Sometimes Democrats and Republicans ARE The Same

Reading Paul Krugman’s “End This Depression Now!” He makes it quite clear that the whole income inequality and the 2008 financial meltdown was a bipartisan accomplishment. To keep this short, I’ll give a timeline mentioning just the players and the legislation responsible and you can Google them for more information.

1980: Congress passes and Carter signs into law the Monetary Control Act of 1980 which deregulated and opened up many more kinds of deposits that banks could now pay interest on.

1982: Congress passes and Reagan signs into law the Garn–St Germain Depository Institutions Act of 1982 which relaxed restrictions on the kinds of loans banks could make.

1998: Citicorp merges with Travelers Group to attain both Smith Barney and Shearson Lehman and form Citigroup. The problem was that at that time Glass-Steagall prevented commercial banks from engaging in either insurance or investment banking. Citigroup CEO Sandy Weill pays a visit to and makes sure large contributions are paid to Texas Senator Phil Gramm. The result:

1999: Congress passes and Clinton signs into law the Gramm-Leach-Bliley Act of 1999, which retroactively authorizes the Citi-Travelers merger. Oh, the key White House figure supporting the bill? Clinton’s Treasury Secretary Robert Rubin. Gramm left the Senate and joined the board of directors of UBS. Rubin was a former co-chairman of Goldman Sachs and after leaving the Clinton White House became vice chairman of…Citigroup.

Also in 1998: Deputy Secretary of the Treasury Larry Summers testifies before Congress that regulating derivatives would be a bad idea and so the issue is tabled. He later endorses the the Gramm-Leach-Bliley Act of 1999. (In 2009, Summers admits he was wrong about everything. Better late than never? Tell that to all the people worldwide who lost homes, jobs, savings, retirement accounts, lives–everything–before Summers in essence said “Oops.”)

My contributions outside of the book:

2001: Along with the British, Dubya starts a war in Afghanistan. The costs for the war is kept off the federal budget.

2001: Congress passes and Dubya signs into law the Economic Growth and Tax Relief Reconciliation Act of 2001.

2003: Dubya invades Iraq. The costs for the war are kept off the federal budget.

2003: Congress passes and Dubya signs into law Jobs and Growth Tax Relief Reconciliation Act of 2003.

2009: Congress passes and Obama signs into law the American Recovery and Reinvestment Act of 2009. It authorizes a stimulus payment of what grew to be $831 billion. Economic adviser Christina Romer insisted that the minimum stimulus needed to jump start the economy was $1.8 billion, and she was later proven right although she was gone from the White House by that time. Who overruled her, insisting on the lower stimulus package? Our old friend (and Bill Clinton’s), Larry Summers, along with Peter R. Orszag, yet another ex-Clinton economic adviser who headed the CBO under Obama. After leaving the Obama administration, Orszag took a job with…Citigroup.

So, as Krugman and I have shown, what led to the 2008 meltdown and which continues the basis and continued extension of income inequality (through all the deregulation because yes indeed, as the rich get richer the poor get poorer) has been a bipartisan affair. It is very true: when it comes to the economy, there is no difference between the two parties.


President Obama Is Responsible For The VA Mess But The GOP Is To Blame

I was engaged in a discussion in my Facebook group, Liberals Taking Our Country Back, as to whether or not Obama can be held responsible for the current scandal regarding the VA Administration. I maintain that he must be held responsible because he’s the Commander-In-Chief and he hired Eric Shinseki to head the Dept. of Veteran Affairs.

But let’s take a step backwards for a moment. While I assign responsibility to Obama, I assign the blame to the Republicans, who have voted to deny adequate funding for the VA at every opportunity. This is why they are also to blame for what happened at Benghazi.

OK, take one step forward again. The issue with the obscenely-long wait times for medical appointments at the VA—even to have VA medical benefits approved–predates Obama by several decades, at least all the way back to John F. Kennedy. Back in the ‘70s my dad complained about not only the long wait times but the revolving door his doctors passed through since a he seemed to be assigned to a new one every six months or so.

So, my point is this: Obama was well aware of the problems and publicly promised to fix it. OK, what did he do after that? And THAT is the big unanswered question. An even better question is: what did Eric Shinseki do after that? The Bush administration handed him memos which admitted how greatly they had screwed up, what was screwed up, the hazards of keeping it screwed up, and in essence “good luck with that”. Did Shinseki call for a top-to-bottom audit of the entire system so he would have an accurate snapshot of the state of (Veterans) affairs? I don’t know, but that’s what I would have done. Did he meet with the directors of the VA Health Admin and VA Benefits Admin and request full reports from them as well? Again, I don’t know but that’s what I would have done. Did Shinseki ever come up with a plan to reform, slim down, and modernize the VA? I don’t know but…

Yes, there are plenty of mid-level bureaucrats afraid of losing their phony baloney jobs and fiefdoms who drag their feet or otherwise sabotage attempts at change. But, even in civil service, there are ways to deal with such recalcitrant, parasitical Federal employees.

And, as I see it, this is how Obama remains culpable for this mess. Had he done all that I’ve just suggested, and then in first State of the Union speech itemize all that he had found wrong with the VA and then asked every member of Congress sporting a US Flag label pin to “support our troops” in fact by approving the VA funding he was requesting and the GOP STILL refused, the Republicans would’ve gotten an earful from their constituents. And you can be sure that Republicans, who are experts in the employment of dog whistles, have very fine hearing themselves and respond like the trained dogs they view their base to be.

But, unfortunately, as on many things throughout his administrations, Obama did drop on this. He chose instead, during his first term, to concentrate on bowing to pressure from the Right to decrease the federal budget deficit against the counsel of all learned and Nobel Prize-winning economists on the Left. And now he’s paying the price, having handed the GOP and Fox yet another club to bludgeon him over the head with. And it looks like this time, the hits are going to leave permanent bruises on his presidency. Maybe it’s time he got out in front of these big issues instead of always playing catch up.

John Stewart Schools Timothy Geithner In Economics

Watch Jon Stewart at his best: Geithner. It’s a 3-part interview with a 5-part extended interview.

Timothy Geithner is making the talk show rounds plugging his new book. Geithner is a typically, tone deaf political economist who was one of the primary constructionists of two economic policies which led to and has perpetuated the effects of the crash of 2008. Watch his body language as he insists the Obama administration did the only thing possible to help the economy recover while Stewart keeps calling him on his bullshit, requiring Geithner to reset and try to throw it again.

Geithner is not a people person and it shows. He has been around economic theory, growing up living a privileged life; he has never known poverty. Throughout most of his childhood he lived abroad; throughout his education, his focus was on Asia, not on the USA. He went to two universities in China and then majored in and got advanced degrees from two American schools in Asian and international studies. His entire career has put a firewall between him and the average person,. He’s all economic theory and no personal knowledge or experience with or—I think—any true compassion for the plight of the people who suffer as a result of economic policies he put in place.

After the 2008 economic meltdown, what was his primary concern? He wanted to avoid setting off a bank panic, or even making them slightly nervous. That’s why he insisted the banks be given all that free money with absolutely no restrictions or federal controls. He smugly claimed to Stewart that the banks paid back all those loans with interest; therefore, the taxpayers made a profit. Really? Was that profit shared with all those homeowners who lost their home because banks like Bank of America, Citibank, and JP Morgan Chase refused or delayed to refinance homes, denying or delaying applications for refinancing under HARP? Over and over again you see Geithner try to run, but he can’t hide from Stewart.

To him, the economic problems of the poor and the middle class are theoretical. So, no matter how much he tries to argue to the contrary, Stewart is right: TARP gave no-strings-attached money to the banks hand-over-fist, and then allowed them to borrow money at the discount window for 0% interest and make 3% interest on that same money. Yet despite both TARP and HARP (Home Affordable Refinance Program), homeowners were foreclosed on in record numbers—many through fraudulent and illegal means—and the banks were left off the hook by paying plea-bargained fines which amounted to pocket change for them.

Even in the face of overwhelming evidence to the contrary, Geithner insists the Obama administration did the right and the only available thing to fix the economy. Tone deaf, again. And this speaks volumes about Obama because he was the one who hired Geithner as Secretary of the Treasury, to work beside Larry Summers, the Clinton retread who gave us unregulated derivatives and the repeal of Glass-Steagall during the Clinton years which directly lead to the 2008 crash. While Stewart did a great job of nailing Geithner to his own cross, even better than Stewart, I’d love to see Paul Krugman and/or Robert Reich debate Geithner over his book. Both of them would bring along their good friend, John Maynard Keynes (in spirit), who I believe would have loved the opportunity to go a few rounds with Geithner on TV. Talk about REALLY being schooled…