Monthly Archives: December 2011
On this day, December 30th, in 1936 — 75 years ago today — hundreds of workers at the General Motors factories in Flint, Michigan, took over the facilities and occupied them for 44 days. My uncle was one of them.
The workers couldn’t take the abuse from the corporation any longer. Their working conditions, the slave wages, no vacation, no health care, no overtime — it was do as you’re told or get tossed onto the curb.
So on the day before New Year’s Eve, emboldened by the recent re-election of Franklin Roosevelt, they sat down on the job and refused to leave.
They began their Occupation in the dead of winter. GM cut off the heat and water to the buildings. The police tried to raid the factories several times, to no avail. Even the National Guard was called in.
But the workers held their ground, and after 44 days, the corporation gave in and recognized the UAW as the representative of the workers. It was a monumental historical moment as no other major company had ever been brought to its knees by their employees. Workers were given a raise to a dollar an hour — and successful strikes and occupations spread like wildfire across the country. Finally, the working class would be able to do things like own their own homes, send their children to college, have time off and see a doctor without having to worry about paying. In Flint, Michigan, on this day in 1936, the middle class was born.
But 75 years later, the owners and elites have regained all power and control. I can think of no better way for us to honor the original Occupiers than by all of us participating in the Occupy Wall Street movement in whatever form that takes in each of our towns. We need direct action all winter long if we are to prevail. You can start your own Occupy group in your neighborhood or school or with just your friends. Speak out against economic injustice at every chance you get. Stop the bank from evicting the family down the block. Move your checking and credit card to a community bank or credit union. Place a sign in your yard — and get your neighbors to do it also — that says, “WE ARE THE 99%.” (You can download signs here and here.)
Do something, anything, but don’t remain silent. Not now. This is the moment. It won’t come again.
75 years ago today, in Flint, Michigan, the people said they’d had enough and occupied the factories until they won. What is stopping us now? The rich have one plan: bleed everyone dry. Can anyone, in good conscience, be a bystander to this?
My uncle wasn’t, and because of what he and others did, I got to grow up without having to worry about a roof over my heads or medical bills or a decent life. And all that was provided by my dad who built spark plugs on a GM assembly line.
Let’s each of us double our efforts to raise a ruckus, Occupy Everywhere, and get creative as we throw a major nonviolent wrench into this system of Greed. Let’s make the politicians running for office in 2012 quake in their boots if they refuse to tax the rich, regulate Wall Street and do whatever we the people tell them to do.
by Bob Fitrakis and Harvey Wasserman
It took two stolen US Presidential elections and the prospect of another one coming up in 2012.
For years the Democratic Party and even much of the left press has reacted with scorn for those who’ve reported on it.
But the imperial fraud that has utterly corrupted our electoral process seems finally to be dawning on a broadening core of the American electorate—if it can still be called that.
The shift is highlighted by three major developments:
1. The NAACP goes to the United Nations
In early December, the National Association for the Advancement of Colored People (NAACP), the largest civil rights organization in America, announced that it was petitioning the United Nations over the orchestrated GOP attack on black and Latino voters.
In its landmark report entitled Defending Democracy: Confronting Modern Barriers to Voting Rights in America, the NAACP directly takes on the new Jim Crow tactics passed in fourteen states that are designed to keep minorities from voting in 2012.
The report analyzes 25 laws that target black, minority and poor voters “unfairly and unnecessarily restrict[ing] the right to vote.” It notes “…a coordinated assault on voting rights.”
The Free Press has been reporting on this coordinated assault since the 2000 election, including the heroic struggle of voters in Ohio to postpone the enactment of the draconian House Bill 194 that was the most restrictive voting rights law passed in the United States. (See Voting rights activists fight back against new Republican Jim Crow attack in Ohio)
The NAACP points out that this most recent wave of voter repression is a reaction to the “…historic participation of people of color in the 2008 presidential election and substantial minority population growth according to the 2010 consensus….”
It should be no surprise that the states of the old Confederacy – Florida, Georgia, Texas, and North Carolina – are in the forefront of repressing black voters. Three other Jim Crow states with the greatest increase in Latino population – South Carolina, Alabama, and Tennessee – also implemented drastic measures to restrict minority voting.
The report documents that a long-standing tactic under fire since the 1860s – the disenfranchisement of people with felony convictions – is back in vogue. This has been coupled with “severe restrictions” on persons conducting voter registration drives and reducing opportunities for early voting and the use of absentee ballots complete these template legislative acts.
Most of these new Jim Crow tactics were initially drafted as model legislation by the American Legislative Exchange Council (ALEC), a secretive and conservative corporate policy group whose founder, according to the NAACP, is on record in favor of reducing the voting population in order to increase their own “leverage.”
The Brennan Center for Justice estimates that the 25 laws passed in these 14 states could prevent as many as 5 million voters from voting, a number easily exceeding the margin of victory in numerous presidential elections.
Ohio’s HB 194, which awaits a 2012 referendum vote, would disenfranchise an estimated 900,000 in one of our nation’s key battleground states.
An important statistic in all the legislation is that 25 % of African Americans lack a state photo identification, as do 15% of Latinos, but by comparison, only 8% of white voters. Other significant Democratic constituents – the elderly of all races and college students – would be disproportionately impacted.
Ohio voters have just repealed a draconian anti-labor law passed by the GOP-dominated legislature and the state’s far-right governor John Kasich. Whether they will do the same to this massive disenfranchisement remains to be seen. But the fact that it’s on a state ballot marks a major leap forward. Ohio activists are also drafting a constitutional amendment that includes revamping the registration, voting and vote count procedures.(Can we transform labor’s Buckeye victory into a new era of election protection?)
2. The Justice Department awakens
On Friday, December 23, 2011, the U.S. Justice Department called South Carolina’s new voter ID law discriminatory. The finding was based in part on the fact that minorities were almost 20% more likely than whites to be without state-issued photo IDs required for voting. Unlike Ohio, South Carolina remains under the 1965 Voting Rights Act and requires federal pre-approval to any changes in voting laws that may harm minority voters.
The Republican governor of South Carolina Nikki Haley denounced the Justice Department decision as “outrageous” and vowed to do everything in her power to overturn the decision and uphold the integrity of state’s rights under the 10th Amendment.
The US Supreme Court has upheld the requirement of photo ID for voting. Undoubtedly the attempt by US Attorney General Eric Holder to challenge this will go to the most thoroughly corporate-dominated Court in recent memory. The depth of the commitment of the Obama Administration to the issue also remains in doubt.
3. The EAC finally finds that voting machines are programmed to be partisan
Another federal agency revealed another type of problem in Ohio. On December 22, 2011, the U.S. Election Assistance Commission (EAC) issued a formal investigative report on Election Systems & Software (ED&D) DS200 Precinct County optical scanners. The EAC found “three substantial anomalies”:
• Intermittent screen freezes, system lock-ups and shutdowns that prevent the voting system from operating in the manner in which it was designed
• Failure to log all normal and abnormal voting system events
• Skewing of the ballot resulting in a negative effect on system accuracy
The EAC ruled that the ballot scanners made by ES&S electronic voting machine firm failed 10% of the time to read the votes correctly. Ohio is one of 13 states that requires EAC certification before voting machines can be used in elections. The Cleveland Plain Dealer reported in 2010 that the voting machines in heavily Democratic Cuyahoga County had failed during testing for the 2010 gubernatorial election. Cleveland uses the same Republican-connected ES&S ballot scanners—the DS200 opti-scan system. Ohio’s Mahoning County, home of the Democratic enclave of Youngstown, also uses the DS200s. The same opti-scan system is also used in the key battleground states of Florida, Illionois, Indiana, New York, and Wisconsin.
Voting rights activists fear a repeat of the well-documented vote switching that occurred in Mahoning County in the 2004 presidential election when county election officials admitted that 31 of their machines switched Kerry votes to Bush.
But a flood of articles about these realities—including coverage in the New York Times—seems to indicate the theft of our elections has finally taken a leap into the mainstream of the American mind. Whether that leads to concrete reforms before another presidential election is stolen remains to be seen. But after more than a decade of ignorance and contempt, it’s about time something gets done to restore a semblance of democracy to the nation that claims to be the world’s oldest.
Ron Paul’s Constitutional Hood
If the character of those whom we attract is any sign of who we really are, then it just got a little uglier for Ron Paul.
“Everybody, all of us back in the 80?s and 90?s, felt Ron Paul was, you know, unusual in that he had actually been a Congressman, that he was one of us and now, of course, that he has this broad demographic–broad base of support,” Mr. Black said on his broadcast yesterday.
Mr. Black is a former Klansman and member of the American Nazi Party who founded the “white nationalist” website Stormfront in 1995. He donated to Mr. Paul in 2007 and has been photographed with the candidate. Mr. Paul has vocal supporters in Stormfront’s online forum. Mr. Black has repeatedly said he doesn’t currently think Mr. Paul is a “white nationalist.”
In addition to Black, Paul has also drawn the endorsement of David Duke, former KKK Grand Wizard, anti-semite and all around pile of scum who finds Paul’s anti-Israel shtick appealing.
“So, I would vote for Ron Paul at this moment because he’s one of the few candidates who have policies in this regard and this realm that I wholeheartedly support, and that’s why I’d vote for him.”
Is Paul bothered by the fact that avowed racists endorse him? Apparently not. His take is that people like Black and Duke are endorsing his policies as opposed to Paul endorsing what the racists say. True but would a true non-bigot not be alarmed (or, at the least, concerned) that racist hatemongers are attracted to their policies? Not Ron Paul.
Then there’s gay activist Dan Savage’s take on Paul’s bigotry as he compares it to Rick Santorum’s.
Ron is older than my father, far less toxic than Santorum, and, as he isn’t beloved of religious conservatives, he isn’t out there stoking the hatreds of our social and political enemies. And Ron may not like gay people, and may not want to hang out with us or use our toilets, but he’s content to leave us the fuck alone and recognizes that gay citizens are entitled to the same rights as all other citizens. Santorum, on the other hand, believes that his bigotry must be given the force of law. That’s an important difference.
Fair enough but one can make the argument that Paul’s real interest in this matter has nothing to do with individual’s rights and everything to do with states’ rights. A Dish reader explains:
Essentially, Paul has no interest in leaving anybody alone. He only wants to get rid of one government scared into submission by oppressive douchebags and replace it with 50 governments scared into submission by oppressive douchebags.
You can run from your past but hiding is another matter…
Late Night Political Humor – Best of 2011
My picks of some of the year’s best from Political Humor‘s compiled list…
”Osama Bin Laden’s supporters want to rename the Arabian Sea where his body was dumped Martyr Sea. Really? Martyr Sea? Hiding in your bedroom for six years? How about Chicken of the Sea?” —Jay Leno
”The Republicans are so happy about bin Laden they’ve granted President Obama full citizenship.” —David Letterman
”I think the next election just got a lot easier for President Obama ’cause his response to every question during the debates will be: ‘Wait, I forget…Did you kill Osama Bin Laden? Or did I kill Osama Bin Laden. Oh no, it was me, wasn’t it?”’ —Craig Ferguson
”President Obama’s approval rating is at a two-year high in the wake of Osama bin Laden’s death. If I were Obama, I’d fish bin Laden out of the ocean and kill him every Sunday.” —Jimmy Kimmel
”No! Not Captain Buzzkill! Not the guy who looks like everyone who ever fired your dad! He’s gonna suck all the fun right out of this crazy thing. Just look at the online video announcing his run. It looks like it could double as an ad for erectile dysfunction pills. ‘Mitt Romney: for when the moment’s right.”’ —Jon Stewart on Mitt Romney running for president
”As the Republicans continue checking underneath every available flag pin and Bible for viable candidates, presumed de facto frontrunner candidate Mitt Romney has gotta be thinking, ‘What the fudge? This is starting to hurt where my feelings should be.”’ —Jon Stewart
”Several congressmen have filed a lawsuit against President Obama for getting us involved in Libya. They claim Obama got the U.S. in a Middle East war without authorization from Congress. To which Dick Cheney and Bush said, ‘You can get sued for that?”’ —Jay Leno
”Egypt has responded to hundreds of thousands of protesters by shutting down the Internet. Just a word of advice: If you want people to stay at home and do nothing, you should turn the Internet back on.” —Conan O’Brien
”You gotta love Sarah Palin. She is now on her website asking her idiot fan base for donations for her to help make a decision about whether or not to run. She wants money now for just thinking? What a grifter.” —Bill Maher
”Sarah Palin continues to make significant contributions to the English language. She asked, ‘Is Libya a war, an intervention, a squirmish, what is it?’ Squirmish is how I feel every time I hear Sarah Palin talk.” —Jimmy Kimmel
”Bristol Palin just announced she had corrective surgery on her mouth. It’s being called the right procedure on the wrong Palin.” —Conan O’Brien
‘‘We had a national tragedy this week, and the President of the United States and Sarah Palin both made speeches on the same day. Obama came out against lunatics with guns, she gave the rebuttal.” —Bill Maher, on the Arizona shooting massacre
”New Rule: When you make stupid into an art form, it’s not stupid anymore. We just found out that the ‘Sarah Palin’ who writes Sarah Palin’s Facebook page is a fake. But the real Sarah Palin has her own Facebook page, under a fake name, and sometimes the ‘real fake’ Sarah Palin praises the work of the ‘fake real’ Sarah Palin. It’s like Inception for hillbillies. There’s also a rumor that she doesn’t really need glasses, she just wears them to look smart. And when she has them on, Todd doesn’t know she’s Superman.” —Bill Maher
”Sarah Palin visited the Wailing Wall in Jerusalem. There was an awkward moment when she said, ‘So this is what keeps the Mexicans out?”’ —Conan O’Brien
”Michele Bachmann is kind of like Sarah Palin but without the charisma — or marksmanship. You know, maybe we should stop telling kids that anyone can grow up to be president of the United States.” —Jimmy Kimmel
”New Rule: Stop comparing Sarah Palin and Michelle Bachmann just because they’re both Republican women. And crazy. And know-nothings. And Jesus freaks, who claim to receive messages from God. Who both get their historical facts wrong all the time. Who both give off a sound that only animals can hear and makes microwaves explode. Seriously, stop comparing them.” —Bill Maher
”I’m not certain of a lot of things. But there are three things in this world that I know for certain: Empire Strikes Back is the best Star Wars movie. OJ killed those people. And what my erect penis looks like in my own underwear from a bird’s-eye view.” —Jon Stewart, on Rep. Anthony Weiner saying he ”can’t say with certitude” whether a lewd picture posted on Twitter wasn’t his wiener
”Herman Cain said he’d only drop out of the race if his wife is no longer behind him. His wife said she’s always behind him, because there’s never any room under him.” —Conan O’Brien
”Herman Cain said he wants people to know that there’s more between his ears than pepperoni and pizza sauce. He says there’s also a few napkins and crazy bread.” —Conan O’Brien
”Donald Trump insisted yesterday that he is not racist, because one time an African-American won ‘Apprentice.’ Because nothing says ‘not racist’ like making a black man run your errands.” —Conan O’Brien
”Chris Christie decided not to run. He had a big decision. He weighed the pros. He weighed the cons. He weighed himself. I like the guy. This is a candidate we could have all gotten behind. Now they’re saying he might be a Vice Presidential candidate. He’d make a great one. I’ll bet this guy knows how to spell ‘potato.”’ —David Letterman
”This morning on the ‘Today’ show, Jenna Bush interviewed Ozzy Osbourne. Ozzy was so confused and inarticulate that Jenna accidentally called him ‘dad.”’ —Conan O’Brien
”These people could have personally witnessed him being born out of an apple pie, in the middle of a Kansas wheat field, while Toby Keith sang the National Anthem and they’d still think Obama was a Kenyan Muslim.” —Jimmy Kimmel
”Today President Obama released his long-form birth certificate, proving once and for all he was born in this country. But you know, it never ends. Now Republican leaders are saying they want to see the placenta.” —Jay Leno
”A gay activist dumped glitter all over Newt Gingrich. He wants Newt to stop being against gay marriage. But Newt believes marriage is a sacred bond between a man and his wife and his mistress and the other woman he’s seeing on the side.” —Jay Leno
”Newt Gingrich said he’s afraid America will become an atheist country dominated by radical Islamists. Right. Our big problem could be religious atheists, almost as bad as pacifist warmongers. If they hook up with the communist capitalists we’re screwed.” —Jay Leno
”Newt Gingrich wants to repeal child labor laws. Ladies and gentlemen, this is the man that we need to lead us into the 18th century.” —David Letterman
”House Speaker John Boehner says President Obama should have clearly outlined his exact plans before bombing Libya. Apparently it’s only Iraq where you don’t have to do that.” —Jay Leno
”This is the first debate Rick Perry has participated in since he announced his candidacy. Perry is a mix between George W. Bush and Yosemite W. Sam.” —Jimmy Kimmel
”Big news from last night’s Republican debate, you guys. It turns out George Bush was actually the smart Texas governor. … Look, I know these Rick Perry jokes are a little mean, but tomorrow, he won’t even remember them.” —Jimmy Fallon
”Tonight was the 14th republican presidential debate, or as Barack Obama has started calling them, campaign ads.” —Jimmy Fallon
”If you’re keeping score at home, they have now applauded executions at the Republican debate, they have cheered letting an uninsured man die, and they booed an active duty U.S. serviceman for being gay. I don’t know how you get to the right with this crowd but Ron Paul’s new campaign ad is just the Rodney King beating to the sound of children laughing.” —Bill Maher
”You got to feel bad for poor Mitt Romney. He’s in their plugging every week, and every week somebody gets ahead of him. The people who have led Mitt so far: Donal Trump, then Michele Bachmann, then Rick Perry, now Herman Cain. He’s been led by a reality show star, a crazy lady, a stuttering cowboy, and the guy who brings the pizza. That’s gotta hurt a little.” —Bill Maher
”You want to add another candidate? It’s like the Republican primary is a season of ‘American Idol’ in reverse, where every week you just add some new idiot… Have you ever considered the possibility that your candidates aren’t the problem — it’s you?” —Jon Stewart to the GOP base
”Republican voters have been reduced to using the same criteria as a 4 a.m. barroom pickup: he has a pulse and no visible cold sores.” —Stephen Colbert
”Hank Williams Jr. got his ass kicked off of Monday Night Football. His crime was comparing Obama to Hitler on Fox News. Or as it used to be called, ‘The Glenn Beck Show.’ … If we are going to fire every Southern hillbilly who thinks Obama is like Hitler, who will be our Republican congressmen?” —Bill Maher
”Senate Majority Leader Harry Reid now wants to outlaw prostitution. Let’s make politicians illegal and keep the hookers. At least they’re upfront about screwing you.” —Jay Leno
”I’m upset that Mike Huckabee criticized Natalie Portman for having a child out of wedlock. Listen, I’m no fan of unwed mothers either, but this is Natalie Portman we’re talking about. That unborn child is Luke Skywalker.” —Stephen Colbert
”The President of China is in Washington. It’s a bit like when you’re into your bookie for more than you can afford, and he stops by the house to say hello.” —Jimmy Kimmel
”My great-grandfather did not travel across 4,000 miles of the Atlantic Ocean to see this country overrun by immigrants.” —Stephen Colbert
You’ll find a lot more of the year’s best late night humor at Political Humor.
We all know that when it comes to character, actions speak louder than words. So let’s call the moral bankruptcy showcased daily what it is.
Let’s start with the bankers.
To show you the moral bankruptcy displayed by people like Bryan Moynihan (Bank of America), Jamie Dimon (JPMorganChase), John Stumpf (Wells Fargo) and the rest as clearly as possible, I need to set the stage using a hypothetical top banking executive–Banker Bob.
Let’s be as sympathetic as possible to Banker Bob, and have him start his job with clean hands. Banker Bob came in as CEO from a different industry; he’s some kind of turnaround specialist. That already puts him on higher moral ground than the people running our bailed-out banks.
True, BofA’s Moynihan got the top job as of January 1, 2010. But Moynihan was promoted from within; he’d been with FleetBoston Financial, which was swallowed by BofA, since 1993. And since 2004 he’d held “senior leadership positions at Bank of America representing experience across virtually all business lines,” as the press release announcing Moynihan’s promotion pitched him.
Dimon’s an even more culpable insider; he’s been running JPMorgan Chase as President since 2004 and CEO since 2006. Dimon fully consolidated his control by becoming Chairman at the start of 2007. Over at Wells Fargo, Stumpf has 29 years of experience at the company, taking over as President in 2005 and CEO 2007, and Chairman in 2010.
Perhaps the closest big banker to Banker Bob in this regard is Citi’s Vikram Pandit, who came to Citi in 2007 and took over near the end of that year. That said, Pandit’s no newbie, having run Morgan Stanley’s investment banking division, followed by running his own hedge fund. And he took over at Citi before Citi finished wreaking all the havoc it did in the meltdown.
Unlike those guys, our Banker Bob is totally innocent the day he gets the top job; none of his company’s current ruin is his fault. And let’s be specific about the ruin the company is when Bob takes over.
The Ruins That Are Our Bailed Out Banks
First, the executives that preceded Banker Bob “built” the company by buying up other companies, exactly the way Bank of America, JPMorgan Chase, Citigroup, and Wells Fargo came to be the monstrosities that they are today. Each acquisition triggered major payouts to the executives, and each resulted in layoffs and reduced morale for the original companies’ employees. Such wealth for the executive few and pain for the worker many is justifiable if the executives deliver the shareholder value promised by the deals: a better, stronger, more profitable company. However, in the case of Banker Bob’s bank (and BofA, JPMorgan Chase and Wells Fargo) generally the executives failed to execute the acquisitions properly.
Instead of a new, integrated and more potent company, say, a solidly built tinkertoy creation, the companies were like a bunch of marbles in a bag too small to hold them snugly. That is, profits and share prices may have spiked, but at the expense of the company. Shareholders lost.
And that’s the first moral failing: doing a lousy job without being accountable for the failure. How do I know they weren’t accountable? They kept their jobs, took big payouts and heaped misery on those much weaker than them. The failure to integrate the companies is deeply ironic, if you think about it, since executing, such as implementing a plan of merger, is what “executives” are supposed to be good at, right? Nonetheless, in those failures, Banker Bob’s predecessors were merely following the law of averages; “70% of banking mergers fail“, a Bain & Co. consultant told USA Today when Dimon merged BankOne into JPMorgan Chase.
As a result of all the poorly executed mergers, Banker Bob’s company has databases that can’t effectively talk to each other, just like the problems at JPMorgan Chase described by whistleblower Linda Almonte. (Read my DailyFinance story on Almonte here, and her SEC letter here.) I mean, banks’ databases are so bad that the “never-event” of being wrong about what a borrower owes happens all too frequently.
Second, Banker Bob’s predecessors ruined the company with gambling, er, “trading”, and lies. In fact, when the bets were called and the lies exposed (by the surprise mark down of AAAs), the company’s only hope of continued existence was a government bail out to the tune of hundreds of billions of dollars. (See page 4 of the second link for a company-specific bailout breakdown current as of October 1, 2011, by Naomi Prins and Krisztina Ugrin).
What kind of “trading” destroyed the banks? Rampant speculation, including betting that companies the traders had no interest in would fail, like betting your neighbor’s house will burn down. Similar wagers were made on whether or nothomeowners would default on their loans. And in the years leading to the crisis, the bankers and traders were these placing bets with lots of borrowed money. (See also here and here.) That’s right; the bankers and traders were using credit cards for cash advances at the casino.
Many people have long viewed gambling as immoral, or at least morally questionable. And gambling with borrowed money? How about gambling with thrice borrowed money, so that the collateral no longer backs the loans? (Check out “re-hypothecation” here.) That’s definitely immoral. Worst, the bankers and traders knew they were making disasters for others to deal with; they didn’t care so long as they got their fat bonuses. This attitude is embedded in the Wall Street slang “IBG, YBG“, for I’ll be gone, you’ll be gone (when the s–t hits the fan, after the bonus has been paid.)
But the immoral corporate self-immolation in the name of massive pay for the few went beyond gambling; it included lies. What kind of lies destroyed the banks? Let’s start with making the loans. Bankers lied to homeowners about the terms of the loans they’d get (see comment about bait & switch at closing here) and lied to their own computers by inputting mythical, magic numbers so the software would approve the loan (so many possible cites, here’s one “this is the figure that made the ratios fit”). After the loans were funded, bankers lied to investors (like pension funds) to get them to buy the loans your employees called “crappy” (though more crassly) behind the investors’ backs.
But the bankers’ lies to investors went beyond the loan quality. The lies generally included all the contractual promises about giving good title to the loans they were selling. That is, the company lied about doing mountains of necessary and important legal documents truthfully and on time. Those lies alone have the power to destroy the bankers’ companies, as the Congressional Oversight Panel discussed.
So that’s another form of immorality the bankers have so flagrantly displayed: lying. The wrongness of lying is so basic my four year old gets it. Again, our Banker Bob, unlike the current captains of the industry, didn’t tell any of these lies. And don’t waste any time on claims that the guys on top didn’t lie. That’s nonsense. The guys on top set the compensation structures that incentivized lying, and they fired the whistleblowers who tried to get the executives to stop the lying. And, most fundamentally, the buck stops at the top.
When the financial crisis caused housing prices to fall off a cliff, foreclosures spiked. Suddenly all those never-properly done documents were needed, so Banker Bob’s predecessors hired document fraud factories to fill in the gaps. In so doing the bank executives revealed their belief that they are allowed to break the law, if the law interferes with their profits. And the immorality of that position couldn’t be clearer.
Okay, so here’s the picture when Banker Bob takes the reins:
The bank’s financial statements are a mess, and since investors aren’t (always) stupid, the bank is trading at a steep discount to book value;
The bank’s databases are so flawed it continues to drive homeowners into foreclosure that are current on their mortgages;
The bank is continuing to commit document fraud, even after signing agreements with the government promising to stop;
The bank faces massive but as yet unquantifiable liabilities for all the immoral and illegal acts of Banker Bob’s predecessors.
So what does Banker Bob do?
The Bankers’ Ongoing Moral Bankruptcy
Does Banker Bob insist on giving investors an honest accounting of his banks’ books, knowing he has to sign off on the financial statements under Sarbanes Oxley? That would be the moral and ethical thing to do. I mean, doesn’t his signature on those certificates mean anything to him? Unlike many of the mortgage loans with their legalese and lengthy riders, the Sarbanes Oxley certificates are short and easy to understand. And Banker Bob self-righteously points to homeowners’ signatures on the mortgage loans, doesn’t he?
Moreover, all the big banks are public companies, seeking all the benefits of the capital markets. And the lifeblood of the markets is timely and accurate information. (See, e.g., the SEC’s Fair Disclosure regulation, aimed at the profitable-for-executives distortions of “selective disclosure.”) So does Banker Bob insist his company comes clean? Sadly, the answer is “No.”
On the incompetence resulting from busted acquisitions, what does Banker Bob do? Does overhaul procedures and dedicate resources to ensure that payments are no longer processed inaccurately? Does he stop his bank from charging inappropriate fees? Does he stop his company from forcing unnecessary and exorbitantly expensive insurance on borrowers? All those would be the moral things to do, since generally being competent is a basic part of good faith and fair dealing. But I can’t find any sign that Banker Bob’s doing any such thing.
How about the most blatant lawbreaking? Does Banker Bob shut down document fraud, insisting that his company will obey the letter and the spirit of all the laws that apply to it? This time the answer isn’t no. It’s Heck, NO!. At least there’s no sign any bank or mortgage servicer has quit the document fraud habit, not in any form visible in any court or land record office in the nation.
Does Banker Bob investigate his bank’s inability to modify mortgages as mandated, and fix the problems by dedicating the staff and resources necessary to do the job? That would be the moral thing to do, since the banks’ current practices are deceptive and abusive, and are harming homeowners in incalculable but devastating ways. Again, no.
Does Banker Bob make a Japenese-style show of contrition to save face while he struggles mightily to fix the bank he runs? Ha. American bank executives have responded to the situation by whining, while Japanese executives have been known to commit suicide in the face of humiliating failures by their companies. So that’s a “No.”
Does Banker Bob at least insist that he won’t take another dime in compensation–not another penny from shareholders–until he has fixed the company he’s running? I mean, his millions could hire an awful lot of people to make his company run better. Again, the answer is no. In fact, it’s more like, no, no, absolutely not, over my dead body will I give up any compensation even though my company sucks.
(To be fair, Citi’s Pandit has offered to work for $1/year, but it’s worth noting he cleared almost $80 million from Citi when it bought his company, and that’s money he only really gets to keep if he stays at Citi through the end of this year.)
The Damage Done
In total, the malfeasance and incompetence of the bank Banker Bob leads is devastating our economy. The banks’ securities fraud cut off the capital that used to fuel the mortgage market, destroying demand and pushing home prices into the free fall that’s drowning so many homeowners. The banks’ lies and incompetence of all sorts mock the rule of law daily, wrecking our land records, and evicting millions of people who rightfully should still be in their homes. (Millions when you count both servicer driven foreclosures and failures to appropriately modify loans.) And in the face of all this the only thing Banker Bob tries to do aggressively is settle lawsuits on terms abusive of investors and homeowners.
Let’s recap. After incompetently building bank behemoths by piling little banks up on one another like badly built cairns, bank executives lied to everybody, borrowed all the money they could to fuel their gambling, and demanded taxpayers bail them out. Throughout that time and after, their companies functioned incompetently, consistently abusing homeowners and wrongfully rendering many people homeless. And the bankers, including even mythical, initially innocent Banker Bob, have been paying themselves millions of shareholders’ dollars each year.
If that’s not moral bankruptcy in motion, what is it?
And I haven’t even mentioned how the bankers consistently push the “irresponsible borrower” myth and all the policy-paralyzing consequences that flow from it. Manufacturing and propagating that myth is in itself a demonstration of moral bankruptcy.
Beyond Morally Bankrupt Bankers: Our Government
The only thing worse than the moral bankruptcy so vividly on display by our top bankers is its reflection in our Government. I mean, beyond the need to obey the law, transact with good faith and fair dealing, and occasionally honor a fiduciary duty, it’s fundamentally not bankers’ jobs to look out for ordinary Americans. But it is our government’s job. And even a cursory look at our Government’s actions regarding bank and housing policy reveals a moral bankruptcy that makes bankers look, well, not quite alter-boyish, but certainly much better.
In future posts on this theme, I’m going to look at our most bank-captured regulator, the Office of the Comptroller of the Currency; our most bank-captured cabinet positions, the Secretary of the Treasury (yes you, Mr. Timothy Geithner) and the Attorney General (yes you, Mr. Eric Holder); our indefensibly banker-wannabe Fannie and Freddie; our most bank-captured members of Congress (yes you, Consumer Bureau-blocking Congressional Republicans); and finally, our shockingly bank-cowed President Obama.
Right now though, I’m going to go scrub my hands over and over with warm soapy water, typing this up has just made me feel so gross.
This morning NPR’s Morning Edition did a piece about an Iraqi woman, described as fiction (so one wonders why this would appear on a “news” program), who says when she saw the American troops coming to invade she “cried tears of joy” (listen here if you want to hear propaganda so extreme that FOX News would reject it).
NPR spread the lies of the Bush regime about weapons of mass destruction to justify the illegal invasion of Iraq, and its talking heads, particularly Scott Simon, pushed for war week after week leading up to Shock and Awe. At the time, we are proud to say, LUV News was reporting facts by the world’s foremost experts on Iraqi weapons saying there were no weapons of mass destruction in Iraq (we also opposed the war beforehand and ran opinion pieces by peace activists who were not allowed into the mass media).
Hopeless propagandists, NPR is still spinning the war, having, as far as we know, never apologized for the lies that resulted in so many deaths, so much destruction, leaving millions still refugees.
Rick Perry’s Elusive Search for a Brain
Rick Perry wins the Idiot Quote of the Week award.
“Every barrel of oil that comes out of those sands in Canada is a barrel of oil that we don’t have to buy from a foreign source.”
The fact that anyone could take this dumbass to be a serious presidential candidate is a reflection of how low the bar has been set for politicians in the Republican party. You can thank George W. and his enablers in the conservative media for that one.
Scarecrow: I haven’t got a brain… only straw.
Dorothy: How can you talk if you haven’t got a brain?
Scarecrow: I don’t know… But some people without brains do an awful lot of talking… don’t they?
Dorothy: Yes, I guess you’re right.
by Glenn Greenwald
American presidential elections are increasingly indistinguishable from the reality TV competitions drowning the nation’s airwaves. Both are vapid, personality-driven and painfully protracted affairs, with the winners crowned by virtue of their ability to appear slightly more tolerable than the cast of annoying rejects whom the public eliminates one by one. When, earlier this year, America’s tawdriest (and one of its most-watched) reality TV show hosts, Donald Trump, inserted himself into the campaign circus as a threatened contestant, he fitted right in, immediately catapulting to the top of audience polls before announcing he would not join the show.
The Republican presidential primaries – shortly to determine who will be the finalist to face off, and likely lose, against Barack Obama next November – has been a particularly base spectacle. That the contest has devolved into an embarrassing clown show has many causes, beginning with the fact that GOP voters loathe Mitt Romney, their belief-free, anointed-by-Wall-Street frontrunner who clearly has the best chance of defeating the president.
In a desperate attempt to find someone less slithery and soulless (not to mention less Mormon), party members have lurched manically from one ludicrous candidate to the next, only to watch in horror as each wilted the moment they were subjected to scrutiny. Incessant pleas to the party’s ostensibly more respectable conservatives to enter the race have been repeatedly rebuffed. Now, only Romney remains viable. Republican voters are thus slowly resigning themselves to marching behind a vacant, supremely malleable technocrat whom they plainly detest.
In fairness to the much-maligned GOP field, they face a formidable hurdle: how to credibly attack Obama when he has adopted so many of their party’s defining beliefs. Depicting the other party’s president as a radical menace is one of the chief requirements for a candidate seeking to convince his party to crown him as the chosen challenger. Because Obama has governed as a centrist Republican, these GOP candidates are able to attack him as a leftist radical only by moving so far to the right in their rhetoric and policy prescriptions that they fall over the cliff of mainstream acceptability, or even basic sanity.
In July, the nation’s most influential progressive domestic policy pundit, New York Times columnist Paul Krugman, declared that Obama is a “moderate conservative in practical terms”. Last October, he wrote that “progressives who had their hearts set on Obama were engaged in a huge act of self-delusion”, because the president – “once you get past the soaring rhetoric” – has “largely accepted the conservative storyline”.
Krugman also pointed out that even the policy Democratic loyalists point to as proof of the president’s progressive bona fides – his healthcare plan, which mandates the purchase of policies from the private health insurance industry – was designed by the Heritage Foundation, one of the nation’s most rightwing thinktanks, and was advocated by conservative ideologues for many years (it also happens to be the same plan Romney implemented when he was governor of Massachusetts and which Newt Gingrich once promoted, underscoring the difficulty for the GOP in drawing real contrasts with Obama).
How do you scorn a president as a far-left socialist when he has stuffed his administration with Wall Street executives, had his last campaign funded by them, governed as a “centrist Republican”, and presided over booming corporate profits even while the rest of the nation suffered economically?
But as slim as the pickings are for GOP candidates on the domestic policy front, at least there are some actual differences in that realm. The president’s 2009 stimulus spending and Wall Street “reform” package – tepid and inadequate though they were – are genuinely at odds with rightwing dogma, as are Obama’s progressive (albeit inconsistent) positions on social issues, such as equality for gay people and protecting a woman’s right to choose. And the supreme court, perpetually plagued by a 5-4 partisan split, would be significantly affected by the outcome of the 2012 election.
It is in the realm of foreign policy, terrorism and civil liberties where Republicans encounter an insurmountable roadblock. A staple of GOP politics has long been to accuse Democratic presidents of coddling America’s enemies (both real and imagined), being afraid to use violence, and subordinating US security to international bodies and leftwing conceptions of civil liberties.
But how can a GOP candidate invoke this time-tested caricature when Obama has embraced the vast bulk of George Bush’s terrorism policies; waged a war against government whistleblowers as part of a campaign of obsessive secrecy; led efforts to overturn a global ban on cluster bombs; extinguished the lives not only of accused terrorists but of huge numbers of innocent civilians with cluster bombs and drones in Muslim countries; engineered a covert war against Iran; tried to extend the Iraq war; ignored Congress and the constitution to prosecute an unauthorised war in Libya; adopted the defining Bush/Cheney policy of indefinite detention without trial for accused terrorists; and even claimed and exercised the power to assassinate US citizens far from any battlefield and without due process?
Reflecting this difficulty for the GOP field is the fact that former Bush officials, including Dick Cheney, have taken to lavishing Obama with public praise for continuing his predecessor’s once-controversial terrorism polices. In the last GOP foreign policy debate, the leading candidates found themselves issuing recommendations on the most contentious foreign policy question (Iran) that perfectly tracked what Obama is already doing, while issuing ringing endorsements of the president when asked about one of his most controversial civil liberties assaults (the due-process-free assassination of the American-Yemeni cleric Anwar Awlaki). Indeed, when it comes to the foreign policy and civil liberties values Democrats spent the Bush years claiming to defend, the only candidate in either party now touting them is the libertarian Ron Paul, who vehemently condemns Obama’s policies of drone killings without oversight, covert wars, whistleblower persecutions, and civil liberties assaults in the name of terrorism.
In sum, how do you demonise Obama as a terrorist-loving secret Muslim intent on empowering US enemies when he has adopted, and in some cases extended, what was rightwing orthodoxy for the last decade? The core problem for GOP challengers is that they cannot be respectable Republicans because, as Krugman pointed out, Obama has that position occupied. They are forced to move so far to the right that they render themselves inherently absurd.
Ron Paul’s Candidacy
Whatever happens in Iowa come January 3, the next Republican debate should be a doozy. Here’s Newt Gingrich unloading on Ron Paul.
“I think Barack Obama is very destructive to the future of the United States. I think Ron Paul’s views are totally outside the mainstream of virtually every decent American,” Gingrich said Tuesday in a CNN interview with Wolf Blitzer.
Could he vote for Paul? “No.” If it came down to Paul vs. Obama? “You’d have a very hard choice at that point.”
“As people get to know more about Ron Paul, who disowns 10 years of his own newsletter, says he didn’t really realize what was in it, had no idea what he was making money off of, had no idea that it was racist, anti-Semitic, called for the destruction of Israel, talked about a race war – all of this is a sudden shock to Ron Paul?” he asked. “There will come a morning people won’t take him as a serious person.”
With Paul now leading in Iowa (Romney’s in second with everyone else but Huntsman tied in third position), the spotlight is now on the cranky old man with the radical positions and the bigoted-tinged past. To hear Paul disavow any knowledge of the content of newsletters which earned him a little fortune ($1 million or more), does serious damage to his credibility. It’s a point which Gingrich, Bachmann and Perry will hammer away at over the next while.
Interestingly, a poll released this week shows that only 51 percent of Paul’s supporters come from the Republican side of the ledger. That compares with Romney’s 87 percent and Gingrich’s 85 percent Republican support. The breakdown for Paul supporters in New Hampshire is as follows: 13% Republican, 36 % independents and 26% Democrats. No other candidate attracts non-Republicans like Paul does.
Is Ron Paul going to win this thing? Not likely…but here’s an interesting thought to ponder:
[A] semi-successful Paul 2012 run means that there is now a whole network of party activists who love the Paul brand and know the ropes. They’re ready to go if Kentucky Senator Rand Paul – Ron’s son – wants to run. He’s also a fairly pure libertarian in many ways and could easily pick up that wing of the party. If the social conservatives burn out in 2012 and 2016, by running against Democrats during the peak of the business cycle, then the GOP may be ready to let Rand Paul run in 2020 and he might win. The real legacy of Paul’s 2012 primary run may be laying the groundwork for Rand Paul presidency.
Chew on that.