Category Archives: Politics

Alan Grayson on Geithner’s Conflict of Interest

06 Thursday May 2010

Posted by in Congress, economy, financial reform, financial regulation, Politics, Progressives, too big to fail, Uncategorized, Wall Street

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I’ve been considering relocating from Texas to the Sunshine State, since it looks like we may be in for another 4 years of Secessionist Rick here. Alan Grayson’s latest shot across the bow of the U.S.S Turbo Timmy might be enough to tip the scales. From Zero Hedge:

“In today’s ABC Top Line, Alan noted, “when Tim Geithner says that he doesn’t want to see the Fed audited, what he’s really saying is he doesn’t want to see Tim Geithner audited…”

“He was the head of the New York Fed for years and years. This audit would apply to him. And the actions he took — which he can now take in secret and, when this bill passes, will no longer be secret — we’ll be able to see and understand the decisions that he made that among other things put huge amounts of bailout money into the hands of private interests.” Grayson added: “It’s one of the biggest conflicts of interest I’ve ever seen.”

[…]

“The Fed doesn’t want to be audited. Who does? Do you want to be audited? I don’t want to be audited, but sometimes it’s necessary,” he said. “When you’re handing out a trillion dollars at a time — a trillion dollars at a time, which works out to $3,000 for every man woman and child in this country — don’t we have a right to know what happened to it?”

“It’s central to the bill. We’ve had secret bailouts from the Fed to private interests now for the past two years without any exposure whatsoever. … We need to know what happened to our money, because when the Fed hands out our money, every dollar in your pocket, every dollar in your checking account, every dollar in your 401(k) becomes that much cheaper and less in value.”

Dialing 1-800-MOVERS.

Senate Passes Two Meaningless Amendments on Financial Regulation

06 Thursday May 2010

Posted by in Congress, economy, financial reform, financial regulation, Politics, too big to fail, Wall Street

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Any time I see that the Senate has passed something by a vote of 93–5 or 96–1 I can be sure of one thing—it’s meaningless. It’s the equivalent of a proclamation naming Sunday as the official first day of the week. Such was the case yesterday with 2 amendments to the financial regulatory bill:

“The Senate on Wednesday approved two amendments to the financial regulatory bill that both Democrats and Republicans claimed would end the prospect of taxpayer-financed bailouts for companies deemed “too big to fail.”

[…]

By a vote of 93 to 5, the Senate approved an amendment by Senator Richard C. Shelby of Alabama, the ranking Republican on the Banking Committee [which] eliminated a $50 billion fund that was designed to help bridge financial shortfalls while a failing company was undergoing liquidation. Mr. Shelby said the fund was “a honey pot” that would facilitate “backdoor bailouts.” (Somewhere Frank Luntz is smiling).

[…]

The Shelby amendment also requires the Federal Deposit Insurance Corporation to oversee the liquidation of a systemically important financial company that is failing, using money provided by a special line of credit with the Treasury.”

And where does the Treasury get its money again?

“The Senate also approved, by a vote of 96 to 1, an amendment by Senator Barbara Boxer, Democrat of California, saying that no taxpayer money may be used to keep a ailing financial company alive.”

Wow, earthshaking stuff there too. Wake me up when (or should that be if) they get around to the Brown–Kaufman amendment.

The Unintended Consequences of Lieberman’s Law

06 Thursday May 2010

Posted by in Politics, Republicans, terrorism, war on terror

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In the ‘Be Careful What You Ask For You Just Might Get It’ Department comes this from Steve M. at No More Mister Nice Blog concerning Joe Lieberman’s proposal to strip citizenship from Americans affiliated with foreign terrorist organizations:

“Lieberman’s law would amend an earlier statute that details other things that can cost you citizenship: Serving in the army of a foreign state, pledging allegiance to a foreign state, and so on. In those cases the State Department decides whether your disloyalty merits loss of citizen status. Lieberman’s law would add involvement with a foreign terror organization — as opposed to a foreign state — to this list….

Who would determine whether you’re involved with a foreign terror group? The State Department. It already decides what is and isn’t designated as a terror organization. Lieberman’s law would also empower State to determine whether you are in league with one of these groups.”

Three of the organizations on the State Department list of Foreign Terrorist Organizations (FTO) are Hamas, Hezbollah, and Mujahedin-e Khalq (MEK). Would any of these relationships count as “affiliation” with a terrorist organization?

“[Grover] Norquist is a founding director of the Islamic Institute, a socially conservative Muslim think tank that eschews international issues in favor of domestic issues such as tax cuts and faith-based initiatives. In addition, Norquist’s lobbying firm…was officially registered as a lobbyist for the Islamic Institute as well as for Abdurahman Alamoudi, the founder and former executive director of the American Muslim Council.

[At] an anti-Israel protest outside the White House on October 28, 2000. Alamoudi revved up the crowd, saying: ” I have been labeled by the media in New York as being a supporter of Hamas. Anybody supporters of Hamas here? ” The crowd cheered. ” Hear that, Bill Clinton? We are all supporters of Hamas … I wish they added that I am also a supporter of Hezbollah. “

How about this interview of Tom Tancredo by John Hawkins of Right Wing News?:

John Hawkins: Let me ask you another question, it’s Iran related. I heard that you support the National Council of Resistance (NCR), a political arm of the Mujahedin-e Kalq (MEK)…

Tom Tancredo: Yes, I do.

Another MEK friend in high places:

“In June 2004 Defense Secretary Donald Rumsfeld “designated MEK members as civilian ‘protected persons’ under the terms of the Fourth Geneva Convention,”… Rumfeld’s “decision controverted [Department of State], International Committee of the Red Cross (IRC), and Office of the United Nations High Commission for Refugees (UNHCR) recommendations…”

One more name on the State Department FTO list is the Real IRA:

“…during the 1980s and 90s, the NSA and CIA collected intelligence on financial transactions between the United States and Ireland and Northern Ireland involving Irish terrorist groups supported by Peter King. The group Irish Northern Aid (NORAID) funneled money to the Irish Republican Army (IRA) that was used to buy weapons used to blow up civilians and members of the British government, military, and police.

King was an active supporter of NORAID, a tax-exempt front for the IRA. Martin Galvin, King’s friend and former NORAID chief, rejected the Northern Ireland Good Friday agreement and supports the agenda of the terrorist “Real IRA.”

Let the citizenship-stripping begin.

The End is Near: Glenn Beck is the Voice of Reason

05 Wednesday May 2010

Posted by in Bill of Rights, Congress, Politics, Republicans, terrorism

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OK, it’s official, we are through the looking glass on the treatment of suspected terrorists. Glenn Beck is the voice of reason and sanity. Yes, you read that right, Glenn Beck, reason, and sanity all in the same sentence. On Fox and Friends yesterday, Beck said of Faisal Shahzad, the Pakistani-born American citizen arrested in the attempted Times Square bombing:

“He is a citizen of the United States, so I say we uphold the laws and the Constitution on citizens. If you are a citizen, you obey the law and follow the Constitution. He has all the rights under the  Constitution. We don’t shred the Constitution when it’s popular. We do the right thing.”

Vodpod videos no longer available.The award for the most extreme, knee-jerk (emphasis on jerk) reaction comes from Joe Lieberman. He proposes taking away the citizenship of those who are “affiliated” (whatever that means) with foreign terrorist organizations when they are “apprehended and charged.” 

My own Senator finds that “interesting”:

Sen. John Cornyn (R-Texas), the head of of the GOP’s Senate campaign arm, is open to Lieberman’s idea. “I’m interested in Senator Lieberman’s approach. He is one of our leading members when it comes to national security issues and I would be interested in exploring that. I think at some point an act of war is a treasonous act, which could be a basis for relinquishing one’s citizenship,” he said.

I propose that we take away the citizenship of those who advocate that we take away the citizenship of others. I think that might solve the problem.

McCain: Miranda Rights for U.S. Citizens a “Serious Mistake”

04 Tuesday May 2010

Posted by in Bill of Rights, Dick Cheney, McCain, Politics, Republicans, war on terror

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John McCain has taken the baton from Dick Cheney as drum major in the crazy parade. McCain said today it would have been a “serious mistake” to read the suspect arrested in connection with the May 1 attempted Times Square bombing his Miranda rights.

“Obviously that would be a serious mistake…at least until we find out as much information we have,” McCain said during an appearance on “Imus in the Morning” when asked whether the suspect, 30-year-old Faisal Shahzad, a naturalized American citizen from Pakistan.

“Don’t give this guy his Miranda rights until we find out what it’s all about,” McCain added.”

Sen. McCain, I know the suspect doesn’t have a good old ‘Murrican name like John, or Cindy…or even Sarah, but he is a United States citizen and he is entitled to Constitutional rights.

Scott Lemieux at Lawyers, Guns, and Money asks this:

“Did John McCain strenuously object when Scott Roeder was read his Miranda rights?   If not, I wonder what criteria McCain is using to determine which American terrorists are entitled to their constitutional rights and which aren’t?”

But the Arizona Senator didn’t stop there. He’s already assessed the death penalty—despite not knowing the charges:

“There’s probably about 350 different charges he’s guilty off — attempted acts of terror against the united States, attempted murder,” said McCain, cautioning that he’s not privy to the charges with which Shahzad might be charged. “I’m sure there’s a significant number to warrant the death penalty.”

And not to be outdone, New York Rep. Peter King also questioned the Justice Department with this:

“Did they Mirandize him? I know he’s an American citizen but still,” King said.”

I’ll leave it to your imagination what Rep. King was thinking but left unsaid.

“Toxic Magnification” of Subprime Mortgage Securities

04 Tuesday May 2010

Posted by in economy, Financial Crisis, Goldman Sachs, Politics, Wall Street

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How “investment” instruments that were allegedly designed to spread the risk ended up spreading the poison. From the Wall Street Journal via BooRadley at The Seminal:

“Even at its peak, subprime lending accounted for a relatively small portion of overall mortgage lending. Yet losses from these mortgages caused deep damage to the financial system.

Now, documents released by Senate investigators last week provide clues in understanding why the losses were so severe. The documents show how Wall Street banks packaged and repackaged the same risky bonds into securities that ultimately helped magnify the impact of defaulting subprime mortgages on the financial system.

In one case, a $38 million subprime-mortgage bond created in June 2006 ended up in more than 30 debt pools and ultimately caused roughly $280 million in losses to investors by the time the bond’s principal was wiped out in 2008, according to data reviewed by The Wall Street Journal….

In effect, the documents said, Wall Street was “copying and pasting” what turned out to be the worst-performing securities of the mortgage boom. Such activity helped multiply opportunities for hedge funds and traders who wanted to short the housing market, but magnified the losses of those on the other side of the trades.”

In graph form:


“God’s work,” no doubt.

Gulf Oil Spill “Worse Than the Exxon Valdez”

02 Sunday May 2010

Posted by in Politics, Uncategorized

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From the Hufington Post:

“The Gulf Coast spill will have eclipsed the Exxon Valdez in terms of total gallons of oil before the weekend is over — making it the largest oil spill in U.S. history — according to calculations made by oceanographer Ian MacDonald after studying aerial Coast Guard photos taken earlier in the week.

MacDonald, a professor at Florida State University who counts “oil and gas development” among his areas of expertise, stopped short of comparing the Deepwater Horizon spill to that of the Alaskan oil tanker, but said Saturday, “The spill is growing. I’m comfortable saying that the size and extent of this slick is 10 million gallons.”

Given that just over a million gallons are leaking into the Gulf per day, according to MacDonald’s calculations, the spill will shortly top the Exxon Valdez’s estimated 11-million-gallon spill.”

With that in mind, consider that the effects of the Valdez spill are still being felt—20 years later:

“The amount of Exxon Valdez oil remaining substantially exceeds the sum total of all previous oil pollution on beaches in Prince William Sound…This Exxon Valdez oil is decreasing at a rate of 0-4% per year, with only a 5% chance that the rate is as high as 4%. At this rate, the remaining oil will take decades and possibly centuries to disappear entirely.

…surveys outside Prince William Sound have documented lingering oil also on the Kenai Peninsula and the Katmai coast, over 450 miles away.”

Now take this:


And multiply it by this X 10,000:


How’s that drill, baby, drill workin’ out for ya?

Oligarchs of a Feather Stick Together

02 Sunday May 2010

Posted by in economy, financial reform, financial regulation, Goldman Sachs, Politics, too big to fail, Wall Street

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Buffett defends Blankfein:

OMAHA, Neb.— Warren Buffett offered a vigorous defense of Goldman Sachs Group Inc. Saturday, saying the embattled firm hadn’t engaged in improper activity and shouldn’t be blamed for the losses of its clients.

[…]

Mr. Buffett’s comments—which came early in the day at Berkshire Hathaway Inc.’s annual shareholders meeting—offer a powerful vote of confidence in Goldman, which has seen its shares slide since the SEC announced the investigation on April 16. Goldman’s stock fell 9.4% on Friday alone after it emerged that the Manhattan district attorney’s office was conducting a preliminary criminal probe into its mortgage-trading activities.

[…]

The billionaire investor said he fully supported Goldman CEO Lloyd Blankfein. Asked if he could choose a successor for Mr. Blankfein, Mr. Buffett said: “If Lloyd had a twin brother I’d go for him.”

But he does, Mr. Buffett, he does.

The Short-Lived “New Era of Openness”

01 Saturday May 2010

Posted by in economy, financial reform, Obama, Politics

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January 21, 2009:

“On his first full day in office, President Barack Obama signed an executive order and two presidential memoranda heralding what he called a “new era of openness.”…President Obama said that “every agency and department should know that this administration stands on the side not of those who seek to withhold information, but those who seek to make it known.”

April 30, 2010:

“The Senate is getting ready to kick its financial reform debate into high gear next week when they start voting on amendments on all kinds of issues from both parties.

Obama administration officials have declined to weigh in on any specific amendments, with one exception: a move by Sen. Bernie Sanders (I., Vt.) to give the government more power to audit certain operations at the Federal Reserve. Fed and administration officials have signaled they would fight to stop it at all costs.”

So I guess the definition of an “era” is now about 15 months.

“Put Up or Shut Up” Time on Too Big To Fail

01 Saturday May 2010

Posted by in bailout, Congress, economy, financial reform, financial regulation, Goldman Sachs, Politics, too big to fail, Wall Street

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Now that the Senate Republicans have abandoned their filibuster (after perusing the public opinion polls on Wall Street and observing the tap-dancing by Goldman Sachs execs at the Senate Subcommittee on Investigations hearings, I assume) financial reform legislation is set for debate.

Richard Eskow at the Huffington Post has a one-question test we can apply to our elected representatives to tell if they are serious about reforming the financial system or just being a posturing, pontificating blowhard—something that comes naturally to most politicians.

“This quick, easy-to-use test can be applied from the comfort of your own home (if you still have one), from that third job you’ve got to work every evening (too bad you can’t help the kids with homework anymore) … why you can even use it while you’re waiting on line to collect the last of your unemployment benefits!

As long as there’s a television droning away in the waiting area while you wait for that job interview, or a newspaper somebody left behind on that park bench, as long as you can learn how your politician voted, you can learn whether he’s really on your side or just another bank lackey.

Here’s the test: Will they vote to break up the big banks or not? It’s as simple as that … really.

…Yesterday Sens. Ted Kaufman and Sherrod Brown officially introduced an amendment that limits the size of banks and the amount of risk they can take. Under this amendment, no bank could become either so big or so leveraged that its collapse could threaten the economy… An identical amendment was introduced in the House by Reps Brad Miller, Keith Ellison, Steve Cohen, and Ben Chandler.

…What’s striking about the proposal is how simple and effective it is. No bank could hold more than 10% of the nation’s deposits, nor could it leverage (take risks with) sums that amount to more than 2% of the GDP.

What’s also striking is how few institutions it would affect. Only the three biggest banks would be affected by the size limit, and the cap on liabilities would only affect an estimate nine institutions or so.

These amendments offer our representatives in the House and Senate a simple choice: Support a safer and more rational banking system, or be counted among those whose votes are being swayed by the influence of Wall Street money. And they give the rest of us an invaluable tool. We’ll be able to see whether our leaders really means those words about “too big to fail” and “no more bailouts” by seeing whether or not they vote for these amendments.

If they do, they’ve passed the test. If they don’t, they’ve failed. Simple as that.

Here’s the greatest benefit this new test offers to frustrated voters everywhere. It lets us say to politicians, once and for all, on one of the most crucial issues of our day, those words every citizen longs to say to a long-winded public servant:

Put up or shut up.”