1 Boring Old Man

These bubbles, it seems weren’t something that just happened. They were engineered by exploiting the relaxation of government regulation or industry standards that allowed them to occur. In each case, an actual commodity became something else – poker chips in a great casino. This month’s Rolling Stone has an article by Matt Taibbi that places that Casino in the halls of Goldman Sach’s. The article is only partially on-line, but there’s enough to let you know that he’s got his finger on the pulse of the thing:

The Great American Bubble Machine
Rolling Stone
MATT TAIBBI
Jul 02, 2009

^{The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.}

^{Any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. What you need to know is the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain — an extremely unfortunate loophole in the system of Western democratic capitalism, which never foresaw that in a society governed passively by free markets and free elections, organized greed always defeats disorganized democracy.}

^{They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased. They’ve been pulling this same stunt over and over since the 1920s — and now they’re preparing to do it again, creating what may be the biggest and most audacious bubble yet.}

^{Fast-forward to today. It’s early June in Washington, D.C. Barack Obama, a popular young politician whose leading private campaign donor was an investment bank called Goldman Sachs — its employees paid some $981,000 to his campaign — sits in the White House. Having seamlessly navigated the political minefield of the bailout era, Goldman is once again back to its old business, scouting out loopholes in a new government-created market with the aid of a new set of alumni occupying key government jobs.}

^{Gone are Hank Paulson and Neel Kashkari; in their place are Treasury chief of staff Mark Patterson and CFTC chief Gary Gensler, both former Goldmanites. (Gensler was the firm’s co-head of finance.) And instead of credit derivatives or oil futures or mortgage-backed CDOs, the new game in town, the next bubble, is in carbon credits — a booming trillion- dollar market that barely even exists yet, but will if the Democratic Party that it gave $4,452,585 to in the last election manages to push into existence a groundbreaking new commodities bubble, disguised as an "environmental plan," called cap-and-trade. The new carbon-credit market is a virtual repeat of the commodities-market casino that’s been kind to Goldman, except it has one delicious new wrinkle: If the plan goes forward as expected, the rise in prices will be government-mandated. Goldman won’t even have to rig the game. It will be rigged in advance.}

Bush’s 4th of July Celebration
04 July 2009
by: John Scripsick, t r u t h o u t | Perspective

John Scripsick, who lost his son Bryan in Iraq on September 6, 2007, lives in Norman, Oklahoma.

    It’s good to see that Woodward, Oklahoma, invited George W. Bush to their 4th of July celebration. Some days I feel sorry for this poor, lonely man. His dream of being rich and famous took him to be the leader of our great nation. My satisfaction as an Oklahoma farmer and rancher is the rain that comes in July or August to carry a cow herd ’till fall.

    I wonder what Bush will say in his 40-minute speech. I’m sure it will be sprinkled with patriotism, independence, and how we were only attacked once during his presidency. Maybe he’ll talk about how going to war in Iraq helped move oil from less than $25 to $147 a barrel. If oil could go to six times it’s price, maybe cattle could go to $6 a pound, or each cow could have six calves in one year. That $4 a gallon fuel put many people behind on their stretched mortgages and kind of turned our economy into a tailspin. That money ended up in the pockets of his campaign contributors, so it should be a fair trade.

    I doubt if he will talk about 4,300 American soldiers killed in Iraq or the 30,000 maimed for life. Or the haunting memories of thousands of others who watched it all happen. The Iraqi people suffered the greatest loss of property and life, but I doubt if there is time to mention them in a 40-minute speech. He could touch on torture for a few minutes. Bush said America did not torture, which is partly true because most Americans would not torture a fellow human being. Bush and Cheney had to torture to back up faulty intelligence and extract information to suit their story of why we invaded Iraq. So that must mean it’s okay.

    I often wondered why a man would commit suicide to kill my son in Iraq. I guess if we treated his son, brother or cousin in a sub-human way with our torture techniques, it would compel him to take revenge on the first American he could find. The war is depressing to all but Halliburton, KBR, Blackwater and others who profit. So my guess is, Bush will stick to our independence or maybe mention SEC watching Madoff, or how he firmed up the banks with our tax dollars.

    The story of how the big banks failing would cause a major economic collapse reminds me of another story he told about weapons of mass destruction that were never found. On second thought, I’ve heard his stories before and I’m short one family member because of him. So, I’ll pass on George’s speech this 4th of July.

Sarah Palin Outsmarts the Left
Peter Ferrara
FOXNews
July 04, 2009

Sarah Palin’s resignation as Governor of Alaska is a brilliant liberating move for her career, and a potential turning point for the national conservative movement.

The biggest problem with her responsibility as Governor of Alaska is that the state is so far away from the rest of America. No one hears of the good work she has been doing there, and the left is free to paint their own false caricature of her. And because of the long distance and her family, as well as governing, responsibilities, she can’t get down to the lower-48 enough to build her national political presence.

I am hoping she spends two weeks of every month now touring the states doing fundraisers for a the sweeping Republican revival in 2010 that is now developing. I hope she establishes a new national grassroots organization to fight for conservative causes. And I hope she starts a new national think tank in Washington.

She could pick up the mantle for social conservatism for the late Paul Weyrich in Washington, reinvigorating the pro-life cause and defense of traditional values. She could advocate sane, grown up energy policies through these organizations, favoring increased production of traditional as well as alternative energy, including nuclear power, while opposing fruitcake ideas like cap-and-trade taxes, and runaway corporate welfare that would bring back Jimmy Carter’s synfuels. She should also lead the nation’s mothers to oppose mandating replacement of incandescent light bulbs with the new mercury poison gas bulbs.

Here’s hoping as well that she devotes these organizations to advancing the economics of Milton Friedman, Art Laffer, and Jack Kemp, rather than the outdated, failed economics of John Maynard Keynes that Obama advocates as if there was never any alternative. She should also be a new staunch advocate for peace through strength, and rebuilding our nuclear deterrent, rather than Obama’s policy of nuclear disarmament. And here’s hoping she becomes a powerful new voice for Israel, making new alliances with Jewish voters.

If she does all that, the left won’t be making jokes about her any more, just like they stopped joking about Ronald Reagan long about 1984, and Newt Gingrich in 1994.

Palin resigns…
^{travel in the lower 48}

^{advancing conservative causes}

^{a new think-tank}

^pro-life
^{traditional values}

^{energy alternatives}
^{jimmy carter was wrong bad}
^{fight poisonous lightbulbs}

^{return to Friedman’s economics}
^{obama is bad wrong}
^{peace through strength}

^{build nuclear deterrence}
^{bring Jewish voters into the Republican fold}

brilliant move!

I’m not done with the decision to not release Vice President Dick Cheney’s F.B.I. Interview from the C.I.A. Leak case involving Joseph Wilson and Valerie Plame. It’s a 50 page document that reads like one of John Yoo’s Memos [the kind that start with some foregone conclusion and paste the reasons around that conclusion]. I expect C.R.E.W. and/or the A.C.L.U. will keep pressing. The only part I want to mention is the notion that if this interview is released, future high officials won’t cooperate with future investigations.

That’s not a legal argument. It’s more like a behavioral plan written by a first year grad student in a  second rate psychology department. In the first place, what are we doing electing high officials that won’t cooperate with investigations? It’s a plan contingent on future high officials being "Cheney-esque.  – as in uncooperative. Who ever said Cheney was cooperating in the first place? A person cooperating with that investigation would’ve gone out of their way to see that the White House leak was fully investigated. And worse, if this future high official were actually like Cheney, he/she would be just as hard to pin down no matter what had happened in the past.

But mostly, the decision is itself Cheney-esque. High Officials are outside the law, special people. Their participation in oversight is optional. They are not "public" officials, they are an elite class – "private" officials.

Yesterday, the oak tree in our front yard came down. It had been getting sicker and sicker for a couple of years. This year, there was sawdust at the base of the tree. Then, its limited foliage began to wither. So it was time, and the tree man came to finish it off. He’s a wonderful guy – a humble, religious person who ministers to the elderly and the down-trodden, always a pleasure to talk to.  And he is a tree-felling artist. He landed this huge tree in the only possible spot it could land without doing big damage. And taking down an oak tree and ending up with a stack of firewood is a day-long process. Toward the end of the day, I went out and announced that Sarah Palin had resigned. I said, "I guess she’s going to run for President." He said, "I’d vote for her. I think she’s got a good head on her shoulders."

Later, we were on the lake with a flotilla of boats tied together for a "first friday" gathering – our first ever flotilla social with ten or so small pontoon boats lashed together. We even motored out together when the wind blew us too close to the shore. A friend stood up and asked a humorous question about Palin’s resignation. In the biggest boat, there was a visitor who couldn’t "keep it light" [the usual protocol for political dialog in our small community]. Out came the "Limbaugh-isms." The only one I recall was "On the 4th of July this year, we’re celebrating Dependence Day" – the Socialism meme.

I like to think that the sarcasm and contempt comes from the Conservative side of the fence, but anyone reading this blog would be well within their rights to call me on that. I can’t think of much to say about Sarah Palin that’s not sarcastic. A friend reminded me that my first comment when Sarah Palin marched onto the stage as McCain’s pick, was that he’d picked a "hottie" or something like that. It’s funny, now when I see her, I’m reminded that she’s an attractive woman  – UNTIL she starts talking. Then that attractiveness melts in the blather that follows [see, I am sarcastic].

It is impossible for me to take her seriously as a political candidate for anything. I saw a video clip of her on today’s New York Times Palin Timeline from 1987 as a sports-caster. She was good. She hadn’t yet perfected the hair-toss, head bob, or her signature wink [It’s worth a visit]. She throws around sports metaphors well. As a politician, her jargon is poorly integrated – she uses phrases like "Maverick," "out of the box," "business as usual" like they are concrete objects, anchors for her sea of confusion. It’s as if she knows what she stands for by the categorical titles, but knows nothing of the paragraph under the heading that explains its meaning. But when she talks about basketball, or hockey, she’s right at home and the jargon remains metaphoric.

I think that a lot of people think about President Obama like I think about Sarah Palin [or I thought about George W. Bush]. They have an immediate negative reaction, and internally begin to reframe what he says as socialism, or welfare-ism, or he’s-going-to-take-my-stuff-ism. Though I doubt that they can bring off "he’s a fool" like I feel when Sarah gets going, there are many ways to discount others. "She’s a lightweight" isn’t much different from "He’s a Communist."

I have the fantasy that there is a center, some place where political debate isn’t so polarized and divisive, some middle of the road where the thrust of our political life isn’t driven by the kind of polarization we live with right now. But when I review my own experience, or read history, I don’t find that to be true except in certain situations.  It was true during World War II, I think. We pulled together with a common purpose. I expect it was kind of true during the Revolutionary War. The time in my own life when it was most true was in the year or two after 9/11. We did have a common purpose and a common enemy. We were "united."

I think that discussions with my tree man or the rich guy in the big boat would have been different in the summer of 2002. We would have been on the same side. So there it was, the center that I think would be a such good thing. The religious right tree man would’ve set his biases aside. The capitalist in the big boat would’ve moved to the middle. Liberal-me might have relaxed on the social issues that have otherwise driven my political thinking. And yet, the summer of 2002 was a time when our unified country was about to make one of the biggest mistakes we’ve made in our entire history – the Invasion of Iraq.

There were enough signs in the Summer of 2002 to let us know that we weren’t in good hands. All of that Axis of Evil talk should have alerted us. We should’ve paid more attention to "dead or alive," "bring ’em on," the Bush Doctrine. Our leaders weren’t talking like grown-ups. They were using the language of video games or action movies. As my friend ShrinkRap recently pointed out, we were operating on Palin-esque slogans like "we don’t want the smoking gun to be a mushroom cloud." Our unity was not a good thing. In fact, it was a bad thing. It led us into an unwise call to action that will nip at out heels for decades.

No, I’m not going to declare Mark Sanford and Sarah Palin are crazy Republican Governors ergo Republicans are crazy. After all, the Democrats had Eliot Spitzer and Rod Blagojevich. I’m not even going to claim Governors are crazy [even though that is 8% of our Governors]. But I do think that a few comments are in order about disrespect of elected office.

Mark Sanford talks about his office as Governor as a "therapy" for him – a way to redeem the trust of his wife and the South Carolinians he serves. He said he thought about resigning, but then decided that he would take the high road and face the music. That seems to me to be an amazingly self-serving way to look at public office. It’s not about him and his moral or spiritual growth, being Governor. It’s about running the State of South Carolina – a state has the third highest unemployment in the country, and is in big trouble. Sanford’s reign has been no great shakes before these last several weeks, mostly characterized by conservative rhetoric with little else. Now, he’s paralyzed and making a public fool of himself [I went surfing for someone to quote who thinks Mark Sanford should continue in public office, but came up empty-handed].

Sarah Palin was inaugurated Governor of Alaska on December 4th, 2006. She was announced to be John McCain’s running mate on August 29th, 2008 – a campaign that lasted until November 2nd, 2008. Today, she resigned as Governor effective July 26, 2009. Taking time out to run for Vice President and now leaving early, that means she actually served 37% of her term. She doesn’t seem to have spent much time in the public service to the people who elected her. She butchers the Kings English. ["We know we can affect positive change outside government at this point in time on another scale and actually make a difference for our priorities,"] There is little question that she would not even be a political contender except for her "cutsie" persona. Palin was "discovered" by William Kristol, editor for the ultra [neo]Conservative Weekly Standard while on an Alaska Cruise. His take on her resignation?

"My contrarian take is almost everyone I talk to thinks it’s crazy but I wonder maybe it’s crazy like a fox," said Bill Kristol, editor of the Weekly Standard, who has been out defending Palin this past week. Kristol’s view is that spending another 18 months in office in Alaska will not persuade skeptics that she’s ready to be president. Instead, he said, she can use this time to travel the country and the world, to immerse herself in policy issues and to campaign for Republican candidates, without facing questions every time she leaves her state about whether she is shirking her responsibilities.

Surreality Only Beginning
By Josh Marshall

As David noted below, many commentators have taken little more than an hour to proceed from slack-jawed bewilderment to belief that Sarah Palin’s unexplained resignation may be a political masterstroke.

For the moment there’s no clear evidence of or explanation for some massive political or scandal bombshell that would have driven Palin from office. And it can be difficult not to allow the preposterous to become credible when many supposedly rational people are saying it.

But logic and common sense seldom fail as a guide to understanding politics. And the idea that Gov. Palin just up and decided for no reason in particular to resign her office little more than half way through her term, with a hastily assembled press conference and a rambling and histrionic speech, is just too silly for serious consideration. Another sign of the confusion on the inside are the comments reporters are getting from supposed Palin insiders. Palin insiders told Andrew Mitchell that Palin was “out of politics for good.” But she told the Executive Director of the Republican Governors Association that she’s resigning to campaign for more candidates in the continental US, work on her book, all with an eye to gearing up for her run for president in 2012. Call me cynical but it seems hard to reconcile those two explanations.

As with her speech itself, the tell is that the decision was apparently so rushed and sudden that there was not enough time to come up with a plausible cover story or to get out the word about what it was.

It looks like a duck and quacks like a duck. Either Palin is resigning ahead of some titanic scandal [which should emerge in short order if it exists] or her resignation was triggered by an even more extreme mental instability than we’d previously suspected.

THE EMPLOYMENT SITUATION: JUNE 2009

Nonfarm payroll employment continued to decline in June (-467,000), and the unemployment rate was little changed at 9.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Job losses were widespread across the major industry sectors, with large declines occurring in manufacturing, professional and business services, and construction…

Unemployment (Household Survey Data)

The number of unemployed persons (14.7 million) and the unemployment rate (9.5 percent) were little changed in June. Since the start of the recession in December 2007, the number of unemployed persons has increased by 7.2 million, and the unemployment rate has risen by 4.6 percentage

In June, unemployment rates for the major worker groups–adult men (10.0 percent), adult women (7.6 percent), teenagers (24.0 percent), whites (8.7 percent), blacks (14.7 percent), and Hispanics (12.2 per-cent)–showed little change. The unemployment rate for Asians was 8.2 percent, not seasonally adjusted.

Among the unemployed, the number of job losers and persons who completed temporary jobs (9.6 million) was little changed in June after increasing by an average of 615,000 per month during the first 5 months of this year…

  

Iran Cleric Says British Embassy Staff to Stand Trial
New York Times
By ALAN COWELL and STEPHEN CASTLE
July 3, 2009

PARIS — Brushing aside British and European efforts to seek the release of local British Embassy staff members held in Tehran, the Iranian authorities indicated Friday that they planned to put some of them on trial — a move that deepened a diplomatic crisis and could provoke the withdrawal of ambassadors.

In London, the Foreign Office said it was urgently checking reports that the Iranian authorities planned to put two of its local employees on trial. Nine staff members were seized after the unrest sparked by Iran’s disputed presidential elections on June 12.

Hours after the Iranian threat, the European Union seemed to hold back from an out-and-out showdown, resolving to summon Iranian ambassadors in all 27 countries to send “a strong message of protest against the detention of British Embassy local staff and to demand their immediate release,” a European diplomat said, speaking in return for anonymity.

Other measures — such as a ban on issuing visas to Iranian travelers and a pullout of European ambassadors — would be considered depending on how the crisis unfolded, the diplomat said.

The Iranian authorities accused the local employees of fomenting and orchestrating protests, but pro-democracy Iranians ascribed the violence on the streets to a widespread crackdown by government security forces.

In London, a spokeswoman for the Foreign Office, speaking in return for customary anonymity under civil service rules, said: “We are very concerned by these reports and are investigating. Allegations that our staff are involved in fomenting unrest are wholly without foundation. We will be seeking an urgent explanation from the Iranians”…

My understanding of why Obama mostly kept his mouth shut was that he has good sense. By criticizing the Iranian government, the E.U. played in to the Iranian Cleric’s Standard Operating Procedure: Rally support by attacking the west. Remember Jimmy Carter’s debacle. Now we’ll have marching in the streets, burning the British Embassy, etc. All very familiar.