More on the Good Guys

Jimmy Breslin, 10 years into retirement, comes out to cover #occupywallstreet:

This was the start of a moving day that has not been seen in this city in a great many years, back when the unions were large and nasty to those who opposed the war in Vietnam back in the '60s and '70s.

Now yesterday, they joined hands with the young, and people were mostly orderly and all for the idea that the troops be pulled out of Afghanistan and that we need jobs for the young unemployed around here.

They were angry, and they shouted about the injustice of a tiny percentage of the rich getting richer, while the middle class endures foreclosures, dwindling savings and sudden losses in employment with the jobs going to places like China.

Naomi Klein, author of The Shock Doctrine, on people finally standing up after the banks destroyed the economy in 2008:

Naomi Klein: Occupy Wall Street Oct. 5th Demo from The New Significance on Vimeo.

Ever wonder why we got into this crisis?

Twenty golden years of consolidation and concentration of ownership.

The 1%.

If The Tea Partiers Had Any Brains...

...they'd be with the people taking over the Bank of America branch in DC today:



Join National People's Action and Make Wall Street Pay.

Thieves

This Rolling Stone article by the incomparable Matt Taibbi, Looting Main Street, tells of how big banks like JP Morgan are acting like Tony Soprano in driving places like Jefferson Country, Alabama (the case Taibbi chronicles) to massive debt on top of debt, well beyond the actual cost of any infrastructure improvements needed:

...In 1996, the average monthly sewer bill for a family of four in Birmingham was only $14.71 — but that was before the county decided to build an elaborate new sewer system with the help of out-of-state financial wizards with names like Bear Stearns, Lehman Brothers, Goldman Sachs and JP Morgan Chase. The result was a monstrous pile of borrowed money that the county used to build, in essence, the world's grandest toilet — "the Taj Mahal of sewer-treatment plants" is how one county worker put it. What happened here in Jefferson County would turn out to be the perfect metaphor for the peculiar alchemy of modern oligarchical capitalism: A mob of corrupt local officials and morally absent financiers got together to build a giant device that converted human shit into billions of dollars of profit for Wall Street — and misery for people like Lisa Pack.

And once the giant shit machine was built and the note on all that fancy construction started to come due, Wall Street came back to the local politicians and doubled down on the scam. They showed up in droves to help the poor, broke citizens of Jefferson County cut their toilet finance charges using a blizzard of incomprehensible swaps and refinance schemes — schemes that only served to postpone the repayment date a year or two while sinking the county deeper into debt. In the end, every time Jefferson County so much as breathed near one of the banks, it got charged millions in fees. There was so much money to be made bilking these dizzy Southerners that banks like JP Morgan spent millions paying middlemen who bribed — yes, that's right, bribed, criminally bribed — the county commissioners and their buddies just to keep their business. Hell, the money was so good, JP Morgan at one point even paid Goldman Sachs $3 million just to back the fuck off, so they could have the rubes of Jefferson County to fleece all for themselves.

It's an amazing article, which also shows you what happened to Greece -- now causing massive bankruptcy/bailout pain for the EU, threatening the Euro itself:

Now if the euro was a company, the Greek division would be closed or sold off. The product line had not lived up to expectations. It was important therefore to protect the core business. Other weaker divisions might have to go too. Now some economists like Paul Krugman, who is an admirer of Europe, opined recently that the problem was that Greece had joined the Euro before it was ready. We are now living out the consequences of a fudge ten years ago.

One big question: will Goldman Sachs be indicted in Europe?:

Greece's debt managers agreed a huge deal with the savvy bankers of US investment bank Goldman Sachs at the start of 2002. The deal involved so-called cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period -- to be exchanged back into the original currencies at a later date.
...
But in the Greek case the US bankers devised a special kind of swap with fictional exchange rates. That enabled Greece to receive a far higher sum than the actual euro market value of 10 billion dollars or yen. In that way Goldman Sachs secretly arranged additional credit of up to $1 billion for the Greeks.
...
At some point Greece will have to pay up for its swap transactions, and that will impact its deficit. The bond maturities range between 10 and 15 years. Goldman Sachs charged a hefty commission for the deal and sold the swaps on to a Greek bank in 2005.

At what point do we start using the f-word to describe what these huge "masters of the universe" banks have done? As in, F is for Fraud?

Downs and Ups

Here's the big bummers:

• The Supreme Court gives away America's democracy saying that corporations are just like real people and it's absolutely fine if their massive profits are used politically to overwhelm the voices of actual flesh and blood individuals. You know, individual citizen voters. A whole new way for lobbyists to warp our system of government.
  

• In the It's Tough but Necessary to Fight Back category, let no one get away with the MSM lie that the healthcare reform bill has lost support by being too far to the Left. Per Joan Walsh, support has dwindled because it's moved AWAY from the Left...and towards the very corporations who will now be able to spend whatever they want to kill it or profit from it.

• Air America is no more. Not sure what will be on AM 1150 tomorrow morning. Does this mean no more Stephanie Miller on the drive in?
  

On the plus side:

• Obama speaks up immediately against the Supreme Court decision, and legislation will be drafted to answer the ruling.

• Obama shifts the discussion from healthcare reform to bank reform, taking a populist position that some Republicans may find themselves having to support, following all of former Fed Chairman Paul Volcker's tough reform measures and marginalizing Wall Street insiders Timothy Geithner and (worst of all) Larry Summers.
  

• The "Move Your Money" movement, advocating taking your banked dough out of big huge national banks and moving them to regional banks, gets a big boost in New York City, where Mayor Bloomberg is moving $25 million to neighborhood credit unions.
  

I wish I could say the other good news is that healthcare/health insurance reform is still going to pass Congress...please, oh, please, put Dr. Dean in charge of Health and Human Services, or the goddamned Democratic National Committee again.

Rahm?

Pitchforks

It looks like England and France want their "master of the universe" bankers to pay for their crimes, by forking over 50% of their bonuses to the government:

On Friday, President Nicolas Sarkozy of France plans to announce a windfall tax “equivalent” to the 50 percent levy just unveiled in London by the Labour government of Prime Minister Gordon Brown, said Christine Lagarde, the French finance minister, in an interview Thursday in Paris.

“We have been advocating this for a long time, and we are delighted to see that Gordon Brown is taking that stand,” Ms. Lagarde said. “The president,” she added, “thinks he is brave to take on the City.”

Mr. Brown and Mr. Sarkozy — whose relations have been strained in recent weeks — held a 30-minute meeting at the start of the European Union summit meeting here Thursday and buried other differences to agree a joint approach over bonuses.

Both countries say their stand should increase pressure on other nations to follow suit.

Maybe that's why Goldman Sachs made this announcement:

Moving to quell the uproar over the return of big paydays on Wall Street, Goldman Sachs announced on Thursday that its top executives would forgo cash bonuses this year and that it would give shareholders a say in determining compensation.

With a resurgent Goldman set to award billions of dollars in bonuses — a trove that could rival the record payouts of the bubble years — the bank said that its 30 most-senior executives would be paid in the form of a special stock, rather than in cash. Goldman said that it would also let its shareholders vote on its executives’ pay, although the decision would be nonbinding.

Knowing these weaselly bankers, they're some way they're overcompensating themselves again, and here after we bailed their asses out.

Criticism still coming from Matt Taibbi in Rolling Stone, calling out the President as well:

What's taken place in the year since Obama won the presidency has turned out to be one of the most dramatic political about-faces in our history. Elected in the midst of a crushing economic crisis brought on by a decade of orgiastic deregulation and unchecked greed, Obama had a clear mandate to rein in Wall Street and remake the entire structure of the American economy. What he did instead was ship even his most marginally progressive campaign advisers off to various bureaucratic Siberias, while packing the key economic positions in his White House with the very people who caused the crisis in the first place. This new team of bubble-fattened ex-bankers and laissez-faire intellectuals then proceeded to sell us all out, instituting a massive, trickle-up bailout and systematically gutting regulatory reform from the inside.

How could Obama let this happen? Is he just a rookie in the political big leagues, hoodwinked by Beltway old-timers? Or is the vacillating, ineffectual servant of banking interests we've been seeing on TV this fall who Obama really is?

And it looks like the Dems are having trouble coming up with rules to keep the collapse from happening again:

As the House took up a sweeping measure that would put new controls on businesses and financial institutions, a bloc of business-oriented Democrats threatened to withhold support because of their concerns about its impact on financial institutions.

To address those concerns, Representative Melissa Bean, Democrat of Illinois, a leader of the group called the New Democrat Coalition, offered a proposal to limit a state’s ability to impose tougher rules on national banks already judged to meet federal standards.

But liberal lawmakers, led by Speaker Nancy Pelosi, were not eager to make concessions to banks given their role at the center of the economic crisis. The dispute stalled the beginning of a debate scheduled to run through Friday.

Bean there, done that, Melissa.

Big Stuff

None of these items may eventually play out exactly as I'd like, but all are potentially big news:

• The Senate is moving ahead with a healthcare reform bill resulting from merging with the House version. On the face of it, it appears that key Dem concerns have been addressed, and full steam ahead to the floor. Any filibuster, hello reconciliation.

• A House panel has approved curbs on "Too Big to Fail" banking firms. About time.

• China appears to be ready to cooperate with President Obama and the U.S. on curbing global-warming emissions.

• Attorney General Eric Holder goes before Congress to reiterate and explain the decision to try the 9/11 masterminds in NYC where the crime was committed, showing more spine than all the conservative fear-infected detractors put together.

And meanwhile, in the alt reality that is The Sarah Palin Network a.k.a. FNC, her book-signing crowd sizes are being inflated, once again, by using footage from other events...a.k.a. bald-faced lying.

Bank Shot

So now that some banks have stabilized and maybe, according to Time magazine, the Banking Crisis of 2008 is over, all that's left is the clean-up:

The banking crisis may be over, but what is left is a reclamation job that will probably take years to complete, will still have a taxpayer price tag of over $1 trillion, and will leave America's largest financial firms as institutions of modest power and a regulated scope which will prevent them from looking anything like what they did two years ago.

There's some bumps ahead on that road to clean-up, per The New York Times:

As the Obama administration completes its examinations of the nation’s largest banks, industry executives are bracing for fights with the government over repayment of bailout money and forced sales of bad mortgages...

...Some of the healthier banks want to pay back their bailout loans to avoid executive pay and other restrictions that come with the money. But the banks are balking at the hefty premium they agreed to pay when they took the money.

It's like teenage boys -- begging for dough when they need it for a car or a prom, but acting all haughtily independent once there's gas in the tank.

While I've had my questions -- not exactly disagreements -- with Nobel Prize-winning economist Paul Krugman as he's heavily criticized Obama Administration economic policy from the Left, I'm in deep agreement with his op-ed today calling for regulations returning to the days when banking was considered as square as can be:

Before 1930, banking was an exciting industry featuring a number of larger-than-life figures, who built giant financial empires (some of which later turned out to have been based on fraud). This highflying finance sector presided over a rapid increase in debt: Household debt as a percentage of G.D.P. almost doubled between World War I and 1929.

During this first era of high finance, bankers were, on average, paid much more than their counterparts in other industries. But finance lost its glamour when the banking system collapsed during the Great Depression.

The banking industry that emerged from that collapse was tightly regulated, far less colorful than it had been before the Depression, and far less lucrative for those who ran it. Banking became boring, partly because bankers were so conservative about lending: Household debt, which had fallen sharply as a percentage of G.D.P. during the Depression and World War II, stayed far below pre-1930s levels.

Strange to say, this era of boring banking was also an era of spectacular economic progress for most Americans.

Krugman goes on to talk about how the high-flying, deregulated bankers who went on to massive personal wealth thought themselves especially deserving, in nauseating hubris made ridiculous by the crash of the system. These are the guys Matt Taibbi was talking about, bald fat men who looked in the mirror as they overleveraged America and saw superheroes staring back at themselves.

Well, bankers are supposed to be boring.

How else can we be expected to trust them with our money?

Knockovers

You want to just say fuck 'em all, but there is the credit issue, the oil that lubricates the whole system all the way down to the guy with the local bank loan. And maybe that's what it has to get back to. Because the hell with every one of those obscenely wealthy corporate bankers and everyone else feeding off their feudal system if they're doing shit like this:

The 20 largest banks that received government rescue funds slightly reduced their lending to consumers and businesses in the last three months of 2008, the government said Tuesday.

The Treasury Department said the banks reduced their mortgage and business loans by a median of 1 percent each, while credit card lending rose by a median of 2 percent. The median is the point halfway between the banks that lent the most and those that lent the least.

And the White House, the Obama Administration, wants to water down the bank executive bonus restrictions in the the stimulus package?

Read my lips, you guys who got us into this: Step Off.

Maybe it's all grand kabuki, make the bankers think this before you nationalize the whole thing, with the guy who presided blithely over this meltdown, Alan Greenspan as your cover. Maybe Geitner's only just figured out his strategy (not necessarily a bad thing to deliberate for your first week in the job) and all will go well. But the massive greed of the money class is lying low there, like flames ready to slip around wall or through a crevice, just give it even a whiff of oxygen.

That said, the stimulus transparency website, Recovery.gov, features the boss putting his face on it, YouTube style, the first cyberbuck stops here Presidential moment ever in history, a model for all time. What's so striking is the overview graph where I first saw that the #1 largest element of the stimulus package is tax relief -- $228 billion, as seen in proportion to the other categories.

(Second is State and Local Fiscal Relief -- similar to tax relief, not a pure spending measure -- at a distant $144 billion, Third is $111 billion for Infrastructure and Science, again more of our money coming back to us.)

The auto makers are next, America's post-industrial horror show, and that's going to hurt no matter what happens, but look at where we're at compared to just a month ago. Our President is strong, he is implementing the agenda the American people voted for, on the side of transparency for the people, the year is still young.

And here, after three weeks on the job, is our new, young President signing the largest non-military spending bill in our nation's history:

Visit msnbc.com for Breaking News, World News, and News about the Economy

"It is great to be back in Denver. I was here last summer to -- we had a good time -- to accept the nomination of my party and to make a promise to people of all parties that I would do all that I could to give every American the chance to make of their lives what they will. To see their children climb higher than they do. And I'm back today to say that we've have begun the difficult work of keeping that promise. We have begun the essential work of keeping the American Dream alive in our time and that's what we're doing here today."

Obama's gaining strength, every day. It's like his Barack powers are zapped up by Presidential booster beams. He's not losing strength at all -- that the Republicans.

He's still growing.