then again, patriotism is only a slogan to them they use to beat liberals over the head with.

Patriotism: from the Latin patriota meaning "fellow countryman."  Colin Powell damn well knows what he talks about when warning that his party cannot continue to listen to the likes of Rush Limbaugh and hope to have a future.

"Can we continue to listen to Rush Limbaugh?" Powell asked. "Is this really the kind of party that we want to be when these kinds of spokespersons seem to appeal to our lesser instincts rather than our better instincts?"

Rush certainly does have a vast audience . . . and they scare the crap outta me.

Shut Up Chuck

Although he doesn't actually come right out and say it, my Washington Post summary email on Charles Krauthammer's column today called From Market Economy to Political Economy did one of those "Shorter Chuckles" thingies, saying,

This is not the time to pursue an economic agenda based on liberal social goals.

Is it ever with these twits? Onward and forever to tax-cutting and cannibal capitalism!

Creepier still is what he actually has to say, conflating the evils of lobbyists who have a worse reputation than lawyers lately, Wall Street bankers who as a group are probably less popular that the C+ Augustus still aggravatingly living at 1600 Pennsylvania Ave. that Chucky has been fellating O' these many years, and the entire city of Detroit with its principle industry as both a wholly subsumed nationalized colony of Washington DC with its hand out like any common crook lobbyist as well.

For the hat-trick, he looks in his crystal ball and declares any attempt to assist the auto industry in modernizing and greening our future stinks of the Soviet Union's completely planned Diktats on every factory floor, then pronounces the entire effort doomed to the same failure.

All this because we might want GM, Ford and Chrysler to build affordable, fuel efficient hybrid cars if they want a loan. (And they should look really cool too, but that's just me.)

The ruling Democrats have a choice: Rescue this economy to return it to market control. Or use this crisis to seize the commanding heights of the economy for the greater social good. Note: The latter has already been tried. The results are filed under "History, ash heap of."

I smell fear. Fear that events and the excesses of those who share Krauthammer's dementia are truly irrelevant, increasingly so in a world that is passing them by. The more they sink into the "ash heap" of their "commercial republic," the more outlandish the rhetoric will become.

I've no doubt Charlie will be deriding President Obama in stark terms in short order. He'll compare Obama to Stalin for instituting virtual gulags for FOX reporters who never get to ask a question at press conferences. He'll demand the Democrats provide bridge loans to house the refugees of a Purity Purge as soon as he doesn't retain every single incompetent US Attorney hired by AG Gonzales based their use of smiley-faces instead of periods at the end of each sentence in their essay on "What I Did Over My Summer Vacation To Make George W. Bush Even More Awesome." Obama will walk on sour wine and only heal everybody those who wait in line long enough to see a doctor that doesn't speak English -- since all the "good" docs, those still permitted membership in those whites-only country-clubs, will have left the country to set up practice in Dubai.

No doubt my crystal ball is fractured just as much as Krauthammer's. The problem is that he looks through his murky lens to see the past, and the present -- wrongly.

Just keep this in mind with all this talk of nationalization and socialism right now, communists didn't "loan" capital to industry. They just took over, declared the state the owners and ultimate authority over everything. They didn't just hand over rubles to company managers, with or without conditions. For the various bailouts to be anything remotely resembling what the Bolsheviks did, we would have to completely replace the management of those companies with federal bureaucrats and destroy shareholder equity.

Indeed, there wouldn't be any stock market for Chuckles to get his skirts all twisted over when it bolts up and down on the latest message from Obama or Secretary Paulson. Under Soviet-style socialism, for those who either don't know nor care to grok, you don't play with fractions of ownership rights in corporations like so many casino chips. You eliminate corporations altogether.

Not to put too much an edge on it, when President Obama decides to "buy" GM et al., I'll worry about our new socialist overlords. Telling the automakers that they only will get the USA as a co-signer on their loan application if they promise to use the money for good -- good for the USA btw -- is just plain old-fashioned horse trading, capitalism in it's purest form.

There are no free lunches, right? You want something from me, I get something in return -- and if you want it bad enough I can demand very favorable terms. What part of "you scratch my back, I'll scratch yours" stuff don't these Free Marketeers understand? I mean, Detroit doesn't have to take the deal and can take their chances.

Disgusting Displays

A standing ovation for a convicted felon who should never been allowed inside the Senate chamber let alone honored like he was man of the year...

A trillion for banks and AIG with no oversight, no plan, and no clue exactly what would happen if they didn't get their extortion money. (Brad has the right idea on this.)...

The markets (along with everyone's retirement plans and any hope of financial security) are still tanking, losing half their value so far with no idea where the bottom is. Citigroup may be next, Boeing in trouble ...

Faux outrage over private jets. Union busting and style over substance driving decisions when we know exactly what kind of turmoil ensues if the American auto industry is allowed to die. Who can compete when burdened with health care costs foreign competitors' governments cover when they too were hit by Wall Street craziness, the credit squeeze, and the failure of those "pro-business" conservatives to insist that the industry abide by reasonable mileage standards and competitively retool for 21st century transportation needs.

Funny how we got a bailout of the bankers and brokers in a heartbeat that the public didn't really like, let alone understand. Everyone knows what kind of deep doodoo we're in if GM goes under, and they can't get a loan for 3% of what we've thrown at Freddy, Fanny, all the banks and AIG. No wonder the GOP is hated more each day and everyone is just holding their breath until January 20th.

I guarantee Joe the Plumber never heard of AIG before this year -- but he knows the Rust Belt will be hemorrhaging jobs if we stop making American cars. If there has ever been a clearer example of the Villagers on the Potomac being far more concerned about wealth over workers, I can't think of it. Two months seems like an eternity.

The only real variable is that we just don't know exactly how many unemployed millions will be walking midwestern streets as that southern rump party and that C+ Augustus in the White House watch approvingly as Detroit dies just as sure a death as New Orleans when Katrina struck. A million unemployed here, a million there, and pretty soon you're talking real Depression.

Why should they care when they've got friends who can spend $20 million on fireworks just to get their parties started and have brand new Nieman Marcus Christmas catalogs to drool over.

(Yeah, I'm back, and pissed. You should be too.)

You Are Excused

(Wow, of all days to spend the morning writing instead of watching "Morning" Joe Scarborough melt down and get his ass suspended.)

Hilzoy is understandably alarmed and puzzled by some of the mischief that has come to light regarding the never ending AIG bailout, which at $150 billion is about to become the single most costly "investment" the government has ever made to a single corporate entity.

Hilzoy's confusion/outrage stems from Treasury Secretary Paulson reinterpreting a provision of the tax code which slipped through with little notice while Washington was consumed with the $700 billion bailout debate and the election drama.  The result is a $140 billion windfall to the American Banks.

Andrew C. DeSouza, a Treasury spokesman, said the administration had the legal authority to issue the notice as part of its power to interpret the tax code and provide legal guidance to companies. He described the Sept. 30 notice, which allows some banks to keep more money by lowering their taxes, as a way to help financial institutions during a time of economic crisis. "This is part of our overall effort to provide relief," he said.

Now Hilzoy reminds us that she's not a lawyer, let alone a tax lawyer, yet insists that this just doesn't seem right, especially when you read the whole Washington Post story -- if you can keep awake long enough to weed through something most people simply hate.  I feel her pain. Americans justifiably have a Pavlovian sleep response to the word "taxes," so I'll forgive you if this doesn't make the top of your reading list today.

The key question is: does the Secretary (or the President or any part of the executive branch) have the authority to simply repeal acts of Congress?  In this age of signing statements, the answer may be self-evident, but I guess not.

More than a dozen tax lawyers interviewed for this story -- including several representing banks that stand to reap billions from the change -- said the Treasury had no authority to issue the notice.

Several other tax lawyers, all of whom represent banks, said the change was legal. Like DeSouza, they said the legal authority came from Section 382 itself, which says the secretary can write regulations to "carry out the purposes of this section."

Section 382 of the tax code was created by Congress in 1986 to end what it considered an abuse of the tax system: companies sheltering their profits from taxation by acquiring shell companies whose only real value was the losses on their books. The firms would then use the acquired company's losses to offset their gains and avoid paying taxes.

Lawmakers decried the tax shelters as a scam and created a formula to strictly limit the use of those purchased losses for tax purposes.

But from the beginning, some conservative economists and Republican administration officials criticized the new law as unwieldy and unnecessary meddling by the government in the business world.

"This has never been a good economic policy," said Kenneth W. Gideon, an assistant Treasury secretary for tax policy under President George H.W. Bush and now a partner at Skadden, Arps, Slate, Meagher & Flom, a law firm that represents banks.

The opposition to Section 382 is part of a broader ideological battle over how the tax code deals with a company's losses. Some conservative economists argue that not only should a firm be able to use losses to offset gains, but that in a year when a company only loses money, it should be entitled to a cash refund from the government.

During the current Bush administration, senior officials considered ways to implement some version of the policy. A Treasury paper in December 2007 -- issued under the names of Eric Solomon, the top tax policy official in the department, and his deputy, Robert Carroll -- criticized limits on the use of losses and suggested that they be relaxed. A logical extension of that argument would be an overhaul of 382, according to Carroll, who left his position as deputy assistant secretary in the Treasury's office of tax policy earlier this year.

Yet lobbyists trying to modify the obscure section found that they could get no traction in Congress or with the Treasury.

"It's really been the third rail of tax policy to touch 382," said Kevin A. Hassett, director of economic policy studies at the American Enterprise Institute.

I'm not a tax lawyer either, but I think I can put this in terms we can all appreciate.  Tax law was a required course when I was an eager legal beagle.  My tax law professor said you could tell the tax lawyers from the rest of the profession by the size of their biceps -- Popeye-like from carrying around those huge books.  (And here I always thought you could tell by the thickness of their glasses.)

The United State Tax Code of 1986 As Amended (coincidentally that was the year I took tax law) is a two volume monster that reflects the revenue statutes as passed by Congress.  The companion to The Code is a four volume set of Federal Tax Regulations that track and interpret The Code.  The Regulations were christened The Gospel According to the Commissioner of Internal Revenue by my professor.  Each of these six books is three inches thick and filled with the most mind-numbingly confusing edicts imaginable. 

Now I had the privilege of clerking for two gentlemen while I was in law school, both of whom were CPA's and attorneys -- tax lawyers.  Between running errands for them, updating their tax law library was part of my responsibilities.  See, the Code as well as the Regulations were much like the Pirate Code -- more like a set of guidelines.  The real "law" came in the form of daily IRS rulings, weekly updates and slip opinions from the tax courts that I had to collate daily and insert in their proper place on a wall-sized bookshelf filled with court opinions and tax practice guides.  After wearing out my nicest shoes in three months and aware that my brain was in danger of seizing up for good, I moved on to more invigorating pastures in the legal field.

But when you think about it, the IRS Commissioner as well as the Treasury Secretary have immense discretion when it comes to enforcing the tax laws.  Just like a police officer who has the discretion of giving you a warning or impounding your car when s/he stops you for a rolling stop at an intersection, the members of the executive branch have complete discretion on whether to arrest you if they're a cop, prosecute you if they're the district attorney, or even reduce your sentence at the probation department and let you go under the executive's pardon authority. 

So if the Federal Government decides it's just going to let someone slide on tens of billions of dollars worth of tax liability, who's going to complain?  Certainly not the tax payer who otherwise owes the money and who is always free to write a bigger check than required to the treasury.  Congress can jump up and down all it wants, declaring this or that illegal, but if the executive decides not to make that its priority, decides not to enforce that law, the courts aren't going to interfere between the two political branches and second guess the executive's discretion.  In fact, it's doubtful that anyone would have standing to sue the Secretary or Commissioner in this case, including a Congressman/woman let alone a lowly taxpayer who isn't directly affected.

Think about it this way.  If you don't pay your taxes this year (presuming you owe any) and the IRS sues you, the prosecutor on behalf of the Commissioner can cut you a deal, like forgiving some or all of the interest or penalties if you pay up in full on the courthouse steps.  Clearly this is a reduction in revenue that Congress did not specifically authorize.  Indeed, by providing for interest and penalties, Congress authorized exactly the opposite result.  Anyone want to second guess the executive authority in that case?  It is really no different legally if the Treasury forgives the banks their tax haven schemes to ease the overall economy's current crisis.

It's not rocket science.  They're the government.  They do what they want.  You just had your accountability moment and the consequences will begin January 20th.

Ohio Poll And Job Numbers

Obama - Plus 11.5% ?  Plus 14% ?!?  Holy Crap!
Jobs - Minus 7.2% ?  Minus 434,000 ?!? Oh Shit!!

Something stinks with all those numbers.  Not that I don't believe them.  I'm no expert on statistical analysis or unemployment calculations.  It's just that numbers like this usually only exist in some alternate universe.  A figment of a bizzaro imagination.

Look folks, whatever the "experts" say, we've been in a recession for a year now, and we've got a year or two more of the same crap facing us.  Most recessions last no more than 8 months and aren't even declared until they're over.  This one's much harder to obscure.  We aren't so much running with the "hot chick" as running from the ugly one when it comes to our choice in new leadership. 

Ohio, perennial grand prize in the presidential sweepstakes, is right in the middle of our economic woes.

Yesterday, Chrysler eliminated it's entire second shift in Toledo's Jeep plant, over 825 jobs half a mile from my blue-collar bar that caters to these guys and the factory workers and tool-n-die workers, drivers, broom pushers and upholstery makers who supply the place, adding to a steep rise in unemployment claims which were already in recession territory.

When you consider the employer-matched taxes, health insurance premiums, unemployment and workers compensation payments each Jeep employee represents on top of their salary, a modest estimate of the economic effect of losing those jobs is about $90,000 per worker, or almost $75 Million of Toledo's economy was just wiped out.  The mayor said in no uncertain terms the Jeep layoffs, "reflect the disastrous economic policies of the Bush presidency." 

Mayor Finkbeiner announced a three-day shut down of all nonessential government business to try to claw the city out of debt knowing it's tax revenue will be another million or two less than projected with the lay offs.  It was bad before, it never felt like we recovered from the first "W" recession.  Now I feel like I'm at ground zero of the collapse of the real economy.  I remember the feeling, having lived outside of Youngstown, Ohio when the steel mills closed in the late seventies.  (Hey, it's not my fault, dammit.)

Of course, the way it works is exactly the opposite of what the government should be doing.  When all those city-workers lose three days pay, they'll buy less which hurts all the area's small businesses.  We sell a fair amount of Budweiser to guys off work from the city garage down the street -- who will be buying just that much less.  A municipality that cannot run a defict really has no choice, I know.  But knowing that doesn't mitigate the suck.  This will be exactly the opposite of economic stimulation.

But we're a blue county here in Northern Ohio, solidly Democratic.  My Congress woman, Marcy Kaptur, is a netroots hero who voted against the Wall Street bailout, both times, because once again Washington's fix was to help the millionaires and not people who work for a living.  The fact that bad
things are happening in the Rust Belt doesn't phase GOP election strategy.  They only care about the voters who live closer to the River than the Lake.

Nevertheless, the overall Ohio unemployment data has got to effect John McCain's chances here.  There are five Ohio counties that have over 10% unemployment right now -- all but one are outside of the Lake Erie watershed and each voted strongly for Bush in 2004. (Tables and maps available here.)  Huron in Northern Ohio, Van Wert in the West, Pike, Meigs and Morgan counties in the South and Southeast have the worst jobs outlook in the state right now.  Believe it or not, the numbers say this won't matter as much as you might think, not everywhere.

It could be enough to push Obama over the edge, but some red counties in Ohio are just plain stubborn.  Here's why.  Back in September of 2004, Pike county, Bush country, had a 9.5% unemployment rate.  Meigs was at 9.6% and Morgan boasted 9.8% out of work.  None are really that much worse now at 10%+, a point or so higher in these Appalachian foothills.  Despite tumbling over they abyss they were only looking into four years ago, they'll vote for McCain.  Watch. 

I think the economy will, however, make a difference in a northern county like Huron whose unemployment was high enough at 6.7% in '04, or in western Van Wert which only saw a 4.9% jobless rate when they voted for Bush.  These folks don't know what hit 'em now that they're in double digits.

Of course outside of Columbus, Dayton and Cincinnati there are few "red" zones with large population centers in Ohio, and the vote counts in the urban centers were very close last time.  Van Wert county, on the other hand, is one of the least populous, so it's nothing to get excited about if it switches to the Democrat on the heels of doubling it's unemployment rate (even though it would be noteworthy and very welcome if it went blue).  

Huron county is another story, half-way between the Cleveland and Toledo metro areas it would be a healthy addition to the blue column -- but they don't have an especially high concentration of voters there either, but it's even more welcome to join the reality based community. 

As for the big red counties, the Dayton metro area (Montgomery county) is witnessing a 7.8% unemployment rate, 1.3% more than in October of 2004.  That translates into 17,700 people on the streets then compared to 21,300 now.  To give you an idea how that compares to Van Wert county, there were only 14,827 total voters there in 2004, less voters in Van Wert than job hunters in Dayton. 

Huron county turned out 25,557 voters in 2004.  Today there are more people scouring the help wanted ads in Hamilton county (Cincinnati) which had 23,500 unemployed in October of 2004 (5.6%) and just barely went for Bush.  Now there are nearly 3,000 more people looking for work there (6.3%) who are not only bitter (whether they cling to guns and religion or not), but who have family and friends depending on them who are equally pissed off at the way the Republicans have mis-managed everything economic.  Just these slight downturns in the Southwestern Ohio metro centers may have a much more dramatic effect on voter sentiment than more rural areas facing unemployment rates they haven't seen in generations.

Columbus, much like Washington DC, really doesn't have a workforce that makes anything -- except trouble and paperwork for the rest of the state.  While higher than four years ago, they still are around the national average when it comes to joblessness.  It's more about the availability of enough working voting booths there than working people.  If everybody in Franklin county who wants to vote, gets to vote -- they go blue.

Loyal GOPers, bless their deluded souls, have a built-in excuse for losing this one.  Somehow, "mysteriously," the economy tanked.  But this is an economy of their own making.  I will never forget Bush's second Treasury Secretary Snow, a Toledo native for Pete's sake saying outsourcing was a good thing back in '04, and that new jobs were coming to Ohio.  What bull!

The sad part, for the Republicans anyway, is that despite all of this John McCain actually had a chance to win on this issue.  He had a real shot at owning the economic argument.  No really, he did. 

He could have parlayed that campaign "suspension" gimmick into a true maverick moment, rejected the bailout on principle alone as passionately as did Marcy Kaptur, but for entirely different reasons -- earmarks -- and spent the last two months lambasting Bush for his financial fecklessness without fear of damaging his support with the conservative base since there is no definition of conservatiism that can be applied to Bush's fiscal policies.

What a douche.

St. Krugman and the Dragons

Knowing that Ad Nags says it ain't over 'til it's over, I have to agree with Kevin.  The Presidential race is over. 

Even in an Era of Peak Wingnuttia, there will still be pockets of stupidity to be drilled, baby, drilled -- just coming at a higher cost and notable more for their extreme rarity than their pernicious influence.  It's not if Obama will win, but by how much.  If that doesn't tell the remaining Klingons of Conservopodnia that they're done, nothing will.

Facing electoral disaster of epic proportions there are still die-hard conservatives that won't give up the cause.  You can spot the dead-enders who are so lacking in self-awareness, intellectual honesty, and perspective they remain firmly wedded to an ideology that has spectacularly failed for all to see.

"Small government conservatives?"  Don't make me laugh.  The Government had enormously grown before the financial crisis, all to their delight; the occasional obligatory pang of worry notwithstanding since it was merely offered to cynically cover their true ideological passion -- destruction of those damn dirty hippies. 

Now with the nationalization of most of the financial industry, government is astronomically huge, an inconceivable amount of control and power and money, your money, has taken over our society in what seems like a blink of an eye, but has been creeping in this direction for decades.  Every time they grew the debt, they grew the government.

Ironically, it was their religious-like devotion to free market fundamentalism that required a socialistic themed intervention.

The era of Reagan is dead.  The conservative movement has been exposed as bankrupt of ideas as it bankrupted the nation.  Nothing could encapsulate the Zeitgeist better than Paul Krugman winning the Nobel Prize in Economics.  (Big Congrats Shrill Guy!)  Joining Al Gore in that fraternity is just icing on the cake.  Repudiation, thy name is Republican.

They've ruined us, these scam artists on the right.  As Ed Rollins put it today:  "James Carville's famous slogan in Bill Clinton's 1992 victory over the first Bush: 'It's the economy stupid!' can now be replaced with 'You morons, what have you done with my money, my life and my kids' future?'""

By any measure, in any field -- financially, diplomatically, in our ability to project power militarily, provide leadership through inspiration as opposed to intimidation both at home and abroad, from maintaining our infrastructure to honoring basic constitutional precepts like separation of church and state, due process (including habeas corpus), checks and balances and the notion of separate but equal branches of government -- the conservatives have wrecked havoc on the very ideals America is supposed to stand for.  We have sacrificed our mandate to provide for the general welfare by pouring the bulk of our resources into the common defense, to the point that as we face the reality of this economic turmoil we are in grave danger of being unable to do either.

To simply blame George Bush is convenient, a scapegoat who they will attempt to write off as someone untrue to the faith, never "really" a conservative at all.  Yet the remaining leaders of the Republican Party cling steadfastly to their orthodoxy.  House Minority Leader Roy Blunt is content to talk and walk the well worn path of tax cuts, and only tax cuts being the solution to absolutely everything.

Rep. Roy Blunt, the Missouri Republican who serves as House minority leader, said he would support a stimulus plan if it did not include massive public works spending and budget bailouts for states that overspent on health care and other social programs.

Come on Roy, how many more generations are we supposed to wait for all the largess to trickle down to the rest of us?  You guys in Washington and Wall Street have been passing so many bucks back and forth, stuffing each other's pockets with so much for so long you'd think some well worn holes would have opened up in your wallets by now -- but so far, not so much.

Blunt abhors those massive public works projects and infusion of cash to states who will be even more burdened to provide a social safety net on a dwindling tax base as the recession takes hold, which of course, are exactly what is required and should have been part of the last stimulus package.  It is notably missing from the current version of the bailout despite what some of those self-proclaimed geniuses proclaim from the  depths of their delusions (and some from outright utter stupidity ).  Fortunately, Obama does get it and was here in Toledo today promising exactly what we the people need as BushCo takes care of them the bankers.

Messieurs Yglesias and Klein note this handy chart from Moody's that illustrates exactly what return you can expect on a stimulus investment in a variety of projects.



If a Republican looks at that chart and believes the data that went into it, yet still refuses to consider the spending initiatives at the bottom of the list that clearly provide the most help where it's most needed and offer the biggest return on investment, then they are captive to a constituency they have failed to educate and have nothing but dogma and demonization keeping them in power.

Another titular head of the GOP, their candidate himself John McCain grasped for the tried and true panacea of elimination of capital gains taxes as well, before dumping it when it was pointed out that the last thing anyone is worried about right now is all the taxes they'll have to pay on their gains and dividends.  Nobody will realize a gain on their stock this year unless they divested quite some time ago.  If you're still holding stocks you'll be very lucky indeed if you get any kind of a dividend this year, which means the vast majority of 401(k) investors.  McCain's instinct was ridiculous as it was predictable.

I can hardly wait for version 4.8 of what John McSame really stands for tomorrow.  Not that it will matter, but it will give us lefties something to amuse ourselves with until he makes an ass out of himself at the (praise be) last debate.

I Thought So Too

The Shrill One observes,

The IMF ministers have endorsed the G7 plan — but there isn’t any plan, just a vague statement of principles.

What did you really expect Paul?  When you're in essence dealing with pirates, their "code" is really no more than guidelines, to be broken, modified and made up as they go.

GM Chrysler Merger?

Back in 1979, Chrysler's Lee Iacocca became a celebrity and the government's $1.5 Billion bailout/loan guarantee to the company was one of the most hotly discussed issues of the time. A couple of weeks ago, amidst the implosion of the financial markets, AIG, Freddy/Fanny takeovers, Lehman's bankruptcy and the end of finance as usual throughout the world, Congress approved a $25 billion loan program for the auto industry with barely a hearing or headline.

Even in 1979 dollars that's still over five times the value of Iacoca's Chrysler bailout which included caps on executive salaries and concessions from the UAW. This time, with the size of the Wall Street rescue plan dwarfing the assistence to the Detroit automakers, all that remains is writing the check. With GM and Ford looking more like penny stocks on the exchange board instead of industrial powerhouses, the fact that this sailed through is good news indeed for Ohio and Michigan, two states that have born the brunt of George Bush's economic madness the last 7 years.


Along the Lake Erie coast, we notice stuff like this no matter what else is happening. If you live within a hundred miles of Detroit, Toledo, Cleveland, Youngstown or Erie PA, you or someone in your family either works for the auto industry, works for for a company that supplies or supports a car maker, or you sell stuff to those that do. This area has been bleeding since 2001 and never felt the recover the rest of the nation talks about from the last recession. If one of the Big Three shuts down, there'll be nothing left here but scrap merchants and vacancies.

And now they're talking merger between Chrysler and GM. The history of car makers in America has been a study in mergers. Scores of independent companies are now consolidated under the umbrellas of Ford, Chrysler and the biggest amalgam of assimilated manufacturers in the nation, General Motors. Paring the Big Three down to two is epic. Indeed, with a combined 35% share of the US market, the merger would result in the Big One and the other guys.

It's no secret American vehicle manufacturers have been under fire for some time now. I've noted before that they have become health insurance providers who happen to make cars. Beyond loan guarantees and mergers, streamlining production, easier credit for buyers, and retooling for a greener, more fuel efficient and less oil dependent world, the single thing that will help Detroit and every business in the country would be a national health care plan that is at once more affordable and moves us away from employer based insurance.

You want to save businesses big and small, you want to increase the tax base, you want to put America to work, you want a better life for everyone? Health care is the answer. If they didn't have to shell out billions in premiums, I seriously doubt these mega corps would be looking for government handouts or joining their competitors.

My Econ Lesson For The Day

Today was quite fascinating, especially for a Friday.  If you were cat blogging today, you're wasting precious pixels and clogging up the intertubez.  Just stop it.  It's silly.

I found myself breathless as the stock market spanned a thousand points, bouncing up and down like a child on a pogo stick as I watched like a worried parent, knowing I couldn't react in time if she lost her balance, unable to break her fall if she crashed to the pavement. 

Normally, watching CNBC is as interesting to me as studying a fan slowly grind to a stop after the power is switched off.  Usually I would rather watch C-SPAN hearings on agricultural subsidies.  But this week it's been a gripping mini-series, and today has been a climactic cliff-hanger with more fun promised for next week.

Through the day, we confirmed that there is a direct correlation between the length of time George Bush speaks and the speed at which the market tanks.  At the close of the trading day we learned when Treas.Sec. Paulson emerged from his somewhat inconclusive meeting with his G7 counterparts, we are going to do what we need to do to fix the economy (and it probably means nationalizing most of the banks out there) and the other nations will do what they need to do, and everybody promised not to step on each other's toes even though there was no unified approach to address the global economy with a global plan.

I'll say this, Paulson is no Rumsfeld.  Except in the manner in which Still PrezNitWit Bush handed off a crisis to his minister and walked away, it just doesn't feel like he's got a handle on this thing.  Rummy was entertaining and feisty with a self-appreciation that there were things he just didn't know -- and he was sometimes even philosophical about his human frailty.  Paulson is simply feckless, oblivious to his benign neglectful contributions to the current situation, and wholly unable to inspire confidence as he reads from his bullet-points.

Rumsfeld would be defensive and arrogant because he knew he was under fire for his manifest incompetence.  Paulson doesn't seem to possess the introspection to appreciate his complicity in the current fiasco, from doing absolutely nothing for his entire two-year tenure when even someone like me, with a casual interest in high finance at best, knew over a year ago that the housing bubble was in imminent danger of bursting and that there was something called a sub-prime mess fueling instability in the lending business.  How on earth did this thing go to hell without Paulson out there screaming that the sky was falling until if fell on our heads?

At least you can understand Paulson.  It's easier to read between the lines with him.  For an economic kinda guy, he speaks English and if you know a thing or two about how things work, you understand that when he says we're going to take an "equity share" of lots of financial institutions, that means we are about to nationalize the banking industry like FDR did (and not a moment too soon). 

Lord knows I'd be tearing my hair out trying to understand what was going on and the rest of the country would be clueless if Greenspan were still around, cautioning us against exuberant pessimism or some such nonsense.

Whaaaa?

You almost have to admire the complete rejection of liberal leaning reality when the McCain Campaign comes out with something like this. (HT: Steve Benen):

Instead of acknowledging the real differences that exist in this
election, Barack Obama is using America’s economic crisis to deflect
legitimate criticisms of himself and his record.

Ahh yes, the genius of Obama is clear now, resistance is futile, all your votes are belong to us . . .

How dare Obama pander to small businesses, offering a rescue plan for increased loans through the Small Busniness Administration's disaster loan program to help Main Street when John McCain was rushing out with his own call for suspending mandatory withdrawal from 401(k)'s by the folks in his bridge club. 

(Nice idea that retirees over 70 aren't forced to realize a loss on those withdrawals, as long as they can afford to eat or pay for medicine without tapping into their savings and can live off something else.  Doesn't do much good for people who count on those withdraws as part of their fixed income though.)

We have been "distracted" by the oncoming Depression instead of paying attention to Teh Awesum McCain/Palin smear, jeer and puppet dinner theater in the round.  And it's all Obama's fault.  Him and that pinko media of his aren't doing nearly enough to assassinate Obama's character.

Don't you see it now?  Isn't it all quite clear?  Obama and his co-conspirators throughout Wall Street right down through every fly-by-night lender and ne'er-do-well home owners in every hamlet in America conspired to engineer a world-wide economic catastrophe in order to hide Obama's connection to to the sinking of the Lusitania and make John McCain look bad.

Those democrats have no shame.

DOW under 8000.  Damn You Jimmy Carter!!!

Dear Government: You SUCK

That is all.

Give em Hell, Marcy

I think we should make my Congresswoman, Marcy Kaptur, an honorary lefty blogger.  Check out her shorter version of why the Bailout is Teh Suck!

Sounds Like Insider Trading To Me! Rep Kaptur
HT: Kossack Tunney

She ain't buying the charade.  Throwing out a Trillion Bucks without so much a real hearing before any real committees, with no time to analyze or consult with any non-crony experts on whether it will even work and what unintended consequences await.

Yes, that is the same dress as last time.  Reward good behavoir and help a lady out with a proper wardrobe.

The last time I lived in a District where my Representative was even more liberal than me was when I went to school in Dennis Kucinich's playground -- but no one beat Jim Trafficant for sheer wackyness where I grew up. Both of them made my other reps, Lou Stokes and Stephanie Tubbs-Jones, seem downright mainstream. Now Marcy, god love her, completes the cycle -- leading me to ever more DFH behavior. I've never had occasion to write one of them to stop being a pussy or angry that they were in the pocket of someone with a big fat checkbook. Invariably they've inspired me to remind my kids (and you) that some of the most dangerous enemies this nation has live right here, selling snake oil.

Ahh, screw it. I might as well admit right now I've been known to say "Go Blue!" on occasion, just to piss off my father-in-law; and actually have a Michigan cap buried in my closet under all the required Ohio State gear all Ohioans are issued at birth. Living in THE most liberal districts in Ohio sure has skewed my take on my fellow Buckeyes -- and I even spent a summer at OSU a hundred years ago taking classes, chasing girls and searching in vain for decent pot. (All the good stuff was in Athens, home of my beloved yet eternally hopeless Bobcats, the only blue county south of Columbus.)

Bailout Has Devilish Details

I've but one word for the drafters of the Emergency Economic Stabilization Act Of 2008:

GO2HELL!

Honestly, was this really the best we could do?

Unlike many on the left and the overwhelming majority of PrezTard Bush's former supporters who now conveniently run from their leader like Pavlovian mutts who rolled around in their own shit for eight years suddenly realize they smell bad at the ding, ding, ding of Bush's name -- I still think the bailout is essential. I haven't heard anything else out there that would more effectively unclog the credit market's tubes in the time frame necessary to mitigate the disastrous supply-side damage directly caused by the conventional voodoo since the dark day that Ronald Reagan was sworn in.

If you aren't convinced this was all orchestrated, consider Naomi Klein's take on this bit of theater even before Drama Queen McCain brought his circus act into the West Wing. Unfortunately (and this is where I differ with John Amato), even though it sure looks like this is a manufactured crisis, it's a crisis nonetheless.

That said, the plan still sucks.

Or at least we have a lot more work to do, some of which will probably have to wait until we see if we get a filibuster-proof Senate and impose a progressive version of the Shock Doctrine. What a strange dynamic when the outnumbered children in the House GOP caucus were allowed to pull the strings this time. Come January, no one will give a damn what they have to say. All they did was give John McCain and a couple of other worried Republican Senators cover as they acted their predictable douchey selves. I think America is finally weary of their stunts.

So why Mark? Why does it suck?

Glad I asked: Inadequate help for distressed homeowners.

I don't care what they tell you, I've looked at the Act carefully on this point, which magnanimously expands Chris Dodd's Hope For Homeowners Act to include not just FHA, but also Fanny Mae and Freddy Mac covered loans and anything covered by one of these junk mortgage backed securities we're buying or owned by a bank opting into the bailout. The EESA allows for renegotiation of distressed loans, by changing the interest, the term of years, or sending anyone with 10% equity into a 30 year fixed, which cuts out the house flippers.

Okie, Dokie. That sounds like a good thing, but it isn't cuz it's optional at the discretion of the bank. Under H4H, it's still the banks which decide which loans to renegotiate -- and only folks whose loan is over 31% of their income are eligible. In other words, only folks that got a loan from an almost criminally irresponsible loan officer would qualify, and only if their bank already tanked, the loan is held by Uncle Sam or out of the goodness of their heart the bank decides to give you a break.

There are a lot of otherwise perfectly solvent lending institutions that don't need to opt into the bailout who will laugh at this legislation unless homeowners are empowered to initiate the process and make the thing mandatory if the homeowner qualifies -- whether the lender is opting in or not. Homeowners are still at the mercy of the bankers in this to a large degree.

Sorry, that doesn't cut it, it doesn't help the real people who pay the real taxes that will fund this monstrosity. Barney Frank had the right idea. It needs teeth, like the ability of a Bankruptcy Judge to restructure a loan if they rule that's a just result even if the bank doesn't. Leaving this solely to a bankers discretion is simply pointless.

Take a look at this language from the full EESA (pdf). It's even worse since we're buying the paper guaranteeing the mortgages and not the debt instrument itself. The folks collecting the payment have no incentive to help out the little guy. Go figure.

SEC. 109. FORECLOSURE MITIGATION EFFORTS. (a) RESIDENTIAL MORTGAGE LOAN SERVICING STANDARDS.—To the extent that the Secretary acquires mortgages, mortgage backed securities, and other assets secured by residential real estate, including multifamily housing, the Secretary shall implement a plan that seeks to maximize assistance for homeowners and use the authority of the Secretary to encourage the servicers of the underlying mortgages, considering net present value to the taxpayer, to take advantage of the HOPE for Home owners Program under section 257 of the National Housing Act or other available programs to minimize foreclosures. In addition, the Secretary may use loan guarantees and credit enhancements to facilitate loan modifications to prevent avoidable foreclosures.

So what's Paulson going to say to these fat cats? "Pretty Please, with serfs and handmaidens on top?"

Such is the sausage making that creates laws. We gave up on Bankruptcy reform. We threw away community centric housing relief, where the hopelessly ignorant wingnuts could claim victory over ACORN, an outfit that gives them a perpetual dose of Cialis. They also will dance with joy that they get to play more privatization games with an insurance "solution" to this thing -- which for the life of me I have no clue how it's supposed to work, or help.

So what did we get, politically or for, you know, fixing that whole crisis thingy? Well, very strict reporting on exactly which millionaire can only take home a half million next year without paying (gasp) higher taxes; and "oversight!" on every billion dimes they'll be handing out to the richest financial institutions on the planet. (As long as they don't get lost and shipped to Baghdad in the meantime.)

Look suckers, just be grateful they didn't eliminate the capital gains tax or really deregulate everything -- or do what Gingrich and Bill Kristol prayed for, using the FDIC to create a safe haven for their millions that don't have a safe place to sit this out. The ultimate game of corporate/wingnut welfare yet concieved.

So bitch, moan, and never forget that when Republican are anything more than an obstructive bunch of nay-sayers, but actually get to run things, their ability to fuck up your world is beyond imagination. Meanwhile, just pay up or they'll make Wall Street and Main Street look like Burbon Street. You should feel privileged to be allowed to participate in cleaning up their mess, you ungrateful peasant.

UPDATE: One more thing. I was negligent not to mention that Krugman deems the plan "sufficiently not-awful" since it includes his deal breaker demand for an equity stake so we have a non-zero chance of recouping something on this. Otherwise it was just a handout. I always figured that and the populist red meat of curbing CEO golden parachutes would be a part of this. Nobody buys a pig-in-a-poke without going home with either the pig or the poke, especially if it steals away enough cash to buy it's own lipstick factory.

China Speaks

The most interesting and important interview (to me) in this supersaturated news cycle was Fareed Zakaria's CNN sit down with Wen Jiabao, the leader of China, no doubt one of the few world leaders who can speak intelligently about the works of Marcus Aurelius and Adam Smith. (I guarantee that neither Bush or McCain ever even heard of Smith's Theory of Moral Sentiments even if they've got The Wealth of Nations theme of "Free Markets" tattooed on their ass.)

The Chinese Premier believes we're in this together and all should share in fixing the credit crisis. Think about what an amazing shift this is from the isolation of "Red" China of just a few decades ago, where the Great Wall extended into their economic policy (and still dominates their internet access). However, if we don't get our house in order, this should be a signal that a credit squeeze, loss of value by international shareholders of Wall Street firms combined with a recessionary business cycle triggered plummeting housing values could quickly turn into a catastrophe that makes memories of the Great Depression seem like the good old days.

Wen, who is known for his openness and economic mastery, told Zakaria that despite the impressive growth his country has experienced over the past 30 years, things have changed because of the United States' subprime problems. "We have seen a decline in external demand, and China's domestic demand cannot be significantly increased in a short period of time. [So] we do risk a slowdown. We must re-adjust macroeconomic policy," Wen says. "A U.S. recession would certainly have an impact on China's economy. Ten years ago, China-U.S. trade stood at only $102.6 billion. Today the figure has soared to $302 billion-a 1.5-fold increase. A shrinking of U.S. demand would certainly have an impact on China's exports. And U.S. finance is closely connected with Chinese finance. If anything goes wrong in the U.S. financial sector, we would be anxious about the security of Chinese capital."

I think this confirms my analysis that without some kind of bailout that gets the credit markets going again, quickly, we risk exactly the historic meltdown Warren Buffet warns about.

I got the feeling that Premier Wen was trying to at least reassure us that they weren't considering cashing in all those T-Bills they hold and trigger a Boy And His Dog world. At least not yet. But he didn't obscure the fact that they may have no choice if we don't get 'er done.

They are willing to go along to a point, accepting the end of 10% plus growth and entering a period of more sustainable expansion. But unlike us, they won't tolerate a true recession there, a zero or negative period of economic growth without tapping into their savings -- so much of it tied into credit granted the US government to feed our war lust and conspicuous consumption. Remember, they've already cut off lending to US banks, which is hardly the way a "partner" who wants to "share the burden" all that much.

Maybe they'll conclude that no matter how bad a global economic implosion might hurt the USA, they'll suffer even more and will let it ride -- because any hint that they'd pull out of their "investment" in America would seal everyone's doom. (And you really have to know where to look to infer there was even a hint given, but not a threat.) We can only hope the threat doesn't become more blatant as things go from bad to suck in the next couple of years.

Weirdly, Wen spoke of the "real" American economy as fundamentally strong -- which he defines as our technical and manufacturing base, our innovative abilities. Interestingly enough, the head of the People's Republic didn't define our economic "fundamentals" in the transparently cynical way John McCain tried to redefine how stupid he sounds when talking all things economic.

So once again, for reasons no one in the government or the media cares to discuss, I've convinced myself that the bailout needs to happen or we face dire consequences. The devil being in the details, I'll be taking a close look at what comes out of the sausage factory on Capitol Hill, and some of the wacky ideologically driven alternatives that have been offerend recently.

They Want A Cut

That's the only reason I can think that the recalcitrant House Republicans and John McCain torpedoed the bailout deal, offering instead an 11th hour tax cut/privatization/deregulation scheme (typical). They want a piece of the action in order to line their own pockets and those of their friends.

Comparing the upside of the Paulson plan (as modified by Chris Dodd) to the Louisiana Purchase John Feehery notes that this could be the deal of the century, any century.

I thought of the Louisiana Purchase as I saw Treasury Secretary Henry Paulson defend his bailout plan. Paulson is a smart business guy, and he knows the first principle of finance is to buy low and sell high.

Andy Kessler wrote in The Wall Street Journal yesterday that the Paulson plan may be a similarly good deal for the American taxpayers.

As Kessler says, “My analysis suggests that Treasury Secretary Henry Paulson … may pull off the mother of all trades, which could net a trillion dollars, and maybe as much as $2.2 trillion — yes, with a t — for the United States Treasury.”

He goes on to say, “You can slice the numbers a lot of different ways. My calculations, which assume 50 percent impairment on subprime loans, suggest it is possible, all in, for this portfolio to generate between $1 trillion and $2.2 trillion — the greatest trade ever. Every hedge fund manager will be jealous.”

Yeah, I'm skeptical too. The only reason I give this idea that there might be a lucrative upside on this is the way it's been sold -- not with optimism and emphasizing the potential debt reduction angle, but with fear and panic inducing big numbers pulled out of a hat.

McCAAaaaiiiinn! You Moron

Is this idiot still pushing the fiscally stupid and morally wrong DE-regulation snake oil that got us into this problem in the first place?  Maybe not.  But it was still his side of the aisle, lead by John Boener, who dug in their heels after inserting presidential politics into negotiations he has no clue about, and may have hopelessly derailed.

Republicans like John Boehner brought up the concerns of House GOPers and McCain acknowledged hearing about their concerns. And McCain, and staffers, did seek to gauge the level of support of the GOP working group's white paper. The Democrats were left with the impression that McCain endorsed the GOP efforts, but they concede that he did not raise them directly.

Cuz he didn't read the randsome note from the treasury.

The fact is that Boehner doesn't have 100 votes from his conference -- 100 votes that Nancy Pelosi really wants. And that's not McCain's fault.

But Boehner and the White House -- and McCain -- if they want to get something passed -- do have the responsibility to persuade these Republicans to support the bailout .

After all, if not to get these recalcitrant Republicans on board, why did McCain go to Washington in the first place?

Funny that the leaders of the banking committees in both houses, from both parties announced they had a deal on the basic principle and simply just had to write the thing -- until Bush, at McCain's behest based on an idea by his Maverickynessitude himself, held a photo-op which had the effect of trashing all the work of the last week.

Nice rescue Mr. McCain.  Glad you showed up.  If McSame hadn't stuck his ego into the negotiations something terrible -- like approval of a plan to rescue the economy -- might have gotten done.

Which might not be a bad thing.  Every day there's no deal, it's another day where Wall Street doesn't collapse, bringing down the rest of the nation -- thus exposing the canard of what might be a manufactured crisis.  The gamesmanship is all too obvious, as obvious as the GOP's last minute plan introduced at the Save McCain White House Photo Op.

One the proposals -- favored by House Republicans -- would relax regulation and temporarily get rid of certain taxes in order to lure private industry into the market for these distressed assets.

I'm shocked, shocked I say that tax cuts and deregulation is the Republican approach to a problem only exasperated by eight years of tax cuts and a steady diet of continual deregulation since Reagan showed the GOP that tax cuts were how to win elections and ruin the government they hate in one fell swoop.

If the nearly extinct trickle down crowd insists that there's no way, no how they'll stand for any "socialist" interference in the free markets, then a trickle up approach is the only other option -- one the Democrats can do without demanding any GOP participation.

If this actually gets traction, liquidate your savings and retirement plan -- what's left of it, especially if it was at WaMu -- and move to Malaysia.  I hear they need all the day laborers they can get.  Or Alaska!  They pay you to live there since they've cut taxes and live off drill, drill, drill.  Dress warm.

And you better put your sell order in early, cuz the market is going to tank, again.

On the more promising news front, Katie Couric reports that Sarah Palin's approval ratings are approaching Shrub level, 34%, down from 47% a month ago.  TS at Instaputz insists the more he hears from Caribou Barbie, the more he appreciates "the eloquence of George W. Bush."  McCain lost this election two stunts ago.