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Month: March 2009

Begging For Pitchforks

by digby

Masters of the universe must be coddled or they’ll hold their breath until they turn blue:

Despite being bailed out with more than $170 billion from the Treasury and Federal Reserve, the American International Group is preparing to pay about $100 million in bonuses to executives in the same business unit that brought the company to the brink of collapse last year.

An official in the Obama administration official said Saturday that Treasury Secretary Timothy F. Geithner had called A.I.G.’s government-appointed chairman, Edward M. Liddy, on Wednesday and asked that the company renegotiate the bonuses.

Administration officials said they had managed to reduce some of the bonuses but had allowed most of them to go forward after the company’s chief executive said A.I.G. was contractually obligated to pay them.

In a letter to Mr. Geithner, Mr. Liddy wrote: “Needless to say, in the current circumstances, I do not like these arrangements and find it distasteful and difficult to recommend to you that we must proceed with them.”

Mr. Liddy did agree to Treasury’s request to scale back corporate bonuses for senior partners. But he said he had “grave concern about the long-term consequences of the actions we are taking today.

“On the one hand, all of us at A.I.G. recognize the environment in which we operate and the remonstrations of our President for a more restrained system of compensation for executives. On the other hand, we cannot attract and retain the best and brightest talent to lead and staff the AIG businesses — which are now being operated principally on behalf of the American taxpayers — if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury.”

I’m sure none of you have ever had your compensation be subject to continued and arbitrary adjustment by your employers, have you?

Perhaps these incredibly valuable workers should form a union.

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Tiny Bubbles

by dday

The very good Joe Nocera has an interesting piece in the New York Times, which may read as a little cruel to some. His basic premise is that Bernard Madoff had accomplices in his crime, and they were also his victims.

At a panel a month ago, put together by Portfolio magazine, Mr. Wiesel expressed, better than I’ve ever heard it, why people gave Mr. Madoff their money. “I remember that it was a myth that he created around him,” Mr. Wiesel said, “that everything was so special, so unique, that it had to be secret. It was like a mystical mythology that nobody could understand.” Mr. Wiesel added: “He gave the impression that maybe 100 people belonged to the club. Now we know thousands of them were cheated by him.”

And yet, just about anybody who actually took the time to kick the tires of Mr. Madoff’s operation tended to run in the other direction. James R. Hedges IV, who runs an advisory firm called LJH Global Investments, says that in 1997 he spent two hours asking Mr. Madoff basic questions about his operation. “The explanation of his strategy, the consistency of his returns, the way he withheld information — it was a very clear set of warning signs,” said Mr. Hedges. When you look at the list of Madoff victims, it contains a lot of high-profile names — but almost no serious institutional investors or endowments. They insist on knowing the kind of information Mr. Madoff refused to supply.

I suppose you could argue that most of Mr. Madoff’s direct investors lacked the ability or the financial sophistication of someone like Mr. Hedges. But it shouldn’t have mattered. Isn’t the first lesson of personal finance that you should never put all your money with one person or one fund? Even if you think your money manager is “God”? Diversification has many virtues; one of them is that you won’t lose everything if one of your money managers turns out to be a crook.

There’s no question that the SEC failed in a core function to protect the investor from fraud. But did anybody really want them to step in? The market was overheated for so long that investors felt entitled to unrealistic returns. Those who trusted in Madoff didn’t want to know how the decisions were made or where the money was coming from. They were investing in another part of the shadow banking system, one that turned out to be as fraudulent as the supposedly regulated system of credit default swaps and collateralized debt obligations.

What Madoff did was a crime and the fact that he pulled it off for close to twenty years is an act of regulatory malpractice, but in the end, nobody – not least of which the investors themselves – wanted to pop the bubble anywhere on Wall Street. If it wasn’t ever-larger stock prices for the Pets.com sock puppet it was more mortgages to slice and dice into securities and sell everywhere. They made a fortune off of a phantom, and they certainly didn’t want anyone telling them it wasn’t real.

In another interesting perspective, Chadwick Matlin calls Bernie Madoff a hero, because he focused anger on an individual on Wall Street, as well as exposing the SEC and the whole regulatory apparatus. I don’t know if I totally agree with that, but what Madoff has done is uncover the danger of bubbles, and of endless belief in the power of small men who are mythologized into Masters of the Universe. It has made plain that when wealth is rewarded instead of work, when the economy tips out of balance and moving money becomes a growth industry, when free market fundamentalism reigns, greed takes over, and the endless desire for growth makes fools of us all. What Madoff has accomplished is to give recognition that we need what is being called at the highest levels a post-bubble economy.

The last point that I’d make — and I made this point to the Business Roundtable yesterday — it is very important, even as we’re focused on the financial system and the credit markets, that we are laying the foundation for what I’m calling a post-bubble economic growth market. The days when we are going to be able to grow this economy just on an overheated housing market or people spending — maxing out on their credit cards, those days are over. What we need to do is go back to fundamentals, and that means driving our health care costs down. It means improving our education system so our children are prepared and we’re innovative in science and technology. And it means that we’re making this transition to the clean energy economy. Those are the priorities reflected in our budget, and that is part and parcel with the short-term steps that we’re taking to make sure that the economy gets back on its feet.

In politics you sometimes need villains, and so calling out Bernie Madoff or the bankster CEOs is fine. It’s what they represent – an unsustainable bubble economy, based on cheap credit and over-leveraging and the illusion of wealth and prosperity – that is the real culprit, that took in all of us in one way or another. There’s no floor under our feet in such an economy, and so we have to rebuild that floor out of something heavier than air. It’s not going to happen quickly. But it has to happen now, with the necessary investments to get it going. This is why fixing what’s broken is not enough, and reinflating bubbles will only lead to them bursting larger.

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Heresy!

by digby

Wow. Representative Alan Grayson actually disses Ronald Reagan and lives to tell the tale:

One of the biggest political disappointments of the moment to me is that more Democrats aren’t making the case against Reagan and the legacy he inflicted on this country. It’s a direct path from him to the trouble we’re in today and nobody has yet explained that to the American people.

Good for Grayson for boldly going where few Democrats have the guts to go.

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Scholarly Gentleman

by digby

Via County Fair, I found my way over to ConWebblog and their post about this latest smear job at Newsmax:

We detailed how James Humes, in his March 12 Newsmax column, purported to quote President Obama saying of a bust of Winston Churchill, “Get that goddamn thing out of here.” Humes has now amended his column — not by deleting a quote for which he has yet to provide a credible source for, but by adding another paragraph:

While the story was never fully substantiated, despite frequent repetition on radio talk shows, the sentiment seems to have been confirmed by Obama’s subsequent actions.

Translation: I can’t prove Obama said this — in fact, I can’t even name anyone who said he did, despite “frequent repetition on radio talk shows” — but I’ll pretend he did anyway because it meshes so well with my smear of Obama. Humes also alters another falsehood, substituting the false claim that Obama “grew up in Kenya” with the statement that Obama is “the son of a Kenyan.” Humes’ ugly smear of Obama plotting tribal revenge, however, remains intact.

Be sure to click through the links to see the priginal smear job. It’s quite unbelievable.

But I was curious about this fellow James C. Humes who wrote the smear job in the first place. Apparently, I am an ignorant lout for not recognizing the name because he is quite the distinguished fellow:

Professor James C. Humes (Colorado University at Colorado Springs) was awarded an O.B.E. by Queen Elizabeth for the award-winning, Pulitzer Prize finalist, “Churchill: Speaker of the Century.” Humes is a former presidential speechwriter.

He’s also a major speaking coach, wildly popular among the political class.

And he is a lying sack of fetid compost.

As a side note, he teaches at the same university (different campus) that the other Churchill taught — you know, Ward Churchill, who the wingnuts ran out of town? This guy, however, is a fine example of academic integrity.

The book for which he nearly won the Pulitzer was co-written by none other than Richard Nixon, so I guess we shouldn’t be surprised about the rank dishonesty.

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Punchlines

by digby

It seems as though I can’t click a link (or look at my morning papers) without seeing another story about the Stewart vs Cramer smackdown. And virtually everyone seems to be shocked by the fact that Cramer was so docile and unprepared when he appeared.

I don’t think it was surprising. He thought he would get one of those friendly interviews that John McCain usually gets. After all, Stewart skewers politicians but treats them rather gently when he interviews them, right? But that’s a common misreading of Stewart. He skewers a lot of different things, including politics and culture, but his primary object of derision and satire is the media and particularly the lying gasbags who populate the cable shows. It’s the whole premise of his show.

For some reason the political media establishment just doesn’t get this. Recall the bizarrely confused reaction from the villagers at that notorious Colbert White House correspondents dinner appearance. They honestly didn’t understand that Stewart and Colbert have nothing but contempt for them.

If you haven’t seen it in a while, check it out:

I think this is one of the best illustrations of the media’s insufferable insularity and self regard. It’s not just nobody rubes like me, who watch these people with slack jawed incredulity that such amazing lack of self-awareness exists in ostensibly grown up humans. (We know they view us with a sort of anthropological curiosity like one of those lost tribes in the Amazon, even as they proclaim to be jess’ folks.) But the people they admire and secretly think they are — the cool, smart, sexy, funny guys — also find them ridiculous and dangerous, just like the rest of us. And these scribblers and gasbags clearly don’t see it.

So, you see Cramer on The Daily Show, clearly a fan, thinking he’s going to be part of some sort of good natured ribbing and he finds himself on the receiving end of a scathing critique right in his face. It had never occurred to him that Stewart really meant any of the things he was saying. After all, they’re both cool guys, right? Playing the game. Winners!

He just doesn’t get the joke. None of them do.

If you doubt that, here’s Cramer’s reaction on his own show to Stewart’s smack down.

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Eradicating The E. Coli

by dday

It is exceedingly smart for the President to tackle food safety in his weekly address. The Twitterers in Washington will yelp “But how can he take on something ELSE?” But I’m going to go ahead and guess that 100% of Americans eat food. And the e. coli conservatism of the Bush years had a real and profound effect on people. There’s a lady on my street who I see walking my dog every now and again, and one of her dogs died from the melamine scandal a couple years back. Here in California, the tainted spinach scare of 2007 cost the state’s farmers hundreds of millions of dollars. It’s astonishing that we have had to worry for so long about the quality of the food we purchase, and it contributes to this anti-government backlash that they are incompetent and unable to deal with even core functions.

And that was true – under an executive branch that didn’t regulate and didn’t care about food safety. But this executive branch will. And Obama’s opening paragraph of his weekly address signals that government is vital and needs to be treated with seriousness and respect.

I’ve often said that I don’t believe government has the answer to every problem or that it can do all things for all people. We are a nation built on the strength of individual initiative. But there are certain things that we can’t do on our own. There are certain things only a government can do. And one of those things is ensuring that the foods we eat, and the medicines we take, are safe and don’t cause us harm. That is the mission of our Food and Drug Administration and it is a mission shared by our Department of Agriculture, and a variety of other agencies and offices at just about every level of government.

In the address Obama announced the appointment of Margaret Hamburg as the new head of the FDA. She has a long record in government, including a stint as New York’s health commissioner. Her deputy, Joshua Sharfstein, is the Baltimore Health Commissioner. They are serious people who are not former lobbyists or executives of the industries they will regulate, and they will get the proper staffing and funding to actually carry out the mission of the department.

People have lost faith in our institutions. A more competent and successful FDA may seem small, but it’s part of an effort to restore trust in government, as the only entity big enough for numerous tasks. Proven ability in making food safer and more secure can lead to proving that government can administer health care or implement a workable system to fight global warming. With e. coli conservatism demonizing the functions of government for so long, it’s vital to see some pushback.

The address is below.

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In Charge, And Mad You’re Not Happy About It

by dday

Chris Bowers has the depressing details on the financial services industry, through their advocates in the Senate, continuing to hold up eminently sensible foreclosure reform.

A House-passed bill that would allow bankruptcy judges to modify the terms of troubled homeowners’ mortgages has entered a holding pattern in the Senate, where the necessary 60 votes remain elusive.

The bankruptcy provision – often referred to as “cramdown” – is a key component of the Obama administration’s housing initiative, but it worries moderate Democrats in both chambers.

Indiana Democrat Evan Bayh and Pennsylvania Republican Arlen Specter are leading a group of Senate moderates in an effort to limit the bill’s reach in a way that could attract 60 votes.

Senate leaders had hoped to have the bill go straight to the floor as early as this week, but it may now have to go through the Senate Banking, Housing and Urban Affairs Committee as proponents of the measure search for a deal. On March 11, the bill was referred to the panel.

“There are still significant concerns with the bill on both sides of the aisle,” said Scott Talbott, senior vice president for government affairs at the Financial Services Roundtable, a group that lobbies on behalf of the banking industry.

Lenders fiercely oppose the cramdown language, which would allow bankruptcy judges to reduce the principal owed on a primary-residence mortgage and order other modifications in mortgage terms.

These lenders lied on forms to get customers into loans, lied to their customers about the terms of those loans, sold these unstable loans around the world and caused a near-collapse of the global financial system.

In America, that not only means they still have a check on legislation, they think the lawmakers are being too mean to them as well.

“When I hear the constant vilification of corporate America, I personally don’t understand it,” (JP Morgan CEO Jamie) Dimon said in his speech. “I would ask a lot of our folks in government to stop doing it because I think it’s hurting our country.”

Jamie Dimon and all his buddies are lucky they aren’t sharing the same cell right now. The audacity of these people, to have rewritten the rules of the US economy only to see it fail, and then demand courtesy!? We have paid you our tax dollars, given you the capital to finance your adventure (h/t Jon Stewart), and now you want a chocolate from us?

Oh, they also want all accounting laws changed so they can more easily fudge the numbers, too.

Before financial institutions have collapsed over the past several months, they have come to the Financial Accounting Standards Board, pleading for a change in mark-to-market accounting rules so that they can continue to appear to be solvent on their balance sheets.

Robert Herz, head of the FASB, told a panel of lawmakers Thursday that the loudest critics of fair market accounting practices have been the very same banks that have gone belly up when regulators would not let them adjust their accounting.

“There seems to be a clamoring for changing mark-to-market rules that seems to come largely from institutions that may be insolvent,” Rep. Alan Grayson (D-Fla.) said to Herz at a meeting of the Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises.

Grayson said that, from Herz’ testimony, it seemed that “there may be institutions that are insolvent and they haven’t been forced to write down their books to the point [of insolvency] yet, and those are maybe the same institutions that are asking us to modify the mark-to-market rules so that they won’t have to admit that they’re bankrupt. Is that correct?”

Herz said that it was.

As Grayson says, “We have people who break every rule in the book and then they think that the answer to their problems is to break more rules.”

I’m all for criticizing the Obama Administration for their failure to come up with a workable plan to fix the banks; heck, I’ve done it on occasion. But I save some special loathing for these criminals running major companies into the ground, lying to everybody about the inner workings of their companies, exerting the same power and influence over the legislative process as if nothing happened, and coming back for more changes and work-arounds so they can keep the Wurlitzer playing for just a few hours longer. I think trained chimps in the corner offices of every firm on Wall Street could do better. And they wouldn’t ask us to stop being so mean to them.

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Nothing To Fear But Idiots On TV

by digby

On the heels of Larry Summers’ speech today, Matthews chattered a bit about optimism and the Ballyhoo Boys (as he called the administration.) He also observed that people understand Bernie Madoff is a crook, compared it to the economy as a whole and wondered if maybe the whole economy was a ponzi scheme. It was actually mildly interesting, for him anyway. But soon, it devolved into this predictable predigested mishmash:

Robert Kaiser, Washington Post editor and author of “So Damn Much Money”: Summers implied that we’re not greedy anymore and I wonder. Look at all these earmarks in the omnibus spending bill…

Matthews: same old games

Kaiser: same old games, and that’s depressing that so many member of congress are acting as if it’s no big deal

Fineman: it’s not only depressing it’s counterproductive because if the new mantra is that we have to live within our means then congress has to do it too and we all have to pitch in, there has to be some ..

Matthews: right

Fineman: real hard choices made. The president keeps saying we’re going to have to make hard choices. Which choices are they and how is the congress making them?

Matthews: He comes into office with all the priestly vestments and all the rustle of vestments in the sanctuary, this is all going to be clean and perfect. And all of a sudden he comes up against Nancy Pelosi and all the people on the hill who have their own agenda and spending dreams, which is years and years of pent up desire to spend money. Right? And they did it. And if we have another stimulus bill it’ll happen again. And business is looking at it and saying they’re just a greedy as we are, they just don’t have the income we have.

Right, the stimulus and budget bills are exactly like Bernie Madoff’s ponzi scheme and greedy hedge fund operators incomprehensible financial instruments. Ok.

As for Fineman, I can’t help but scream at the TV when I see this kind of commentary, “what do you mean we, jackass?” Here we have wealthy, elite celebrities incessantly complaining that the American people aren’t being asked to sacrifice enough. As if a huge number aren’t losing their homes and their jobs — or are desperately afraid they are going to. As if virtually every average worker who was saving for their retirement isn’t looking at a decimated savings. As if average people aren’t being crushed by the costs of college and health care and debt they built up over years of income stagnation just to keep from falling behind. Yes, Americans have spent too much. But that spending is what propped up this bubble (or succession of bubbles) for years and nobody was telling them to do otherwise. In fact it was the opposite — you were a sucker if you didn’t get in the game.

And Jesus H. Christ, do these people really believe that the way to save the economy is for the government to punish average citizens some more in the name of “shared sacrifice?” Somehow, I don’t think the shared sacrifice is defined in quite the same way for the average middle class American as it is for Chris Matthews and his pals. After all, he makes five million dollars a year. I’m sure his portfolio has taken a hit and I’m sure he he feels he is suffering, but a family of four that’s lost two thirds of its $50,000 annual income isn’t likely to see their immediate fear and pain as being fully comparable to that felt by TV celebrities whose vast holdings have been somewhat reduced. What’s really being “shared,” other than the idea that rich people shouldn’t have to pay taxes and everyone else should prepare to die young?

Fineman, like so many of his fellows, is obsessed with this idea that the American people have to make “hard choices” — which translates into “entitlement” reform and reining in government spending, both of which are completely out of the question in this environment for both economic and moral reasons. It’s easy for him to say it with such pious certainty. He’s wealthy. It’s understandable that he and all of his friends are concerned about their future, as everyone is, but that just isn’t on the same level of suffering and insecurity as those who are cutting back on their groceries or having to negotiate with their doctors over which tests they can afford to get to find out if they have cancer.

Like most villagers, both Fineman and Matthews think they are regular working class guys who have the standing to lecture other Americans about sacrifice. But they sound like tin-eared fools to the audience outside their own rarified circle. Aside from the sheer economic ignorance of such statements, it once again demonstrates their distance from the lives of the average Americans they purport to represent. (It reminds me of a very liberal writer I once encountered who casually told me that one simply couldn’t live in LA on less than 300k a year. I honestly didn’t know how to reply since I’ve been here for nearly 25 years and never made anything close to that. Apparently, I’m not “living.”)

These upper class celebrities going on and on about earmarks and the unholy Pelosi’s supposed profligacy in the same breath with which they condemn wall street hustlers and wealthy con artists is just dishonest — and cruel. Only the most regressive Randian wingnuts see congress funding useful projects in their districts as “stealing,” especially at a time when government spending is is the only thing that’s keeping the economy from sinking into a depression. And the sacrifice they demand will be felt by their unwealthy fellow citizens as serious pain at a time when they are already suffering from the vagaries of the unregulated capitalistic free-for-all these wealthy elites cheered on for the past twenty years.

Right now it would be wise for the rich and famous to keep a very low profile as they sit poolside at their mansions fretting about runaway “entitlements.” It brings to mind certain unpleasant historical parallels that make one think of guillotines or beerhalls and the like, which could lead to all sorts of unintended consequences for everyone.

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Rigged

by dday

I sincerely hope that nobody is surprised by the fact that MSNBC, which has hyped the Jon Stewart/Jim Cramer “battle royale” for over a week now, has coincidentally dropped coverage of it at precisely the moment when Stewart delivered the knockout punch and made minced meat out of Cramer, CNBC and the entire media-industrial complex:

TVNewser reports that “MSNBC producers were asked not to incorporate the Jim Cramer/Jon Stewart interview into their shows today.” By TVNewser’s count, Cramer’s Daily Show interview was only mentioned once on MSNBC today and that was during the White House press conference when a reporter asked for Obama’s reaction.

CNBC is part of a corporate entity (although, interestingly, they don’t report to the news division). That corporate entity is not going to get rich by highlighting the deficiencies of certain parts of its business. As much as CNBC deserves scorn and Jim Cramer deserves a subpoena, it’s not just them. It’s the entire media complex. And this indictment of their business won’t be prosecuted and turned into a conviction.

James Rainey is also interesting today about CNBC and the larger implications.

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The Democrats We Have

by dday

For too long we’ve heard from Democratic leaders that we just need Democrats, any Democrats, to gain back the majority from Republicans, or we just need a Democrat, any Democrat, in the White House, or we just need a filibuster-proof majority of Democrats, any Democrats, and everything will fall into place. This has always been a ploy to get grassroots financial support, and we are seeing the essential bankruptcy of that ploy today.

When President Obama submitted a budget that predicted passage of a revenue-raising climate change bill, hopes rose that Congress could successfully rein in carbon emissions this year.

But a cap-and-trade climate bill is almost certain to be filibustered by Republicans — and in a letter delivered to the Senate Budget Committee yesterday, eight Democratic senators joined 25 Republicans to defend the GOP’s right to set a 60-vote margin for passing emissions limits.

“We oppose using the budget process to expedite passage of climate legislation,” the senators, including eight centrist Democrats, wrote in their missive.

Using the procedure of budget reconciliation, which would allow a climate change measure to become law with 50 votes while preventing filibusters, “would circumvent normal Senate practice and would be inconsistent with the administration’s goals of bipartisanship, cooperation, and openness,” the 33 senators wrote.

Actually, the normal Senate practice is that items included in the budget should go through the process of budget reconciliation. Further, normal Senate practice for 200-odd years up until now is that filibusters weren’t routinely used to obstruct all legislation. But that history has been forgotten, for the specific reason that a group of Democratic Senators don’t want to pass climate change legislation. Here are the names:

The eight Democratic senators who signed on to the letter are Robert Byrd (WV), Blanche Lincoln (AR), Ben Nelson (NE), Evan Bayh (IN), Mark Pryor (AR), Bob Casey (PA), Carl Levin (MI), and Mary Landrieu (LA).

Of those eight, only Robert Byrd is possibly asserting Senate rules in drawing this line in the sand, although being from a coal state you cannot be sure. The others make up the core of the Senate Blue Dogs, and lawmakers from states with a vested interest in stopping America’s addiction to oil. They don’t want to stop the gravy train that has funded their rise to political power, and so the planet continues to burn and moneyed interests continue to hold the marionette strings over their heads. And even beyond these louts are additional members who want to stand in the way of progress.

President Obama’s budget doesn’t have enough support from lawmakers to pass, the Senate Budget Committee chairman said Tuesday.

Sen. Kent Conrad (D-N.D.) said he has spoken to enough colleagues about several different provisions in the budget request to make him think Congress won’t pass it.

Conrad urged White House budget director Peter Orszag not to “draw lines in the sand” with lawmakers, most notably on Obama’s plan for a cap-and-trade system to curb carbon emissions.

“Anybody who thinks it will be easy to get the votes on the budget in the conditions that we face is smoking something,” Conrad said […]

Conrad joined Sen. Judd Gregg (N.H.), the top Republican on the Budget Committee, and Sen. Lindsey Graham (R-S.C.) in criticizing the administration’s cap-and-trade proposal for not doing enough to counterbalance increases in energy costs that will be felt by consumers and companies, especially those in energy states such as North Dakota.

Conrad said that it would be a “distant hope” to expect the climate change plan to pass unless it includes help for industries that would be hit hard by limits on carbon emission production.

Yes, I weep for the polluting industries who have skated by without having to pay for the externalities they create for decades, who have generated phantom wealth by destroying the planet and never having to pay for it (Yes, I know that link is a Tom Friedman column, drill down to the quote by Joe Romm).

Conrad, in addition, doesn’t want Obama getting any big ideas about spending any money as a down payment on health care reform, either. And he doesn’t see the need to restrict Big Agriculture subsidies to wealthy farmers either, with the detachment of a Senator representing the farm state of North Dakota.

Conrad is but one of the budget-writing barons who have their jurisdiction over the legislating process and are quick to assert it. And this is standard practice and how the process works, so that’s fine. But what Conrad and his pals are putting forward are the same short-sighted, uninspiring policies that have created mistrust and anger with the Democratic Party for a generation. Democrats were inspired by a Presidential candidate talking about big ideas and plans to solve pressing problems for the first time in a long while. But he is one man representing part of one branch of government. As Matt Yglesias rightly notes, he needs partners on the Hill:

The legislative accomplishments of 1933-34 and 1965-66 were partially the result of tactical acumen in the wake of an electoral victory on the part of the White House.

But in part, they reflected a genuinely willing congress. There was a key block of legislators in the mid-1960s who really wanted to dramatically advance social justice in the United States. They wanted black kids and white kids to attend the same schools, and they wanted the schools to be better. They wanted equal voting rights and equal rights to public accommodations and a guarantee of health security for the poor and the elderly. They though it was obscene for extreme poverty to flourish in the wealthiest country on earth. Lyndon Johnson’s leadership was important to making that happen as was, obviously, the role of social movement leaders like Martin Luther King, Jr. But LBJ and MLK didn’t bewitch the congress into having those priorities. A critical mass of key members really wanted to solve these problems.

When I read stories about Democrats signing letters urging the leadership not to pass cap & trade through budget reconciliation, or whining that Clinton-era tax rates will wreck the economy, or preemptively caving on permit auction, then it’s hard to escape the conclusion that it’s not the administration doing something wrong is that the key members of congress just fundamentally agree with George W. Bush and Mitch McConnell that it doesn’t matter if people die of treatable illness or if the planet ceases to support human life.

I’ve been reading G.Calvin Mackenzie and Robert Weisbrot’s The Liberal Hour: Washington and the Politics of Change in the 1960s, and what jumped out at me is that, while John Kennedy and Barack Obama shared a lot of the same profile at the beginning of their Presidencies – both were cautious centrists who were wary of the left flank of their parties – in Kennedy’s case what ultimately led to the eventual policy successes (most of them carried out under Lyndon Johnson) was the strength and ingenuity of the leaders in Congress, who were skilled enough and bold enough to push these changes through. I don’t see that kind of urgency in today’s Congress. They are perfectly content on the poll-driven margins to fulfill the John Kerry 2004 agenda – stem cell research, SCHIP, half-measures on energy, etc. I don’t mean to denigrate these accomplishments. But actually, I do. We have too many problems that have gone unsolved for too long, and it seems like the political muscles among liberals in Congress have completely atrophied. And these hornets have been allowed in the nest, these corporate whores who exist as moles inside the caucus to make sure all this hope and change doesn’t hold a hope of changing anything.

Under normal circumstances, these would be debates we could have and struggles we could play out for a year or so. But the string has run out. The time has all but passed. And yet the same elites predominate. If there’s an excess of fear out there right now, at least part of it stems from the feeling that these elected men and women are either unable or, more likely, unwilling, to ever do what’s necessary, not for prosperity, but for survival.

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