Month: September 2008

Paul Krugman And The Epic of Gilgamesh

by tristero

Following up on earlier posts by Digby, dday and myself, I’d like to quote from Krugman’s short analysis and proposal outline of the Bush financial catastrophe. Not that anyone asked. As mentioned, the Sunday talks hosted not a single economist.

I should say, the plan does nothing to address the lack of capital unless the Treasury overpays for assets . And if that’s the real plan, Congress has every right to balk.*

So what should be done? Well, let’s think about how, until Paulson hit the panic button, the private sector was supposed to work this out: financial firms were supposed to recapitalize, bringing in outside investors to bulk up their capital base. That is, the private sector was supposed to cut off the problem at stage 2.

It now appears that isn’t happening, and public intervention is needed. But in that case, shouldn’t the public intervention …take the form of public injections of capital, in return for a stake in the upside?

Let’s not be railroaded into accepting an enormously expensive plan that doesn’t seem to address the real problem. [Italics in original]

*Krugman is being witty here. He knows the Treasury has every intention to, and will, overpay for assets. The real question facing us is how much will Treasury overpay? My guess: the American taxpayer will be taken for the biggest cleaning since Utnapishtim’s Flood.

UPDATE: Robert Reich has some proposals that are interesting, and would be doable if political discourse in this country didn’t resemble Ebola in terms of how diseased it is. As it is , they have no chance in hell of happening. Here’s Reich’s proposals, for entertainment purposes only:

1. The government (i.e. taxpayers) gets an equity stake in every Wall Street financial company proportional to the amount of bad debt that company shoves onto the public. So when and if Wall Street shares rise, taxpayers are rewarded for accepting so much risk.

2. Wall Street executives and directors of Wall Street firms relinquish their current stock options and this year’s other forms of compensation, and agree to future compensation linked to a rolling five-year average of firm profitability. Why should taxpayers feather their already amply-feathered nests?

3. All Wall Street executives immediately cease making campaign contributions to any candidate for public office in this election cycle or next, all Wall Street PACs be closed, and Wall Street lobbyists curtail their activities unless specifically asked for information by policymakers. Why should taxpayers finance Wall Street’s outsized political power – especially when that power is being exercised to get favorable terms from taxpayers?

4. Wall Street firms agree to comply with new regulations over disclosure, capital requirements, conflicts of interest, and market manipulation. The regulations will emerge in ninety days from a bi-partisan working group, to be convened immediately. After all, inadequate regulation and lack of oversight got us into this mess.

5. Wall Street agrees to give bankruptcy judges the authority to modify the terms of primary mortgages, so homeowners have a fighting chance to keep their homes. Why should distressed homeowners lose their homes when Wall Streeters receive taxpayer money that helps them keep their fancy ones?

That $700 Billion Could Parlay Into A Fortune For Ya

by dday

Apparently the line from the White House that is being snuck into news reports about this bailout plan is that the US could turn a neat little profit on it at some time in the future. There is one paragraph from the LA Times front-pager on the topic that put the lie to that:

The only limitations would be that Treasury’s stock of troubled assets could not total more than $700 billion at any one time, that the buying program would end after two years, and that Paulson or his successor would regularly report to Congress. Moreover, though the proposal says Treasury’s new authority would expire after two years, the history of past grants of emergency power suggests that Congress finds it hard not to renew them.

And so you see how this would go. President Paulson spends $700 billion on crap assets in about a week and a half. Whenever one is sold, the government can buy another one. And if it’s the banks in association with the guy who used to run Goldman Sachs deciding what constitutes an “illiquid asset,” you can pretty much be sure that the government will be out $700 billion at all times. They can even buy assets that have nothing to do with the mortgage crisis, or in other words, whatever they want. And given the difficulty stopping “emergency” programs like this, that will continue in virtual perpetuity. This is a direct addition to the national debt, and no profit will ever be made.

As Calculated Risk says:

Think of a drunk gambler at a slot machine. He starts with $100 and slowly loses. Every now and then he wins some money, but he keeps putting the coins back into the slot until he has lost everything. That is how this plan will work.

Unless there is a dramatic changes, there will be no upside participation in the financial companies for taxpayers, and the taxpayers will recapitalize the banks by, in Krugman’s words, “having taxpayers pay premium prices for lousy assets”.

Of course, the other issue is that there are virtually no reforms to safeguard the taxpayer from having to do this again down the road, and the Big Money Boyz have deployed their assets to keep it that way. The White House is making explicit that trying anything like making CEOs foot some of the bill for their own terrible decisions would be a poison pill. The PR machine is actually trying to make you feel sorry for these clowns.

“A lot of those people will have to sell their homes, they’re going to cut back on the private jets and the vacations. They may even have to take their kids out of private school,” said Frank. “It’s a total reworking of their lifestyle.”

He added that it’s going to be no easy task.

“It’s going to be very hard psychologically for these people,” Frank said. “I talked to one guy who had to give up his private jet recently. And he said of all the trials in his life, giving that up was the hardest thing he’s ever done.”

It’s pretty clear what’s going on here, and none of it is any good. “Shock doctrine” is not a sufficient phrase to deal with what President Paulson wants.

The 110th Congress has had a number of defining moments and failed every time. Some of them are talking a good game anonymously but that needs to translate into constructive action. President Paulson is desperate to get his friends off without a scratch, and so he ought to be made to eat whatever Democrats want to feed him.

Call your member of Congress today, later today and on Monday morning and let them know how you feel. And Sen. Obama, you can step in at any time. Unless you want your potential Presidency to take on nothing more than a caretaker role.

(Oh, and anyone who tells you with a straight face that the Community Reinvestment Act of 1977 is the cause of the financial crisis of 2008 is either a mindlessly dishonest or deeply stupid person. See the entire right-wing blogosphere for the proof. And see this for the debunk.)

…Obama is going to say this today in Charlotte:

As of now, the Bush Administration has only offered a concept with a staggering price tag, not a plan. Even if the U.S. Treasury recovers some or most of its investment over time, this initial outlay of up to $700 billion is sobering. And in return for their support, the American people must be assured that the deal reflects the basic principles of transparency, fairness, and reform.

First, there must be no blank check when American taxpayers are on the hook for this much money.

Second, taxpayers shouldn’t be spending a dime to reward CEOs on Wall Street.

Third, taxpayers should be protected and should be able to recoup this investment.

Fourth, this plan has to help homeowners stay in their homes.

Fifth, this is a global crisis, and the United States must insist that other nations join us in helping secure the financial markets.

Sixth, we need to start putting in place the rules of the road I’ve been calling for for years to prevent this from ever happening again.

Sounds OK in the main, but the question is whether he’s willing to fight for it. Or rather, signal to his party to fight.

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The Shrill One

by digby

No Deal
I hate to say this, but looking at the plan as leaked, I have to say no deal. Not unless Treasury explains, very clearly, why this is supposed to work, other than through having taxpayers pay premium prices for lousy assets. As I posted earlier today, it seems all too likely that a “fair price” for mortgage-related assets will still leave much of the financial sector in trouble. And there’s nothing at all in the draft that says what happens next; although I do notice that there’s nothing in the plan requiring Treasury to pay a fair market price. So is the plan to pay premium prices to the most troubled institutions? Or is the hope that restoring liquidity will magically make the problem go away? Here’s the thing: historically, financial system rescues have involved seizing the troubled institutions and guaranteeing their debts; only after that did the government try to repackage and sell their assets. The feds took over S&Ls first, protecting their depositors, then transferred their bad assets to the RTC. The Swedes took over troubled banks, again protecting their depositors, before transferring their assets to their equivalent institutions. The Treasury plan, by contrast, looks like an attempt to restore confidence in the financial system — that is, convince creditors of troubled institutions that everything’s OK — simply by buying assets off these institutions. This will only work if the prices Treasury pays are much higher than current market prices; that, in turn, can only be true either if this is mainly a liquidity problem — which seems doubtful — or if Treasury is going to be paying a huge premium, in effect throwing taxpayers’ money at the financial world. And there’s no quid pro quo here — nothing that gives taxpayers a stake in the upside, nothing that ensures that the money is used to stabilize the system rather than reward the undeserving. I hope I’m wrong about this. But let me say it again: Treasury needs to explain why this is supposed to work — not try to panic Congress into giving it a blank check. Otherwise, no deal.

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All I can say is that it looks as though we are about to give a 700 billion dollar blank check to the people who brought us Katrina and Iraq. Remember what happened the last time we gave the Bush administration a blank check?

RAJIV CHANDRASEKARAN: This is a book [Imperial Life in the Emerald City] that attempts to shine a light on a whole other set of fiascos in the American effort to occupy Iraq. You know, we all know now about the disastrous consequences of failing to send enough troops there to stabilize Iraq after the U.S. invasion, the Pentagon’s failure to anticipate the growth of the insurgency.

But what I write about is the whole other litany of mistakes that were made by American civilians who were there, from Ambassador Paul Bremer on down. It’s a series of what I think are blood-curdling stories: the people who showed up in Iraq, a country with 40-50 percent unemployment, and said, ‘Hey, this place needs a flat tax. It needs tariff reduction. It needs all sorts of other neoconservative economic solutions. It needs all of its government-run industries to be privatized’; the people who showed up and said, ‘There are traffic jams here. We’re going to fix that by giving them a new traffic law’; the people who showed up and said, ‘They need new intellectual property laws. They need new laws governing the types of seeds their farmers can plant’; the sort of crazy micromanagement that took place there.

Meanwhile, the more important tasks of actually rebuilding the country, of trying to find sustainable ways to increase electricity generation, to rebuild shattered hospitals and schools, to provide clean drinking water. All of those vastly more important tasks were sort of relegated, because the folks who came there saw Iraq as a terrarium for a number of neoconservative policies that they were never able to implement here in the United States.

Now, we are supposed to give these same people a 700 billion dollar blank check? It’s mind boggling that it’s even being considered.

I am not competent to judge what has to be done. But I do know that “trusting” these people to do the right thing without any oversight is an epic mistake.

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Thoughts On Sunday Bobbleheads

by tristero

I watched the Sunday talk shows, which I rarely do, as I usually have something important going on on Sunday morning, like watch the battery charge reach “full” in my portable computer. Anyway, here is what I learned.

First of all, I learned that none of the networks care to educate their viewers about this crisis. Not a single economist was scheduled, or appeared, on any of these shows. Instead we got, for the most part, ignorant or economic amateur congresscritters combined with self-admitted ignorant commentary from hosts (Schieffer) and “journalist panels” (the worthless worthies that infect Steph). Bloomberg lurked on one channel, but he didn’t spend valuable tv time explaining anything, of course. Instead he heaved and struggled to present himself as a post-partisan-above-the-fray problem fixer who is available, should anyone ask, to take over the country on a moment’s notice.

Henry Paulson, on Steph, sounded on the verge of panic (especially when Steph lobbed softballs at him in an angry tone), but that didn’t stop him from repeating the following talking points, which he spewed out again on all the shows:

The mission now is “protecting the American people.” He repeated that hoary bromide at least five times by my count. (This exact same line was also repeated by John Boehner several times on another show. Nothing as simple and direct was said, at least that I heard, by a Democrat.)

Paulson wants a “clean” bill. Translated, that means no limits on executive compensation, no slowing of mortgage foreclosures, no accountability.

You’ll be happy to know that this is not a sinkhole like the Bush/Iraq war, because he – Paulson – is going to buy bad debt that will later be sold to make money. How this magic trick would be accomplished, more specifically, how much money would be made, was not mentioned. Correction – the subjects of mechanisms and money to be made were deliberately, if crudely, avoided.

John Boehner repeated at least three times that this is a time to rise above partisanship. (Translated: this is a time to try to tightly wrap this crisis around the Democrats’ throats by blaming the current Congress.) He, too, wants to keep the bill before Congress “clean and simple” and not burdened with, to paraphrase what he said, the pet ideas of 535 congresspeople.

The Democrats I heard, notably Frank and Dodd, want to limit executive compensation, ensure accountability to elected officials, and want something called “reciproicity,” which seems to mean anything you want it to mean. The Republican Shelby agreed.

Everyone agreed we must act quickly to avert total catastrophe. (Except for Paulson, who was quite preoccupied constantly repeating that he was for “protecting the American people,” so he didn’t have time to mention the word “catastrophe” or respond to it.) Paulson also said, “This is something that has to work.” Exactly what was said about Bush/Iraq. George Will felt this crisis was bad for McCain.

And now you know what happened this Sunday.

My take on all this: They – the big They – are scared stiff – not for the collapse of the economy, of course, but that They, personally, will lose a lot of money. They even might have to give up a few of their uncounted mansions before this thing is over. They also have no idea how much more is coming down the pike.

The Republicans are also playing politics. They believed it is necessary, before actually addressing the crisis in real terms, to make sure they are carefully positioned as the “protectors of the American people” advocating a “clean” solution. Given the shared sense of imminent crisis requiring immediate action, the oversight, compensation limits, and “reciprocity” – whatever that is – put on this bill will be limited. In other words, Congress is about to hand the Bush administration the biggest blank check they have received to date.

And finally, I am confident that the American people will greatly benefit from this. Which American people? After 8 years of Bushism, you have to ask? Why, those who caused this crisis and who exploited this crisis, of course. They will slurp up the trillion dollars of our hard-earned money that’s gonna be served up on a silver platter faster than you can say “Americans are suckers if they vote Republican.”

Update from digby: I just have to add that when I heard Paulson say this bail out was actually going to make money for the government, I couldn’t help but remember Paul Wolfowitz assuring us that the Iraq war would pay for itself.

Trust ’em?

A Rare Win Against Voter Suppression

by dday

I really thought that Haley Barbour and his gang was going to get away with it, but the state Supreme Court grew a spine:

The Mississippi Supreme Court ruled Thursday that the special election to replace Sen. Trent Lott (R-MS) – who resigned last December – will appear near the top of the November ballot.

The court ruled 8 to 1 that the ballot layout approved by Republican Governor Haley Barbour violated state election law by listing the race at the very bottom of the ballot. Barbour was chairman of the Republican National Committee from 1993 to 1997 […]

Many saw Barbour’s choice as a hardball political tactic to discourage voter participation in a close Senate race. Democrat Ronnie Musgrove is within striking distance of unseating former Republican congressman Roger Wicker, whom Barbour appointed last winter to replace Lott.

They’re trying to hide this race because Musgrove is a former Governor and proven winner with a compelling story.

But the voter suppression tactics are going to sprout up like daisies as we get closer to Election Day. And that’s aside from the potential voter registration database glitches (which could just randomly eliminate people’s voter registration) and high turnout on Election Day which could end up with long lines and voters left out in the cold.

Some friends of ours have set up a Voter Suppression Wiki to call attention to a lot of these efforts. I’m certainly going to be checking in throughout the next month or so. Sunlight is the best disinfectant.

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Saturday Night At The Movies

Counter-intelligent: Burn After Reading

By Dennis Hartley

Being Malkovich: Attention, K Street choppers…

In an inspired bit of dialog from the new Coen brothers film, Burn After Reading that will surely become oft-quoted, ex-CIA agent Osborne Cox (John Malkovich) goes into an exasperated, paranoiac rant about the “league of morons” in America who have continually conspired to make his life hell. While I was laughing along with everyone else in the audience, part of me was thinking “Well, yeah…I know exactly how you feel.”

It’s sad. “Stupidity” has become the buzzword in any examination of contemporary American cultural anthropology. It insidiously pervades all aspects of our lives-home life, work life, school life. Television celebrates it-American Idol, America’s Got Talent, American Gladiator, Fox News. Preachers and politicians bank on it. As Madge would say, we’re soaking in it. Besides-why open a book when you have text messages to read?

Thank god for the Coen brothers. Perhaps more than any other American filmmakers, they have provided an on-going movie therapy service for those of us who are chronically depressed about the chuckleheaded state of our union. Through films like Blood Simple, Raising Arizona, The Hudsucker Proxy, The Man Who Wasn’t There and Fargo, the Coens have milked many a sardonic guffaw from the axiom “stupid is as stupid does”. Those films also serve as reminders that if you are dumb enough to believe that you can find a shortcut to achieving your American Dream at the expense of destroying someone else’s without suffering some kind of karmic payback, then you are even dumber than originally advertised. Whether or not karmic payback exists outside of a movie universe is up for debate, but the possibility that it could makes me feel all warm and fuzzy inside.

Burn After Reading signals a welcome return to the type of dark, absurdist cringe comedy that the Coens truly excel at. The story revolves around the aforementioned Osborne Cox, a CIA analyst who decides to write his memoirs after quitting his job in an acrimonious huff. The arrogant, misanthropic Cox is a paper tiger bureaucrat who pompously fancies himself more akin to a Robert Ludlum hero. He is certainly less than a hero to his fed-up, no-nonsense physician wife (Tilda Swinton) who is having a torrid affair with a married, sex-addicted treasury agent (George Clooney). Following the advice of a divorce attorney, Mrs. Cox surreptitiously downloads information from her husband’s hard drive onto a disc, which ends up (through a typically Coen-esque comedy of errors) in the hands of a pair of dim bulb fitness club employees (Frances McDormand and Brad Pitt). Mistaking Cox’s memoir notes as some type of coded high-level state secrets, the would-be criminal masterminds cook up a lame-brained scheme that starts as a simple garden-variety blackmail attempt, but somehow morphs into a grand clusterfuck involving the Russian Embassy and nearly every branch of the Beltway’s clandestine community.

The cougar and the slow man

If that sounds pretty High Concept, well, it is…on paper. But leave it to the Coens to mash up the elements of screwball comedy, door-slamming bedroom farce, spy spoof, political satire, social commentary and self-parody into a perfect cinematic cocktail. The breezy script (penned by the brothers) is tighter than a one-act play, and capped off with a great zinger. It’s a rarity in film these days: an expedient, highly satisfying denouement. In other words, the film neither overstays its welcome nor feels rushed; it wraps up just when it needs to. Setup. Story. Punchline. Callback. You’ve been a great crowd-g’night!

Malkovich is in top form; he is a master of the slow burn that builds into manic apoplexy. He manages to make these fits of rage both extremely menacing and screamingly funny at the same time; it’s an acting tic that rings of vintage Gene Wilder. It’s a cakewalk for McDormand; it goes without saying that her husband and brother-in-law know more than anyone else on the planet how to best utilize her unique instrument. She and Pitt make a great comedic tag team, and it’s easily Pitt’s funniest performance since Snatch . This is the third outing with the Coens for Clooney, and he appears to have their quirky rhythms down to a science. Swinton seems to have the most thankless role (she’s mostly required to just glower and fume) but it is interesting to see her reunited with her Michael Clayton co-star. Veteran character actors J.K. Simmons and Richard Jenkins round off the fine ensemble cast quite nicely. As a follow-up to last year’s No Country for Old Men, which was a much more somber and thoughtful piece, Burn After Reading may feel like a relatively superfluous toss-off, but it’s a perfect salve for election season weltschmerz. So as your fake physician, I prescribe that you buy two tickets, and call me in the morning.

Previous posts with related themes:
OSS 117

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Bush To Congress: Trust Me, I Can Solve It

by tristero

Now here’s a truly sensible idea:

The Bush administration on Saturday formally proposed to Congress what could become the largest financial bailout in United States history, requesting unfettered authority for the Treasury Department to buy up to $700 billion in mortgage-related assets.

And right now, congresscritters are soberly weighing the consequences.

No, you ninnies! Not the consequences for the country! No! The consequences of acceding to Bush’s wish versus acting sensibly:

1. If I agree to give Bush carte blanche then
2. Repulbicans can’t blame me for blocking their proposals and thereby scream I made the crisis worse, but
3. This country will endure yet more grossly incompetent management from Bush/McCain/Cheney/Palin and friends while the rich get richer.

1. If I don’t agree and fight Bush tooth and nail,
2. Four bloggers, my mother, and my pet hamster will be really, really proud of me. But
3. This country may have a chance of putting together at least a moderately workable approach to the financial crisis that doesn’t reward the shareholders at the expense of the victims.

Anyone have any doubts what course of action Congress will take?

UPDATE: Glenn has the long versionwith a terrific ender:

… this authorizes Hank Paulson to transfer $700 billion of taxpayer money to private industry in his sole discretion, and nobody has the right or ability to review or challenge any decision he makes.

The Natural Consequence

by digby

Eric Boehlert wrote an essential column this week about the media’s new “problem” convincing the American public that their reporting is serious. This is a very important insight, one that I had just sort of been circling in my mind and hadn’t homed in on:

Fact: Between Monday and Friday of last week, CNN, Fox News, and MSNBC aired more mentions of “lipstick” than they did “Fannie Mae.” You know Fannie Mae, that’s one of the two distressed mortgage giants (along with Freddie Mac) that the federal government had to take over last week in order to fend off insolvency, an unprecedented move that was fraught with dire economic repercussions. But yes, the lipstick story was more newsworthy on cable television last week. It wasn’t even close. Lipstick was mentioned more than 350 times, while Fannie Mae was mentioned approximately 230 times, according to TVEyes.com. Were some of those lipstick mentions on TV made while criticizing McCain’s empty ploy? Absolutely. (See NBC’s Chuck Todd.) But that still didn’t excuse the media’s Pavlovian response to the McCain whistle, of embracing and spreading the phony story in the first place. The proper response would have been to essentially ignore the so-called story and keep moving. Or to note that McCain’s camp tried to float the phony lipstick story. But turning the soggy affair into the day’s top news event was an embarrassment. The media’s failure to do so wasn’t surprising. The press throughout this race has walked away from any semblance of traditional standards, yet journalists seemed oblivious to the long-term implications of their chronic embrace of fluff. Why their embrace? Because that’s what the media feel most comfortable with; that’s what they’re good at. (They think.) They’re good at speculating for weeks on end about who might be selected as a candidate’s running mate and what that hypothetical matchup would mean on Election Day. They’re good at ruminating about polls. They’re good at trying to read politicians’ minds. But now we’re seeing the dire consequences — when the press wants to inform voters about outrageous campaign conduct (like the Bridge to Nowhere, McCain’s untrue claim that Obama plans to raise “your” taxes, or even in the margins the lipstick fiasco), the press no longer wields the same authority, in part because the political press has consciously folded its work into the larger entertainment culture.

As I watched the peculiar sight of Chris Matthews and Howard Fineman getting all enraged over John McCain’s lying, I couldn’t quite put my finger on why it all seemed so futile. Yes, it’s certainly an improvement when they don’t just pass on lies uncritically as they usually do. But there was something strange and dissonant about it that made it almost seem like I was watching a Reality Show rather than a news program.

Boehlert hits the nail on the head. These pundits are so lacking in authority, that even when they are doing their jobs, it no longer matters. It’s all part of the same entertainment program whether it’s over lipstick on pigs or Fannie Mae collapsing or blow jobs or weapons of mass destruction. They’ve managed to debase information itself and turn it into just another commodity. I don’t know how you fix that.

It will be interesting to see how they do during the rest of the campaign, which has taken a complicated turn. Will they be able to sustain any interest in a difficult but extremely important story that has no possible tabloid element? I don’t know, but I can’t see how they can ignore it — and I can’t see how they can sex it up. Stay tuned.

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Economists For McCain

by digby

They’re quite the innovators:

Economists’ Statement in Support of John McCain’s Economic Plan

We enthusiastically support John McCain’s economic plan. It is a comprehensive, pro-growth, reform agenda. The reform focuses on the real economic problems Americans face today and will face in the future. And it builds on the core economic principles that have made America great.

His plan would control government spending by vetoing every bill with earmarks, implementing a constitutionally valid line-item veto, pausing non-military discretionary government spending programs for one year to stop their explosive growth and place accountability on federal government agencies.

His plan would keep taxes from rising, because higher tax rates are exactly the wrong policy to restore economic growth, especially at this time.

His plan would reduce tax rates by cutting the tax that corporations pay to 25 percent in line with other countries, by completely phasing out the alternative minimum tax, by increasing the exemption for dependents, by permitting the first-year expensing of new equipment and technology, and by making permanent a reformed tax credit for R&D.

His plan would also create a new and much simpler tax system and give Americans a free choice of whether to pay taxes under that simple system or the current complex and burdensome income tax.

His plan would open new markets for American goods and services and thereby create additional jobs for Americans by supporting good free trade agreements such as the one with Colombia and working with leaders around the world to avoid isolationism and protectionism. His plan would also reform education, retraining, and other assistance programs so they better help those displaced by trade and other changes in the economy.

His plan addresses problems in the financial markets and housing markets by calling for increased transparency and accountability, by targeted assistance to deserving homeowners to refinance their mortgages, and by opposing so-called reform plans which would raise the costs of home-ownership in the future.

The above actions, as well as plans to address entitlement programs–especially Social Security, Medicare and other government health care programs–and his regulatory reforms–especially in the area of health care–constitute a broad and powerful economic agenda. Because of John McCain’s experience working with the American people in all walks of life, with members of Congress on both sides of the aisle, and with leaders around the world, we are optimistic that these plans will become a reality and will create jobs and restore confidence and strong economic growth.

Wow, let’s party like its 1987!

Here’s a neat little graph from EFO I’ve been meaning to share with you all:

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Click here for the list of Obama economic advisers and prominent economists who support Obama.

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Now He Puts his Foot Down

by digby

Fergawdsake:

John McCain came under fire on Friday from defenders of the current Social Security system after his aides signaled to the Associated Press that the current market turmoil has not altered his support for changing the retirement program to allow individuals to invest some portion of their Social Security payroll taxes in stocks and bonds.

It’s not just Alan greenspan who McCain wants to prop up like the corpse in Weekend at Bernies, it’s this privatization zombie as well. It’s hard to believe that he’ll pander on every single thing but this one, but apparently this is where he draws the line. What a putz.

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. Unlike big banks and hedge fund managers, working people don’t have golden parachutes to protect them from failure and the government isn’t likely to step in to bail them out if they take a big risk and fail.

If guys like McCain have their way, people will be so afraid of any kind of investing that they’ll start burying their money in the back yard. And that isn’t going to help anyone.

Leave Social Security alooooone!

Update: Fergawdsake Squared!

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