The Republican Nominee Depresses Me, Too

Matt Taibbi, in comparing Mitt Romney's address to the NAACP and later to a "friendlier audience" in Montana:

So now this is the message: I tried to reason with the blacks, I really did, but it turns out they just want a free lunch.

How’s that for bridging the racial divide? Time to wake up the Nobel committee in Oslo!

As far as free lunches go, we of course just witnessed the biggest government handout in history, one that Romney himself endorsed. Four and a half trillion dollars in bailout money already disbursed, trillions more still at risk in guarantees and loans, sixteen trillion dollars in emergency lending from the Federal Reserve, two trillion in quantitative easing, etc. etc. All of this money went to Romney’s pals in the Wall Street banks that for years helped Romney take over companies with mountains of borrowed cash. Now, after these banks crashed, executives at those same firms used those public funds to pay themselves massive salaries, which is exactly the opposite of “helping those who need help,” if you’re keeping score.

That set of facts alone made the “free stuff” speech shockingly offensive. But the problem isn’t just that Romney’s wrong, and a hypocrite, and cynically furthering dangerous and irresponsible stereotypes in order to advance some harebrained electoral ploy involving white conservative voters. What makes it gross is the way he did it.

Romney can’t even be mean with any honesty. Even when he’s pandering to viciousness, ignorance and racism, it comes across like a scaly calculation. A guy who feels like he has to take a dump on the N.A.A.C.P. in Houston in order to connect with frustrated white yahoos everywhere else is a guy who has absolutely no social instincts at all. Someone like Jesse Helms at least had a genuine emotional connection with his crazy-mean-stupid audiences. But Mitt Romney has to think his way to the lowest common denominator, which is somehow so much worse. [Matt Taibbi, "Romney's 'Free Stuff' Speech is a New Low," 13 July 2012]

Corporate Welfare

Jamie Dimon, CEO of JPMorgan Chase & Co., who received such love from Senators, especially Republican senators, in a recent Senate hearing, owes some of his fortune to taxpayers. According to Bloomberg and research by the International Money Fund, JPMorgan "receives a government subsidy worth about $14 billion a year....[which] helps the bank pay big salaries and bonuses...[and] distorts markets, fueling crises such as the recent subprime-lending disaster and the sovereign-debt debacle that is now threatening to destroy the euro and sink the global economy." Read the entire article at: "Dear Mr. Dimon, Is Your Bank Getting Corporate Welfare?," to get a step-by-step discussion of how corporate welfare affects us all. (h/t Think Progress: Economy)

According to the Center for Responsive Politics, "the financial sector is far and away the largest source of campaign contributions to federal candidates and parties." In the 2011-2012 cycle so far, Mitt Romney has received far more contributions than any other presidential candidate: $19, 222, 965 to Obama's $8, 414, 629. Of the top 20 recipients of the financial industry's largesse, 14 are Republicans and 6 are Democrats. Insurance heads the financial industry PACs in contributions, with 62% of its contributions going to Republicans this year, compared to 38% to Democrats.

The financial industry is hedging its bets, of course, but it looks as if the Republicans are the favored horse in this year's race. Wonder what the industry will expect in return. Not.

Sucking up to Wall Street as Usual

Jamie Dimon, CEO of JP Morgan, testified before the Senate Banking Committee today about the more than $2 billion (and rising) the bank recently lost in risky hedges. Instead of being intensely questioned and sermonized on the need for regulation, Dimon

received a warm welcome from Republican lawmakers, suggesting that his status as Washington’s favorite banker remains intact. Some Republicans praised JPMorgan for navigating the financial crisis better than other Wall Street firms, and even sought Mr. Dimon’s advice on fixing the economy. ["JPMorgan's Chief Says Clawbacks 'Likely,'" in  The New York Times, 13 June 2012]

Senator Jim DeMint (R-SC) told Dimon that lawmakers "can hardly sit in judgment of your losing $2 billion."

Really? Well, what's the use of our lawmakers, huh?

Yep, just the person to trust.....if you're hoping for some Wall Street money for your political campaign. And, of course, the connections between JP Morgan and the Senate Banking Committee are very close and entangled; folks who work for our lawmakers on that committee become lobbyists for the financial institution. Kiss, kiss....

See Cora Currier's details of the revolving door in her article, "Charting the Cozy Connections between JP Morgan and the Senate Banking Committee," on ProPublica's website.

Let's Quit Sucking up to Wall Street!

Okay, I know that campaigns are expensive to run, that politicians running for office need money. I know that with the Supreme Court's Supremely Sucky decision on Citizens United vs. Federal Election Commission, huge amounts of Super Pac money are flowing into campaign coffers, and politicians hesitate to bite the golden hands that wave from the windows of Wall Street.  But, crap, will no one put country first and stand up for the millions of Americans who suffered and continue to suffer from the financial crisis of 2008?  Bill Clinton is praising the likes of Donald Trump and soft-soaping Wall Street, because, well, as Joan Walsh points out, Clinton's philanthropic enterprise depends upon deep pockets of the very rich. And I hear Republicans saying again and again that financial systems need LESS regulation--while again and again we learn more details of what inadequate regulation has done to us.

The latest reveal of the dirty tricks of finance? Top executives at Bank of America withheld from the bank's shareholders information that indicated how an acquisition of Merrill Lynch would negatively affect the organization:

Days before Bank of America shareholders approved the bank’s $50 billion purchase of Merrill Lynch in December 2008, top bank executives were advised that losses at the investment firm would most likely hammer the combined companies’ earnings in the years to come. But shareholders were not told about the looming losses...[snip]

....The bank’s purchase of Merrill, struck during the depths of the financial crisis, was the culmination of an acquisition binge by Mr. Lewis [CEO] that transformed Bank of America from its base in North Carolina into a financial behemoth that could compete head-to-head with the biggest institutions on Wall Street. 

But the transaction, which was ultimately encouraged by government officials who were concerned about the impact on the financial system of a foundering Merrill Lynch, also saddled the bank with billions in losses and required an additional $20 billion from taxpayers on top of an earlier bailout it received in 2008. [my emphasis] [from: Gretchen Morgenson, "Merrill Losses were Withheld before Bank of America Deal," The New York Times, 3 June 2012]

Jeffrey J. Brown, Bank of America's treasurer at the time, warned Joe L. Price, Bank of America's chief financial officer at the time, "that the failure to disclose [the extent of Merrill Lynch's losses to shareholders before the vote] 'could be a criminal offense, stating that he did not want to be ‘talking through a glass wall over a telephone’ if no disclosure was made.”["Merrill Losses were Withheld before Bank of America Deal"] Wow. How was Brown to know just how misplaced his fear of criminal charges was?  The SEC failed to prosecute those most responsible for the financial crisis--executives with Bank of America (which acquired Countrywide and Merrill Lynch), Goldman Sachs, Citigroup, etc., all those folks who continue to wield way too much power in this country.

In a blog post, Matt Taibbi, who has investigated and written extensively on the crimes of Wall Street, succinctly lists and describes those regulatory failures of the SEC: "SEC: Taking on Big Firms is 'Tempting,' but We Prefer Picking on Little Guys." Even when warned by insiders of massive fraud, the SEC failed to act. 

You can read Taibbi's article "How Wall Street Killed Financial Reform," on the Rolling Stone website, and you can sign up to join Matt Taibbi's "Thunderclap" here to add your tweet to the angry tweets of other citizens disgusted with how our government has let Wall Street get away with financial crimes and continue to use its influence to de-fang regulation meant to put the poison to malfeasance.

As Taibbi demonstrates in "How Wall Street Killed Financial Reform," the CEOs of those institutions, with their lawyers and their lobbyists, have way too much influence. Just look at what happened recently with J.P. Morgan. CEO Jamie Dimon and his aides were able to convince regulators to include loopholes in the regulatory laws passed after the financial crisis, laws that enabled J.P. Morgan to do the kind of risky trading that led to the bank's recent $2 billion loss. And don't count on shareholders to hold their executive officers responsible. Even after this latest crisis at J.P. Morgan (which had managed to escape damage in the 2008 financial meltdown), Jamie Dimon "survived a pair of key shareholder votes [on May 15th] on his pay and job responsibilities. [He] won an endorsement of his pay package, which was reportedly $23 million last year. He also can retain his second title as chair of the banking giant."

So don't believe anyone who says that Wall Street needs LESS regulation. Experience proves otherwise.

What Others Are Saying

Another hot day is warming up in South Louisiana, and we have a guest arriving this evening, providing he can get a flight on student standby, so this morning, I'm just linking to some posts and articles that caught my attention:

• Margaret Talbot opines about the Catholic Church's suing the Obama Administration over insurance coverage for birth control, in "Why is the Catholic Church Going to Court?," on The New Yorker website.  Bottom line:

  No one is challenging the rights of those Catholics who object to birth control to eschew it themselves, and to denounce it in public. But the lawsuit proposes something different: namely, that religious freedom means they can deny access to birth control to people who don’t share their faith or that article of it. It doesn’t.

• Heather Digby Parton, guest blogging for Kevin Drum, reflects my own cynicism about the lack of political will of our politicians in reigning in the power of Wall Street. (And now that the Supreme Court has added to the problem with its decision of Citizen's United, what little spine was left in our politicians has been, perhaps, permanently removed.) Adding to my depression about how Wall Street's trade in toxic derivatives screwed millions of Americans while the perpetrators of that financial disaster seem to have become even more politically powerful are these posts to which Parton links: Thomas Edsall's May 26th opinion piece in The New York Times and Mark Taibbi's article "How Wall Street Killed Financial Reform," in Rolling Stone. Here's a lovely quote from Taibbi's article:

  The fate of Dodd-Frank over the past two years is an object lesson in the government's inability to institute even the simplest and most obvious reforms, especially if those reforms happen to clash with powerful financial interests. From the moment it was signed into law, lobbyists and lawyers have fought regulators over every line in the rulemaking process. Congressmen and presidents may be able to get a law passed once in a while – but they can no longer make sure it stays passed. You win the modern financial-regulation game by filing the most motions, attending the most hearings, giving the most money to the most politicians and, above all, by keeping at it, day after day, year after fiscal year, until stealing is legal again.

• A recent study suggests that exercise may actually hurt some folks with heart risks, as Gina Kolata reports in her New York Time's article, "For Some, Exercise May Increase Heart Risk," 30 May 2012. Oh, well. We know we all are going to die, anyway, right? No sweat.
  
  
  
• I'll end with this great Pig at the Trough homage to a Ronald Reagan ad (and a poke at Wall Street) that James Fallows shares this morning on his blog: "The Bear vs. the Pig: A Great Reagan Ad Updated."
  
  ....things to do.....
 

oh, and "oink, oink": "Honeywell CEO Says the Corporate Tax Rate Should be Zero"

Cynicism

My children tell me that I am very cynical, so when they confront some evidence of a younger me--in my writing or the writing of friends--who comes across as naive and trusting, they seem surprised. Of course, our children never really know us, do they? They weren't witness to many of the events (our own failings as well as the failings of others) that transformed us over time--either because they were not present or because they were too young to understand what was going on. I'll admit that a little bit of faith in humanity remains in me, but in the last several years, that bit of faith has received a beating.

The Republicans taking hostage of the debt ceiling is a big disappointment; I mean, they didn't have difficulties with debt ceilings under President Bush. Why so recalcitrant now? (That's a rhetorical question). But the treatment of Elizabeth Warren by Republican Congressmen is in a category by itself, I think. Or maybe not. Given some thought, I could probably come up with other similar examples. Here is a very smart woman who speaks plainly and who has worked to help make financial matters more transparent to consumers, that is, people such as I.

Here is Elizabeth Warren speaking on those credit card contracts that none of us can understand:
"Elizabeth Warren on Credit Card 'Tricks and Traps'," at Now, online, 2 January 2009.

Here she is talking about bankruptcy caused by medical bills and "aggressive hospital collections":
Interview 1
Interview 2

Here she is talking about subprime mortgages in 2004--raising the alarm before subprime mortgages, bundled up as toxic assets, helped to almost blow up our economy:
on "Books of our Time"

People with this kind of sense, with this kind of concern for ordinary families, evidently have no place in our government, according to the Republicans who refused to accept her as the director of the Consumer Financial Protection Agency. Their condescending questioning and unrelenting demonization of this woman is a travesty of public service.

In The New York Times, Joe Nocera reviews Elizabeth Warren's travails with Republican 'leadership,' in this, her last week with the Consumer Financial Protection Bureau: "The Travails of Ms. Warren," posted on Friday, 22 July 2011.

Here is an example of Warren's own lack of cynicism. She thought that if she could make clear to Congress what the mission of the Consumer Financial Protection Bureau would be, the accusations and demonization would stop:

“I’ve never been an ideologue,” she told me. “And I thought the best way to deal with that perception was to put our vision out there. The vision is clear. Consumers should be able to tell the price and risk of any credit product before they buy it. We want to mow down the fine print. I thought once that was on the table, and it was clear that we were executing on it, the accusations would go away.” Nocera, "The Travails of Ms. Warren"

But: " House Republicans regularly brought her before their committees and acted as if this were the second coming of Joe McCarthy....Republicans would cut off her answers and speak to her in tones ranging from contempt to condescension. The treatment wasn’t just disrespectful. It was ugly. And it never stopped."

As I have stated in a previous post, I would have loved having an Elizabeth Warren looking out for my interests. Unfortunately, bankers and financial institutions have far more money than I have and far more influence over those Republicans who made sure that Elizabeth Warren would never direct the agency she was responsible for helping to create.

It's a real shame. Add another coin to my cynicism bank.

Worth Reading

Frank Rich lets loose: "Obama's Original Sin," in New York Magazine's "News and Features," 3 July 2011.

This article would be great to use in a communications class in which one is discussing the art of rhetoric (ethos, logos, and pathos) and the emotional appeal of language (buried metaphors such as "paw print," alliteration, understatement, hyperbole, aphorisms, etc.)

A few excerpts:

• "As the indefatigable Matt Taibbi has tabulated, law enforcement on Obama’s watch rounded up 393,000 illegal immigrants last year and zero bankers."

• "It's as if the Watergate investigation were halted after the cops nabbed the nudniks who did the break-in."

• "What some call a settlement others may find a cover-up."

• "Those in executive suites at the top of that chain have long since fled the scene with the proceeds, while bleeding shareholders, investors, homeowners, and ­cashiered employees were left with the bills. The weak Dodd-Frank financial-reform law that rose from the ruins remains largely inoperative, since the actual rule-writing was delegated to understaffed agencies now under siege by banking lobbyists and their well-greased congressional overlords." (my emphasis--Just listen to the hard "R's" rolling through the first part of that last sentence, only to be let out like air from a tire, with the emphasis on "S's" at the end of the sentence.)

• And--ouch!: "But the president has no one to blame but himself for the caricature. While he has never lusted after money—he’d rather get his hands on the latest novel by Morrison or Franzen—he is an elitist of a certain sort. For all the lurid fantasies of the birthers, the dirty secret of Obama’s background is that the values of Harvard, not of Kenya or Indonesia or Bill Ayers, have most colored his governing style. He falls hard for the best and the brightest white guys."

And the final two paragraphs that one hopes the President (or someone who can influence him) reads and heeds:

“A nation cannot prosper long when it favors only the prosperous,” Obama declared at his inauguration. What he said on that bright January morning is no less true or stirring now. For all his failings since, he is the only one who can make this case. There’s nothing but his own passivity to stop him from doing so—and from shaking up the administration team that, well beyond the halfway-out-the-door Geithner and his Treasury Department, has showered too many favors on the prosperous. This will mean turning on his own cadre of the liberal elite. But it’s essential if he is to call the bluff of a fake man-of-the-people like Romney. To differentiate himself from the discredited Establishment, he will have to mount the fight he has ducked for the past three years.

The alternative is a failure of historic proportions. Those who gamed the economy to near devastation—so much so that the nation turned to an untried young leader in desperation and in hope—would once again inherit the Earth. Unless and until there’s a purging of the crimes that brought our president to his unlikely Inauguration Day, much more in America than the second term of his administration will be at stake.

Depressing if True

William Greider, writing for The Nation, seems to think that while Republicans have certainly done their best to demonize Elizabeth Warren, there are folks surrounding President Barack Obama who also don't want this candid woman to chair the Consumer Financial Protection Bureau. Greider's information relies on a Very Reliable Source, unnamed, so who can really tell how accurate this is. But based on what I've read about the financial industry and how all those finance guys seem to end up in positions of power around the presidency (including Obama's), I wouldn't be surprised. Here's a quote from Greider:

Tim Geithner, said my Very Reliable Source, really, really doesn’t want Elizabeth Warren in the position where she is sure to be a tough-minded and independent voice on major financial-policy issues. As CFPB director, Warren would also sit on the new “systemic risk” council of regulators who decide very large questions like “too big to fail.” The other regulators can outvote her easily enough, but Warren has an alarming history of personal candor. She says what she thinks, out loud and in public. That naturally disturbs the club members, all of whom have a rank history of making life easier for the big boys of banking.

Warren made her integrity clear when she served as chair of the Congressional Oversight Panel digging into the financial crisis and bailouts. Her investigations turned up alarming facts the bankers and bank regulators wished to avoid. Furthermore, Warren was often dissenting on legislative issues Geithner and team were pushing in the congressional debates on financial reform. Geithner doesn’t tolerate contrary thinkers in his midst; witness the galaxy of Wall Streeters he recruited to run the Treasury department. Geithner is a favorite of the president’s, perhaps because he is absolutely faithful to the financial establishment’s best interests. [William Greider, "Why is Obama Dragging his Heels on Appointing Elizabeth Warren to head CPFB?," The Nation, 27 May 2011.]

I don't know the answer to the question in the title of Greider's article, and I'm no expert. But I've read enough about the economic crisis to know that we can't blame just one political party for all the deregulation that eventually led to the risks that the financial industry took and the financial crisis that ensued. Those at the top seem to cover each other's backs very well. Just sayin'.

David Corn, an editor for Mother Jones and a former editor of The Nation, described the distance between Timothy Geithner and Elizabeth Warren in this article on HuffPost's "Politics Daily," in 2010. Here is a quote from Corn's article: "Elizabeth Warren Vs. Timothy Geithner: A Big Decision for Obama."

As head of the bailout oversight panel, Warren has fiercely called out Geithner and Treasury on a number of fronts: for providing a backdoor bailout to AIG, for botching homeowner relief programs, for failing to get mega-banks to resume lending. Moreover, she's an articulate and thoughtful populist, who applies a Main Street-first perspective toward financial matters and who has been a scourge of credit card companies and banks. Geithner is a member of the Big Finance establishment; he's no crusader.

It would be nice to have an "articulate and thoughtful populist" on one's side.

Lessons Learned about Self-Monitoring?

On Saturday of this past weekend, my husband, son, and I traveled to Franklin, Louisiana, to attend the Franklin Black Bear and Birding Festival. On the banks of Bayou Teche,venders had set up booths of local products and crafts, various conservation groups had prepared displays and games for children in a nearby warehouse, and musicians were scheduled to play for a street dance. We took a pontoon ride into the Bayou Teche Wildlife Refuge managed by the U.S. Fish and Wildlife Service. It was a beautiful day, clear and cool, and on the trip up a canal dug over one hundred years ago for logging, we saw several alligators sunning on the banks as well as several species of egrets. The particular area of the refuge near Franklin that we boated into is closed to motorized vehicles from September 1st to April 15th. That area had just been opened for motorized vehicles, and the gate was open, as the picture at left illustrates.

As we motored slowly down the canal, the U.S. Fish and Wildlife employee steering the boat and directing the tour mentioned that there were no old-growth trees here because the area had been intensively logged at the turn of the last century--that is, from the nineteenth century to the twentieth century. Historical records indicate that from 1890 to 1935, timber companies removed virtually all of the cypress from Louisiana; any old growth remaining was few and far between. The trees one sees now are ones that have regenerated since then. The canal we were traveling on was also left over from the timber industry's work. Canals were dug in the swamps in order to get to the trees and then to drag the trees to waterways where they could be then be floated to timber mills. If you pull up a Google Earth map of Lake Maurepas and Lake Pontchartrain, you can still see straight canals radiating out from the places where cypress had been harvested, dragged into the canals by pullboats, and "cribbed up into booms and pushed like barges" to mills.  [Frank B. Williams: Cypress Lumber King, by Anna C. Burns]

Timber industry supporters today complain about the restrictions on harvesting the cypress that has regenerated since 1935 when Louisiana was just about completely stripped of cypress. But the past history of just about any industry that pulled its resources from the natural world--or just about any industry, for that matter--indicates that industries are unable to monitor themselves. It doesn't matter if it's an industry that harvests the resources of the natural world or the banking conglomerates that sell derivatives.  Management and employees live high on the proceeds until they have exhausted the resources that provide those proceeds--or until the financial enterprise threatens to go bankrupt and take the country down with it and is bailed out by the government. Frank Williams "celebrated his fiftieth year in the lumber business by distributing $100,000 in bonuses among his employees" [Burns]. A few short years later, the cypress industry had exhausted its resources. Other timber industries began liquidating their assets in the 1910s, but the company that Frank Williams established managed to branch out into oil and real estate and thus operates to this day.

In 2006, Goldman Sachs paid "its employees a total of $16.5 billion in compensation," bonuses that, if distributed evenly, would mean "$623,418 for every" one of its 26,467 employees. ["The Goldman Sachs Premium," by DealBook, 18 December 2006] By 2008, it was clear that Goldman Sachs and other financial industries had almost brought the U.S.--and the world--to financial disaster. Millions of Americans have yet to recover. But taxpayers bailed out the financial industry, and those "titans" got to keep their bonuses.

But have we learned this lesson: that industries must be vigilantly regulated for the health,  safety, and welfare of not only ordinary people but the planet? It seems that a lot of us haven't. More on that in another post.

More on the logging of cypress in Louisiana:
Jacobs, David. "Logging Off." Baton Rouge Business Report. BusinessReport.com. 10 September 2007. http://www.businessreport.com/news/2007/sep/10/logging

Cypress Logging in Louisiana, circa 1925 (Part 1 of 2)   YouTube. Archival footage provided by Krantz Recovered Woods, Austin, TX. http://youtu.be/HF3-0NISvs4

Cypress Logging in Louisiana, circa 1925 (Part 2 of 2). YouTube. Archival footage provided by Krantz Recovered Woods, Austin, TX. http://youtu.be/FxSP08zJ5tE