Sunday, September 21, 2008

A Conservative Phoenix from the Ashes Populist - John S. McCain

A phoenix is a mythical bird with a tail of beautiful gold and red plumage. It has a 1,000 year life-cycle, and near the end the phoenix builds itself a nest of cinnamon twigs that it then ignites; both nest and bird burn fiercely and are reduced to ashes, from which a new, young phoenix or phoenix egg arises, reborn anew to live again. The new phoenix is destined to live as long as its old self.

There has been a lot of chattering and head shaking lately about how John McCain is changing all of his Republican positions and sounding like a Huey Long populist just to win the Presidency. This is not the John McCain that they have known. Why this John McCain is not lashing out at Pat Robertson and evangelicals like he did in 2000. Oh nooooo.

I disagree with these chatterers and head shakers, and I think their problem is that if they did not have George W. Bush and Dick Cheney opposing them then at least it ought to be Bob Dole and Jack Kemp. Cry me a river because I think this is the same John McCain maverick politician that he has always been.

They are also wrong in portraying John McCain as a Huey Long populist. There are no examples of John McCain speaking about populism in terms of rich man vs. poor man or proletariat vs bourgeoisie. The kind of populism that John McCain expresses is government of the people by the people and for the people. Here are some quotes from his acceptance speech:

Let me offer an advance warning to the old, big-spending, do-nothing, me-first, country-second Washington crowd: Change is coming.

You know, I've been called a maverick; someone who marches to the beat of his own drum. Sometimes it's meant as a compliment and sometimes it's not. What it really means is I understand who I work for. I don't work for a party. I don't work for a special interest. I don't work for myself. I work for you.

I've fought corruption, and it didn't matter if the culprits were Democrats or Republicans. They violated their public trust, and had to be held accountable. I've fought big spenders in both parties, who waste your money on things you neither need nor want, while you struggle to buy groceries, fill your gas tank and make your mortgage payment. I've fought to get million dollar checks out of our elections. I've fought lobbyists who stole from Indian tribes. I fought crooked deals in the Pentagon. I fought tobacco companies and trial lawyers, drug companies and union bosses.

I've been an imperfect servant of my country for many years. But I have been her servant first, last and always. And I've never lived a day, in good times or bad, that I didn't thank God for the privilege.

John McCain will be the next President of the United States of America, and he will serve for the ones who vote for him and for the ones who do not vote for him. An example of this is Michael Steele's take on John McCain appearing before the NAACP.

You've got to live in the real. Barack is going to take more than the lion's share of the black vote. But that doesn't and has not stopped John McCain from competing for that vote. And I think that says a lot about the kind of president he is going to be -- that he doesn't just see this as an election opportunity, that he sees this as an opportunity for America to right a lot of wrongs certainly but to grow together -- the idea of every boat being lifted at the same time, and I think that's a powerful message.

Unlike Obama, McCain held a Q&A after his speech, which caused a visible stir in the room.

You could hear the room go, what?! He's actually going to open this up?! And I was asking folks, 'Did Barack do that?' And they were, like, 'No.' So, I think it speaks to the style. It speaks to the substance of the man in terms of how he wants to engage the black community, and I appreciate him doing it.

It is "long overdue" for Republican leaders to reach out to the African Americans. I think the work has to begin in earnest, and I think John McCain wants to do that. Regardless of how the election falls out in November, the Republican Party -- if they want to be players; if they want to be taken seriously as a political voice in this country -- they are going to have to engage in all levels, all communities. And you can't piecemeal this. You can't have this attitude, 'Well, they won't vote for us so why bother?'

Rich Lowry analyzes the McCain campaign:

The McCain campaign believes that there are twin tests this fall. One is whether Barack Obama is ready to be commander in chief; the other is whether John McCain represents change. Even if Obama fails to meet his test of readiness, he will still win if McCain fails the test of change. It wasn't enough for McCain to mock Obama in his deadly 'not ready to lead' ads. He had to re-establish his outsiderness, and did it with his electrifying pick of fellow reformer Sarah Palin, whose Alaska governor's desk sits no less than 2,800 miles from Washington.

For Sarah Palin's other contribution to McCain is to point him downward, toward the lunch-bucket concerns of the working-class voters that Hillary won in the primaries. McCain's politics of honor can be as unsatisfyingly abstract as Obama's politics of hope. No more. With a new Palin-enabled populism, McCain the 'fighter' for you evoked the struggle 'to buy groceries, fill your gas tank and make your mortgage payment.'

John McCain is going to pass the tests of readiness and that he represents change. Barack not only fails the readiness test, but he also fails the test of making the voters believe the choice is between Barack Obama and George W. Bush.

Friday, September 19, 2008

The Players in Paving the Way to the Wall St Meltdown

During these times of heated political election year politics agreement across the political spectrum has been achieved that the financial institutions on Wall St. are in terrible shape. The agreement that things are a mess very quickly falls apart when it is broken down into who is to blame for this mess, and what can be done to clean the mess up. The disagreement over who is to blame reminds me of the song It Wasn't Me by Shaggy - especially this part of the lyrics

To be a true player you have to know how to play

If she say a night, convince her say a day

Never admit to a word when she say makes a claim

And you tell her baby no way

So the true players that opened up this new road to the abyss are Alan Greenspan, Robert Rubin, Sandy Weill, Phil Gramm, Jim Leach, Tom Bliley, Barney Frank, Bill Clinton,

Alan Greenspan -

In 1990, the Fed, under former J.P. Morgan director Alan Greenspan, permitted guess who J.P. Morgan–to become the first bank allowed to underwrite securities.

Four legislative attempts were made to weaken or repeal parts of Glass-Steagall from 1988-1996. One reason they failed is because smaller banks feared that opening the doors to allow banks to trade in securities would lead to the domination of larger banks–a fate that has come to pass.

The biggest change came in 1996 when Alan Greenspan issued a ruling allowing bank investment affiliates to have up to a quarter of their business in investments.

Robert Rubin - in testimony before Congress in 1995

The banking industry is fundamentally different from what it was two decades ago, let alone in 1933.” He said the industry has been transformed into a global business of facilitating capital formation through diverse new products, services and markets.

U.S. banks generally engage in a broader range of securities activities abroad than is permitted domestically. Even domestically, the separation of investment banking and commercial banking envisioned by Glass-Steagall has eroded significantly.

Robert Rubin - following Shaggy's strategy in 2008

If Wall Street companies can count on being rescued like banks, then they need to be regulated like banks.

He was for the deregulation before he was against the deregulation.

Sandy Weill -

Here you have the leadership, Sandy Weill of Travelers and John Reed of Citicorp, saying, Look, the Congress isn't moving fast enough. Let's do it on our own. To heck with the Congress. Let us effect this. And so they move towards effecting it, and they get the blessing of the chairman of the Federal Reserve system in early April, when legislation is pending.

I mean, this is hubris in the worst sense of the word. Who do they think they are? Other people, firms, cannot act like this. Citicorp and Travelers were so big that they were able to pull this off. They were able to pull off the largest financial conglomeration the largest financial coming together of banking, insurance, and securities when legislation was still on the books saying this was illegal. And they pulled this off with the blessings of the president of the United States, President Clinton; the chairman of the Federal Reserve system, Alan Greenspan; and the secretary of the treasury, Robert Rubin.

And then, when it's all over, what happens? The secretary of the treasury becomes the vice chairman of the emerging Citigroup.

Phil Gramm James Leach Thomas Bliley -

The Citi-Travelers Act went under the benign-sounding name of the Financial Services Modernization Act of 1999 and, like Glass-Steagall it has become known for the key sponsors of the bill as the Gramm-Leach-Bliley Act, for Republican Senate Banking Committee Chair Phil Gramm, House Banking Committee chair James Leach, and Virginia Representative Thomas Bliley.

Lobby money to push through the Gramm-Leach-Bliley Act -

In the year previous to the Financial Services Modernization Act, the thing that overruled Glass-Steagall, Citibank spent $100 million on lobbying and public relations, which is a good indication.

Yes. They spent a small fortune, a king's ransom, if you will, getting rid of Glass-Steagall. In fact, when thrown in with other financial firms lobbying, it was closer to $200 million over the short period of time.

The Industry's efforts to jump-start progress on the Senate bill is a case study in how a well-heeled and well-organized interest group can swiftly prod Congress to move, even on an issue about which most people outside Washington and New York have little knowledge.

Nor is it surprising, according to both political science and economic literature, that the interest groups played a vital role in the timing of the 1999 deregulation. Without persistent lobbying by commercial and investment interests it is unlikely that reform would have taken place in this century.

Barney Frank -

There was only one problem: the bill had to reconcile differences between the House and Senate versions. The House version differed in two important ways: 1) It took regulatory authority from the Federal Reserve and gave it to the Secretary of the Treasury and 2) it refused to extend to insurance companies obligations under the Community Re-investment Act to provide information about their patterns of mortgage lending.

Democrat Barney Frank was among those who especially opposed the second.

We do a good job in fostering conditions in which our capitalist system can flourish and it's in our interest that our capitalist system flourish. But can we try to do a little bit for those who are being left behind. This is an inappropriate continuation of a pattern of helping those who need a benefit but ignoring those who are left behind.

How the Gramm-Leach-Bliley Act became law -

On Oct. 21, with the House-Senate conference committee deadlocked after marathon negotiations, the main sticking point is partisan bickering over the bill's effect on the Community Reinvestment Act, which sets rules for lending to poor communities. Sandy Weill calls President Clinton in the evening to try to break the deadlock after Senator Phil Gramm, chairman of the Banking Committee, warned Citigroup lobbyist Roger Levy that Weill has to get White House moving on the bill or he would shut down the House-Senate conference. Serious negotiations resume, and a deal is announced at 2:45 a.m. on Oct. 22. President Bill Clinton signed this bill into law on November 12, 1999.

Bill Clinton -

So we know that the topic of that late night phone call between Bill Clinton and Sandy Weill, the man whose career began in the subprime mortgage business, was the Community Reinvestment Act. We know that Phil Gramm, who was the one most strongly pushing for gutting CRA (Leach actually supported it) threatened to torpedo the legislation if the White House did not reach an agreement.

So why did Clinton go along? His writings are silent on the subject. He seemingly held the trump card with the threat to veto any legislation that did not meet his approval. And why is it Sandy Weill who makes the phone call to Clinton? At this point not enough evidence is available to finally connect the dots, but whatever it is, it cannot possibly benefit Bill Clinton. The reason for the silence may be that for the Clintons the repeal of Glass-Steagall may prove far more embarrassing in the long run than Monica Lewinsky.

Barack Obama - when asked if he would restore Glass-Steagall

Well, no. The argument is not to go back to the regulatory framework of the 1930's because, as I said, the financial markets have changed substantially.

Obama's top campaign contributors include Goldman Sachs, J.P.Morgan, and Citigroup.

Where are these players today

Alan Greenspan -

Retired as chairman of the Fed in 2006, he is married to staunch Obama supporter and NBC correspondent Andrea Mitchell.

Robert Rubin -

Chairman of Citigroup and one of Obama's economic advisors

Sandy Weill -

Retired as chairman of Citigroup in 2006

Phil Gramm -

Retired from the US Senate in 2003. Served as John McCain's campaign co-chair and most senior economic advisor until July 18, 2008.

James Leach -

Defeated in the 2006 midterm election for US House, Iowa's 2nd District. He currently is the Director of Harvard University Institute of Politics at Kennedy School of Government. On August 12, 2008, Leach broke party ranks to endorse Democrat Barack Obama against John McCain for the American presidency. He spoke at the 2008 Democratic National Convention in Denver Colorado on the night of August 25, 2008.

Thomas Bliley -

Retired from the US House 7th District Virginia in 2001, and he was succeeded by Eric Cantor.

Barney Frank -

Current chairman of the House Financial Services Committee. Earlier this year he told Obama campaign staff Eric Holder and Caroline Kennedy that he would have a hard time voting for the ticket if Obama picks former US Sen. Sam Nunn as his running mate.

Sunday, September 07, 2008

Didn't that take some hubris, Charlie?

I watched the ABC World News program on September 11th, and my initial reaction was that Governor Sarah Palin acquitted herself well in the interview, and did no harm to the McCain/Palin ticket. I also thought Charlie Gibson was the caricature of the Washington DC media elite who believe that anyone who has not achieved membership in their "ruling class aristocrat club" through appearances on Sunday morning TV talk shows and Press Club speeches is not worthy. Very early into the interview I almost threw something at my TV set over this exchange:
GIBSON: Governor, let me start by asking you a question that I asked John McCain about you, and it is really the central question. Can you look the country in the eye and say “I have the experience and I have the ability to be not just vice president, but perhaps president of the United States of America?”

PALIN: I do, Charlie, and on January 20, when John McCain and I are sworn in, if we are so privileged to be elected to serve this country, will be ready. I’m ready.

GIBSON: And you didn’t say to yourself, “Am I experienced enough? Am I ready? Do I know enough about international affairs? Do I — will I feel comfortable enough on the national stage to do this?”

PALIN: I didn’t hesitate, no.

GIBSON: Didn’t that take some hubris?

PALIN: I — I answered him yes because I have the confidence in that readiness and knowing that you can’t blink, you have to be wired in a way of being so committed to the mission, the mission that we’re on, reform of this country and victory in the war, you can’t blink.

So I didn’t blink then even when asked to run as his running mate.

Another reaction I had is that Governor Palin's answers were short and to the point. I know that US Senators are more prone to doing a filibuster in their answers than kinds of folks, but still the answers were quite short. I was also puzzled by this comment from Charlie Gibson to Governor Palin:
GIBSON: And let me finish with this. I got lost in a blizzard of words there. Is that a yes? That you think we have the right to go across the border with or without the approval of the Pakistani government, to go after terrorists who are in the Waziristan area?

What's Charlie talking about - a blizzard of words there? I was watching and listening to Governor Palin using less words in her answers than Charlie Gibson was using in his questions. But I got an explanation for this remark from Charlie about the blizzard of words thanks to Mark Levin

A transcript of the unedited interview of Sarah Palin by Charles Gibson clearly shows that ABC News edited out crucial portions of the interview that showed Palin as knowledgeable or presented her answers out of context. The sections edited out by ABC News are in bold. So with that in mind here is a portion of that interview right before Charlie made his blizzard of words comment with the edited out word I did not hear or read on ABC's website version of the transcript.
GIBSON: The Bush doctrine, as I understand it, is that we have the right of anticipatory self-defense, that we have the right to a preemptive strike against any other country that we think is going to attack us. Do you agree with that?

PALIN: I agree that a president’s job, when they swear in their oath to uphold our Constitution, their top priority is to defend the United States of America.

I know that John McCain will do that and I, as his vice president, families we are blessed with that vote of the American people and are elected to serve and are sworn in on January 20, that will be our top priority is to defend the American people.

GIBSON: Do we have a right to anticipatory self-defense? Do we have a right to make a preemptive strike again another country if we feel that country might strike us?

PALIN: Charlie, if there is legitimate and enough intelligence that tells us that a strike is imminent against American people, we have every right to defend our country. In fact, the president has the obligation, the duty to defend.

GIBSON: Do we have the right to be making cross-border attacks into Pakistan from Afghanistan, with or without the approval of the Pakistani government?

PALIN: Now, as for our right to invade, we’re going to work with these countries, building new relationships, working with existing allies, but forging new, also, in order to, Charlie, get to a point in this world where war is not going to be a first option. In fact, war has got to be, a military strike, a last option.

GIBSON: But, Governor, I’m asking you: We have the right, in your mind, to go across the border with or without the approval of the Pakistani government.

PALIN: In order to stop Islamic extremists, those terrorists who would seek to destroy America and our allies, we must do whatever it takes and we must not blink, Charlie, in making those tough decisions of where we go and even who we target.

GIBSON: And let me finish with this. I got lost in a blizzard of words there. Is that a yes? That you think we have the right to go across the border with or without the approval of the Pakistani government, to go after terrorists who are in the Waziristan area?

PALIN: I believe that America has to exercise all options in order to stop the terrorists who are hell bent on destroying America and our allies. We have got to have all options out there on the table.

So like the title of this blog reads, Didn't that take some hubris, Charlie, to think that in this modern internet age you could edit the interview that showed Governor Palin as knowledgable or take her words out of context and get away with it?

Compare and Contrast

Saturday, September 06, 2008

Change vs Experience - Lets talk about it

With less than 2 months to go the themes are set by the Obama team and the McCain team. Both camps are going with the theme of change. This is a change election and a historic election no matter which side wins.

I define a change election as one in which there is not a President or VP running for either party. This is rare in American politics. The only two examples I can think of are 1928 when Republicans Herbert Hoover/Charles Curtis defeated Democrats Al Smith/Joe Robinson, and 1952 when Republicans Ike Eisenhower/Dick Nixon defeated Democrats Adlai Stevenson/John Sparkman. I am definitely at ease with the prospects of Republican winning a change election Presidency.

Now for some of the nervous nellys who are troubled greatly with the experience issue in this race I suggest you look at history to discover how change has trumped experience in many elections. Let me run down the list:

1960 The change team of Kennedy/Johnson beat the experience team of Nixon/Lodge

1976 The change team of Carter/Mondale beat the experience team of Ford/Dole

1980 The change team of Reagan/Bush beat the experience team of Carter/Mondale

1992 The change team of Clinton/Gore beat the experience team of Bush/Quayle

2000 the change team of Bush/Cheney beat the experience team of Gore/Lieberman

These are 5 examples when having Presidential or Vice-Presidential experience are not a winning combination.

I know that some define experience as the amount of time one has appeared on Sunday morning talk shows, and I reject this definition. One is not experienced because he talks about being President or VP. One who is or has been the President or VP is my definition of someone who is experienced.

The Obama camp has a different change theme than the McCain camp’s theme. From the very beginning a year and a half ago the Obama team decided to run against Pres. Bush.

Gerard Baker describes and comments on this theme:

But by far the clearest sign of how backward-looking this progressive party has become was its attempt to make the 2008 election a rerun of the elections of 2000 and 2004, when George W. Bush was the Republican nominee.

And yet I suspect that the charge that Senator McCain is running for the third Bush term will not, in the end, stick. The Arizona senator is not George Bush, and Democrats, and I suspect voters, know that.

On the big issues that will confront the next president, in fact Senator McCain offered a sharply divergent approach. When President Bush was fiddling two years ago as Iraq burnt, Senator McCain was urging a change of strategy, one that has now borne fruit for the US. While President Bush was gazing into Valdimir Putin's eyes and seeing the purity of his soul, Senator McCain was giving warning of the dangers of a resurgent and authoritarian Russia. While the President was cementing a governing style that emphasised maximal partisanship, Senator McCain was building bipartisan coalitions with Democrats in Congress.

Michael Barone describes and comments on the McCain camp theme:

The Republican convention's premise is that McCain is the maverick reformer -- an American version of Nicolas Sarkozy, who replaced an unpopular president of his own party. There is plenty in McCain's record to back that up. Not least is his selection of Sarah Palin for vice president. Palin's record of successfully battling establishment Republicans and oil companies in Alaska clearly appealed to McCain.

And that was amplified by the mainstream media attacks on her. Now the media, which were not alarmed by Obama's thin record, is worried about Palin being a heartbeat away from the presidency. Other women who were stay-at-home moms for years and then emerged into public life have outperformed their resumes -- namely, Katharine Graham, Jeane Kirkpatrick, Madeleine Albright, Nancy Pelosi and Geraldine Ferraro. Palin, who has negotiated a natural gas pipeline with the oil companies and Canadian federal, provincial and Inuit authorities, may do so, too. We'll see if that argument is sustainable.

The way that I would put the themes of the two camps is this way.

The McCain camp wants to win, and when they arrive in Washington they want to drain the swamp. They really don’t care if the lobbyists are Democrats or Republicans as long as those lobbyists are powerless and lonely.

The Obama camp wants to win, and when they arrive in Washington they want to make the swamp larger. They also want to repopulate this larger swamp with Democratic lobbyists with the money to keep them in power.

Some things that packaged under the theme of change are not really anything new. Obama’s economic plan has been tried before - when Herbert Hoover was President.

Amity Shlaes wrote an article at in which she recalls:

Yet in the dark days of 1932, with unemployment at 20 percent, Hoover perversely signed an increase that reversed the multiple cuts by his predecessor, Calvin Coolidge. Hoover increased the top marginal tax rate to 63 percent from 25 percent. The effect was predictable. That tax error has haunted economists ever since.

Yet today it is not Republicans but Democrats who are preparing to replicate it. Obama has suggested a payroll tax increase and an income tax increase; together they would just about offset all the breaks created by Bush. Who's Hoover now?

I also would like to respond to many conservatives about an aspect of the McCain camp theme of change that makes them wince. Thursday night John McCain said the following in his acceptance speech:

Again and again, I've worked with members of both parties to fix problems that need to be fixed.

Instead of rejecting good ideas because we didn't think of them first, let's use the best ideas from both sides.

I will ask Democrats and Independents to serve with me.

Conservatives wince when they look at people only in the context of the party of which they are a member. John McCain has been around Washington for 25 years, and he has friends and enemies in both of the political parties. Sarah Palin has that similar trait from her political experience in Alaska. This is not a surrender of values to deal with people from both parties.

Gerard Baker wrote a comparison of Barack and Sarah

Record of bipartisan achievement
Obama: Speaks movingly of the bipartisanship needed to end the destructive politics of "Red America" and "Blue America", but votes in the Senate as a down-the-line Democrat, with one of the most liberal voting records in congress.

Palin: Ridiculed by liberals such as John Kerry as a crazed, barely human, Dick Cheney-type conservative but worked with Democrats in the state legislature to secure landmark anti-corruption legislation.

Former state Rep. Ethan Berkowitz - a Democrat - said. "Gov. Palin has made her name fighting corruption within her own party, and I was honored when she stepped across party lines and asked me to co-author her ethics white paper."