With the Republican Convention set to begin on August 27, we are heading toward the final phase of the GOP Veepstakes. Currently, the mainstream media mania is focused on the belief that Romney will play the Rice Card. It won’t happen. The excitement concerns the possibility that playing the Rice Card will enhance support from African-American and female voters. Unfortunately, Condoleezza Rice lacks the degree of charisma one would expect in a Vice-Presidential candidate. Worse yet, the baggage she brings from her testimony before the 9/11 Commission, particularly in response to the questions posed by Richard Ben-Veniste concerning the August 6, 2001 Presidential Daily Briefing is the most important reason she will not be picked. Her failure to seriously heed the warning, “Bin Laden Determined to Attack Inside the United States” would become a big issue – once again. Her response to Ben-Veniste’s interrogation was asinine:
Commissioner, this was not a warning. This was a historic memo — historical memo prepared by the agency because the president was asking questions about what we knew about the inside.
We often hear pundits recite the Cardinal Rule for Presidential candidates, in selecting their Vice-Presidential nominee, as: “Do No Harm”. In other words: Don’t screw up your campaign by choosing a controversial running mate. If Romney were to play the Rice card, he would append to his own campaign the Bush administration’s failure to heed the warnings about the September 11 attacks. It won’t happen.
Wall Street Journal columnist Peggy Noonan – who considered the choice of Sarah Palin as “cynical” – recently endorsed Rice as the best candidate:
Consider: A public figure of obvious and nameable accomplishment whose attainments can’t be taken away from her. Washington experience – she wouldn’t be learning on the job. Never ran for office but no political novice. An academic, but not ethereal or abstract. A woman in a year when Republicans aren’t supposed to choose a woman because of what is now called the 2008 experience – so the choice would have a certain boldness. A black woman in a campaign that always threatens to take on a painful racial overlay. A foreign-policy professional acquainted with everyone who’s reigned or been rising the past 20 years.
What is really happening here is that potential candidates from minority groups are being paraded before the public, purely for optics. Last month, it was Marco Rubio and now it’s Condoleezza Rice. It has been important for the Romney camp to convince the voters that it seriously considered putting a minority group member on the ticket before finally deciding on a white man.
At this point, the smart money is on Ohio Senator Rob Portman. Portman is from a battleground state and Romney can be confident that Portman won’t make any stupid moves or inappropriate remarks which could damage the campaign. Romney needs to play it safe and Portman is a safe choice.
Actually, the Rice Card is being played right now. You won’t see it again after August.
The criticisms voiced by many of us during President Obama’s first year in office are finally beginning to register with the general public. Here’s an observation I made on December 14, 2009:
As we approach the conclusion of Obama’s first year in the White House, it has become apparent that the Disappointer-in-Chief has not only alienated the Democratic Party’s liberal base, but he has also let down a demographic he thought he could take for granted: the African-American voters. At this point, Obama has “transcended race” with his ability to dishearten loyal black voters just as deftly as he has chagrined loyal supporters from all ethnic groups.
On June 11 2010, Maureen Dowd gave us some insight as to what it was like on Obama’s campaign plane in 2008:
The press traveling with Obama on the campaign never had a lovey-dovey relationship with him. He treated us with aloof correctness, and occasional spurts of irritation. Like many Democrats, he thinks the press is supposed to be on his side.
The patrician George Bush senior was always gracious with reporters while conveying the sense that what we do for a living was rude.
The former constitutional lawyer now in the White House understands that the press has a role in the democracy. But he is an elitist, too, as well as thin-skinned and controlling. So he ends up regarding scribes as intrusive, conveying a distaste for what he sees as the fundamental unseriousness of a press driven by blog-around-the-clock deadlines.
The voting public is just beginning to digest the sordid facts of the Solyndra scandal. Rest assured that the Republican Party will educate even the most intellectually challenged of those “low information voters” as to every detail of that rotten deal. The timing of the Solyndra exposé couldn’t be worse for Team Obama.
On August 15, the Gallup Organization reported that during the week of August 8-14, Obama’s job approval rating dropped to 40% – the lowest it had been since he assumed office. Another Gallup poll, conducted with USA Today during August 15-18 revealed that, for the first time, a majority of Americans – 53% – blame Obama for the nation’s economic problems. Forty-seven percent still say he is “not much” (27%) or “not at all” (20%) to blame.
A new McClatchy-Marist poll, taken on September 14-15, revealed that Obama’s sinking popularity has placed him just 5 points ahead of non-candidate Sarah Palin (49-44 percent). The Miami Herald noted that the poll results show the President just 2 points ahead of Mitt Romney (46-44):
Overall, the gains among Republicans “speak to Obama’s decline among independents generally, and how the middle is not his right now,” said Lee Miringoff, director of the Marist College Institute for Public Opinion, which conducted the national survey.
“This will require him to find ways to either win back the middle or energize his base in ways that hasn’t happened so far,” Miringoff said.
By a margin of 49 percent to 36 percent, voters said they definitely plan to vote against Obama, according to the poll. Independents by 53 percent to 28 percent said they definitely plan to vote against him.
With that sentiment permeating the electorate a little more than a year before the general election, most Americans think Obama won’t win a second term.
By 52 percent to 38 percent, voters think he’ll lose to the Republican nominee, whoever that is. Even among Democrats, 31 percent think the Republican nominee will win.
The most devastating development for Obama has been the public reaction to Ron Suskind’s new book about the President’s handling of the economy, Confidence Men. Berkeley economics professor, Brad DeLong has been posting and discussing excerpts of the book at his own website, Grasping Reality With Both Hands. On September 19, Professor DeLong posted a passage from Suskind’s book, which revealed Obama’s expressed belief (in November of 2009) that high unemployment was a result of productivity gains in the economy. Both Larry Summers (Chair of the National Economic Council) and Christina Romer (Chair of the Council of Economic Advisers) were shocked and puzzled by Obama’s ignorance on this subject:
“What was driving unemployment was clearly deficient aggregate demand,” Romer said. “We wondered where this could be coming from. We both tried to convince him otherwise. He wouldn’t budge.”
Because of Obama’s willful refusal to heed the advice of his own economic team, our nation’s unemployment problem has persisted at levels of 9% and above (with worse to come). As Ron Suskind remarked in that passage:
The implications were significant. If Obama felt that 10 percent unemployment was the product of sound, productivity-driven decisions by American business, then short-term government measures to spur hiring were not only futile but unwise.
There you have it. Despite the efforts of Obama’s apologists to blame Larry Summers or others on the President’s economic team for persistent unemployment, it wasn’t simply a matter of “the buck stopping” on the President’s desk. Obama himself has been the villain, hypocritically advocating a strategy of “trickle-down economics” – in breach of his campaign promise to do the exact opposite.
Reactions to the foregoing passage from Confidence Men – appearing as comments to Brad DeLong’s September 19 blog entry – provide a taste of how the majority of Obama’s former supporters will react when they learn the truth about this phony politician. Here are a few samples:
. . . This disgraceful shill for global capital has destroyed the Democratic party for a generation.
The President sure does come across as awfully arrogant, dogmatic and not very smart from this excerpt (and as someone who does not like to listen to his advisors- especially the female ones.).
Wow. Romer was oh so right. And Obama was oh, so so wrong… What a pathetic display of arrogance and bad leadership. . . .
And I was always joking about Obama as the “Manchurian Candidate” from the U of Chicago. Productivity? Really?
I’ve lost any last shred of respect for Mr. O.
Now that Confidence Men and the Solyndra scandal are getting increased publicity, we can expect that large numbers of voters will be losing their “last shred of respect” for Mr. Obama. It’s past time for the Democratic Party to face reality: If they seriously want to retain control of the Executive branch – someone will have to ask Obama to step aside. DNC Chair, Debbie Wasserman-Schultz is obviously not up to this task.
Comments Off on Elizabeth Warren Should Run Against Obama
Now that President Obama has thrown Elizabeth Warren under the bus by nominating Richard Cordray to head the Consumer Financial Protection Bureau (CFPB), she is free to challenge Obama in the 2012 election. It’s not a very likely scenario, although it’s one I’d love to see: Warren as the populist, Independent candidate – challenging Obama, the Wall Street tool – who is already losing to a phantom, unspecified Republican.
A good number of people were disappointed when Obama failed to nominate Warren to chair the CFPB, which was her brainchild. It was bad enough that Treasury Secretary “Turbo” Tim Geithner didn’t like her – but once the President realized he was getting some serious pushback about Warren from Senate Republicans – that was all it took. Some Warren supporters have become enamored with the idea that she could challenge Scott Brown for his seat representing Massachusetts in the Senate. However, many astute commentators consider that as a really stupid idea. Here is the reaction from Yves Smith of Naked Capitalism:
We argued yesterday that the Senate was not a good vehicle for advancing Elizabeth Warren’s aims of helping middle class families, since she would have no more, and arguably less power than she has now, and would be expected to defend Democrat/Obama policies, many of which are affirmatively destructive to middle class interests (just less so than what the Republicans would put in place).
A poll conducted in late June by Scott Brown and the Republican National Committee raises an even more basic question: whether she even has a shot at winning.
* * *
The poll shows a 25 point gap, which is a massive hurdle, and also indicates that Brown is seen by many voters as not being a Republican stalwart (as in he is perceived to vote for the state’s, not the party’s, interest). A 25 point gap is a near insurmountable hurdle and shows that Warren’s reputation does not carry as far as the Democratic party hackocracy would like her fans to believe. But there’s no reason not to get this pesky woman to take up what is likely to be a poisoned chalice. If she wins, she’s unlikely to get on any important committees, given the Democratic party pay to play system, and will be boxed in by the practical requirements of having to make nice to the party and support Obama positions a meaningful portion of the time. And if she runs and loses, it would be taken as proof that her middle class agenda really doesn’t resonate with voters, which will give the corporocrats free rein (if you can’t sell a liberal agenda in a borderline Communist state like Massachusetts, it won’t play in Peoria either).
Obviously, a 2012 challenge to the Obama Presidency by Warren would be an uphill battle. Nevertheless, it’s turning out to be an uphill battle for the incumbent, as well. David Weidner of MarketWatch recently discussed how Obama’s failure to adequately address the economic crisis has placed the President under the same pressure faced by many Americans today:
He’s about to lose his job.
* * *
Blame as much of the problem on his predecessor as you like, the fact is Obama hasn’t come up with a solution. In fact, he’s made things worse by filling his top economic posts with banking-friendly interests, status-quo advisers and milquetoast regulators.
And if there’s one reason Obama loses in 2012, it’ll be because he failed to surround himself with people willing to take drastic action to get the economy moving again.
In effect, Obama’s team has rewarded the banking industry under the guise of “saving the economy” while abandoning citizens and consumers desperate for jobs, credit and spending power.
There was the New York Fed banker cozy with Wall Street: Timothy Geithner.
There was the former Clinton administration official who was the architect of policies that led to the financial crisis: Larry Summers.
There was a career bureaucrat named to lead the Securities and Exchange Commission: Mary Schapiro.
To see just how unremarkable this group is, consider that the most progressive regulator in the Obama administration, Federal Deposit Insurance Corp. Chairman Sheila Bair, was a Republican appointed by Bush.
* * *
The lack of action by Obama’s administration of mediocrities is the reason the recovery sputters. In essence, the turnaround depends too much on a private sector that, having escaped failure, is too content to sit out what’s supposed to be a recovery.
* * *
What began as a two-step approach: 1) saving the banks, and then 2) saving homeowners, was cut short after the first step.
Instead of extracting more lending commitments from the banks, forcing more haircuts on investors and more demands on business, Obama has let his team of mediocrities allow the debate to be turned on government. The government caused the financial crisis. The government ruined the housing market.
It wasn’t true at the start, but it’s becoming true now.
Despite his status as the incumbent and his $1 billion campaign war chest, President Obama could find himself voted out of office in 2012. When you consider the fact that the Republican Party candidates who are currently generating the most excitement are women (Bachmann and the undeclared Palin) just imagine how many voters might gravitate to a populist female candidate with substantially more brains than Obama.
The disillusionment factor afflicting Obama is not something which can be easily overlooked. The man I have referred to as the “Disappointer-In-Chief” since his third month in office has lost more than the enthusiasm of his “base” supporters – he has lost the false “progressive” image he had been able to portray. Matt Stoller of the Roosevelt Institute explained how the real Obama had always been visible to those willing to look beyond the campaign slogans:
Many people are “disappointed” with Obama. But, while it is certainly true that Obama has broken many many promises, he projected his goals in his book The Audacity of Hope. In Audacity, he discussed how in 2002 he was going to give politics one more shot with a Senate campaign, and if that didn’t work, he was going into corporate law and getting wealthy like the rest of his peer group. He wrote about how passionate activists were too simple-minded, that the system basically worked, and that compromise was a virtue in and of itself in a world of uncertainty. His book was a book about a fundamentally conservative political creature obsessed with process, not someone grounded in the problems of ordinary people. He told us what his leadership style is, what his agenda was, and he’s executing it now.
I expressed skepticism towards Obama from 2005, onward. Paul Krugman, Debra Cooper, and Tom Ferguson among others pegged Obama correctly from day one. Obama broadcast who he was, through his conservative policy focus (which is how Krugman pegged him), his bank backers (which is how Ferguson pegged him), his political support of Lieberman (which is how I pegged him), and his cavalier treatment of women’s issues (which is how Debra Cooper pegged him). He is doing so again, with his choice to effectively remove Elizabeth Warren from the administration.
I just wish Elizabeth Warren would fight back and challenge Obama for The White House. If only . . .
You’ve been reading it everywhere and hearing it from scores of TV pundits: The ongoing economic crisis could destroy President Obama’s hopes for a second term. In a recent interview with Alexander Bolton of The Hill, former Democratic National Committee chairman, Howard Dean warned that the economy is so bad that even Sarah Palin could defeat Barack Obama in 2012. Dean’s statement was unequivocal: “I think she could win.”
I no longer feel guilty about writing so many “I told you so” pieces about Obama’s failure to heed sane economic advice since the beginning of his term in the White House. A chorus of commentators has begun singing that same tune. In July of 2009, I wrote a piece entitled, “The Second Stimulus”, wherein I predicted that our new President would realize that his economic stimulus program was inadequate because he followed the advice from the wrong people. After quoting the criticisms of a few economists who warned (in January and February of 2009) that the proposed stimulus would be insufficient, I said this:
Despite all these warnings, as well as a Bloomberg survey conducted in early February, revealing the opinions of economists that the stimulus would be inadequate to avert a two-percent economic contraction in 2009, the President stuck with the $787 billion plan. He is now in the uncomfortable position of figuring out how and when he can roll out a second stimulus proposal.
President Obama should have done it right the first time. His penchant for compromise – simply for the sake of compromise itself – is bound to bite him in the ass on this issue, as it surely will on health care reform – should he abandon the “public option”. The new President made the mistake of assuming that if he established a reputation for being flexible, his opposition would be flexible in return. The voting public will perceive this as weak leadership.
Stephanie Kelton recently provided us with an interesting reminiscence of that fateful time, in a piece she published on William Black’s New Economic Perspectives website:
Some of us saw this coming. For example, Jamie Galbraith and Robert Reich warned, on a panel I organized in January 2009, that the stimulus package needed to be at least $1.3 trillion in order to create the conditions for a sustainable recovery. Anything shy of that, they worried, would fail to sufficiently improve the economy, making Keynesian economics the subject of ridicule and scorn.
* * *
In July 2009, I wrote a post entitled, “Gift-Wrapping the White House for the GOP.” In it, I said:
“If President Obama wants a second term, he must join the growing chorus of voices calling for another stimulus and press forward with an ambitious program to create jobs and halt the foreclosure crisis.”
With the recent announcement of Austan Goolsbee’s planned departure from his brief stint as chairman of the Council of Economic Advisers, much has been written about Obama’s constant rejection of the “dissenting opinions” voiced by members of the President’s economics team, such as those expressed by Goolsbee and his predecessor, Christina Romer. Obama chose, instead, to paint himself into a corner by following the misguided advice of Larry Summers and “Turbo” Tim Geithner. Ezra Klein of The Washington Post recently published some excerpts from a speech (pdf) delivered by Professor Romer at Stanford University in May of 2011. At one point, she provided a glimpse of the acrimony, which often arose at meetings of the President’s economics team:
Like the Federal Reserve, the Administration and Congress should have done more in the fall of 2009 and early 2010 to aid the recovery. I remember that fall of 2009 as a very frustrating one. It was very clear to me that the economy was still struggling, but the will to do more to help it had died.
There was a definite split among the economics team about whether we should push for more fiscal stimulus, or switch our focus to the deficit. A number of us tried to make the case that more action was desperately needed and would be effective. Normally, meetings with the President were very friendly and free-wheeling. He likes to hear both sides of an issue argued passionately. But, about the fourth time we had the same argument over more stimulus in front of him, he had clearly had enough. As luck would have it, the next day, a reporter asked him if he ever lost his temper. He replied, “Yes, I let my economics team have it just yesterday.”
By May of 2010, even Larry Summers was discussing the need for further economic stimulus measures, which I discussed in a piece entitled, “I Knew This Would Happen”. Unfortunately, most of the remedies suggested at that time were never enacted – and those that were undertaken, fell short of the desired goal. Nevertheless, Larry Summers is back at it again, proposing a new round of stimulus measures, likely due to concern that Obama’s adherence to Summers’ failed economic policies could lead to the President’s defeat in 2012. Jeff Mason and Caren Bohan of Reuters reported that Summers has proposed a $200 billion payroll tax program and a $100 billion infrastructure spending program, which would take place over the next few years. The Reuters piece also supported the contention that by 2010, Summers had turned away from the Dark Side and aligned himself with Romer in opposing Peter Orszag (who eventually took that controversial spin through the “revolving door” to join Citigroup):
During much of 2010, Obama’s economic advisers wrestled with a debate over whether to shift toward deficit reduction or pursue further fiscal stimulus.
Summers and former White House economist Christina Romer were in the camp arguing that the recession that followed the financial markets meltdown of 2008-2009 was a unique event that required aggressive stimulus to avoid a long period of stagnation similar to Japan’s “lost decade” of the 1990s.
Former White House budget director Peter Orszag was among those who cautioned against a further big stimulus, warning of the need to be mindful of ballooning budget deficits.
By the time voters head to the polls for the next Presidential election, we will be in Year Four of our own “lost decade”. Accordingly, President Obama’s new “Jobs Czar” – General Electric CEO, Jeffrey Immelt – is busy discussing new plans, which will be destined to go up in smoke when Congressional Republicans exploit the opportunity to maintain the dismal status quo until the day arrives when disgruntled voters can elect President Palin. Barack Obama is probably suffering from some awful nightmares about that possibility.
Donald Trump has enjoyed a good deal of publicity during the past few weeks, since he jumped on the “birther” bandwagon, voicing skepticism as to whether Barack Obama was really born in the United States. Many of Trump’s critics insist that The Donald is not a serious Presidential candidate and that his newfound “birther” agenda demonstrates that his Presidential campaign is nothing more than a flimflam publicity stunt.
I have a different theory. I believe that Trump is running a “decoy” campaign. Keep in mind that Trump is currently the #2 contender for the Republican nomination. Remember also that the Republican Presidential primaries for 11 states (and the District of Columbia) are conducted on a “winner-take-all” basis – meaning that when a candidate wins a state primary, that candidate wins all of the delegates who will represent that state at the Republican National Convention. If Trump can win a few of those states, he could amass an impressive amount of “pledged” delegates. I suspect that Trump’s goal is to win the support from the extreme right wing of the Republican Party and “hijack” those delegates who would have been otherwise pledged to candidates acceptable to the Tea Party. Bill O’Reilly’s intervention to defuse the “birther” controversy (at which point he insisted that Trump has not been seriously seeking the nomination) was apparently motivated by the fact that the candidates most likely to be eliminated from contention because of Trump’s presence – Michele Bachmann and Sarah Palin – are both darlings of Fox News. In fact, Palin is a Fox News contributor.
At the 2012 Republican Convention in Tampa, Trump could step aside and support Willard Romney, who is despised my many Tea Party activists for having created what is now known as “Obamacare”. Trump’s elimination of the Tea Party favorites before the convention would solve Romney’s problem with that voting bloc. Romney can be expected to have an equally difficult time winning the support of dog lovers, as a result of his decision to strap the family dog, Seamus, to the car roof for a 12-hour family vacation drive to Ontario. Despite his “Presidential” appearance, this Homer Simpson-esque episode from Romney’s life has already impaired efforts to portray him as a potentially effective Commander-In-Chief.
Meanwhile, President Obama is busy trumpeting his newly-minted, false campaign promises. Gallup reported that on April 15, Obama’s approval rating had tied its all-time low of 41%. More interestingly, his approval rating among African-American and Hispanic voters is beginning to slip from its enormously-high levels:
Though majorities of blacks (85%) and Hispanics (54%) continue to approve of the job Barack Obama is doing as president, his ratings among these groups slipped in March and have set or tied new lows.
* * *
Obama, elected to office with strong support from minority voters, has averaged better than 90% approval among blacks, and 65% among Hispanics, during his term. Prior to March, Obama’s lowest monthly average among blacks was 88% in July 2010 and December 2010. The president’s 54% March job approval rating among Hispanics ties the low from July and August 2010.
Despite the efforts of Republican commentators, such as Peggy Noonan, to create a narrative to the effect that Obama’s waning popularity – as well as the losses sustained by the Democrats in the 2010 elections – resulted from voter concern about government spending and the deficit, I suspect that Americans have simply become alienated by the failure of Obama and his party to deliver on their 2008 promises. Worse yet, the capitulation to the interests of Wall Street by Democrats who promised “reform” has reinforced voter apathy – the real factor in the 2010 Democratic setbacks.
Cord Jefferson of Good provided this graphic of what Congress would look like if it truly represented America. The failure of Democrats to win the support of Independent and centrist voters is readily apparent. You can blame gerrymandering all you want, but as long as the Democrats fail to provide alternatives to Republican policies, they will continue to lose. I believe it was William Black who said:
Under America’s two-party system, we have one party that is owned by big business and another party that sells out to big business.
I was pleased to see my own sentiments shared and articulated quite well by Mike Kimel of the Presimetrics Blog, in his recent posting entitled, “Why I Will Not be Voting for Obama in 2012”. Although Mr. Kimel doesn’t have an alternative candidate in mind, the very reason for his disillusionment with Obama is that – with respect to the nation’s most significant problems – our current President has proposed no alternative policies to those of his predecessor:
And yes, there are a handful of things Obama did that GW might not do, but let’s be realistic – this has looked from the very beginning like GW’s third term.
Which leaves just one question – if the policies of the Republicans are even worse than Obama’s – and they tend to support anti-growth tax policies (calling them pro-growth doesn’t change the data), what should a rational person do? I don’t know. But I think if I’m going to see Republican policies enacted, I’d prefer to see them run under a Republican label. See, Democratic policies may not be very good, but historically they have tended to produce better results than Republican policies. (BTW – Michael Kanell and I have an entire book called Presimetrics looking at how Presidents performed on a wide range of topics.) Another four years spent bringing the feeble Democratic brand down to the levels of the even more feeble Republican brand will cause lasting damage.
Obama will never re-ignite the enthusiasm of 2008 by presenting himself to the voters as “the devil you know” or “the lesser of two evils”. What America’s middle class really needs is an honest, Independent candidate to make a run for The White House in 2012.
I never liked Joe “The Tool” Lieberman. If you run that name (nickname included) on the search bar at the upper-right corner of this page, you will find a total of 13 previous entries wherein I discussed him in uncomplimentary terms. What bugs me most about Lieberman is that so many people consider him as the personification of centrism. I believe that Lieberman gives centrism a bad name because he is simply an opportunist. The guy doesn’t really appear to stand for anything in particular – he is simply a tool for whatever lobbyist or other interest group is willing to play his quid pro quo game. After Lieberman lost the Democratic Primary for his Senate seat in 2006, he chose to run as an Independent and in the process, he betrayed those individuals who contributed to his election campaign, believing that Lieberman would champion the causes he advanced before he had to sell his soul to Bush and Cheney in order to save his political hide. It was only because Ned Lamont (the man who defeated him in the Democratic Primary) came down with a bad case of The Smug – spending more time vacationing than campaigning for the November election – that Lieberman managed to win a fourth term as junior Senator from Connecticut.
Needless to say, Emily Bazelon’s recent article for Slate, “Good Riddance, Joe Lieberman – Why I loathe my Connecticut Senator” was a real treat. It was nice to see that a good number of people were as thrilled as I to hear that The Tool was calling it quits. While discussing the celebratory outpouring of enthusiasm by anti-Lieberman-ites Ms. Bazelon mentioned this:
Another friend, Judy Chevalier, burned up her iPad tonight when I asked her to enumerate why she hates Joe Lieberman. She ticked off a half-dozen reasons and then said, “The thing is, I did not come up with most of these myself. They come from many rounds of playing the peculiar Connecticut liberal cocktail party game ‘I hated Joe Lieberman before you hated Joe Lieberman.’ ” Longtime Lieberman haters, she says, look all the way back to 1993, when Lieberman led a hedge-fund-friendly charge in the Senate against the Financial Accounting Standards Board, which at the time wanted to close the accounting loophole that let corporations duck the recording of stock options on their balance sheets.
As an aside, the first half of that passage was characterized as “the money quote” by the RedState blog and other far-right commentators, anxious to avenge Sarah Palin since her “crosshairs” SarahPac campaign ad was criticized after the attempted assassination of Representative Gabrielle Giffords. The magic word, “hate” gave the hard right the opportunity to argue that “liberals hate politicians, too”. Actually, the real “money quote” can be found by clicking on the highlighted language discussing the fight over the Financial Accounting Standards Board rules:
Corporate America aligned with the accounting industry to fight the FASB proposal, with the result that in 1994, the Senate, led by Senator Joseph Lieberman (D-Conn.), passed a non-binding resolution condemning the proposal by a vote of 88-to-9.
“It wasn’t an accounting debate,” says Jim Leisenring, the vice chairman of FASB from 1988 to 2000. “We switched from talking about, ‘Have we accurately measured the option?’ or, ‘Have we expensed the option on the proper date?’ to things like, ‘Western civilization will not exist without stock options,’ or, ‘There won’t be jobs anymore for people without stock options.’ … People tried to take the argument away from the accounting to be just plainly a political argument.”
Does that rhetoric sound familiar?
After his 2006 victory, Lieberman continued to betray the people of Connecticut by abandoning his duties in the Senate to follow John McCain all along the 2008 campaign trail (including McCain’s trip to Afganistan) in the hope of securing a place for himself in the would-be McCain administration. The Tool knew he would never win a fifth term in the Senate. His only hope was to latch on to McCain’s pantsleg and hang on for dear life. In the wake of that fiasco, The Tool’s approval rating continued to slide and by October of 2010, it was down to 31 percent. A fifth term in the Senate was definitely out of the question. His campaign war chest could be put to better uses – such as buying “friendships” before beginning a new career as a lobbyist.
Despite Lieberman’s crucial effort in the repeal of the military’s “don’t ask – don’t tell” policy, it is interesting to observe how many gay people are willing to overlook that good deed while celebrating Lieberman’s retirement. A review of the comments at the joemygod blog exposes these reactions:
Good riddance. DADT capped an otherwise awful career as a spoiler.
* * *
Thanks for DADT, but not terribly sorry you’re leaving the Senate. And I really didn’t want the anxiety of watching a 3-way race in CT, which might have sent a wingnut from the Right to the Senate.
* * *
good riddance to the man who killed the public option to satisfy his insurance industry friends in Connecticut. a terrible person
So much for that legacy thing . . .
Daniela Altimari of TheHartford Courant’s CapitolWatch blog, revealed a wide spectrum of reactions to Lieberman’s announcement. As one might expect, the remarks from politicians were painfully cordial, polite and not worth our time here. I’ll provide you with two of the more interesting quotes:
“Joe Lieberman took millions from insurance companies, Wall Street banks, and other corporate interests – and then did their dirty work in Congress, including killing the public option. As a result, Lieberman’s poll numbers were disastrous in Connecticut. His decision to quit in the face of assured defeat is a huge victory for the progressive movement and all Americans who want Democrats to put regular families ahead of corporate interests.”
“It’s the first thing he’s done in 10 years to make Connecticut Democrats completely happy.”
— Bill Curry, former state comptroller, as quoted in The New York Times
* * *
“He couldn’t leave the Senate fast enough as far as I’m concerned. He’s not only driving Democrats nuts down here, but he’s become a right-wing extremist on everything except the environment and gay rights.”
— Ralph Nader, as quoted in The Hartford Courant
* * *
“He will leave behind a long list of achievements, from helping to consolidate the nation’s intelligence gathering services in a way that appears to make it more difficult to gather intelligence, to threatening to filibuster the health care reform act until it had been watered down to suit his own high principles. You will find it all in my upcoming book, ‘Everything Bad Is Joe Lieberman’s Fault.’ ”
We all know how this awful week began. For Rupert Murdoch, one of his prized investments — Sarah Palin — had become the subject of heated debate. Murdoch’s News Corp publishes her ghost-written books and Palin works for News Corp’s Fox News as a contributor. While a team of doctors in Tucson heroically scrambled to save the life of Representative Gabrielle Giffords, a team of spin doctors at Fox News scrambled to save the political life of Sarah Palin. At this point, I defer to an excellent piece written by Glynnis MacNicol of The Business Insider:
It is clear that Palin spent the last few days testing the waters and leaving the heavy lifting of the defending her to the folks at Fox News, most notably Glenn Beck.
As Ms. MacNicol explained, Palin returned to her Facebook page on January 12:
In equally typical fashion, Palin offered little introspection into her role in the political dialogue of the past year and laid the blame directly at the feet of the media, whom she accused of “blood libel.”
As MacNicol and many other commentators pointed out, this choice of words exemplified yet another classic Palin mistake. Palin’s gaffe drew criticism from the Anti-Defamation League and it gave her critics yet another opportunity to emphasize that Palin has been in over her head with her attempts to establish a national leadership identity. The Hill quoted what Representative James Clyburn had to say about Palin’s latest misstep:
“You know, Sarah Palin just can’t seem to get it, on any front. I think she’s an attractive person, she is articulate,” Clyburn said on the Bill Press radio show. “But I think intellectually, she seems not to be able to understand what’s going on here.”
While Rupert Murdoch’s investment in Sarah Palin was obviously deteriorating and becoming an embarrassment for his Fox News organization, things were headed in a more catastrophic direction in his Australian homeland. The intense flooding that had been ongoing for the past several weeks was being attributed to climate change. A report from Reuters began with this statement:
Climate change has likely intensified the monsoon rains that have triggered record floods in Australia’s Queensland state, scientists said on Wednesday, with several months of heavy rain and storms still to come.
An article from the Treehugger website provided details about how badly conditions had deteriorated in Queensland:
When 75% of Queensland is disaster declared due to flooding, that is a huge area, roughly equivalent to two Texas’s or the entirety of South Africa. On the 31st of December Reuters was saying flood water was “covering an area bigger than France and Germany combined, inundating 22 towns and stranding 200,000 people.” This is a continually unfolding natural disaster, of which the financial bill alone was projected to reach $5 billion AUD, and that was before the flash flooding of the past day or so.
* * *
Australia is a rich, industrialised ‘First World’ country. But it’s third most populous state, Queensland, is currently coping with floods which have already decimated food crops, livestock, road and rail infrastructure, mining and so on. The impacts of which will flow on (pardon the pun) to effect most every Australian. Already some particular fruits have all but disappeared from commercial markets.
If all that weren’t bad enough, what must have been the most chilling news for Rupert Murdoch came from Julian Assange of Wikileaks. Ian Burrell of The Independent provided this report:
A year that has begun badly for Rupert Murdoch grew a little worse yesterday after the founder of WikiLeaks, Julian Assange, claimed to be in possession of secret documents damaging to the media mogul and his News Corp empire.
Mr Assange told John Pilger in the New Statesman he had withheld a cache of confidential US government cables and files relating to Mr Murdoch’s business as “insurance”. He has claimed that his life is in danger if he is extradited to Sweden to face allegations of sexual assault.
* * *
Mr Assange indicated that he had paperwork which could be hurtful to News Corp. “There are 504 US embassy cables on one broadcasting organisation and there are cables on Murdoch and News Corp.”
Assange does lots of talking about documents he is holding as “insurance”. Nevertheless, many commentators have mentioned the possibility all this boasting could amount to nothing more than a bluffing strategy.
In addition to discussing the Wikileaks threat, the Independent article provided us with the perspective of a former Murdoch associate on the possibility that Rupert might not be too happy with the way things are going at Fox News:
In a further broadside yesterday, one of Mr Murdoch’s former henchmen, Andrew Neil, publicly questioned whether the world’s most powerful media figure retained his grip over his organisation.
* * *
“My own view is [Fox] is out of control,” Neil told Richard Bacon yesterday on BBC Radio 5 Live. “I think Rupert Murdoch has lost control of it. I know from sources he’s not happy with a lot that appears on it and I think he’s lost over the Glenn Becks and the O’Reillys,” said Mr Neil.
“[Murdoch] is uncomfortable with Glenn Beck and various other positions they take and some of the things they say.” Neil, who fell out with Mr Murdoch in the early Nineties, claimed he had “very good sources at the heart of News Corp”.
If there is any truth to Andrew Neil’s revelations, it will be very interesting to see if Mr. Murdoch makes any changes at Fox News, due to his reported concerns. Either way, 2011 could turn out to be a very important year for Rupert Murdoch.
In the aftermath of the attempted assassination of Representative Gabrielle Giffords and the fatal shootings of six other bystanders (including Federal Judge John Roll), a huge debate has erupted over the motives of the gunman (who left notes admitting his intent to kill Congresswoman Giffords). The accused killer, Jared Loughner, is now being subjected to a great deal of scrutiny to ascertain whether he may have been motivated (to any extent) by Sarah Palin’s now-infamous midterm election campaign advertisement featuring a map with crosshairs over those Congressional Districts whose Representatives who were being “targeted” by SaraPAC (one of whom was Rep. Giffords). Palin’s defenders and apologists have contended that there was nothing unusual about the rhetoric used by Palin throughout the 2010 campaign, during which time Palin attempted to establish herself as an influential “power broker” within the Republican Party.
Among the most specious defenses of Palin was the assertion made by SarahPAC staffer Rebecca Mansour, who claimed that the crosshairs on the map identifying the Congressional Districts of targeted Democrats were actually “surveyor’s symbols”. Amanda Terkel of The Huffington Post had no trouble exposing the dishonesty of that claim.
In order to determine whether Jared Loughner’s videotaped shooting spree was politically motivated – or whether he was politically aligned with any group, a close analysis of his YouTube page can be helpful. (Loughner also had a page on MySpace, which has been removed by that organization.) Take a look at what can be gleaned from a review of Loughner’s YouTube page and ask yourself whether some of this stuff reminds you of anyone famous:
He apparently did not expect to survive this event because his upload entitled, “Hello” began with the statement that what followed were his “final thoughts”.
He constantly addressed his intended audience as “listener”, suggesting that he may have been emulating someone with a radio program.
He opposes the use of fiat money, preferring instead, the use of currency based on gold or silver.
He is an abstruse advocate of citing the United States Constitution in discussions of subjects that involve no Constitutional issue (e.g. the tuition at Pima Community College).
On his YouTube page, Loughner uses his “electronic blackboard” to explain his theories about how the American public is being subjected to mind control.
He is critical of what he describes as the poor grammatical skills of the people in District 8, while at the same time personally exemplifying the potential validity of that claim.
He is apparently obsessed with transitive relations. Nearly every assertion posted on his YouTube page is couched in terms describing some sort of transitivity. Most noticeable among these was what I refer to as his “Transitive Law of Moneyprinting” — which must have scared the hell out of Ben Bernanke:
If you create one new currency then you’re able to create a second new currency.
If you’re able to create a second new currency then you’re able to create a third new currency.
You create one new currency.
Thus, you’re able to create a third new currency.
Any guesses as to who Jared Loughner’s hero might be?
It obviously does not take a licensed clinical psychotherapist to realize that Loughner is suffering from some sort of Axis II personality disorder. Nevertheless, that does not excuse whomever may have been responsible from giving this guy that extra nudge from the realm of the delusional to the ranks of the homicidal.
Despite the claims of Sarah Palin’s apologists that the controversial “crosshairs” campaign advertisement was part of a “normal political discourse”, consider the following:
We’re on Sarah Palin’s targeted list. But the thing is the way that she has it depicted has the crosshairs of a gun site over our district. When people do that they’ve got to realize there’s consequences to that action.
In spite of the eerily prescient objection raised by Representative Giffords, Palin and her minions refused to remove the ad.
— Two versions of the “crosshairs” ad remained posted on the Internet for 65 days after the mid-term elections were concluded. This raises the question of whether Palin was attempting to provoke what Sharron Angle might describe as “a Second Amendment solution” to the continuing political viability of Representative Giffords. The “political discourse” was over on November 4, 2010. Why did SaraPAC wait until Gabrielle Giffords was actually shot in the head before a decision was made to take down the ads?
— Regardless of whether Jared Loughner was motivated by the “crosshairs” ad campaign, the BBC News reported this interesting bit of information provided by the Pima County Sheriff:
Sheriff Dupnik said the congresswoman had been threatened by someone with a gun during her re-election campaign in November, adding that there had been other threats.
It should come as no surprise that Palin’s apologists are now criticizing Sheriff Dupnik for laying blame where it properly belongs. Because Loughner had a history of smoking marijuana, Team Palin is now attempting to characterize Loughner as a “Leftist”. Nevertheless, in the event that any of Loughner’s writings might reference an entity known as Aqua Buddha . . . you know what will happen.
Prior to this tragic event, many astute conservatives, such as George Will, had pointed out that Sarah Palin was in over her head with her attempts to become a Presidential candidate. Although elections often become “beauty contests”, the Republican Party’s cynical decision to actually put a former beauty contestant on their national ticket in 2008 didn’t work out too well. Experience as a beauty contestant does not necessarily qualify one for a position of political leadership. I have always considered Sarah Palin to be a gumball. At this point in her political career, Palin has gone from being toast to toxic. I cannot imagine why any political candidate with an I.Q. above 80 would want to have anything to do with her. In the aftermath of the Tucson killings, Palin’s cherished “brand” may have no greater value than that of Lehman Brothers.
Let’s all hope that Gabrielle Giffords has a successful recovery and that the grieving relatives and friends of those slain in this tragedy can regain the strength to continue enjoying their lives to the fullest extent possible.
Once again, the moment has arrived for TheCenterLane.com to present its Jackass of The Year Award. Our 2010 recipient is Alaska’s Senatorial candidate, Joe Miller.
Joe Miller’s campaign to defeat Senator Lisa Murkowski in Alaska’s 2010 Republican Primary got a big boost when Governor Sarah Palin decided to leave office to become a full-time celebrity. Palin’s decision was immediately criticized by Senator Murkowski. Palin responded to the criticism by endorsing Murkowski’s opponent in the Republican Primary: Joe Miller. Miller then won the support of the Tea Party Express, who – according to The Washington Post– spent more than $150,000 on pro-Miller television and radio ads during the week before the primary. In addition to the mobilization of the Tea Party activists, Miller benefited from an initiative on the Alaska Republican Primary ballot requiring parental consent before a girl aged 17 or younger could receive an abortion. Alaska’s most conservative voters were out in force on Primary Day. The Washington Post article highlighted some of Miller’s positions that helped him curry favor with Alaska’s “hard right” voters:
He has called for phasing out Medicare and Social Security, as well as eliminating the Education Department because it is not mandated in the Constitution.
Never mind the fact that neither the FBI nor the Department of Homeland Security has been mandated by the Constitution. The “lack of a Constitutional mandate” litmus test is only applied to those bureaucracies considered repugnant to Joe Miller.
Because the deadline for filing as an “Independent” candidate on Alaska’s November (general election) ballot had already expired by the August 24 primary, it was necessary for Lisa Murkowski to run as a “write-in” candidate in order to retain her Senate seat.
During the course of the ensuing campaign, Miller’s foolishness provided the news media with plenty of entertainment. Despite Miller’s rhetoric, which called for limited government and fiscal restraint, Anne Applebaum of Slate recalled that Miller’s background became an issue in the campaign, since it was so inconsistent with that of a Tea Party hero:
During the course of the campaign, it also emerged that he had once collected farm subsidies; that his wife had once collected unemployment benefits; and that his family had received state health benefits.
Upon hearing that Murkowski would not abandon her quest to retain her Senate seat after her Republican Primary defeat, Mr. Miller immediately made a foolish statement, which he attempted to blame on an unidentified staffer. Jim Carlton of the Washington Wire blog provided this quote of the now-infamous message sent out from Joe Miller’s Twitter account:
“What’s the difference between selling out your party’s values and the world’s oldest profession?” said the message under Mr. Miller’s Twitter address early Friday.
Mr. Miller said the tweet was sent by a staffer who was temporarily manning his account. He added that the remark was aimed not at the senator herself, but at suggestions that Alaska’s Libertarian Party might allow Ms. Murkowski to run under its banner in November if she ends up losing to him in a final count of absentee ballots.
He blamed the tweet on “poor judgment” by the unidentified staffer, who he “relieved of his duties.” He said he quickly removed the message from his Twitter feed.
If Miller had not already done enough to alienate female voters — his Halloween-themed campaign ad, likening Lisa Murkowski to a witch, immediately drew the ire of the New Agenda website, which embedded a YouTube feed of the ad in this posting.
The most infamous event of Miller’s campaign occurred on October 17, when Tony Hopfinger, editor of the Alaska Dispatch website was handcuffed by Miller’s private security guards, when he attempted to interview the candidate at the conclusion of a “town hall” meeting at the Central Middle School in Anchorage. The incident caused Miller to become the butt of many jokes on national television.
Hopfinger was attempting to question Miller about an incident that had become the subject of an e-mail that had originated a few days earlier from Mike Rostad, a Republican activist in Kodiak, Alaska, based on a discussion between Rostad and Miller’s father, Rex Miller. The Anchorage Daily News provided this report:
Joe Miller was a part-time Fairbanks North Star Borough attorney in 2008 when he led an attempt to oust state Republican Party chief Randy Ruedrich. Rostad wrote in the email that Rex Miller told him there was a poll being conducted during that effort against Ruedrich. Rostad wrote that Rex Miller told him what happened:
“One noon hour, on his own time at the borough, Joe participated in an online poll voting against Randy. He used four office computers in the office to do it, thinking this was his chance to boost numbers to get rid of Randy. He emptied the cache files on the computers so the users wouldn’t know what he had done. When the users asked what had happened to their caches, (Miller) admitted to what he did. He was reprimanded and docked in pay for several days, but was not suspended or fired.
Miller’s improper computer use as a part-time attorney for the Fairbanks North Star Borough has been an ongoing controversy, which was the subject of this December 31 article from the Anchorage Daily News.
The handcuffing of Tony Hopfinger was not the only misstep by Joe Miller’s campaign on October 17. Shira Toplitz of Politicoreported on October 29 that the Murkowski campaign was running an ad, critical of two October 17 blunders:
The same night as the incident with the journalist, Miller told an audience that if “East Germany could, we could” secure the borders of the country — a controversial statement that Murkowski also uses in the new spot.
“Joe Miller’s answer to illegal immigration: Use East Germany as an example,” continues the narrator. “Exactly what kind of America does Joe Miller live in? . . .”
Miller had nobody else to blame for his stupid remark exalting East Germany as a model for border security.
Once it became obvious that Lisa Murkowski made history as the first write-in candidate to win a Senate election since Strom Thurmond in 1954, Joe Miller took his battle to the courts. He initially filed an action in Federal Court, although U.S. District Judge Ralph Beistline stayed proceedings pending resolution of the dispute in the State court, where the action should have been brought. Once the case was filed in the State Court, Judge William Carey dismissed the suit and it was appealed directly to the Alaska Supreme Court. U.S. News reported that when the ballots were still being counted, the Miller camp was determined to turn the election into a spelling bee:
Shortly after the second day of write-in ballot counting began on Thursday, a Miller observer challenged a vote for Murkowski that appeared to have her name spelled and printed correctly, though the “L” in “Lisa” was in cursive handwriting. Later, at least 10 ballots in which Murkowski’s name appeared readable were challenged, including one in which the vote read: “Lisa Murkowski Republican.”
Miller’s campaign said observers are simply challenging votes that don’t meet the strict letter of the law — including those with minor misspellings of Murkowski’s name or those with legibility or penmanship issues.
In addition to the “spelling bee” demand, Miller also attempted to pursue a claim of misconduct by election officials amounting to election fraud. The Christian Science Monitor provided this report on Judge Carey’s dismissal of that count:
“Nowhere does Miller provide facts showing a genuine issue of fraud or election official misfeasance,” Carey wrote. “Instead, the majority of the problematic statements included in the affidavits are inadmissible hearsay, speculation, and occasional complaints of sarcasm expressed by [elections] workers. Nothing rises to the level showing genuine material facts of fraud.”
The stupidity of Miller’s “spelling bee” requirement became more apparent once the Alaska Supreme Court was asked to reverse the dismissal of that claim. During oral arguments, Justice Dana Fabe directed a Why are you here? question to Miller’s attorneys. Here’s how that moment was described by KTUU News:
With unofficial results showing Miller behind Murkowski by 10,328 votes, or 2,169 when ballots challenged by Miller observers are excluded, Justice Dana Fabe asked Miller’s legal team what — if any — impact the court’s decision would have on the outcome of the election.
“Even if you win on this argument and every one of the challenged ballots is set aside, it makes no difference in this count, and it makes no difference in the outcome of this election unless you win on one of your other counts — isn’t that correct?” Fabe said.
In other words: even if the contested ballots were not counted in accordance with the guidelines advanced by Miller’s legal team – Miller still would have lost by over two thousand votes!
So seriously: What was the point of filing suit? Was Miller hoping to get some sort of deal from the Republican Party for conceding defeat? His lawsuit was as idiotic as his entire campaign had been. As late as December 27, Miller was vowing to continue his battle in the Federal Court to contest the election result. Nevertheless, as Miller should have learned at Yale Law School, the pursuit of such a specious claim in a Federal Court, would likely result in rather expensive sanctions against Miller and his attorneys under Rule 11 of the Federal Rules of Civil Procedure, once his case was inevitably dismissed. If that concern had not been enough to motivate Miller to abandon his Federal suit, it should have been enough to convince Miller’s attorneys that the game was finally over. Miller ultimately conceded his defeat in the election on December 30, although he never made a concession call to Lisa Murkowski. He explained that he had not made the call because he did not have Murkowski’s phone number.
Joe Miller may not have won the election to the United States Senate — but he did win the 2010 Jackass of The Year Award from TheCenterLane.com. Congratulations, Jackass!
It seems as though everyone is bashing the Federal Reserve these days. In my last posting, I criticized the Fed’s most recent decision to create $600 billion out of thin air in order to purchase even more treasury securities and mortgage-backed securities by way of the recently-announced, second round of quantitative easing (referred to as QE2). Since that time, I’ve seen an onslaught of outrage directed against the Fed from across the political spectrum. Bethany McLean of Slatemade a similar observation on November 9. As the subtitle to her piece suggested, people who criticized the Fed were usually considered “oddballs”. Ms. McLean observed that the recent Quarterly Letter by Jeremy Grantham (which I discussed here) is just another example of anti-Fed sentiment from a highly-respected authority. Ms. McLean stratified the degrees of anti-Fed-ism this way:
If Dante had nine circles of hell, then the Fed has three circles of doubters. The first circle is critical of the Fed’s current policies. The second circle thinks that the Fed has been a menace for a long time. The third circle wants to seriously curtail or even get rid of the Fed.
From the conservative end of the political spectrum, the Republican-oriented Investor’s Business Daily provided an editorial on November 9 entitled, “Fighting The Fed”. More famously, in prepared remarks to be delivered during a trade association meeting in Phoenix, Sarah Palin ordered Federal Reserve chairman Ben Bernanke to “cease and desist” his plan to proceed with QE2. As a result of the criticism of her statement by Sudeep Reddy of The Wall Street Journal’s Real Time Economics blog, it may be a while before we hear Ms. Palin chirping about this subject again.
The disparagement directed against the Fed from the political right has been receiving widespread publicity. I was particularly impressed by the pummeling Senator Jim Bunning gave Ben Bernanke during the Federal Reserve Chairman’s appearance before the Senate Banking Committee for Bernanke’s confirmation hearing on December 3, 2009. Here is the most-frequently quoted portion of Bunning’s diatribe:
. . . you have decided that just about every large bank, investment bank, insurance company, and even some industrial companies are too big to fail. Rather than making management, shareholders, and debt holders feel the consequences of their risk-taking, you bailed them out. In short, you are the definition of moral hazard.
Michael Grunwald, author of Time magazine’s “Person of the Year 2009” cover story on Ben Bernanke, saw fit to write a sycophantic “puff piece” in support of Bernanke’s re-confirmation as Fed chairman. In that essay, Grunwald attempted to marginalize Bernanke’s critics with this statement:
The “Helicopter Ben” piece was written by Larry Kudlow. The “Zimbabwe Ben” and “Villain of the Year” essays were both written by Adrienne Gonzalez of the Jr. Deputy Accountant website, who saw her fanbase grow exponentially as a result of Grunwald’s remark. The most amusing aspect of Grunwald’s essay in support of Bernanke’s confirmation was the argument that the chairman could be trusted to restrain his moneyprinting when confronted with demands for more monetary stimulus:
Still, doves want to know why he isn’t providing even more gas. Part of the answer is that he doesn’t seem to think that pouring more cash into the banking system would generate many jobs, because liquidity is not the current problem. Banks already have reserves; they just aren’t using them to make loans and spur economic activity. Bernanke thinks injecting even more money would be like pushing on a string.
* * *
To Bernanke, the benefits of additional monetary stimulus would be modest at best, while the costs could be disastrous. Reasonable economists can and do disagree.
The FOMC decided this week that, with unemployment high and inflation very low, further support to the economy is needed.
* * *
But the Federal Reserve has a particular obligation to help promote increased employment and sustain price stability. Steps taken this week should help us fulfill that obligation.
Bernanke should have said: “Pushing on a string should help us fulfill that obligation.”
Meanwhile, the Fed is getting thoroughly bashed from the political left, as well. The AlterNet website ran the text of this roundtable discussion from the team at Democracy Now (Michael Hudson, Amy Goodman and Juan Gonzalez – with a cameo appearance by Joseph Stiglitz) focused on the question of whether QE2 will launch an “economic war on the rest of the world”. I enjoyed this opening remark by Michael Hudson:
The head of the Fed is known as “Helicopter Ben” because he talks about dropping money into the economy. But if you see helicopters, they’re probably not your friends. Don’t go out and wait for them to drop the money, because the money is all going electronically into the banks.
At the progressive-leaning TruthDig website, author Nomi Prins discussed the latest achievement by that unholy alliance of Wall Street and the Federal Reserve:
The Republicans may have stormed the House, but it was Wall Street and the Fed that won the election.
* * *
That $600 billion figure was about twice what the proverbial “analysts” on Wall Street had predicted. This means that, adding to the current stash, the Fed will have shifted onto its books about $1 trillion of the debt that the Treasury Department has manufactured. That’s in addition to $1.25 trillion more in various assets backed by mortgages that the Fed is keeping in its till (not including AIG and other backing) from the 2008 crisis days. This ongoing bailout of the financial system received not a mention in pre- or postelection talk.
* * *
No winning Republican mentioned repealing the financial reform bill, since it doesn’t really actually reform finance, bring back Glass-Steagall, make the big banks smaller or keep them from creating complex assets for big fees. Score one for Wall Street. No winning Democrat thought out loud that maybe since the Republican tea partyers were so anti-bailouts they should suggest a strategy that dials back ongoing support for the banking sector as it continues to foreclose on homes, deny consumer and small business lending restructuring despite their federal windfall, and rake in trading profits. The Democrats couldn’t suggest that, because they were complicit. Score two for Wall Street.
In other words, nothing will change. And that, more than the disillusionment of his supporters who had thought he would actually stand by his campaign rhetoric, is why Obama will lose the White House in 2012.
The only thing I found objectionable in Ms. Prins’ essay was her reference to “the pro-bank center”. Since when is the political center “pro-bank”? Don’t blame us!
As taxpayer hostility against the Fed continues to build, expect to see this book climb up the bestseller lists: The Creature from Jekyll Island. It’s considered the “Fedbashers’ bible”.
TheCenterLane.com offers opinion, news and commentary on politics, the economy, finance and other random events that either find their way into the news or are ignored by the news reporting business. As the name suggests, our focus will be on what seems to be happening in The Center Lane of American politics and what the view from the Center reveals about the events in the left and right lanes. Your Host, John T. Burke, Jr., earned his Bachelor of Arts degree from Boston College with a double major in Speech Communications and Philosophy. He earned his law degree (Juris Doctor) from the Illinois Institute of Technology / Chicago-Kent College of Law.