September 22, 2008

9/22: Consensus!

Conservative bloggers and liberal bloggers finally agree on something: the Bush Administration's $700 billion bailout plan is a bad idea. Michelle Malkin echoes the views of many righty bloggers when she denounces the proposal as "the death of fiscal conservatism." Many conservative bloggers are concerned about the "ideological consequences" of the proposal -- namely, that "it reinforces the idea of government as an all-powerful entity that can fix any problem".

On the left side of the blogosphere, the criticism of the bailout plan is even fiercer. Liberal bloggers are strongly opposed to the idea of forcing taxpayers "to take bad debts off the hands of financial institutions who were foolish enough to make the deals in the first place" -- particularly when the plan "demands nothing from these firms in return". Furthermore, many lefty bloggers do not want to give so much power to Treasury Sec. Henry Paulson, whom they believe is acting in the interests of his former (and possibly future) employees on Wall Street. Several bloggers are urging Barack Obama to take a stronger stand against the bailout plan.

$700 BILLION BAILOUT: The View From The Left

Liberal bloggers are overwhelmingly opposed to the Bush Admin.'s bailout plan:

• The American Prospect's Robert Kuttner: "The plan is outrageous on several levels. It demands nothing from these firms in return. It holds the Treasury Secretary accountable to no one. And it extends the most generous terms to Wall Street while offering nothing to Main Street. [...] Paulson is playing this more as the investment banker that he used to be, than as a steward of the public interest. This is a dubious deal, with all the gain going to Wall Street and all the risk going to taxpayers. Congress should not be intimated by his threats to hold his breath and turn blue of he doesn't get his way."
• TPM's Josh Marshall: "The more I look at this plan, the more wrongheaded it seems. But if I'm understanding this deal, the taxpayers are going to pony up close to a trillion dollars to take bad debts off the hands of financial institutions who were foolish enough to make the deals in the first place. And in exchange, I think the tax payers get nothing?"
• Atrios: "If the Democrats pass this piece of shit, look for Republican challengers to run against them on it."
• Firedoglake's Ian Welsh: "This is a stickup. Paulson is trying to stampede the Congressional herd into giving him powers and money that he knows they would never give if they had time to think it through carefully. It worked with the Patriot Act. It worked with the AUMF. He's betting it'll work again. Create a crisis (or lie one into existence) then demand dictatorial powers and unlimited spending authority to deal with it. Congress needs to not succumb to fear or to explicit or implicit blackmail. If the crisis was as severe as Paulson makes it out to be, virtually the end of market capitalism, he wouldn't be quibbling over whether or not CEOs get to keep their golden parachutes."
• TPMCafe's Dean Baker: "This is the domestic equivalent of the Iraq war authorization. The threat of financial collapse is analogous to the weapons of mass destruction. The markets will wait. Congress can give a proposal with real conditions and then it will be Bush's call if he wants to be responsible for collapsing the U.S. economy. Congress can't be taken yet again."
• Open Left's Matt Stoller: "This is a $700 billion blank check for the Bush administration and the financial elites. Glenn Greenwald notes the pacing of the discourse is identical to the run up to war. The political system is engaged in a massive transfer of wealth to corrupt actors with no debate (except in the foreign press and in the blogs) with no details made public. Furthermore, the Democratic leadership is entirely complicit in what is happening."
• Think Progress' Matthew Yglesias: "The bailout plan on the table right now seems to me like something of a crisis point for American liberalism. The plan is bad. But bad policies get enacted all the time. But we're at a point now where congress is, allegedly, in the hands of progressive leadership. Simply put, if congressional Democrats manage to acquiesce in a plan that spends $700 billion on a bailout while doing nothing for average working people and giving the taxpayer virtually no upside in a way that guarantees that even electoral victory would give an Obama administration no resources with which to implement a progressive domestic agenda in 2009 then everyone's going to have to give serious consideration to becoming a pretty hard-core libertarian."
• Mark Kleiman: "It looks as if Paulson has been spending too much time around [Dick] Cheney. The bill gives him unrestricted authority and only the vaguest guidance, and forbids any judicial review. It also lists as goals only protecting financial institutions and taxpayers. No mention of preventing housing abandonment, for example. I think our friends in Congress have some work to do. Given the history of Iraq, giving the dying Bush Administration $700 billion worth of unreviewable power seems a bit extreme."
• The Washington Monthly's Kevin Drum: "Why are we willing to fund an enormous RTC-like agency to bail out bankers, but not an enormous RTC-like institution to bail out ordinary people? Lack of lobbyists? Republican ideology? A desire to punish irresponsibility regardless of the disastrous sytemic consequences? Or what?"
• AMERICAblog's Chris in Paris: "The American taxpayer did not ask for this, but were forced into this dreadful situation due to the failures of Wall Street. We should not help Wall Street continue their lifestyle, especially if it's only a very short term boost, as many are suggesting. The panicked intervention will not stop this economy from unraveling and may only delay the inevitable."

While liberal bloggers liked Obama's initial criticism of the bailout plan, several want him to criticize the plan more strongly:

• Welsh: "While I was very happy with Obama's words against the Paulson plan, he needs to make it clear and unequivocal. [...] His principles are not compatible with Paulson's bill, he needs to come out against it in plain 'Hell No' language. It is the responsible thing to do, because it is not 'Hank's plan or the highway', Congress, of which Obama is a member, can pass its own bill meant to deal with this crisis. Indeed, let me suggest that Obama needs to suspend his campaign and return to Washington to propose his own Market Stabilization bill."
• Atrios: "Obama's people are making the right noises, but there's a difference between being on record as being kinda-maybe against and actually, you know, opposing. [...] Basically, you'd have to be insane to give Paulson a $700 billion blank check with no strings attached. The fact that this is what Paulson has asked Congress to do is enough reason to tell him to fuck off and come up with something better, with him utterly out of the loop."
• Sadly, No!'s Brad: "If Obama agrees to this nonsense, I will not vote for him -- it's as simple as that. In fact, I will not support any Democrat who gets on board with this."

$700 BILLION BAILOUT II: The View From The Right

Conservative bloggers are also criticizing the Bush Admin.'s bailout plan, although not quite as vociferously as are liberal bloggers:

• Malkin: "Bush Treasury Secretary Hank Paulson just wrapped up his press conference announcing the Mother of All Bailouts. He said a 'bold' approach was needed to achieve 'stability' in the market. Let me translate that. 'Bold' = Massively massive, taxpayer-funded rescue. 'Stability' = Privatizing profits and socializing losses on a scale we have never seen before in our lifetimes. [...] Fiscal conservatism has been on life support for quite some time. Bush/Paulson pulled the plug permanently today."
• AmSpec Blog's Robert Stacy McCain: "Wall Street has essentially blackmailed U.S. taxpayers into footing the bill for managerial greed, ineptitude and corruption. The alternative to the bailout is economic collapse, yet there's no prospect of recouping the millions collected by the executives who were (over)paid to run these institutions into bankruptcy. They reap the profits, taxpayers absorb the losses. And what 'reforms' are proposed to solve the inevitable problems caused by bad regulations, subsidies and corporate welfare? More of the same. Lather, rinse, repeat."
• NRO's Yuval Levin: "Even if Hank Paulson were the all knowing god of economics, would it make sense to give this kind of power to the treasury secretary for the next two years just forty days before an election? Shall we go through our mental list of who an Obama administration (or a [John] McCain administration for that matter) is likely to put in that post? And doesn't it make sense to establish some kind of process for deciding how specifically to use the money? To put in place some criteria of prioritization? Some real-time oversight? Isn't transparency crucial to the proper functioning of our modern financial system?"
• NRO's Jim Manzi: "This is obviously unfair. It bails out irresponsible behavior, and by implication, punishes responsible behavior. Longer-term, unless there is a lot of pain felt by financial company executives -- who, remember, don't look like they have to go bankrupt to dump their bad loans on taxpayers -- this creates a massive moral hazard problem. Further, if such a situation develops, it won't be lost on voters, who will likely demand greater socialization of consequences of reasonably-foreseeable bad behavior by people who don't make a million dollars per year. The ideological consequences of the last few weeks will take many years to play out, and conservatives are unlikely to happy about them."
• AmSpec Blog's Philip Klein: "One of the things that concerns me most about the pending $1 trillion bailout of the financial sector is that it reinforces the idea of government as an all-powerful entity that can fix any problem. [...] Americans who purchased homes that they couldn't afford, banks that made loans to those who they shouldn't have, financial institutions that made risky bets on derivatives even though they had no idea what they we betting on -- they're now all off the hook. And the bill will be paid by responsible working class Americans who either paid their mortgages or deferred purchasing property because they were priced out of the market by skyrocketing prices driven by irresponsible lenders and borrowers, and those who invested reasonably. The fact that Hank Paulson can snap his fingers and come up with $1 trillion to rescue financial institutions means Americans will assume government can dip into a bottomless well to cure any ill in society."
• RedState's Pejman Yousefzadeh: "The New Moral Hazard Deal is staggering and appalling in its scope. It promises to get even more staggering and appalling once Congress is finished adding Christmas tree ornaments to it, such as provisions regulating CEO pay [...] For all practical purposes, this Act gives the Treasury Secretary money to play with. And it radically transforms our economic structure."

MCCAIN: Glass Houses

Liberal bloggers are accusing McCain of hypocrisy for running ads linking Obama to ex-Fannie Mae CEO Franklin Raines despite the fact that McCain's campaign manager, Rick Davis, "was paid more than $30,000 a month for five years as president of an advocacy group set up by the mortgage giants Fannie Mae and Freddie Mac to defend them against stricter regulations":

• TalkLeft's Big Tent Democrat: "Lying about Obama's advisors while doing that he claims to criticize. That is John McCain in a nutshell -- a lying, unprincipled, incompetent ideologue. McCain is a disgrace."
• The Washington Monthly's Steve Benen: "Obama met Franklin Raines once, for about five minutes, and McCain thinks the association is scandalous. Given this, shouldn't McCain necessarily feel compelled to fire his campaign manager immediately?"
• Oliver Willis: "That's right, John McCain's campaign manager was paid $2 million by Fannie Mae to specifically lobby John McCain. They were trying to fend off regulation and I guess they wanted to curry favor with the self-described 'deregulator'."
• Obsidian Wings' hilzoy: "I do not think it ought to be a problem for a campaign to ask for advice from people who have some connection to Fannie Mae and Freddie Mac. A lot of those people know a lot about the mortgage industry, and having no contact whatsoever with them would probably be a bad idea. I do get concerned when a campaign has people who lobbied against better regulation in its most senior positions. There is only one campaign of which that is true, and it's not Obama's."
• AMERICAblog's John Aravosis: "Earlier this decade [Fannie Mae and Freddie Mac] paid $2m to the man who is now John McCain's campaign manager in order to buy influence with John McCain as Senator and as possible president (they also paid him to derail legislation that would have increased federal regulation of the banking industry). There should be a campaign to demand that McCain's campaign manager, Rick Davis, give ever penny back to the American people. There had better be an ad about this out by COB Monday, and calls for Davis' resignation."

MCCAIN II: In The Ferrari Or Jaguar, Switchin' Four Lanes...

Liberal bloggers are mocking McCain after Newsweek revealed that he and Cindy McCain own thirteen cars (versus one car for Barack and Michelle Obama):

• Daily Kos' MissLaura: "If you're John McCain, you know you're losing your Man of the People image when Newsweek begins a story: 'When you have seven homes, that's a lot of garages to fill...' [...] Not to mention when it closes by noting that the car your wife actually drives isn't even registered in her name, but in that of her massive beer distributorship. But, uh, Obama is elitist because, uh, look over there! Arugula!!!"
• Willis: "John McCain is not like us."
• Drum: "The McCain family owns 13 cars, including 'three 2000 NEV Gem electric vehicles, which are bubble-shaped cars popular in retirement communities.' Mostly in Cindy's name, of course. Don't you wish you owned three bubble-shaped electric scooters?"
• Benen: "Truth be told, I really don't much care about McCain's lavish wealth. His second wife is part of a very rich family, and it stands to reason that the couple, in addition to owning a lot of homes, is going to own a lot of cars. I guess that's what extraordinarily wealthy people do. The problem, though, is that McCain is offering a policy agenda that presupposes everyone is doing as well as the McCains. He wants more tax breaks for the very wealthy. He's opposed increases to the minimum wage -- 19 times. He's insisted that we've experienced 'great progress' economically under the Bush administration's policies. In the face of a crisis, McCain wants everyone to believe the 'fundamentals of the economy are strong.' With 13 cars and more homes than he can count, McCain's credibility on these issues could be better."
• Firedoglake's Pachacutec: "Bet they'll love [McCain's] Honda in Michigan...."

Aravosis: "Is it dementia, confusion, or what that is causing McCain to atypically say repeated falsehoods -- from placing Spain in Latin America, to claiming that [Sarah] Palin was against the Bridge to Nowhere, to now saying that he's always bought American. We now know that at least 3 of the McCain's 13 cars -- yes, McCain has 13 cars -- are foreign cars (a Honda, a VW, and a Lexus). Now, I don't personally have a problem with someone buying a foreign car -- though you know the Republicans would be all over Obama if his car were foreign (it's not, Obama owns one car and it's a Ford hybrid). But the issue here is that McCain has once again lied about yet another fact in his life, in order to get elected."

MCCAIN III: Things He Probably Wishes He Hadn't Written...

Liberal bloggers are blasting McCain for writing the following passage in his recent article, "Better Health Care at Lower Cost for Every American" (which was first noted by New York Times columnist Paul Krugman, as Todd Beeton explains here):

"Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation."

Liberal bloggers believe that McCain made a big political mistake in writing this passage:

• Daily Kos' Markos Moulitsas: "He's going to regret writing that. A lot. And this isn't some long-ago passage. It's from the current Sept/Oct edition (PDF) of Contingencies, the magazine of the American Academy of Actuaries. So yeah, oops. I guess he was for financial sector deregulation before he was against it?"
• Marshall: "If the Obama folks are smart -- and they are -- they'll ride this one all the way to the election. But among ourselves let's admit that you could only be surprised by this statement if you were willfully ignorant to what McCain and his key advisors believe. Remember, his top economics advisor is former Sen. Phil Gramm, the legislative architect of the banking and financial services deregulation that led to the current crisis. And his health care proposals are all off-the-rack Heritage Foundation-style initiatives based on the premise that people have too much, not too little insurance. The only thing jarring about the statement is the degree to which it has been overtaken by events as McCain now tries -- a la Palin the Earmark-Killer -- to rebrand himself as a Mr. Wall Street oversight and transparency when he's been pushing deregulation for 25 years."
• Kleiman: "McCain, who has spent the latter half of this week playing Jeremiah, promising to drive greed out of Wall Street, has the solution to all health care problems: make the health care sector more like the financial-services sector. No, seriously."
• Ezra Klein: "John McCain is a died-in-the-wool deregulator. He's not going to come out and endorse the financial crisis, but if you press the rewind button for just a moment, and freeze frame right before the collapse, McCain was trying to give Wall Street more responsibility over pensions and paint the basket of deregulatory policies that led to the meltdown as a model for other industries. It's why his response to the financial crisis has been so tinny and confused: The collapse is directly disproving McCain's view of the world, and no man can replace a long-held ideology in a matter of weeks."

MCCAIN IV: Netroots To McCain: Leave Social Security Alone!

Liberal bloggers are criticizing McCain after his aides said that he continues to support the idea of privately investing a portion of Social Security dollars in the financial markets:

"Wall Street turmoil left John McCain scrambling to explain why the fundamentals of the U.S. economy remained strong. It also left him defending his support for privately investing Social Security money in the same markets that had tanked earlier in the week. [...] The Republican presidential nominee says all options must be considered to stave off insolvency for the government insurance and retirement program, and top McCain advisers say that includes so-called personal retirement accounts like those President Bush pushed in 2005 but abandoned in the face of congressional opposition."

• hilzoy: "I can't imagine anyone would accept the idea of investing their Social Security pension in the stock market with equanimity right now. Even after Thursday's and Friday's rallies, with the DJIA close to its previous levels, the rate of return on the DJIA since the state of the union address in which the President proposed instituting private accounts is around 2% a year, well below the rate of inflation. A couple of days ago, it would have been well below that. And the actual rate of return on an individual account would have been lower still, given administrative costs and so forth. This is exactly why we all went to the mattresses for Social Security back in 2005. No one's basic retirement security should be at the mercy of the stock market. We have just been reminded why that's such a stunningly bad idea. Apparently, the only people on earth who haven't figured it out are John McCain and his advisors."
• Willis: "John McCain: Time To Invest Your Social Security In Lehman Brothers, AIG, And Merrill Lynch!"
• digby: "It's one thing to tell 23 years olds that they get to have fun with their social security taxes. They are young and dumb and don't have clue about saving. But once people get into their 30s and have kids and old parents they start to think about the future. And one of the things that allows them to take some risk with their 401ks or their homes is the fact that they have a guarantee of some kind of modest retirement income. If these free market wizards want average people to continue to participate in the markets, they'd better make sure they aren't asking them to risk everything."

OBAMA: Scaring Seniors?

On a somewhat related note, conservative bloggers are criticizing the Obama camp for running a misleading ad warning Social Security recipients that their money would now be in the stock market if McCain "had his way" (in reality, McCain's plan would have only affected workers under age 58, not current retirees):

• Hot Air's Ed Morrissey: "Obama has spent over $8 million in Florida, while McCain just started attending to the Sunshine State. Neverthless, McCain leads Obama in Florida in all polling, and the gap has become wider, not smaller. The lie about McCain and Social Security intends to address that gap by scaring seniors into believing that their benefits are at risk. However, since the very beginning of the 2005 effort to partially privatize Social Security, it has always exempted people 55 and above, and some versions push that back even earlier."
• Yousefzadeh: "To quote campaign slogans, this isn't 'Hope and Change.' This is 'More of the Same.' Barack Obama is no different from any other Democratic politician around. This kind of cheap trick could be pulled by anyone with a 'D' at the end of their name."
• Power Line's John Hinderaker: "Is Barack Obama running the most disgraceful Presidential campaign of modern times? The evidence continues to mount, as Obama's ads and speeches are filled not only with exaggerations and distortions, but with outright lies: claims about John McCain that Obama must know are false."

OBAMA II: The Plot Thickens...

Righty bloggers are buzzing about The Jawa Report's Rusty Shackleford's allegation that an Obama-linked PR firm is "the source of smears directed toward [Palin]":

"Extensive research was conducted by the Jawa Report to determine the source of smears directed toward Republican Vice Presidential candidate Sarah Palin. Those smears included false allegations that she belonged to a secessionist political party and that she has radical anti-American views. Our research suggests that a subdivision of one of the largest public relations firms in the world most likely started and promulgated rumors about Sarah Palin that were known to be false. These rumors were spread in a surreptitious manner to avoid exposure. It is also likely that the PR firm was paid by outside sources to run the smear campaign. While not conclusive, evidence suggests a link to the Barack Obama campaign."

• Malkin: "The blogosphere is doing the job the MSM thinks no one else can do. A collaborative investigative effort by our friends at The Jawa Report to expose an apparently astroturfed, anti-Sarah Palin smear campaign seems to have caused late-night panic in Barack Obama-linked p.r. circles. The bloggers digging into the provenance of anti-Sarah Palin smears on the web got results last night/early this morning while most elite journalists were still in their pajamas sleeping."
• Morrissey: "If all of this is true and the Obama campaign can be connected to it, it would represent a massive set of FEC violations, as well as the ultimate repudiation of 'hope and change' and 'New Politics'. In fact, it would be a massive demonstration of Chicago Politics on a national scale."
• Dan Riehl: "Given the facts turned up by The Jawa Report in this must read post, it seems fair to ask if the campaign of Barack Obama funded a malicious and deceptive web-based smear campaign against Republican Vice Presidential nominee, Governor Sarah Palin. [...] It's important to keep in mind that this played out while the candidate, Obama himself was attacking Palin every day on the stump, such was the threat Obama perceived from her nomination."
• Confederate Yankee: "I'm not a lawyer and won't pretend to know which campaign laws (if any) were broken, but it certainly appears that Barack Obama's campaign manager is involved if not orchestrating these efforts, and people have certainly gone to jail on far less evidence."
• NRO's Jim Geraghty: "Sure seems like somebody's got something to hide."

THOUGHT OF THE DAY: Todd Palin = Hillary Clinton?

The New Republic's Michelle Cottle:

"So I'm reading the WaPo's front-pager today on Todd Palin, when it hits me: Todd Palin is Hillary Clinton circa 1992. As the WaPo lays it out, the major criticism leveled at Todd is that he's too involved in his spouse's governing duties but operates without any oversight or accountability. The couple is seen throughout the state's political circles as a team -- 'Sarah and Todd.' Todd sits in on high-level meetings. He's copied on official emails. He offers counsel on a wide range of issues. He travels on state business (often at taxpayer expense). He even unofficially lobbies lawmakers and outside interest groups on matters of importance to him. But because all of this is done under the auspices of his personal rather than professional relationship with Governor Sarah, the good citizens of the state have no real sense what Todd is up to.

All of this smacks of the two-for-the-price-of-one deal we were offered -- and which many people took such exception to -- in 1992 with the Clintons. Obviously, the times are different and the gender dynamics are scrambled this time around. But Todd clearly has his fingers in Sarah's bidness as much as -- if not more than -- Hillary ever did in Bill's. Just something to think about the next time the conservative punditocracy gets all self-righteous about the need to protect the candidates' families from public scrutiny. If anything, it sounds like 'Sarah and Todd' could use a little more scrunity."

LEST WE FORGET: Cash-Strapped NPR Launches 'A Couple Things Considered'

From The Onion:

"WASHINGTON -- Facing major cutbacks, National Public Radio has been forced to retool and relaunch its popular program All Things Considered as a truncated newscast that now only considers a couple, maybe three things per show. 'We'd love to consider all things, but the reality is we no longer have the resources necessary to do so,' host Michele Norris said following the new show's first broadcast, in which rising gas prices and jazz legend Wynton Marsalis were considered. 'We'll still be able to mention six or seven things, gloss over four, and reference five, but we cannot afford to give every single thing our full consideration. Perhaps we were biting off more than we could chew in the first place.' A Couple Things Considered is just one of many new shows brought about by budget constraints, along with NPR's recently launched Bicycle Talk and Public Radio International's This Tri-State Area Life."

Posted by Ian Faerstein at September 22, 2008 01:44 PM