Corporate State = Bad

Bill Moyers inadvertently provided useful information on his show last week. He gave the name of an organization that correlates donor money to politicians: Center for Responsive Politics. Presumably, the reason Moyers was flogging the New York Times convoluted Bank PAC matrix



is because most of the top 3 contributors identified were typically Republican, and AIG was left off the map. I suspect both the New York Times & Moyers wish to muddy the awters and push the meme that all politicians are corrupt, but especially Republicans, who take kickbacks from private banks. I suspect that their answer to said problem is to nationalize the banks and have them controlled by the government, but only if said government is controlled by the Democrats.

What would be more useful is to correlate the PAC recipients' voting records to their support of TARP & other corporate baiouts. For fellow Buckeyes, Rep. Boehner received a boatload of bank PAC dough, and also voted in favor of the 3 Oct 2008 HR 1424 TARP bank bailout bill, but only after being Mau Maued by the MSM:

"CBS Evening News" anchor Katie Couric demanded that House Minority Leader John Boehner, R-Ohio, tell her on Sept. 30, 2008, "What in the World Are You People Doing?" That was after the bailout failed to pass the first time.

I agree how Moyers and his guest, William Greider, identified the problem: that it is wrong for the government to fob corporations' losses onto the public whilst allowing private profits. I assumed that our roads would drastically diverge from there, with Moyers and his merrie band of Marxists taking a hard left down the road to serfdom & bank nationalization.



I was rather taken aback when Greider argued against nationalization:

President Obama and if the Democratic leaders in Congress follow along, he'll put the Democratic Party on the wrong side of history. At this critical moment. What we ought to be seeking, the goal of reform, and government aid, is creating a new financial and banking system, of many more, thousands more, smaller, more diverse, regionally dispersed banks and investment firms. That's first obligation is to serve the economy and serve society. Not the other way around. What the administration's approach may be doing is consecrating too big to fail, for starters. Which, of course, everybody in government denied was the policy until the moment arrived. And secondly, and this will sound extreme to some people, but I came to it reluctantly. I fear what they're doing, not intentionally, but in their design is setting the crown for a corporate state.

I don't buy into Greider's false dichotomy that small=good and big=bad. His New Way Forward looks like an old way backward into the 19th C Andrew Jackson's liquidating of Biddle's bank. However, at least Greider's not taking us back to the 20th C Stalin's liquidating of the Kulaks, which I suspect is what Moyers wants.

I disagree with Greider's procedure for separating the wheat from the chaff. For me, a good bank is well managed, remains solvent, and eschews pimping themselves for taxpayer bailouts regardless of race, religion, gender, etc, etc, or size. A bad bank is a zombie bank that should go into Chapter 11, again, regardless of size and regardless of political favor curried.

Go Green! Bankruptcies > Bailouts

Standard class warfare from the university list serve:

Since the world's economic foundation began to crumble last fall, I've heard conservatives lay the blame on liberals like Congressman Barney Frank and Senator Chris Dodd who, along with the Clinton administration, supposedly "forced" mortgage brokers to make loans to people who had no business buying houses. And I've heard them blame "greedy" auto workers who resisted pay cuts when US auto companies were on the ropes for the demise of that industry. I'm glad to see that finally populist anger is turning against those who really do bear responsibility for much of what has happened, the "Masters of the Universe" in financial firms on Wall Street and around the world as well as those who fought for more deregulation of the banking industry.

The federal government has "loaned" more than $170 billion in taxpayer money to AIG (American International Group) in an effort to cover the insurance it issued on credit default swaps held by firms like Goldman Sachs and Lehman Brothers as well as banks all over the world.

On Friday, it was revealed that AIG paid out more than $165 million in bonuses -- described as retention payments to keep top employees with the firm -- mostly to the very people in the financial products unit who caused the most damage to AIG and the world economy. According to a letter from New York Attorney General Andrew Cuomo to Barney Frank, here are some facts about the people who received the AIG bonuses:


* The top recipient received more than $6.4 million;
* The top seven bonus recipients received more than $4 million each;
* The top ten bonus recipients received a combined $42 million;
* 22 individuals received bonuses of $2 million or more, and combined they received more than $72 million;
* 73 individuals received bonuses of $1 million or more; and
* Eleven of the individuals who received "retention" bonuses of $1 million or more are no longer working at AIG, including one who received $4.6 million.

Cuomo went on to say, "These payments were all made to individuals in the subsidiary whose performance led to crushing losses and the near failure of AIG. Thus, last week, AIG made more than 73 millionaires in the unit which lost so much money that it brought the firm to its knees, forcing a taxpayer bailout."

I can't believe the mess we're in, and I don't know how we'll get out of it. But one thing I do know is that it wasn't caused by a bunch of liberals who wanted to make it possible for poor people to own their own homes.

Well, you better believe it, because "Yes, the Community Reinvestment Act Really Did Help Cause the Housing Crisis"

However, I agree with the poster on the above thread:

The CRA encouraged loaning in less affluent areas to QUALIFIED individuals, it did not say throw all standards out the window for the quick buck. That was done by greedy bankers and mortgage brokers all on their own initiative.

Individual and corporate responsibility should be enforced versus fobbing off the bill from the profligate to the prudent loaners & loanees. Rather than kill more trees and increase our collective carbon footprint by wasting time, money & energy reinventing the wheel, bankruptcy laws, that are already on the books, should be followed. Think green, people!


In an edifying note, some banks are returning their TARP money.

UPDATE I

More on hope & change ; rainbows & unicorns .



UPDATE II

The New York Times, of all places, has a good, level-headed analysis of the AIG bailout/bonuses controversy in its editorial today. Again, there wouldn't be a bonus controversy if there hadn't been a bailout in the first place.

UPDATE III

A list of politicians who received campaign contributions from AIG & thus have a huge conflict of interest . The politicians rewarded a poorly managed company with tax payer dollars because said company gave said politicians legal vote buying bribes.

Rob Simmons = CT's next Senator

Chris Dodd is running behind Rob Simmons in the latest poll for the 2010 Connecticut senate race. Dodd is trailing mainly because voters have noticed that he wants to drink their milkshakes, especially shamrock minty flavored milkshakes.

Specifically, Dodd appeared to have engaged in dubious ethics to secure a cottage mansion in Ireland:



What's wrong with securing a mortgage to buy an overseas mansion, you may ask? Just the minor detail of a huge conflict of interest. From Hemingway sans sarc tags:

I find it awfully reassuring that in the middle of a major economic crisis and the accompanying government bank bailouts, the head of the Senate Banking Committee is indebted to bank lobbies to pay the legal tab for his personal corruption.

Even though NBC might find it perplexing for US banks that have received TARP funds to loan US taxpayer money overseas, I'm quite certain Dodd isn't at all perplexed.

In case you're not a trained economist, the Heritage Foundation has put together a slide show to explain all the nuance and intricacies of TARP:

Bank CEOs receiving TARP funds had spent corporate funds on prostitutes

Some bank CEOs, who are receiving tax payer bailouts, had previously demonstrated their fiduciary irresponsibility not only by advancing bad loans, but by using corporate credit cards to pay for prostitutes :

Wall street lawyers, investment bankers, CEOs and media executives often used corporate credit cards to pay for $2,000 an hour prostitutes, according to the madam who ran one of New York's biggest and most expensive escort services until it was busted last year.

Most of the posters over on the ABC website seem rather annoyed by this. However, there's a purported Libertarian post, asserting that only laws make criminals...in a lawless society, the jails would be empty...:

Another reminder that criminalizing certain forms of sexual contact, like criminalizing recreational drug use and gambling, spawns real criminality. End the idiotic, useless and hypocritical laws against prostitution, drugs and gambling and you put an end to much of the sort of activity that this article exposes.