Digby's Hullabaloo Posts

Know When To Hold ‘Em, Know When To Fold ‘Em

by dday

The New York Times profiled John McCain’s penchant for gambling this weekend, and there actually were some serious elements to the story, including McCain buddying up with Indian casino lobbyists and giving them sweetheart deals, while punishing Jack Abramoff, who those lobbyists were competing with. It’s a pretty damaging story, and the DNC jumped on it, in particular pushing this story in religious communities where gambling is frowned upon.

But today shows how McCain’s gambling problem gets him into serious trouble. The guy who suspended his campaign to race back to Washington to save the economy, who then took credit for showing the leadership to get it passed, ended up bragging about passage before it ever happened.

Sen. John McCain (R-Ariz.) and his top aides took credit for building a winning bailout coalition – hours before the vote failed and stocks tanked.

The rush to claim he had engineered a victory now looks like a strategic blunder that will prolong the McCain’s campaign’s difficulty in finding a winning message on the economy.

Shortly before the vote, McCain had bragged about his involvement and mocked Sen. Barack Obama for staying on the sidelines.

“I’ve never been afraid of stepping in to solve problems for the American people, and I’m not going to stop now,” McCain told a rally in Columbus, Ohio. “Sen. Obama took a very different approach to the crisis our country faced. At first he didn’t want to get involved. Then he was monitoring the situation.”

McCain, grinning, flashed a sarcastic thumbs up.

“That’s not leadership. That’s watching from the sidelines,” he added to cheers and applause.

Of course, it’s even worse than that. When he swooped in to the Capitol the deal started falling apart, and when he visited the White House he stood mute as the whole thing went to pot. He left to snarl at Barack Obama in the debate, and returned to Washington but holed up in his apartment. The “I’m suspending the campaign” gambit was a big bet that came up completely empty.

McCain just gave a statement blaming Obama and the Democrats for partisanship (that mean ol’ Nancy!) and urged everybody to keep working. But if there was a major crisis last week, it’s even bigger now, with the Dow crashing before our eyes. No suspending the campaign today? (UPDATE: Greg Sargent also notes that McCain’s campaign delivered a pretty strong finger-pointing press release right before McCain said “now is not the time to assign blame.”)

I’m less worried about McCain than I am about the future of an Obama presidency and the US economic mess. He gambled and lost, putting his personal ambition far above the country at large.

(as a side note, this bill needed to fail. It was a repudiation of the leadership of both parties in the House and the closest thing in our system to a no-confidence vote. The left and the right came together and said “Hell No” to the middle. The solution is to let America decide who’s right and who’s wrong, and use a popular mandate as the lever to push this through instead of insider secrecy.)

A Bannana Republic With Nukes

by tristero

Heh, indeed:

So what we now have is non-functional government in the face of a major crisis, because Congress includes a quorum of crazies and nobody trusts the White House an inch.

As a friend said last night, we’ve become a banana republic with nukes.

And we’ve been that for a very looooooooong time.

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Partisan Tantrum

by digby

The Republicans are saying that many of their members had promised to vote for the bill until they heard the Democrats being too mean in their speeches. It was inappropriate. So they voted against it at the last minute out of pique. Apparently they think this is some kind of excuse.( Of course that won’t last. The Republicans will ultimately spin this as an act of fiscal integrity.)

Amazing. Pelosi brought it to the floor with the promise that the Republicans would deliver and they didn’t. I swear to God, if there’s a way to get punk’d, the Democrats will find it.

Not that I care. It doesn’t break my heart that this bill didn’t pass. But the idea that the Dems put themselves out there and the Republican hypocrites stabbed them in the back is so predictable that it puts me to sleep thinking about it. They’ll never learn.

Update: Oh Jesus. Chris Matthews is out there calling the Republicans a “party of mavericks” as if that’s some kind of insult in this environment. Oy.

And MSNBC is buying the GOP line that Pelosi may have ruined the economy because she was a bitch on the floor. They’ve got some business reporter on there saying that by blaming Republicans for the mess the Democrats are to blame for all of this.

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Whoa

by digby

So, the bill fails. You have to wonder how this happened. All morning we’ve been hearing that the Dems said they could deliver half and that they needed the GOP to deliver half. And now we see the Dems have delivered far more than half and the Republicans whiffed. Did the GOP lie and stab the Democrats in the back or did the Dems bring this to the floor knowing it would fail? (I think you can guess what I’d bet on.)

This is getting very, very interesting. Keep your eye on McCain.

The vote has been held open and they still need ten more. That sounds like a tall order.

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Investigation And Prosecution Left On The Table Post-Bush

by dday

Obviously the bailout bill is the order of the day (and I hear enough Congresscritters saying they “have to do something” and “we are all Murcans” that the ship has pretty much sailed) but there’s another very interesting report out today, a long-awaited Justice Department Inspector General summary of the US Attorney firings.

In 2007 (before my time here) I was fairly obsessed with these prosecutor purges, and it became clear that the affected US Attorneys were singled out for nakedly political reasons and in most cases for failing to indict Democrats or insert themselves into the electoral process. The actions of the prosecutors who remained made the actions taken to fire those who failed to comply more pronounced. The ugly underbelly of Karl Rove politics was really ripped open for all to see, and no amount of denials would change that.

The report is about as thorough as it can be, given that key Republicans in the Justice Department, as well as elected officials caught up in the probe like New Mexico Senator Pete Domenici, simply stonewalled the investigation. This is particularly the case in the firing of New Mexico US Attorney David Iglesias.

The report concludes that Iglesias was removed as a result of complaints brought to DOJ by New Mexico GOP members of Congress and party activists, and shows that Karl Rove knew in advance of the decision. It reveals that at a meeting on November 15, 2006, Rep. Heather Wilson told Rove: “Mr. Rove, for what it’s worth, the U.S. Attorney in New Mexico is a waste of breath.” Rove’s response: “”That decision has already been made. He’s gone.”

But it states that IG investigators were unable to determine how Rove knew this (Iglesias wasn’t notifed until December 7), and what his possible role in the decision was, because Rove and White House counsel Harriet Miers refused to cooperate with the investigation.

Similarly, it notes that Kyle Sampson, who as chief of staff to Alberto Gonzales took the lead in bringing about the firings, gave “misleading after-the-fact explanations for why Iglesias was placed on the list.” The report concludes: “[W]e question whether Sampson provided us the full story about Iglesias’s placement on the list, as well as the reasons for other U.S. Attorney removals.”

And: “Our investigation was also hindered by the refusal of Senator Domenici and his Chief of Staff to agree to an interview by us.” (In April, Domenici, who is retiring this year, received a “qualified admonition” from the Senate ethics committee for his role in the firing.)

The report is a monster, but it can be boiled down to “the DoJ broke the law in spirit and probably in letter, but they won’t give us enough information to figure out precisely how they broke the law, so… somebody else should figure that out.” While it certainly appears that Fredo Gonzales and some of his top deputies perjured themselves before Congress, the report does not recommend criminal charges (it merely says that Fredo et al “failed to provide accurate and truthful statements about the removals and their role in the process,” which is… something different entirely?). However, it does clearly state that Gonzales and his lead deputy Paul McNulty turned a blind eye to the firings, essentially outsourcing personnel decisions to the White House political office, and that Kyle Sampson was largely responsible for the haphazard process both during and after the firings. And it asks for the appointment of a special prosecutor to investigate this further. And wouldn’t you know it, Michael Mukasey went along with it:

WASHINGTON — Attorney General Michael B. Mukasey appointed a special prosecutor on Monday to investigate whether criminal charges should be brought against former Attorney General Alberto R. Gonzales and other officials in connection with the firings of nine of United States attorneys in 2006.

“The report makes plain that, at a minimum, the process by which nine U.S. attorneys were removed in 2006 was haphazard, arbitrary and unprofessional, and the way in which the Justice Department handled those removals and the resulting public controversy was profoundly lacking,” Mr. Mukasey said in a statement. The report called for further investigation to determine whether prosecutable offenses were committed either in the firings or in subsequent testimony about them.

Nora Dannehy, acting United States Attorney in Connecticut, will lead the investigation, Mr. Mukasey said. A graduate of Harvard Law School, she has served as a prosecutor for 17 years and specializes in white-collar and public corruption cases. She led the prosecution of the former governor of Connecticut, John Rowland, who pleaded guilty in 2004 to accepting $107,000 in gifts.Mr. Gonzales, who resigned last year after coming under criticism because of the firings, has been the main focus of interest, in part because several members of Congress charged that he may have perjured himself in his testimony through his memory lapses and misstatements about the firings.

Here’s Mukasey’s statement. I was a little surprised that he went ahead and did this. Sure, appointing a prosecutor inside the DoJ affords a little more control than an independent counsel, but Mukasey’s team will be gone soon enough, and so this investigation certainly will carry over into the next Presidency. Which is as it should be. There is no way that these charlatans should be able to manage oversight over themselves.

The question, obviously, is how far the next President would be willing to go. And not just with the US Attorney purges, but a host of other topics (Murray Waas had additional information late last week about Fredo’s trip to the hospital to bully John Ashcroft into signing off on the illegal wiretapping program – looks like Bush personally directed it). The mechanisms are now in place, at least in this case, to continue serious investigations into White House crimes without meddling or stonewalling from Bush and his cronies. That’s an opprtunity we can’t afford to pass up.

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Shrill Politics

by digby

If you haven’t had your Krugman yet today, his column is very worthwhile, as always. But his blog posts have been very helpful these past few days and today’s are no exception:

First:

In Manhattan, at 85th Street and West End Ave., there’s an apartment building going up; the sign advertises “21st century prewar living!” which only makes sense if you spend a lot of time in New York. But I found myself thinking about that sign when reading this terrific WSJ article about how the fall of Lehman triggered global panic. One lesson of the article is that Paulson screwed up very badly by letting Lehman fail; it’s not clear where Bernanke stood, but it seems clear that Tim Geithner of the NY Fed was on the other side. What the article really adds, though, is the details of the chain reaction that did the damage. Read on …

Interesting, no? I don’t actually get why Paulson was so intent upon letting Lehman fail in this environment. Maybe it was an experiment. Whatever it was, it seems to have made things worse, although that doesn’t necessarily translate into the kind of massive bailout he subsequently proposed either. Perhaps King Henry is clueless?

And here’s Krugman’s reasoning as to why it’s better to hold one’s nose and vote for the plan than not let it pass:

I see the politics of this the same way he does. The problem for Democrats is that they are pretty much the only governing entity working today. Bush and his boys are lame ducks who have no political stake in the outcome. The Republicans stand to gain by being obstructionists in this environment either in this coming election and almost certainly the next one. This is an opportunity for them. Democrats have a different set of problems because they will be held responsible for economic failure because they are the majority.

That is not to say that I think they’ve handled this correctly. I think they’ve been far too willing to accept that responsibility — you can see their hunger for leadership power written all over their faces. They’re wonky types who like this stuff. But if they felt they had no choice (a debatable point, to be sure) they should have been holding their noses and refusing to do anything in public without Paulson, Bush and the Republican leadership standing arm in arm with them every single time. If they have some kind of illusion that this is politically helpful to them, they are nuts. Before the Republicans are through with them, Bush will have been disappeared and Bill Clinton, Nancy Pelosi and Barack Obama cooked this crisis up together during a white house coffee with Jeremiah Wright back in 1997. (And don’t think it won’t work.)

A lot of bloggers are asking their readers to call their representatives to vote no on the bill. I think it’s a good idea, but I have to be honest and tell you that I don’t think it will make any difference. Polls are showing that people in general are pretty supportive of Obama and the Democrats on this so far:

The higher scores of Obama and the Democrats in Congress relative to McCain and the Republicans in Congress are mainly owing to differences in intraparty support for each side. Nearly 8 in 10 Democrats approve of the way Obama has responded to the Wall Street crisis, compared with only 7 in 10 Republicans approving of McCain. Similarly, 65% of Democrats approve of the Democratic leaders in Congress, in contrast to 55% of Republicans approving of the Republican leaders in Congress.

If the bill is going to fail it will be because of Republicans who have decided to follow Newt Gingrich’s advice and reanimate the GOP corpse on the backs of faux fiscal responsibility.

However, it is important that the Democrats understand that some of their constituents are as dismayed by this bail out as the Republicans’ are. Otherwise, they are likely to think that taking ownership of this crisis is in their political interest and it most definitely isn’t. And frankly, I’m as scared by that as I am by this crisis. If the Democrats don’t fully grasp what the political stakes are for the next generation then they are even bigger fools than I thought they were. This is one of those defining moments and if they persist in showing up at press conferences high fiving and congratulating themselves publicly for bailing out rich people, they are signing their own death warrants. This economic crisis isn’t going away. They’d better figure out the right politics of this right now because that popular support isn’t going to last.

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You Can Kiss That $700,000,000,000 Goodbye Forever, People

by tristero

When Tony Snow resigned as Bush’s press secretary because of cancer, Commander Codpiece reassured us that Snow would completely recover. Not mind you, that he merely wished or prayed for Snow’s recovery, but that he would get healthy. On a personal level, I felt very bad for Snow when I heard that because I knew Churchill Jr. was a pathological liar – Bush certainly had been told the cancer was terminal. And sure enough, less than a year later, Snow was dead.

Today, according to CNN:

Addressing the $700 billion cost, Bush said that “much, if not all, of the taxpayer funds we invest will be paid back.”

In short, we have just lost $700,000,000,000.

Still feeling optimistic, people? You have no reason to be:

The government’s planned financial bailout is a significant if costly step intended to avert economic calamity, but it may not be the last one, according to economists and finance experts.

This disaster, so patently a function of Republican ideology and incompetence, would, in a rational world, be the death knell for movement conservatism, if not the Republican party itself. But we live in a bizarro world where it is very likely that precisely the opposite will happen.

Coming To Their Senses

by digby

It seems as though the American people now understand that Barack Obama isn’t some kind of foreigner from an other planet and that McCain is a crotchety old kook:

PRINCETON, NJ — Barack Obama leads John McCain, 50% to 42% among registered voters in the latest Gallup Poll Daily tracking update for Thursday, Friday, and Saturday — just one point shy of his strongest showing of the year.

These results, from Sept. 25-27, span the time period since John McCain made the announcement that he was temporarily suspending his campaign and returning to Washington to work for a bipartisan solution to the financial crisis, and since Congressional leaders first announced progress towards the resolution of a financial bailout bill. The results also include one complete day (Saturday) after the first presidential debate on Friday night. McCain had reached a point where he was tied with Obama earlier in the week, but Obama has gained steadily in each of the last three days’ reports. Overall, Obama has gained four percentage points over the last three days, while McCain has lost four points, for an eight-point swing in the “gap” or margin.

It’s not just the debate. This only includes Friday Saturday. But I expect that between Obama’s calm and intelligent demeanor during a crisis, McCain’s antics of last week and the surreal Palin show, a lot of people have stepped back and realized that they can’t succumb to the usual trivial culture war tribalism this time.

Let’s hope so, anyway.

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Enablers

by digby

In case you were wondering how we got here:

A Memo Found in the Street

By BARRY L. RITHOLTZ

Uncle Sam the enabler.
To: Washington, D.C.
From: Wall Street
Re: Credit Crisis Dear D.C., WOW, WE’VE MADE QUITE A MESS OF THINGS here on Wall Street: Fannie and Freddie in conservatorship, investment banks in the tank, AIG nationalized. Thanks for sending us your new trillion-dollar bailout. We on Wall Street feel somewhat compelled to take at least some responsibility. We used excessive leverage, failed to maintain adequate capital, engaged in reckless speculation, created new complex derivatives. We focused on short-term profits at the expense of sustainability. We not only undermined our own firms, we destabilized the financial sector and roiled the global economy, to boot. And we got huge bonuses. But here’s a news flash for you, D.C.: We could not have done it without you. We may be drunks, but you were our enablers: Your legislative, executive, and administrative decisions made possible all that we did. Our recklessness would not have reached its soaring heights but for your governmental incompetence. THIS MEMO PROVIDES A BRIEF HISTORY OF your actions that helped create this crisis.We on Wall Street do not deny our part. We created these securities, we rated them triple-A, we traded them without understanding them. Now that they have gone bad, we are real close to getting the rest of the country to take them off our hands. Thanks, D.C. None of this would have been possible without you. Very truly yours,
Wall Street

That’s funny. But scary. My question is what is going to be done about this once this fabulous deal is done (if it gets done.) The Republicans have already set themselves up as the scourges of Wall Street and Washington perfidy, (as if they haven’t been furiously servicing their Big Money bosses for the past decade like cheap, two dollar whores.) They will get some gold plated pitchforks and immediately begin running against the big spending liberals and their rich friends.

And after this week, it’s going to be much easier for them to make that case. Even if it passes, it’s clear that it will happen with at least a fairly large number of Republicans voting against it. (It still remains to be seen if McCain will find a way to vote against it. He’s a gambler, and he may just go all in… )

The argument over this bailout is going to be with us for a long time to come and unless Democrats play this right, they are going to wind up holding the bag. The “populist Republican” meme is alredy out there and starting to take hold. They’ve bet on this economy getting very bad and being able to blame the hated Bush and Clinton for causing it and then blame the Democrats for throwing money at the problem and failing to solve it.

Why would the Democrats let them do that?

Right now I’m watching Pelosi and Reid, Frank and Dodd stand there all by themselves taking “credit” for this bill. They are handing out plaudits to all the others who “helped” them get it done like members of “the Hills” at the MTV awards.

The optics are all wrong. If they really feel they have to do this thing each one of them should have a Republican under each arm every time they make an announcement.

Update:

“Nobody wants to have to support this bill,” said Rep. John A. Boehner, R-Ohio, the minority leader. But, he added, “I’m encouraging every member whose conscience will allow them to support this.”

That’s quite an endorsement. Golly, I wonder how many Republicans aren’t going to be able to support this extremely unpopular bill because their consciences won’t let them? you can’t blame them. they are all men and women of principle, you know, who put the taxpayers first.

Gosh, I sure hope Mitch McConnell can persuade St John of Sedona to abandon his crusade against the great malefactors of wealth to back the extremely unpopular plan or he might end up voting against it and using it as a weapon in his presidential campaign. (His campaign manager suggests he’s actually responsible for knocking heads together to get a deal, so maybe not.) I’m actually less concerned about him these days. He’s so unhinged that I’m not sure it makes a difference. But it could impact the congressional elections in a big way.

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I Said No, No, No

by digby

I don’t know about you, but McCain’s dizzying Britney-like behavior last week screams “I don’t want to go to rehab.” The next thing you know he’ll be speaking in a British accent and shaving his head…

And according to today’s NY Times, he actually does have at the very least a potential gambling problem. In more ways than one:

Perhaps no episode burnished Mr. McCain’s image as a reformer more than his stewardship three years ago of the Congressional investigation into Jack Abramoff, the disgraced Republican Indian gambling lobbyist who became a national symbol of the pay-to-play culture in Washington. The senator’s leadership during the scandal set the stage for the most sweeping overhaul of lobbying laws since Watergate. “I’ve fought lobbyists who stole from Indian tribes,” the senator said in his speech accepting the Republican presidential nomination this month. But interviews and records show that lobbyists and political operatives in Mr. McCain’s inner circle played a behind-the-scenes role in bringing Mr. Abramoff’s misdeeds to Mr. McCain’s attention — and then cashed in on the resulting investigation. The senator’s longtime chief political strategist, for example, was paid $100,000 over four months as a consultant to one tribe caught up in the inquiry, records show. Mr. McCain’s campaign said the senator acted solely to protect American Indians, even though the inquiry posed “grave risk to his political interests.” As public opposition to tribal casinos has grown in recent years, Mr. McCain has distanced himself from Indian gambling, Congressional and American Indian officials said. But he has rarely wavered in his loyalty to Las Vegas, where he counts casino executives among his close friends and most prolific fund-raisers. “Beyond just his support for gaming, Nevada supports John McCain because he’s one of us, a Westerner at heart,” said Sig Rogich, a Nevada Republican kingmaker who raised nearly $2 million for Mr. McCain at an event at his home in June. Only six members of Congress have received more money from the gambling industry than Mr. McCain, and five hail from the casino hubs of Nevada and New Jersey, according to data from the Center for Responsive Politics dating back to 1989. In the presidential race, Senator Barack Obama has also received money from the industry; Mr. McCain has raised almost twice as much.

So, reformer McCain’s Abramoff investigations actually ended up benefiting his contributors and lobbyists who are now working on his campaigns? How convenient. Are there any of his vaunted reform credentials that aren’t complete bullshit?
And on a personal level, the maverick seems to really, really like to gamble under stress, which his behavior in picking Palin and the antics last week suggest is exactly what’s happening:

In May 2007, as Mr. McCain’s presidential bid was floundering, he spent a weekend at the MGM Grand on the Las Vegas strip. A fund-raiser hosted by J. Terrence Lanni, the casino’s top executive and a longtime friend of the senator, raised $400,000 for his campaign. Afterward, Mr. McCain attended a boxing match and hit the craps tables. For much of his adult life, Mr. McCain has gambled as often as once a month, friends and associates said, traveling to Las Vegas for weekend betting marathons. Former senior campaign officials said they worried about Mr. McCain’s patronage of casinos, given the power he wields over the industry. The officials, like others interviewed for this article, spoke on condition of anonymity. “We were always concerned about appearances,” one former official said. “If you go around saying that appearances matter, then they matter.” The former official said he would tell Mr. McCain: “Do we really have to go to a casino? I don’t think it’s a good idea. The base doesn’t like it. It doesn’t look good. And good things don’t happen in casinos at midnight.” “You worry too much,” Mr. McCain would respond, the official said.

McCain needs to worry a bit more. His corrupt ties to lobbyists in the face of his constant hectoring about integrity is very revealing. The man clearly protests too much. More importantly, we should all worry that this erratic, intemperate flyboy is a big time gambler who plays with big time stakes. He certainly rolled the dice on Palin and that could have huge consequences both for his ability to win the election — and for the country should he manage to eke out a victory.

These days McCain looks much less like a maverick and more like someone who’s got problems and can’t ask for help.

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