Hank Paulson screwed a lot of things up, but his new book contains some interesting nuggets:
When he spoke to House Republicans about efforts to help Fannie and Freddie, he was chagrined that many responded with speeches about ACORN, the low-income housing activist group.
No one should pretend that fixating on idiocy like ACORN (instead of doing their fucking jobs as legislators) doesn’t have consequences.
El Cid
Paulson may be a recklessly greedy parasite on the US financial system, but in he’s not a demonic toddler.
Xenos
The wages of sin being death, what we have here is the rather profound sin of deceit leading to the folly of a whole generation of Republicans believing their own propaganda.
And it is not just specific propaganda here. The Acorn bamboozlement was relatively new bit of nonsense. But the Republicans conditioned themselves to speak ridiculous lies, and conditioned themselves thereby to believe those lies. It is like a self-induced mental illness.
El Cid
Also…
The leading banker-investors may have been greedy, short-sighted shits, but they were begging for some sort of federal oversight, and instead they got a leadership from Paulson on down of not doing so, and then they got a Republican leadership during the billionaire bailout society phase babbling about Barney Frank and ACORN.
I assume the point of the quotes were to decry the awful leadership at the heads of the corporations, but then, they operate entirely within the structure of incentives and disincentives and rules they’re given, unless even those aren’t enforced.
Sly
You give them too much credit. The House GOP certainly thought it had consequences. The right has long been perfectly willing to shit on a Democratic constituency (poor minority people) and an allied organization of their rival party even if it meant disaster and abandoning their sacred core principles. Spite is central to the modern conservative animus.
Tort reform has long been proclaimed as a method of hurting trial lawyers, even though it contradicts basic states’ rights doctrine and would hurt the vulnerable. Poor women have been hurt the most by the right’s crusade against Planned Parenthood, as their clinics are often the only place where affordable prenatal care is available. And they certainly don’t give a shit if they destroy school districts in their mission to bust the NEA and the AFT. Hell, that’s often seen as an ancillary bonus.
Shit, even Erick the Erickson championed the idea of abolishing his local police force if they unionized. These people will gladly destroy any social institution if it means hurting their political enemies.
El Cid
The Financial Times does a fun little animated introduction to proposed banking / financial system reforms by the administration. Punchline? These could be major reforms, with impacts as large as the post-Depression banking reforms. Or not. No one yet knows. And given the pronouncements from Dodd, nothing may happen, and might not even be tried. (That is, until any new round of bailouts are required.)
Speaking of the FT, Steve Clemons notes the account based on many interviews, most unnamed, done by FT’s Washington editor Luce (behind a paywall) on what is argued to be the vastly dominant and yet arguably harmful role of Obama’s dependence on 4 of his key advisers, Rahm, Jarrett, Gibbs, and Axelrod.
valdivia
@El Cid:
that Luce piece is a hatchet job and Clemons does his best as a Sally Quinn impersonator by cheerfully saying idiotic things about the Chicago people not attending enough cocktail parties. The fact everything is anonymous just tells it all. Another huge sin in that piece btw–total embrace of the right wing meme of the team’s Chicago Thuggery. You link to a piece that lauds this fucking idea? And last but not least: this is just more Black Jimmy Carter bs about Obama’s inner circle being bad just like Carter’s Georgia circle was bad, back in the day. This is not worthy of linking, it’s a Politico-like gossip story not a deep analysis. Obama’s first year is a total failure? really? Give me a freaking break.
/end rant. I really do not get how people keep linking to this (HuffPo did it yesterday) as if it tells us anything. It’s pure pure guessing from Important People in DC, who are not connected to Obama and hate that Obama is not playing their fucking game. You don’t like what Obama is doing put it in your own words but linking to this bs piece full of gossip is just totally wrong.
El Cid
@valdivia: I can’t say — I’ve seen selections of the article. Clemons goes beyond the contents of the article to appear somewhat gossipy.
You may note that in my own description of the piece I emphasized that the piece was based primarily on unnamed sources. I would not have mentioned that had I not thought it potentially relevant. I will admit, however, that on occasion really good journalists can use unnamed sources if there’s some really scrutinized methodology of who is consulted and how their testimony can be checked against other available facts. Otherwise there simply won’t be any reporting about current White House activities outside press releases, since nobody ever goes on record except to funnel their own propaganda. Maybe such reporting shouldn’t be done in general, given the harm of unnamed sources.
On the other hand, I’m no hack propagandist, but I think that the past year has actually shown enormous incompetence by both the Obama administration and the rest of the Democratic leadership — though, admittedly, I think that’s incompetence by sane standards rather than by comparison with the angry drunk hallucinatory cavemen of the Republican Party, against which simply remaining asleep would count as bold, sensible action.
I tend to situate what I see as errors and blown opportunities as more widely based in deeply held ideology by both Obama and much of the rest of the Democratic leadership establishment (though in the latter I think fundamental conflicts of interest play an even greater role, as in many Democratic Senators simply preferred HCR to favor insurers and pharma), as much as I would like to believe it’s due to a particular set of insiders. Others disagree and think the best was done that could have been done.
low-tech cyclist
Stuff like this is all a sneaky GOP plot to make us liberals feel condescending towards them.
valdivia
@El Cid:
then say that in your own words instead. But you link to a piece you have NOT read (I did by the way) and the whole thing is the same kind of Chicago bashing you can read in the screeds of right wingers just done in the Villagy way of some people say. The argument of the piece is not what *you* think is wrong, but that Obama is surrounded by people who are thugs and do not follow the niceties of the city and therefore are both out of their depth and at the same time throw their weight around. This is not about the Dem leadership, it is about making Obama look weak and incompetent and out of his depth.
My problem is when people link to pure gossip stories just because it makes a vague point about something they might agree with. Instead of validating your point about missed opportunities I walk away thinking you not only buy this kind of gossip but want others to buy it too even when the whole thing is based on a right wing talking point.
I know you are not a hack of any kind, I am not either, link me to something critical of policy and I will agree and maybe even bash a bit, but this kind of thing? It says NOTHING of consequence, it simply serves to make Republican points spread.
valdivia
I need to go catch a train out of the snowmaggedon so catch you all later.
Napoleon
I personally have learned to not trust Clemons judgment on anything, but having said that it is easy to think Rahm has been a disaster for Obama. Otherwise I would agree with El Cid @7.
El Cid
@valdivia: Well, we’re going to disagree, because I think you can link to a blog post or article without being seen as endorsing it. I thought it was interesting, it would be discussed, and so far I don’t think it at all looks like some hack trash piece. Again, one can take a blanket opposition to doing stories based on sources refusing to allow their names to be printed, but if so it does mean that there won’t be any reporting on current activities in the White House. Its central argument may be wrong and may or may not be based on the distorted views of jealous types, etc., but there’s no particular reason to assume that this must be the case. And I also disagree that the tenor of the piece makes it sound like the mistake is in not sufficiently appealing to The Village as the Sally Quinn loons would have one believe. I don’t know Clemons that well, so perhaps extra caution should be exerted.
If you prefer the Balloon Juice comments to be more like a policy making discussion group, I respect that. I’m not necessarily going to abide by that preference.
El Cid
I should say, I guess, that I think the main discussion of the Paulson book is more newsworthy for the moment than reporting about White House decisionmaking styles based on unnamed sources.
DougJ
I may link to the Luce piece that Clemons likes. The thing is…I hate Clemons and don’t consider him at all credible. And his attack on Emanuel is so stupid it made me laugh. (I say all this as someone who doesn’t like Rahm very much.)
AnneW
OT (I’m repeating this because it may have gotten lost in the last thread): you can freeze the animation in the Gator ad by hitting your Escape key.
slightly_peeved
Who is the standard of competence here? Clinton’s health care effort was far worse, and he brought in Nafta. Carter had plenty of problems getting stuff done. FDR didn’t turn around the great depression in a year.
Since my US history knowledge is pretty scanty, I’d be interested to find out which president’s first year is the yardstick here.
El Cid
@AnneW: My god — you’re magic.
General Winfield Stuck
@El Cid:
Sounds to me like you do endorse it, or at least agree with the major points made by Clemons. And “enormous incompetence” . Oh puhlease!
These hack pieces are one reason why Huffpo is a rag.
El Cid
@slightly_peeved: What am I supposed to do? I’m a citizen, not some Presidential ratings agency. Am I supposed to look at things from some politician’s point of view, as if I were standing there with them, or from my point of view, caring about the things I care about and pushing for the things I think the country desperately needs.
Maybe my standards are too high — the fact that I think that core, egregious failures were made in the health care reform push without which the effort very well could have been passed already and the administration’s position as well as that of the Democratic Party would be stronger… What, should I ignore that sort of thing and instead hope that people look at things on some sort of comparative, century-level scale? Okay, I hope that works, but I don’t really think it will.
Maybe there’s some sort of weird standard out there that one is either an Obama ‘ally’ or an Obama ‘foe’. If so, then I’ll just give up any pretense of analyzing the world for myself and just let the respective advocacy teams do their work.
And if I were to take this viewpoint — yeah, so much more seems to little old me that it could have been accomplished, but, gosh, in context I guess everyone was trying hard and passing all sorts of other stuff — how is this supposed to make me feel any better? For example, if I were to conclude that, say, Obama, or the 2009 Congress, was doing ‘better’ in some sort of general or numerical measure than 1993 Clinton or 1993 Congress, what of it? What am I supposed to do with that? I still don’t know that HCR will pass, I still think that different approaches by both White House and Congress could have gotten it done by now, and I’d rather it be done by now, and if it doesn’t happen, do I feel better that we came a lot further than 1993? I just don’t get it. Maybe I’m different. Maybe what I see as “enormous” should be rather situated in comparative context and seen as minor, whatever the consequences.
El Cid
@General Winfield Stuck: You are completely free to think whatever the fuck you want about me. I really don’t give a shit. I am endorsing the notion that the article might be worth taking a serious look at it. I don’t give a damn what you think it sounds like you think I’m saying or where you think I fall on the ‘mature’ or ‘friend or foe’ scale.
El Cid
@General Winfield Stuck: Yeah. Financial Times = HuffPo. Dork.
General Winfield Stuck
@El Cid: All I am saying is if you agree with something you link to then don’t claim it’s for some general interest story people might think is interesting.
That is all. You have a right to your opinion, but not to blow smoke up my ass about a link that obviously supports that opinion.
General Winfield Stuck
@El Cid:
I prefer dweeb.
El Cid
@General Winfield Stuck: I just don’t get the attitude that linking to something in a completely not serious forum such as a blog where people bitch and moan and joke about politics is some sort of serious, heavy choice that I need to be careful about it. This is not the official newsletter or annual review from some academic association or business trade group.
I’ll link to right wing articles, Weekly World News articles, spam e-mails, TimeCube type nuts, and anything else I damn well please, and if someone thinks that it constitutes a serious and considered endorsement and agreement with all the core arguments of the article, then, no. Maybe at least that it’s reasonably plausible — i.e., no reporting that insiders say that Obama has a tunnel to Kenya and gets his advice from that Nairobinati.
Yeah, I happened to think that it might be newsworthy and worthy of discussion if the Washington bureau chief of the Financial Times does an article supposedly based on lots of interviews regarding the inner deliberations of the White House. Admittedly for the most part I don’t care about the conflicts etc. in the White House, and only care about what actually happens in the outer world, though I keep waiting for much evidence that Rahm has any clue compared to the weird reputation he has for being tough and effective.
I just keep reminding myself, from time to time, this is an open comments forum on a blog named Balloon Juice.
bkny
i thought this was pretty interesting from paulson’s account of st johnny’s emergency return to wdc to confront economic catastrophe … and a likely explanation for st johnny’s extraordinary efforts to undermine the obama administration:
Finally, raising his voice over the din, Obama said loudly, “I’d like to hear what Senator McCain has to say, since we haven’t heard from him yet.”
The room went silent and all eyes shifted to McCain, who sat quietly in his chair, holding a single note card. He glanced at it quickly and proceeded to make a few general points. He said that many members had legitimate concerns and that I had begun to head in the right direction on executive pay and oversight. He mentioned that Boehner was trying to move his caucus the best he could and that we ought to give him the space to do that. He added he had confidence the consensus could be reached quickly.
As he spoke, I could see Obama chuckling. McCain’s comments were anticlimactic, to say the least. His return to Washington was impulsive and risky, and I don’t think he had a plan in mind.
Napoleon
@slightly_peeved:
I have read that Rahm considers NAFTA Clinton’s greatest achievement. Seriously. Right there if I was President that would disqualify him from being alowed to wash the Presidential limo let alone anything else
General Winfield Stuck
@El Cid: You build a complete strawman and miss my point entirely. What I said is simply own the links you agree with and are arguing toward it’s content, no more no less. And yes, it is possible to link to articles for general interest that may be controversial and one in which the linker doesn’t have a strong opinion about. I just don’t think that is the case in this instance.
El Cid
@Napoleon: I know. How hard was it to pass a Republican negotiated trade agreement (Bush Sr. and Carlos Salinas) with the backing of one of the biggest corporate lobbies ever formed (USA*NAFTA) with a majority of Republicans and a minority of Democrats in both the Senate and House?
I mean, it caused a lot of noise and a decent bit of protest, but it wasn’t really hard to get Republicans to pass legislation they generated and they support and that they get to pass against other Congressional Democrats. (What, the Republicans were going to oppose what all the biggest, richest U.S. corporations were screaming for and side with U.S. labor unions and most environmental groups [apart from the NRDC]?) And given that it was truly easy to portray your biggest opponent as the flighty and weird subsidized billionaire Ross Perot, even the debating was easily managed.
Doesn’t seem exactly like some brilliant political achievement, and given that one of the major goals of the original DLC politicians were to sideline traditional labor Democrats, it was also pretty much what they were saying was their priority for an entire decade.
On the other hand, it was big, so I guess if you’re just looking at how important legislation was, it’s a masterpiece.
El Cid
@General Winfield Stuck: What does that “mean”? You just used the phrase “own the link”.
Then, let me be very clear, as I don’t want to build a strawman: that strikes me as literally an insane, meaningless statement to make.
Without value. Without reason. Without the slightest bit of anything other than a voodoo sounding invocation.
[And let me be clear again: I don’t give a shit if people want to draw some sort of conclusions about my intentions if I happen to think that an article from a serious source may very well be significant and possess information of value but also may not. I may point out that such allegations of my intentions may be a bunch of horse-shit, but I don’t actually give a shit. I realize that there’s a very tense and insane game here on this blog by a bunch of neurotics on the Rahm / Not Rahm issue. I’m neither. I think he’s a useless prick and most likely harmful and counter-productive, particularly for goals I think are desirable, but I’m also not given to Rasputin theories of Executive power.]
jenniebee
@El Cid:
“Isn’t there something you can do to order us not to take all of these risks?”
This isn’t as infantile as it sounds. These firms have to show returns in order to keep their customers and stay in business. If one company starts getting involved in these kind of shenanigans and makes a pile for their investors, the other investment firms can’t very well tell all their customers “oh, you don’t want that money, you want to be responsible and the bets they’re making over there could lead in several years to the destruction of the world economy.” They can’t – they’d lose that business to the company that was taking all those unholy risks, and the effect would be the same except that the responsible companies would go under first.
So they need either regulation or collusion to level their playing field to stop irresponsible behavior from having an insurmountable advantage.
Napoleon
@El Cid:
On top of it if you recall the whole thing was sold on the promise that programs and laws would be passed to help displaced workers.
Plus it meant that the first really big act of Clinton was to piss on his base.
By the way, and maybe this is projection on my part because this is what I would do if I was in Congress, I think that what Clinton did with NAFTA colors what is even happening in politics to this day, for example in the HCR debate. I think the big reason you have the House refusing to pass the Senate bill until the Senate passes the fix, and you have progressives like that Hispanic Congressperson who heads the House Progressives Caucus almost Kamikaze drive for the public option is because they know there is a 30 year history of bate and switch on issues where “you pass something that helps business and we will pass something that helps the average voter”. I bet if I had all day I could come up with 50 examples but the one other then NAFTA that really stands out is the 82-84 time period fix to Social Security where workers would be overtaxed, the money would be saved then drawn down when they retired. Of course then tax cuts for the rich were passed and now that we have come to the “draw down” portion of the deal everyone from top Democrats to the WaPo editorial page are effectively talking about dishonoring the deal that was made.
It has been 30 years of bait and switch.
El Cid
@jenniebee: I don’t think it was infantile. I think such a comment is something you’ve heard from big business quite a few times throughout history — without effective regulations and restrictions and mandates from government, this whole thing will fall apart.
It’s surprising to me that it’s being portrayed as some sort of problem that the executive is acting silly or irresponsible or immature when what he’s doing is telling the appropriately empowered government official that if he and his administration keep blowing off the need to regulate the market for non-disastrous results then he needs to get busy.
What, they’re just supposed to stop doing profitable activities and hope their competitors do the same, and that the share-holders appreciate their nobility and responsibility?
General Winfield Stuck
@El Cid:
LOL, I have no idea what this means. All I said is if you agree with the contents of a link you make, just say so. But you don’t have to, you don’t have to do anything here you don’t want to. lighten up.
jenniebee
@slightly_peeved: It is worth noting that in Lincoln’s first year in office four states seceeded (bringing the total to 11. Any mention that seven had seceeded before Lincoln ever took office would, in today’s logic, be met with a derisive sneer of “blame it on Buchannan”) and the Union had been defeated at Fort Sumter and at Bull Run. So that was definitely worse than Obama’s first year.
Brian J
I talked to a woman who worked in the financial industry and who, while very nice and pleasant, was definitely a conservative. She mentioned something about Andrew Cuomo being involved in some CRA-type deal where the private banks were forced to take on crappy loans or something. I can’t remember her exact words, and while it may have been no different than what most who have been saying about this have said, it did strike me as different. I’m pretty confident she’s mistake, since some non DFHs, like Barry Riholtz, have said this was nonsense, but if this woman really believes it, I’m wondering what the point of contention is. After all, this concerns facts, not values, so after a certain point, it shouldn’t be that hard to see what is true and what is not.
Napoleon
@El Cid:
I personally like a sports analogy in this case, and the perfect one is pretty much the movie Rollerball.
Does anyone really think that if football quit enforcing rules and there was not criminal penalties to anything you did during a football game that pretty soon you would have brass knuckles and razor bladed tucked into some players gloves, or worse? If so only an idiot who was playing would not take steps to counter act other player’s actions, but why would you think it is somehow inconsistent for those same players to go to the league and tell them they have to put rules in place regulating stuff like that (by the way, in the last few years I think you have seen a version of this in football with the whole issue of letting players with concussions back into the game).
SpotWeld
I think the Bush administration was possibly correct in being a little slow to bring aid to the banks.
They way the requests were being coached… On the surface it sounds like and out and out plea for help. But you have to consider the context, the heads of these banks are not people to mitigate power. They mitigate responcibility.
Any action by the goverment to help the banks, done at a point in time when the banks leaders were feeling the freedom to set terms, it would have turned into the banks handing over the problems and then walking away with loud shouts of “free market”.
It’s like the 14-yr-old with the science project … he want’s some “help” from his mom. But as soon as mom offers to cut the wooden dowels to size, she also ends up paiting the foam spheres, printing the labels and looking up the masses of the planets the make up the solar system.
Maybe.. in the long game, it was better that the bailout happned in the way that it did.
Dan Robinson
What did Paulson expect? He has been part and parcel of the Republican machine that generated Wingdom in Washington.
The Republic of Stupidity
@Napoleon:
Well… that certainly explains why Bush kept coming back on the field…
Maude
@Napoleon: @31
How right you are.
The Republic of Stupidity
Perhaps if they hadn’t taken such over-the-top risks… they wouldn’t haven been in such vulnerable positions.
Did they really just ‘operate within the structures of incentives and disincentives and rules’ they were given, or did they go nucking futz? We’re not talking about sixteen year olds who go crazy after breaking into dad’s liquor cabinet and end up wrecking the car here.
And next time some bank robber gets caught, mebbe he’ll try and claim they shouldn’t have stopped him BEFORE he robbed a bank… for his own good.
tesslibrarian
@AnneW: Thank you! That was wonderful.
Svensker
@El Cid:
Sums it up elegantly.
El Cid
@The Republic of Stupidity:
Well, actually, if you look at it from the executives’ point of view, they really didn’t do anything wrong. After all, the system allowed them to do it, had they not done so the competitors would have, and any way no one seemed to be at personal risk of any financial loss or criminal punitive measures, so, the analogy would be more like 16 year olds knowing that a 16 year old who wrecked the family car after breaking into dad’s liquor cabinet would be able to keep any remaining liquor, be left with the key to the liquor cabinet afterwards, and have another car provided to him. Or something like that.
It’s a pretty classic theory of capitalism which holds that regulation is necessary to prevent the destruction of the system itself. Quite a lot of big businessmen and generational super-rich actually supported New Deal regulations and reforms — they weren’t all represented by the NAM.
xian
@bkny:
At least he didn’t read it off his hand:
xian
@jenniebee:
that’s all true but they also, as an industry and community, lobby for and get the regulatory regime they want. they are very powerful and unaccountable, so this all smacks a bit of “stop me before I kill again”
Zach
Go watch Paulson on MTP yesterday discussing his opinions of Obama and McCain’s actions during the financial crisis. His damning-with-faint-praise regarding McCain is pretty incredible. Shorter Paulson: “To Sen. McCain’s credit, he didn’t tell every Republican in the country to grab a pitchfork and thus engender 25% unemployment.”
Many folks seem to have forgotten that the market plunged 7% in a single day in response to the failed TARP vote in the House (even though it still seemed more likely than not that some bailout package would pass).
It’s sad that Wall St. is now turning to back Kudlow & Co. for Senate after having their asses saved by Democrats (and Bush!) willing to take certain political heat for doing the right thing (cf Chris Dodd’s career).
CalD
If only it had consequences for them.