Opening the Day: Why Democratic Candidates Aren't Harder Edged

by: Matt Stoller

Fri Sep 26, 2008 at 09:49


I'm heading to the Clinton Global Initiative for a few hours before going back to DC for the debate.  One thing to note is just how wankerous the Democratic leaders including Obama are being in this crisis.  I'm glad McCain and the House GOP blew up this deal, and frankly, the notion that Obama is acting like an adult by wanting to give $700B to Wall Street is nauseatingly stupid.  Note that Democratic leaders are all equally angry that McCain pulled out and praising Obama for being 'serious'.  It's just more evidence that Obama's people represent zero change from the Democratic status quo.  Even with the $700B number completely pulled out of thin air and an election in 40 days, these fuckers can't bring themselves to control their obviously showing boners at a possible bipartisan deal and let the voters make a damned decision for once.  This crisis has been good for Obama's electoral chances and all the downticket Democrats, so you'd think the Democrats would play this for all its worth.

Nope.  They hate politics.  They hate it and wish it would just go away so they can cut a deal without those pesky voters.  It's really pathetic.  They also won't realize that Republicans don't agree with us on most stuff, as Sirota noted in his post yesterday.  They aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.  They need to be fought.  Why do Democratic leaders keep extending a presumption of good faith to this faction of illiberalism?  They don't believe in good faith, they think Democrats are evil chumps.

So watch, again, as Lucy puts the football down for Obama to kick.  

  • This is interesting.

    The pistol-packing Sarah Palin is the party's new housewife saint, a cross between Annie Oakley and Joan of Arc. If elected, she will be a heartbeat from the presidency. One of McCain's old friends in Washington told me the senator has serious but so far undisclosed ailments. Americans had better think hard about President Palin from Alaska.

    A friend who works on broadway told me you don't spend $5000 on makeup without getting prosthetics in there.  This is a very serious story that isn't getting attention.

  • McCain is still futzing around with the debate as the market tanks.

  • Tom Edsall reports.

    The progressive wing of the House Democratic caucus reacted angrily Thursday evening to the news that Barack Obama opposes attempts to add bankruptcy reform to the Wall Street bailout bill.

    Obama is backtracking on this, I hear.  But we'll see.

  • I'm hearing there are lots of IE ads in the works, but the money's not there yet.  Surprise surprise, Democratic big dollar donors are acting like the selfish narcissists that characterize the rest of the party.  Republican donors wouldn't tolerate the shit Obama would force them to eat, they'd tell McCain to go fuck himself and spend the money anyway on defining his opponent and Congressional challengers.  Merkley is facing $500k of Freedom's Watch money, Darcy's facing some Chamber cash, Shaheen's getting pounded, etc.  With no pushback from our side.  Thanks, Democracy Alliance!  Great job structuring all your money to be c3 driven, I bet you saved a lot by taking tax deductions.  On the other hand, having no political money lets the Republicans screw up this bailout, so you probably lost a lot more of it as the dollar and the markets tank.  

  • Why aren't Democratic candidates being harder edged on the bailout?  I learned last night that it's because a lot of their donors have money in the stock market, and a lot of them are afraid that if there's no bailout their constituents will lose jobs.

  • Democrats Mike Capuano an Bob Brady continue to be morons about letting House members use youtube.

  • Here's Gore playing armchair revolutionary.

    Hey Al, why not actually work with the people willing to engage in these kinds of actions instead of throwing contracts to the Glover Park Group?  Oh wait, that would require you going outside your politician comfort zone and changing your own behavior.  God forbid anyone ask Gore to change his behavior, it's up to civilizations to change, not Al Gore.

Yes, I'm in a rabble rousing mood and not particularly inclined to be nice about it.  As the Cunning Realist, a Wall Street guy, asks, "is the ballot box part of the solution?

Hell yes, it is.  The solution starts with the voters.  With us.  With democracy.  And it shouldn't a surprise that online, which is a democratic medium, the pushback against this piece of shit deal has been ferocious.

What are you reading?

Matt Stoller :: Opening the Day: Why Democratic Candidates Aren't Harder Edged

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Man, you're being pretty harsh on Al Gore. (4.00 / 1)


That is surprising? ... (4.00 / 1)
It sounds like Matt is ready to lead the torches and pitchforks brigade

[ Parent ]
I'm glad someone from the left says it. It needs to be said. (4.00 / 1)
Hey Al, why not actually work with the people willing to engage in these kinds of actions instead of throwing contracts to the Glover Park Group?  Oh wait, that would require you going outside your politician comfort zone and changing your own behavior.  God forbid anyone ask Gore to change his behavior, it's up to civilizations to change, not Al Gore.

Amen.


[ Parent ]
Is Bob Brady ... (0.00 / 0)
Bowers Congresscritter? .. or is it Fattah?

Vote with your feet! (4.00 / 1)
Pitchfork, or not, now is the time to take to the streets. Do you think that the spontaneous protests that broke out across the country yesterday had no effect on the negotiations that resulted in NO DEAL?

These protests need to continue, and they need to grow.

These should culminate in a GENERAL STRIKE sometime next week. Start hoarding food, water, and cash now. When the strike is called, go to the parks, go to your front-yard, join with your neighbors and the other workers around you.  Feed each other, have a party, have a discussion, have a debate, and then march to the nearest government building and let them know that you say, "HELL NO!".


"It sounds wrong...
     ...but its right."


I'm not sure it's technically rabble rousing (4.00 / 2)
if you don't offer people an opportunity to take action on the ground.   We need demonstrations against the bailout all weekend all over the country and we need the press to cover them (not easy).  True Majority, USAction and UFPJ organized a few hundred for yesterday - we need more.  If you have any contacts who can help get that done, then now's the time to do something about it.    

Give 'em hell Matt! (0.00 / 0)
Sometimes when our party does not want to be hard-edged the rest of us have to do it for them.

Al Gore (4.00 / 7)
Al Gore has done more than any human in history to bring global warming into mainstream discourse. Yeah, what a fucking schmuck! Get your priorities straight Mr. Gore!

"Don't hate the media, become the media" -Jello Biafra

no kidding (4.00 / 1)
It's mindboggling that the jihad against Al Gore continues here.

[ Parent ]
And? (0.00 / 0)
Nobody denies that. The point is that he wants things to be taken a step further and isn't willing to do that himself. That's not laudable and we can recognise his contributions in other areas whilst still thinking he's being worse than useless on this particular part of the energy issue.

Forgotten Countries - a foreign policy-focused blog

[ Parent ]
Cussing!! (4.00 / 3)
You guys have been cussing a lot lately!

I send links to this site to everyone I meet during my own
work here in St. Louis MO.  I tell people if you want to help real blue candidates and LEARN about elections and polling this is THE site.

I am afraid the "unprofessional" cussing may turn off the people I send here.

Don't be mad at me!!  


Righteous rant (0.00 / 0)
Have our Democratic leaders stopped to consider that they have left an gaping opening for the Republicans to get to the "left" of them on the bailout issue - a la Pat Buchanan's pitchfork brigade.  Sure, it's disingenuous as hell and inconsistent as hell but that may not matter if the Republicans get their act together.

As long as the Republicans don't have an actual plan, this may not matter to the Democrats' chances, but God help us if they do and we don't.

If the Paulson plan is dead then the Democrats need a plan of their own, since the Republicans have pulled out of the bipartisan game.  They cannot get stuck holding the Paulson bag or being seen as Bush's ally.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


Have you been under a rock? (4.00 / 1)
Did you steal my Zoolander crazy pills? The Dems have their own plan -- the Dodd plan.

[ Parent ]
The Dodd plan (4.00 / 1)
is an improved Paulson plan, no?

I don't doubt it's somewhat improved, maybe even greatly improved, but it's still paintable as the "Paulson" plan, especially as long as Bush and Paulson are in favor of it.  It would not hurt to have an all-Democratic plan at the ready as another option.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


[ Parent ]
By that definition... (0.00 / 0)
any plan will be a Paulson plan, unless veto-proof majorities are secured in the house and senate.  

[ Parent ]
The GOP Congress does have a plan...'Free Market Fairies' (0.00 / 0)
The House GOP wants tax breaks for business and investors to free up money because they think Wall Street will double down on the big shitpile.  Paulson's plan is designed as theft.  The House GOP plan is utter ideological stupidity.

I think the Dems need to back away from their plan and look at alternatives while letting the White House and Congressional Rethugs duke out publicly over which handout to the rich is the one they are going to try and shove down our throats.


[ Parent ]
Yes, there is room here. (0.00 / 0)
If that is the GOP plan the Dems will have something to fight against.  If the GOP plan is more tax breaks for the rich, they will let the air out of their own balloon.

But we are in agreement I think, the Dems may need to have their own plan ready and not let them be tied to the Paulson plan.  

This is a knife fight.  

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


[ Parent ]
Liz Lemon v. Jack Donaghy (0.00 / 0)
This boils down Republicans and Democrats more than anything I can imagine, they enjoy the fight:



Self Righteous (4.00 / 3)
"[The Democrats] aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.  They need to be fought."

This is foolish and counterproductive. The Democrats are struggling to come up with some way to protect the public interest without letting the Republicans use this issue to steal the election. Calling Barney Frank a selfish racist is just outrageous. Stop it.


Misreading (4.00 / 3)
The passage in question refers to Republicans, not Democrats.

Please retract the statement.


[ Parent ]
Please clarify (0.00 / 0)
The passage in question refers to Republicans, not Democrats.

Possibly you are right, in which case this rant is extraordinary for its poor construction.

Consider the entire passage in context:

One thing to note is just how wankerous the Democratic leaders including Obama are being in this crisis.  I'm glad McCain and the House GOP blew up this deal, and frankly, the notion that Obama is acting like an adult by wanting to give $700B to Wall Street is nauseatingly stupid.  Note that Democratic leaders are all equally angry that McCain pulled out and praising Obama for being 'serious'.  It's just more evidence that Obama's people represent zero change from the Democratic status quo.  Even with the $700B number completely pulled out of thin air and an election in 40 days, these fuckers can't bring themselves to control their obviously showing boners at a possible bipartisan deal and let the voters make a damned decision for once.  This crisis has been good for Obama's electoral chances and all the downticket Democrats, so you'd think the Democrats would play this for all its worth.

Nope.  They hate politics.  They hate it and wish it would just go away so they can cut a deal without those pesky voters.  It's really pathetic.  They also won't realize that Republicans don't agree with us on most stuff, as Sirota noted in his post yesterday.  They aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.  They need to be fought.

It is hard see how the antecedent of "they" in the second paragraph could be Republicans. If you look at the whole preceding passage, the most proximate reference is "The Democrats." I suppose it could be "These fuckers," which seems to be a reference to "Obama's people."

Possibly Matt's use of "they" refers all the way back, five sentences before, to "McCain and the House GOP."  Is that what you mean? Perhaps Matt could explain what he meant.


[ Parent ]
I think it is confusion based on a bad construction (4.00 / 1)
This sentence is the problem:
They [Democrats] also won't realize that Republicans don't agree with us [Democrats, or possibly Progressives] on most stuff, as Sirota noted in his post yesterday.

I think Matt switches pronouns in mid sentence- from "they" for Dems to "us" for Dems by the end of the sentence which follows that the "they" in the next sentence has switched to the Republicans:

They [Republicans] aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.

I think the reference to "proudly racist" in the light of Stu Rothenberg's recent comments is the clincher.

Not that any of this matters as I'm just rightly pissed at both parties in this whole stinking mess!!!!

I've come around to we need to do something to slow the meltdown of the system, by why do we need to do something predicated on what this administration wants?


[ Parent ]
Remarkable! (4.00 / 3)
A post based on a third grade-level misreading is promoted by three readers.

This is quite revealing of the intellectual level on which the self-proclaimed "adults" on this list are operating-their hosannas to the ever so advanced discipline of Economics notwithstanding.


[ Parent ]
Seriously (0.00 / 0)
This ain't rocket science.  It's ("It" referring to the previous passage, not to rocket science) a quick, strident style and the referent for "they" switches from one sentence to the next but, come on, this isn't the kind of thing any well-read person should have trouble with.

To wit:

They also won't realize that Republicans don't agree with us on most stuff, as Sirota noted in his post yesterday.  They aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.

The "they" in the first sentence refers to Democratic leaders.  The second "they" refers to the Republicans.  Now please have a sentence diagram posted to the comments by the end of the day, and I'll try to grade it over the weekend.

Now we just have to see if someone can spot an example of Muphry's Law, which states that it's impossible to correct someone else's spelling or grammar on the Internet without making a spelling or grammatical error of your own.


[ Parent ]
The reason Democratic leaders aren't being (0.00 / 0)
more hard edged is that they are adults, unlike you leaders of the Pitchfork Perfectionists. Don't believe me? Read Krugman today, which is aimed directly at the Republican monkey wrenchers you are so fond of and, indirectly, you.

If the street protests grow will you join your fellow citizens (0.00 / 0)
in opposition to this ill-concieved and possibly unnecessary bailhandout?


"It sounds wrong...
     ...but its right."


[ Parent ]
Hell no I won't (0.00 / 0)
I'll join my fellow citizens in getting behind our candidate and our party in defending the Dodd bill (assuming that it does in detail what is says in principle.)

[ Parent ]
Cannot your ends be met in the streets? (0.00 / 0)


"It sounds wrong...
     ...but its right."


[ Parent ]
Well, yes, actually (4.00 / 1)
I'm knocking on doors for Obama on Sunday, if you must know.  

[ Parent ]
Streets is streets! (0.00 / 0)
Pressure is pressure.

Marching or knocking its all pushing.


"It sounds wrong...
     ...but its right."


[ Parent ]
give us a break, Matt (2.00 / 2)
1968 called ... it wants its attitude back.  Yes, Democrats are 'racists.'  I can tell, having nominated a black man.  What the hell is your problem?  There is only one concern right now: DEFEATING McCAIN AND PALIN.  If you think the country wants purist screw-the-rich bullshit while their retirement money disappears, you are either rich or about 20 years old.    This is America; Wall Street always wins.  We should hold down the score, make the best deal and get on with it.  

Isn't there a 'Free Mumia' rally someplace you could be attending?


Another misreading (4.00 / 1)
You have also misread the passage in question.

Please retract this response.


[ Parent ]
Ah, I see (0.00 / 0)
I was also confused--Matt changed who "they" was referring to in mid-paragraph--but yes, you're right.

[ Parent ]
I don't (2.00 / 2)
They also won't realize that Republicans don't agree with us on most stuff, as Sirota noted in his post yesterday.  They aren't interested in solving this, they are proudly racist and selfish and want a monarchy built on those values.  They need to be fought.

Are you saying the first time he uses "they" in the passage above he is referring to the Democrats, and somehow in the second sentence "they" suddenly refers to Republicans? That just doesn't make any sense!  


[ Parent ]
Is English not your first language? (0.00 / 0)
Or are you just astonishingly unfamiliar with standard conversational English?

Changing pronouns and assuming that the reader will pick this up from context is not in the slightest bit uncommon and Matt's comment would be patently absurd if your reading was correct.

Forgotten Countries - a foreign policy-focused blog


[ Parent ]
Multitasking (4.00 / 3)
There is only one concern right now: DEFEATING McCAIN AND PALIN.  We should hold down the score, make the best deal and get on with it.  

To paraphrase Obama, we should be able to do both at the same time.  The fact is that if this deal passes due to Bush and Democrats, it could be an epic electoral stinkbomb for congressional Dems.  McCain tipping the chessboard yesterday is a stark example that R's fully intend to use this to partisan advantage.

[ Parent ]
Repated Ad nussum every election, (4.00 / 3)
ignore the issues! Just prevent the republicans from getting a mandate. That got us Clinton, NAFTA, DOMA, welfare reform, WTO, Phil Graham's deregulation bill an more.

When will people understand the power of leverage.  Stoller's right if you don't hold their feet to the fire, the Dems will continue to abandon progressive principals. Could you even image McCain moving to "center" on abortion or gun control? The right wing has leverage, we don't and that's why dems will continue to capitulate on every single issue important to the progressive "movement".


[ Parent ]
Krugman (4.00 / 3)
It seems Krugman supports the Dodd plan.  Here I've been slowly coming to your point of view, but waiting for the experts to weigh in.

Well, the bipartisan "agreement on principles" released on Thursday looks a lot better than the original Paulson plan. In fact, it puts Mr. Paulson himself under much-needed adult supervision, calling for an oversight board "with cease and desist authority." It also limits Mr. Paulson's allowance: he only (only!) gets to use $250 billion right away.

Meanwhile, the agreement calls for limits on executive pay at firms that get federal money. Most important, it "requires that any transaction include equity sharing."

Why is that so important? The fundamental problem with our financial system is that the fallout from the housing bust has left financial institutions with too little capital. When he finally deigned to offer an explanation of his plan, Mr. Paulson argued that he could solve this problem through "price discovery" - that once taxpayer funds had created a market for mortgage-related toxic waste, everyone would realize that the toxic waste is actually worth much more than it currently sells for, solving the capital problem. Never say never, I guess - but you don't want to bet $700 billion on wishful thinking.



The atmospherics are all important (0.00 / 0)
They are being tarred with the brush of the original Paulson plan even though they've improved it substantially.

I still maintain this is very dangerous.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


[ Parent ]
The atmospherics are all important (0.00 / 0)
They are being tarred with the brush of the original Paulson plan even though they've improved it substantially.

I still maintain this is very dangerous.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


[ Parent ]
Not Quite (4.00 / 1)
Even Krugman wants an equity stake in return for any taxpayer money.  Buying equity in these investment houses buys us a share of their assets as well as their debts.  See his column this past Monday.  And, there is no bankruptcy reform in this compromise.  So, the rich will continue to be able to get a bankruptcy judge to re-set the mortgage payments on their vacation homes, but we poor schloks cannot get our home mortgages re-set.

[ Parent ]
He supports the Dodd bill if improved (0.00 / 0)
Which is not much different than the few of us in here that aren't buying up pitchforks on Ebay.

[ Parent ]
You think you get an improvement? (0.00 / 0)
To get Republican support (which is going to be necessary) compromises will be necessary. Compromises which will strip out most of the good bits of the Dodd plan and leave us with only a slightly improved Paulson plan.

Can't we actually push a good plan to the left and settle for something resembling the Dodd plan? Must we always negotiate in good faith with conmen?

Forgotten Countries - a foreign policy-focused blog


[ Parent ]
Equity (0.00 / 0)
What do you mean "Not quite, even Krugman wants an equity stake"?  That is in the plan and the whole reason why I (more or less) support it.  Krugman also supports it largely for that reason.

And last we saw, bankruptcy reform was in the compromise.

I realize everything changes each minute and we never have enough detail in front of us, but people are waving pitchforks at ghosts.

There is no Paulson plan and there hasn't been for quite some time.


[ Parent ]
Chill out guys (0.00 / 0)
The "racist" comment is directed at Republicans. Certainly less contentious. I think Matt's attitude is generally understandable and called for, nor as ridiculous or extreme as some have tried to make it out to be (why?).

Once again (4.00 / 1)
openleft delves into self parody!

might be true (0.00 / 0)
but what would interest me more, is what kind of solution Matt proposes exactly

[ Parent ]
A Responsible Plan to End the Debt Crisis (0.00 / 0)
By Chuck Collins and Dedrick Muhummad:

http://www.alternet.org/workpl...

If the Dems got on board something like this, there would be much less suspicion that they are behaving like the tools of Wall Street which we of course know, based on quick scan of Opensecrets.com, they are.



Matt's mad as hell (4.00 / 1)
Matt's mad as hell and he's not gonna take it anymore!

Unfortunately, all that anger has caused him to gloss over important distinctions between what the Democrats are proposing and what Hank Paulson originally proposed.  The differences are huge and important.  But Matt evinces no awareness that they exist.

Frankly, I respect an expert macroeconomist's take on the Dodd plan over a non-expert rabble-rouser's.  If Paul Krugman -- a person has been right about this economy over and over again -- says something needs to be done to prevent an economic meltdown, I'm willing to bet that he's probably right.  Self-righteous indignation is fine until it leads you into your new home: a van down by the river.


Yes, but Matt still has a point (4.00 / 2)
if the distinction is lost on the voters.

There is real difference between the Congressional plan as it now exists and the original Paulson plan, but the Republican game is now to bet that the average voter doesn't see it.  

I am not willing to risk the election on the chance that the Republicans are wrong on this.

The Democrats need to do more to make obvious the distance between what they are proposing and the original plan.

They must not allow themselves to be dishonestly painted as in the tank for Wall Street or the economic-disaster bounce they've gotten could erode.

Where are the public voices explaining this to the voters?  It's too damned quiet.

sTiVo's rule: Just because YOU "wouldn't put it past 'em" doesn't prove that THEY did it.


[ Parent ]
Great Depression ...? (4.00 / 1)

I dunno, guys, playing with the possibility of another Great Depression is just not prudent politics or economics.

The public do not not want their money used to bail out the banks, fine.

But the public's money is held in ... banks.

So if the banks fail (as they will if everyone decides to bring their money home and stuff it in a mattress), where does that leave your life savings, your kids college fund, your job or you business?

Its a hard choice... It seems Washington Mutual was about to go under, what bank will be next?

Bankers suffered in the Great Depression, but working people and the middle class suffered more. And it led directly to a world war when economic collapse rebounded overseas.

Remember that some left wingers hailed the 1928 stock market collapse as the "death throes of capitalism".

If fairly sensible moderate commentators like Krugman and Obama are advising a deal, then the prudent thing is to accept a bailout that will have Obama and a Democrat congress in charge when/ if he becomes President.



If Obama wants us to back one plan, or another (4.00 / 2)
Let him and the others backing it come out to the public square and tell us exactly what they have in mind for our money.

None of this BS where they cut a deal in the back-room, then let everyone debate it while they start handing money to the Wall Street firms that back their campaigns.


"It sounds wrong...
     ...but its right."


[ Parent ]
Kum Bah Yah, yes, thats the ticket, NOT (0.00 / 0)
Sorry, but you youngins just trust these guys way too much...

[ Parent ]
Nice scare job (4.00 / 2)
I'll listen to the 200 economists who contacted (Republican) Senator Shelby of AL and said, "Don't support a bailout."

"...if the banks fail..." is just a scare tactic at this point.

Why not say "What if Pakistan starts dropping nukes on people...?"  

Or better yet, how about "What if the solution isn't actually a solution?" Remember, the administration has already admitted that they pulled the $700B number out of the air.

For example, there is no indication that simply dumping $350B into the FDIC wouldn't shore up the system sufficiently. Poof. Problem solved. (No, not really. But I hope you get the idea.)

There really is no need to freak out. It's really worth it to determine the right direction and then start going there, rather than start going in ANY direction just so you can say you went somewhere.


Karl in Drexel Hill, PA


[ Parent ]
Democrat does not equal progressive (0.00 / 0)
Until enough of us come to realize that being a Democrat does not equal being a progressive, this will continue to happen. Unfortunately, liberal ideas and policies have been so discredited in this country by three decades of Republican attacks and Democratic equivocations in the face of those attacks that if any politician tries to push truly left-wing positions, they are either laughed at or called an unpatriotic radical. Similarly, much of the populace has come to believe that liberal basically means evil, so even though most people support progressive/liberal ideas--social security, medicare, universal health care, etc.--they don't understand them as progressive ideas. Think about it--most of the people in this country oppose the bailout because they believe only the rich will benefit. That is about as progressive as you can get, yet I do not see anyone in the Democratic Party playing that angle. If it weren't for the Republicans, we would already have a bailout deal in place, as the Democrats are more than ready to kowtow to Bush, Paulson, et. al.

Bravo, Stoller! (0.00 / 0)
Looks like some of you young people are taking up Al Gore's call for civil disobedience after all, albeit against the armchair revolutionary himself! ;-) All the better. Reserve your generosity for the deserving. Attack the powerful with all your energy! Épater la bourgeoisie!!!


I Thought You Were Smart (4.00 / 1)
Maybe in politics, but not in finances and economics.  The economy needs an influx of cash to enable a loosening of credit.  This will create a floor for the decline in home prices and prevent a large number of foreclosures.  Until the foreclosures stop, or are, at least, brought under control, home values will continue to decline, and credit will dry up.  If people can't get car or home loans, or if small businesses can't borrow, people lose their jobs.  No jobs means people don't spend money.  The first thing to be cut are unnecessary expenses.  I bet internet access gets cut before food or housing.  

Your post screams of knee jerk reaction without the benefit of information.  Try reading the original Dodd draft and Paul Krugman's piece in today's NY Times (http://www.nytimes.com/2008/09/26/opinion/26krugman.html?_r=1&oref=login).  You might learn something.  Doing nothing is not a real option.

Normally, you make alot of sense.  This time, you espouse politics as the ends and not the means of addressing a problem and doing the best thing possible.


Housing prices will fall anyway (0.00 / 0)
...don't forget to mention that housing prices are going to fall anyway - estimates are 20% by the end of the year. That's because the industry needs an inventory correction and until supply tightens, there are just too many houses available.

So no matter what is done (or even doing nothing) about mortgages and/or credit, there is going to be a housing correction.

Btw, Krugman?  

Karl in Drexel Hill, PA


[ Parent ]
True, but ... (0.00 / 0)
An injection of capital could, and some say would likely, reduce the fall of prices by eliminating the number of foreclosures and therefore, reduce the number of homes on the market.

[ Parent ]
The end of Cannibilistic Capitalism? (4.00 / 1)
Matt asks what we've been reading.

In addition to Roubini's RGE Monitor and posts from DevilsTower and Hunter at dkos (see links below), I've started reviewing the writings of Ellen Brown.  They are pretty scary for anyone wanting to "save" the current financial system, but downright inspiring for someone who sees the current crisis as a truly revolutionary opportunity.  I'm a bit of both.

To give you a sense of Brown's perspective, here's a quote that began a piece she wrote in June called "The Subprime Trump Card: Standing Up to the Banks."
http://www.webofdebt.com/artic...

If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.- Thomas Jefferson, Letter to Treasury Secretary Albert Gallatin (1802)

Brown went on to say [bolding is mine]:

Jefferson had it right.  More than 1.5 million homeowners are expected to enter foreclosure this year, and about half of them are expected to have their homes repossessed.  If the dire consequences Jefferson warned of 200 years ago have been slow in coming, it is because they have been concealed by what Jerome a Paris calls the Anglo Disease - "the highly unequal economy whereby the rich and the financial sector...capture most of the income but hide it by providing cheap debt to the middle classes so that they can continue to spend."  He calls "finance" the "cannibalistic" sector in today's economy.

When I've got more time I'm going to put together a diary with more excerpts from Brown, since I think we're at a point in time when we face the opportunity to end the era of "cannabilistic" capitalism.  I don't really have the expertise to fully evaluate her arguments and proposals but, in the current environment and based on what else I've read lately, they seem both fundamentally sound and radically progressive--which strikes me as the combination we need at this historic crossroads in our history.

To give you a sense of her approach to solutions, here's a few excerpts from a 9/18 article of hers I just read, called "IT'S THE DERIVATIVES, STUPID! WHY FANNIE, FREDDIE AND AIG ALL HAD TO BE BAILED OUT
http://www.webofdebt.com/artic...
[bolding mine]

"The point everyone misses," wrote economist Robert Chapman a decade ago, "is that buying derivatives is not investing.  It is gambling, insurance and high stakes bookmaking.  Derivatives create nothing."  They not only create nothing, but they serve to enrich non-producers at the expense of the people who do create real goods and services. In congressional hearings in the early 1990s, derivatives trading was challenged as being an illegal form of gambling.  But the practice was legitimized by Fed Chairman Alan Greenspan, who not only lent legal and regulatory support to the trade but actively promoted derivatives as a way to improve "risk management."  Partly, this was to boost the flagging profits of the banks; and at the larger banks and dealers, it worked.  But the cost was an increase in risk to the financial system as a whole.

Since then, derivative trades have grown exponentially, until now they are larger than the entire global economy.  The Bank for International Settlements recently reported that total derivatives trades exceeded one quadrillion dollars - that's 1,000 trillion dollars.  How is that figure even possible?  The gross domestic product of all the countries in the world is only about 60 trillion dollars.  The answer is that gamblers can bet as much as they want.  They can bet money they don't have, and that is where the huge increase in risk comes in...

Proposals for reforming the banking system are not even on the radar screen of Prime Time politics today; but the current system is collapsing at train-wreck speed, and the "change" called for in Washington may soon be taking a direction undreamt of a few years ago.  We need to stop funding the culprits who brought us this debacle at our expense.  We need a public banking system that makes a cost-effective credit mechanism available for homeowners, manufacturing, renewable energy, and infrastructure; and the first step to making it cost-effective is to strip out the swarms of gamblers, fraudsters and profiteers now gaming the system.

Links:
A diary I wrote that tries to summarize Roubini's HOME plan to focus federal money on helping homeowners:
http://www.openleft.com/showDi...
Roubini's daily publication, with lots of background material available, though you have to register (free) to get some of it:
http://www.rgemonitor.com/
Devilstower: "What Are We Buying?"
http://www.dailykos.com/storyo...
Hunter: What is This Money Even For?
http://www.dailykos.com/storyo...


The bailout is actually small potatoes compared to CAFR standing liquid assets > $60 Trillion (0.00 / 0)
If you really want to help progressives find the cash to fund national health care, green technology, urban renewal, etc., I suggest that you
a) get the right perspective
b) treat the $700 billion bailout as the PR godsend that it can be

It's a potential PR godsend because it's in-your-face, and makes the much larger, multi-trillion dollar CAFR scam easier to grok. If you haven't heard of CAFR's, it's not your fault. See 19:00 into Burien's April 28th 2001 lecture to the Arizona Breakfast Club:

if you look at the composite total of all, inclusive of the Federal government,  standing liquid investment assets, as a conservative figure, is about 60 Trillion dollars

The public may be kept in the dark about CAFR's, but not everybody is. People who receive a copy each and every year are mentioned 17:50 into the video:

Every editor of every primary paper was sent a copy (of the CAFR) each and every year. The CEO and every one of the directors from ABC, CBS,  NBC, CNN were sent a copy each and every year and they have been for 18 years...I found out that deans of all of the colleges were sent a copy each and every year

I posted a diary today on Burien's discovery of the CAFR's, as well as Catherine Austin Fitts and her persecution at the hands of the Justice Department, here: http://www.openleft.com/showDi...

I hereby challenge the OpenLeft heavies to push knowledge about the CAFR's into the blogosphere consciousness, and thereafter, into the public consciousness. If we don't follow the money, then we won't be able to figure out centers of power in plutocratic America. And if we can't figure out the real centers and pathways of power (and hence of corruption), you will have a Democratic Party dominated by the likes of the Nancy Pelosis of this world, indefinitely.

Blogging is great, but it's not enough. If this election doesn't prove that, I don't know what does.

DemocracyABC.org
TheRealNews.Com
http://www.pdamerica.org


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