Republican Slight of Hand

Hello Papamoka Readers! The news lately has been filled with both Republicans and Democrats screaming bloody murder over the completely unjust bonuses being paid by AIG. I agree there have been lots of mistakes made and that everything should be done to stop those payments, however, I also believe the right wing is driving the scandal to distract from the more important reforms.

Republicans haven't had a lot to crow about lately, so they're thrilled the Democrats dropped the ball involving something as controversial as bonus payouts to failing Wall Street bankers. Sure, AIG under the Obama Administration should have seen this coming, but it's still a GOP distraction.

The GOP operatives pushing this scandal are only interested in political gain. It's a scandal within a scandal. They are conveniently ignoring the fact that Bush and Paulson paid the first installment without any congressional involvement and without excluding bonuses the same way, because they too were afraid of employee lawsuits. Subsequent Capitol Hill and Treasury negotiators were also concerned about employee lawsuits. They were worried about increasing liabilities, something lawmakers care a lot about these days. They all had bigger fish to fry.

That's at the heart of the matter, yet nobody seems to have the balls to talk about it. It's all about politics now, and the Republican spin machine is doing its best to strum the last Democratic nerve. The only thing the Republicans are concerned about is a "gotcha" moment, and the Democrats on Capitol Hill are falling for it all hook, line and sinker. Only President Obama has had the nerve to take responsibility while asking us to focus on the big picture. I agree with him. Let's do it!

The AIG Financial Products Corporation, which is now being dismantled by government appointed executives, is the real scandal. The bonuses are horrible, but the real story is why the financial products division of AIG ever came into existence. Let's not forget the regulatory changes led by Senator Phil Gramm of Texas, Newt Gingrich, and the rest of the Republican Congress during the waning days of the Clinton Administration started this national nightmare. They know it, but for some reason rank and file Republicans ignore it, and average Americans never talk about it.

Sure, Clinton signed it under extreme pressure, and he was wrong to do it, but the real culprits were the Republicans who destroyed the walls that stood between banks, speculative investment brokerage firms, insurance companies, and the rest. Those protections were put in place after things went horribly wrong during the last Republican depression. They were designed to manage greed, PROTECT the free market from its darker side, and in the end keep the wolves out of the hen house. It was the REPUBLICANS WHO DESTROYED IT!

Of course, their deregulation was made worse by the fact that regulators were undermined by the Bush Administration. Oversight was weak at best. The Bush Administration was without a doubt a REACTIVE regulator. They didn't believe in the protections. They didn't do their job. I don't care what my right wing readers say, the Bush Administration could have done more to prevent the crisis. They had the data, they knew about AIG and the $50 TRILLION plus DERIVATIVES market, and they knew about the risk to the whole economy. They did NOTHING! They were at least negligent, and at worst conspiratorial.

My dinner party debates always feature a Republican blaming Congressman Barney Frank, Senator Christopher Dodd, and the usual Democrats for not reigning in Freddie Mac and Fannie Mae. What they never admit is how the Bush Administration had the authority, through dozens of regulatory agencies, to reign in the risk across the board. Many economists feel that most administrations would have done so. It was the Bush Administration, along with the Republican belief in small and unobtrusive government, that failed the American people.

Therefore, let's be angry about the greed on Wall Street, but I think it's more important to keep our eyes on the prize. Let's make sure the Democrats and the Obama Administration do everything necessary to reverse the regulatory changes that allowed the Bush Administration to look the other way. Let's FORCE future Republicans to regulate the risk by creating strong and principled new laws.

Let's reform until we can't reform any more. AIG is the critical patient that needs to be isolated and treated, but it's the Republicans and their broken philosophies about government and the market that represent the deadly contagion. Let's find a vaccine and a cure! Let's make sure we never become victims of their greed and stupidity again.

Michael Boh
Papamoka's Left Coast Contributor
from Our Rants & Raves Blog

Panic and the Economy

I'll just let this CSPAN video speak for itself but back in September of 2008 their was in fact a run on the banks here in the States and the Treasury shut down the electronic transfer of funds after pumping in $105 Billion to the banks when they found it happening. $550 Billion was drained out of money market accounts in one hours time and if the draw continued it would have collapsed the world economy. If they did nothing it could have amounted to $5.5 Trillion being drained out of our banking system that would have caused panic all around the world. Check out the video and what Rep. Paul Kanjorski has to say...

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I'm wondering if the Treasury investigated why there was a run on the banks electronically in such a short time span? That was the first question in my mind! Is the Congress investigating this. If they are not, then why not? If they are, then what did they find out? Or is this Congressional member full of crap? Or could the world as we know it really have ended on September 18, 2008? Two plus weeks before the election of President Obama and on George W. Bush watch, makes you wonder doesn't it?

As always, we follow the money and not the messenger... Thank you Memeorandum for the news tip!

Papamoka

Did Bush/Paulson Scam Us? Were We Fooled Again?

Good Morning Papamoka Bloggers - Raw Story today is pointing to a letter from CONSERVATIVE Senator James Inhofe (R-OK) where he tells his Senate colleagues that he "intends to push for immediate legislation that would require Congressional authorization for any further payouts" related to the recent bailout package.

According to my sources in DC, many in Congress are beginning to believe that Bush and Paulson bailed out their friends on Wall Street, with few conditions to lend the money out. Many now feel that's all they really wanted. There are rumors flying around DC that they needed to save specific institutions and markets before leaving office.

Since investing the money they have done very little to encourage lending, and they appear to be holding on to the rest of the funds just in case something else goes wrong - an emergency buddy fund I guess? They are supposed to be freeing up credit. They were supposed to be demanding that banks lend money. What the hell is going on?

The ultra-conservative Oklahoma Republican told the Tulsa World, "It is just outrageous that the American people don't know that Congress doesn't know how much money [Paulson] has given away to anyone. ... It could be to his friends. It could be to anybody else. We don't know. There is no way of knowing. ... He was able to get this authority from Congress predicated on what he was going to do, and then he didn't do it." I agree. I'm beginning to wonder if they know anything up there. What is wrong with them?

I never thought I would say this, but I think Inhofe is right! I, like so many others, came to believe that the government was trying to stop a disaster when they passed the legislation. Facts on the ground since are showing that things weren't as bad as suspected, and if anything it's beginning to look like Bush and Paulson created the panic based on very little data.

It's beginning to look like we might have been scammed again, just like with the Iraq War - another crisis that helped Bush and his buddies. What did Bush say, fool me once shame on me, or some perverted version of it? Maybe he's not the idiot we all took him for? Maybe he's just a much bigger CROOK! Then again, we're supposed to TRUST THE PRESIDENT when he warns us of a potential disaster. I don't know about you guys, but I feel sick!

Incredibly, our trustworthy Democrats in Congress - and center-right Republicans - didn't dig deep enough. I know they convinced many of us in the end, but aren't they supposed to know more than us? Then again, maybe they're not as smart as we think they are? Maybe we rely on a bunch of smooth-talking IDIOTS!

What in the hell is wrong with this government, especially our elected representatives? Nobody seems to know what they're doing. WE NEED ANSWERS NOW!

We need to FOCUS ON STOPPING THE BUSH CRIME SYNDICATE from plundering more. We need immediate investigations! We need action now! Unless something happens, this may be the first issue where I take a stand AGAINST OBAMA! Once in office, we need President-Elect Obama to support immediate investigations into possible Bush crimes, or we should take to the streets!

The American people voted for change, and we might not be able to wait until the inauguration. The Lame Duck Congress should act now! To protect our democracy for the future, we need to get to the bottom of what is happening to that money. I hope you agree.

Michael Boh
Papamoka's Left Coast Contributor
from Our Rants & Raves Blog

Bailout Plan Failure

The defeat of the bailout bill today in Congress was pretty much expected by yours truly. You can not dump $700 Billion on the backs of the American people and expect both parties to come to any consensus on it on the first round. Nancy Pelosi threw this bill to the floor without knowing if she had enough votes to pass it and that is shear incompetence. She trusted Republican leadershipt to get the votes needed on his side of the aisle and then she lambasted the bipartisanship effort by blaming Republican’s at the last minute in a floor speech before the vote?

Politics is a funny business and I’m thinking that the Democrats did not like the merits of the bill and this was not going to be a Republican slam dunk and it was possibly scuttled for political reasons. Pelosi delivered exactly 140 votes from Democrats to this bill which is what she promised the Republican leadership in the Congress. Republicans bailed on the bill once the vote started.

One of the reasons that both parties are not voting for this bill is the lack of judicial review and an omnipotence given to the Treasury Secretary. Our nation can not hand out $700 Billion for discretionary spending without knowing where the money is really going. Our government leaders should not back any blank check written out to Wall Street without being able to legally prosecute wrong doing if thing does go south!

Politically, this looks really bad for the Republican Party and John McCain who claimed he was “Suspending his campaign” to fix this issue. Then he prematurely injected into the media that the bill passed in a statement early today before the vote happened. You can’t fight the media on that point or for that matter John McCain himself. Politics is what it is and Republicans all over the media are bashing McCain and President Bush and their leadership faster than Democrats can. Representative Darrell Issa R-CA, on Chris Matthews Hardball slammed McCain and President Bush over and over again. Congressman Issa thinks there are better ways to do this and there probably is. The question has to be asked, what, how, and how soon?

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This situation will be fixed by the Congress, it just needs to be worded differently and more palatable to the members of Congress that have to get re-elected in five weeks. That is the politics of this situation in the nutshell. Holding your seat in the Congress is far more important than bailing out Wall Street and the American economy. A philosophy that more Republicans backed on this vote today than Democrats.

Anyone want to buy a used apple cart that my grandmother owned? It was only used once during the Great Depression. New tires, spinner hubcaps, new apples, updated with a GPS system that tells you how screwed you really are and where you are.

Papamoka