World-Wide Takeover

Matthew Yglesias has an interesting piece that ought to drive the Sarah Palin people, the seeming future of the national GOP, more insane than they may already be.

Writes Yglesias in Time for a Global Stimulus:

The world needs a coordinated response to the current economic crisis, in which each country commits to undertake stimulus that's appropriate to the size of its economy and to its position in the global balance of trade. ... Global coordination of this sort would be difficult to undertake. Indeed, it would largely be unprecedented. But the economic crisis is also without precedent. Or, rather, it carries with it the scary precedent of the Great Depression. In the 1930s and 1940s, the international dimension of the situation eventually did come to the rescue of the global economy. But it came in the form of a horrifically violent war, which first served as a jobs program for the belligerent countries and then managed to destroy so much of Europe and Asia that the world was left with ample 'shovel ready' projects simply rebuilding. That, however, is not a model we want to emulate. The only alternative is a serious effort at a global coordination of recovery programs.

This is just the sort of coordinated and cooperative action that will drive the rightwingers nuts, in point of fact. But the economic end days appear to be approaching and the free market's invisible hand has now gone the way of all things saved during the rapture: Away to a better place.

The economic artifacts left behind are a hollowed-out American manufacturing base and some awfully scary mass psychology in the western world and Asia that has veered into a disassociative deflationary zone unreachable by traditional monetary policy.

War on Terror Is Over If We Want It

The war on terror has always been a a propaganda device used by the mendacious Bush administration.

Matthew Yglesias asked in the American Prospect if Obama will jettison this exercise in lying writ large to the American people.

The notion of a 'war on terror' is a controversial one—British Foreign Secretary David Miliband recently critiqued it for giving the impression of a 'unified, transnational enemy.' Will Obama discard the phrase?

Standing Up ... to the Man

Robert Kuttner ask in The American Prospect, "Will congressional Democrats (and Republicans) stand up to the treasury secretary?"

The early answer is a resounding 'yes'.

From the Times:

Treasury Secretary Henry M. Paulson Jr. received an angry and skeptical reception on Tuesday when he appeared before the Senate Banking Committee to ask Congress to promptly give him wide authority to rescue the nation’s financial system.

The time when Bush can steam-roll the Congress on anything is over. This political reality stands in glaring relief when we speak about the future of capitalism and the economic security of American families.

Good that Senators are asking some questions.

Obama's performance at a press conference today about the proposed financial rescue package in Tampa, Florida shows a confident, knowledgeable candidate asking a lot questions and laying out clear parameters, qualities of no little political significance a few days before the big debate as McCain and Palin draw press criticism for hiding from answering questions as one reporter today asked McCain whether he should rename his campaign bus the "no-talk express".

Obama Statement

Yesterday, the President said that Congress should pass his proposal to ease the crisis on Wall Street without significant changes or improvements.

Now, there are many to blame for causing the current crisis, starting with the speculators who gamed the system and the regulators who looked the other way. But all of us now have a stake in solving it and saving our financial institutions from collapse. Because if we don’t, the jobs and life savings of millions will be put at risk.

Given that fact, the President’s stubborn inflexibility is both unacceptable and disturbingly familiar. This is not the time for my-way-or-the-highway intransigence from anyone involved. It’s not the time for fear or panic. It’s the time for resolve, responsibility, and reasonableness.

And it is wholly unreasonable to expect that American taxpayers would or should hand this Administration or any Administration a $700 billion blank check with absolutely no oversight or conditions when a lack of oversight in Washington and on Wall Street is exactly what got us into this mess.

Now that the American people are being called upon to finance this solution, the American people have the right to certain protections and assurances from Washington.

First, the plan must include protections to ensure that taxpayer dollars are not used to further reward the bad behavior of irresponsible CEOs on Wall Street. There has been talk that some CEOs may refuse to cooperate with this plan if they have to forgo multi-million-dollar salaries. I cannot imagine a position more selfish and greedy at a time of national crisis. And I would like to speak directly to those CEOs right now: Do not make that mistake. You are stewards for workers and communities all across our country who have put their trust in you. With the enormous rewards you have reaped come responsibilities, and we expect and demand that you to live up to them. This plan cannot be a welfare program for Wall Street executives.

Second, the power to spend $700 billion of taxpayer money cannot be left to the discretion of one man, no matter who he is or which party he is from. I have great respect for Secretary Paulson, but he cannot act alone. We should set up an independent board that includes some of the most respected figures in our country, chosen by Democrats and Republicans, to provide oversight and accountability at every step of the way. I am heartened that Secretary Paulson appeared to be softening on this position in his testimony this morning.

Third, if taxpayers are being asked to underwrite hundreds of billions of dollars to solve this crisis, they must be treated like investors. The American people should share in the upside as Wall Street recovers. There are different ways to accomplish this, including putting equity into these firms instead of buying their troubled assets.

But regardless of how we structure the plan, if the government makes any kind of profit on this deal, we must give every penny back to the taxpayers who put up the money in the first place. And after the economy recovers, we should institute a Financial Stability Fee on the entire financial services industry to repay any losses to the American people and make sure we are never asked to foot the bill for Wall Street’s mistakes again. We can ask taxpayers to make an investment in the stability of our economy, but we cannot ask them to hand their money over to Wall Street without some expectation of return.

Fourth, the final plan must provide help to families who are struggling to stay in their homes. We cannot simply bailout Wall Street without helping the millions of innocent homeowners who are facing foreclosure.

There are a number of ways we can accomplish this. For example, we should consider giving the government the authority to purchase mortgages directly instead of simply mortgage-backed securities. In the past, such an approach has allowed taxpayers to profit as the housing market recovered. This is not simply a question of looking after homeowners, it’s doubtful that the economy as a whole can recover without the restoration of our housing sector, including a rebound in the home values that have suffered dramatically in recent months.

Finally, the American people need to know that we feel as great a sense of urgency about the emergency on Main Street as we do about the emergency on Wall Street. I have repeatedly called on President Bush and Senator McCain to join me in supporting an economic stimulus plan for working families – a plan that would help folks cope with rising food and gas prices, save one million jobs by rebuilding our schools and roads, help states and cities avoid painful budget cuts and tax increases, and help homeowners stay in their homes.

Let me be clear – we shouldn’t include this stimulus package into this particular legislation, but as we solve the immediate crisis on Wall Street, we should move with the same sense of urgency to help Main Street.

It is absolutely wrong to suggest that we cannot protect American taxpayers while still stabilizing our market and saving our financial system from collapse. We can and must do both.

In summary, there is no doubt negotiations over the next few days will be difficult. I will continue to keep in close touch with Secretary Paulson, Chairman Bernanke, and the leaders of Congress to ensure that we can work in a bipartisan manner to get this done as quickly as possible. Our country is being tested by a very serious crisis. We are all in this together, and we must come together as Democrats and Republicans, on Wall Street and on Main Street to solve it. And with the proper spirit of cooperation, I know we can.

Seven Sins of Deregulation

See the Seven Deadly Sins of Deregulation -- and Three Necessary Reforms by Robert Kuttner for a run-down on the melt-down.