Economic Fundamentalists, by John Ostrander
Over last weekend, the Presidential campaign’s silly season came to a screeching halt. Karl Rove, politics’ answer to P.T. Barnum, manipulated things pretty well, dominating news cycle after news cycle with his Beauty Queen Who Can See Russia From Her Porch (!) but that pesky reality came in and re-focused everything back on the issues again.
I suspect you know that the large brokerage house of Lehman Brothers went into bankruptcy. Merrill Lynch, another famous brokerage, got sold to Bank of America for relative pennies because it didn’t have much other choice. Insurance giant AIG went on the ropes and required a mega-Fed bailout. The Dow dropped almost 500 points on Monday before somewhat recovering on Tuesday before nose-diving again Wednesday morning.
In recent days, mortgage giants Fannie May and Freddie Mac were also bailed out (and acquired by the government). In a move of surprising fiscal sanity, the government has refused to pay the fired CEOs of these two companies their severance packages that would have come to about 24 million dollars. NY Senator Charles Schumer said “It would have been unconscionable to award these inflated salaries, particularly when the leadership of Fannie and Freddie can hardly be given good grades." Too right, Chuck.
Another bank, Washington Mutual (WaMu – Wooo Hooo!), is on the skids. Other banks and big-time brokerages are in trouble. The Fed has signaled that Wall Street should not expect the sort of bailout that they’ve done elsewhere. And experts are saying that a full-blown recession can be expected by the end of this year, start of the next year at the earliest.
So we’re back to dealing with issues. And what’s the main issue? What’s the election going to be all about? Not Sarah Palin, although her getting anywhere near the Presidency is pretty scary. Not the Iraq War, although that remains a mistake and a drain on our resources and the lives of our soldiers. It’s not about “values” and whose values are best. It’s not about whether or not we agree on what God is or if there is a God. It’s not about “smalltown” versus “big city.” It’s not about red states versus blue states. It’s not the environment although having air to breathe is pretty important. In terms of the election, there is one primary issue.
It’s as true today as when James Carville hammered it into Bill Clinton and got him into the White House. People are hanging on by their fingertips; they’re losing their jobs, their businesses, their homes. Older people are losing their pensions. I know people who have houses they can no longer afford but that they can’t sell, either, because the housing market is so depressed. I’m not talking about people buying McMansions. I’m talking about regular people with modest homes who were able to handle their mortgages until the economy went south. Now they can’t make the monthly payment, they can’t sell the house – period – and they have damn little hope.
John McCain went on the air to say that the “fundamentals” of the American economy were sound. The Democrats pounced and McCain stumbled back on the air to explain what he meant by fundamentals. He displayed an interesting bit of body language while doing it; his head kept moving side to side suggesting he either has Parkinson’s or he was denying what he was saying.
President Bush, in reacting to the Wall Street fun and games on Monday, said, “Adjustments in the financial markets can be painful, both for people concerned about their investments and for the employees of the affected firms. But in the long run I am confident that our capital markets are flexible and resilient and can deal with these adjustments.”
As Jon Stewart pointed out on The Daily Show, “adjustments” are something the chiropractor does to your back.
What Bush and McCain both are showing is an act of faith – economic fundamentalism, if you will. An unwavering belief in the “free market” – that the “free market” is the answer to all things and it doesn’t require regulation because it will regulate itself. Little magical financial pixies come along to make an “adjustment” as needed. Allan Greenspan in a tutu and wings.
Well, actually Greenspan always looked more like a gnome although he was described as a wizard. I always thought that the rules of Dungeons and Dragons were a little more accessible and understandable than economic theories. What will the market do today? Let’s roll our twelve sided dice and see.
I have less faith in the market than the true believers. If I’m an agnostic about deities, I might as well doubt economists, too. The fundamental truth about the market is that it’s based on greed. There’s a lot of real financial pain that real people are feeling out there and somebody will make some money out of this, even if it isn’t you. Government regulation gets in the way of that as well it should.
The McCain camp on Tuesday said that Obama would hobble the economy with “burdensome regulations” just when the economy can least afford it. Excuse me? Maybe it was a lack of regulation or an excess of de-regulation that have already hobbled the markets.
The housing market got overheated because of cheap subprime mortgages. The banks and brokers and insurance companies are in trouble and We, the Chump Taxpayers, are bailing them out because they all got involved in the artificially created junk mortgages because a) they were greedy and b) the regulations were relaxed or withdrawn to keep them from doing pretty stupid things. Why were they relaxed? Because the Bush Administration and the Republicans were always chummier with Big Business than the Little Guy.
Need proof? Take a look at the scandal in the Interior Department last week. Thirteen employees in Denver and Washington who sell U.S. mineral rights to oil companies were accused by a government investigation of receiving gifts, using drugs and having sex with employees of the oil companies with which they were dealing. As Senator Bill Nelson (D-Fla) said, "The government employees who oversee off-shore oil drilling are literally and figuratively in bed with big oil.” It should be noted that the sale of mineral rights to these oil companies is a large source revenue for the government; the only greater source is taxes. To me this is emblematic of the whole Bush Administration approach to Big Business and its’ wrong.
The government should be about protecting its citizens. It should not be about making lots of bucks for the richest percentile of Americans so that the effect can then ‘trickle down” to the rest of the population. The Bush Administration – the Republican Administration – has screwed this country good and proper economically. Do you reward it with another term so it can fix it? McCain ain’t that different, folks, and Palin is a political copy of Bush. I don’t care what your social beliefs or religious beliefs or any of your other beliefs are, you just don’t reward this kind of gross incompetence (and that’s giving them the benefit of the doubt) with another term.
I’ll use a comic book analogy. I know fans who have griped about a certain book for years, moaning how the quality has gone down hill and how cynically the publisher keeps churning out the same old drivel. Ask them if they continue to buy it, they admit they do but because they don’t want to mess up the numbering system of consecutive issues they’ve acquired. The publisher has no reason to change or improve the book because the fans keep buying it regardless of the quality. The simple answer is – don’t buy it. Send a message.
Do the same for the Republicans. You’ll be doing them – and the country – a favor.
Obviously, ComicMix columnist John Ostrander is some sort of commie.
It's not just gross incompetence, but Bush took his cronyism to the level of planned gross incompetence. Regulators were regularly and specifically put in place for their lack of any motivation or skill at regulating. Look at the MMS scandal, the supposed regulators were literally "in bed" with oil companies!And we can't look to McCain and Palin for transparency and reform. For instance, Palin's "Troopergate": Palin promised to cooperate with an Alaskan legislative investigation in July, now teams of Washington lawyers are working to stonewall the investigation any way they can. Seriously, it's like a road company version of the same show that has been playing out in the Bush White House for years! "Troopergate" wouldn't even be a national issue IF Palin had been vetted by her own party.
Palin also bases her staff on loyalty and prizes secrecy in her activities — which is pretty much what the current administration is doing. it's like putting lipstick on Bush.
Very true about the comic book analogy. Buying a comic and still griping about the quality just sends a message to the publishers that the "fans" are so stupid that no matter what we do, they'll keep buying.This current presidency has really screwed things up. Also, there's enough blame for the "Do-Nothing" Congress we have that haven't passed any major regulations for oversight, nor did Barney Frank give any major warnings regarding the shady lending practices.What do you expect from a bunch of "leaders" that receive their bribes, excuse me "campaign contributions" from these very same people? Obama has some of the former heads of Frannie and Freddie on his team. McCain isn't one to talk either. Too bad we can't place a vote of "none of the above".
Well done, John – I had been hoping you'd tackle this subject, as I couldn't figure out an appropriate comic book connection ;).
Obviously, your tag/bi-line is EXTREMIST-ly Appropriate…Ostrander IS a commie!!! Glad to know what writer's books I won't be buying anymore…That is, if you are allowed to write anymore books from the mainstream. Because, according to you, the young whipper snapper writers, editors, and EICs won't let you join their party anymore because you are "too old" and "don't get" what is hip nowadays. That you are "out of touch"…..I see an interesting parallel with the current presidential election…and oddly enough, you are backing, who? Obama, right? You know, the guy that represents the party that says McCain is "too old" and "out of touch with mainstream America"…hmmm…interesting when you put it that way, huh?
Update: the Fed and the Bush Administration are announcing a bail-out for the banks and investment firms that will, by the Sec of the treasury's offhand estimate, cost the taxpayers "hundreds of billions" of dollars. Which some Republican leaders in Congress think we should be able to do without tax increases. (Before an election? Yeah, without tax increases.)The city of Detroit also this week asked for a bailout of 25 billion dollars. I mean, as long as the government is in the mood to just give money away, why not? Except, of course, they won't get it because, like, they're a CITY and not something that is really WORTH anything. It's just where lots of PEOPLE live.I never want to hear another fucking thing from the free market apologists. About how the market will regulate itself. Gordon Gecko would've blanched at the greed these Wizards of Wall Street manifested. The government lifted regulations, turned a blind eye to what was going on and literally got into bed with the people they WERE supposed to be regulating. All on the Republican watch.McCain wants a commission to study the mess. Sure he does. A commission can be manipulated or ignored and won't even come into being until LONG after the election. His economic policies aren't different from Bush. This week shows the utter failure of an economic policy he wants to perpetuate. We just nationalized the world's largest insurer, AIG. That's socialism, baby, and it's what the hounds of Wall Street want. Look at how the stock market rebounded at word of the bail-out. Just call it FINAL CRISIS OF THE AMERICAN ECONOMY and double-bag it, folks. We're going to be feeling the aftershocks and effects of this for a long time.
What I like is that Bush was able to socialize the largest insurance company in the nation without ANY Congressional debate, oversight or consensus on the subject. And yet, we can't social medical insurance because that would take away people's freedom of choice in their medical care. As if the people who can't afford medical insurance have any choice at all. I'm not saying the government shouldn't have bailed out Bear Stearns, Fannie Mae, Freddie Mac or AIG, especially when things were allowed to get SO bad. But when was there ANY public discussion on the subject? When was any elected representative, besides the President, allowed to weigh in on the subject before action was taken? It seems to me that our President just assumed a great deal of power and made several major, unilateral decisions without anybody questioning his authority. How can the President appropriate HUNDREDS of BILLIONS of dollars in corporate welfare without any legislation involved?
Woo-hoo, socialism for the rich on the backs of the middle class and poor! That's 21st century America, buddy!Utterly disgusting.
And following this http://www.washingtonpost.com/wp-dyn/content/arti…"The House yesterday approved legislation aimed at curbing speculation in oil and other commodity markets, saying federal regulators don't have the tools or manpower to track trading abuses." Later in the article it says "The White House said in advance of the House vote that President Bush is likely to veto the bill if it reaches his desk. There "is no verifiable evidence to conclude that oil speculators were behind the rise in oil prices . . . [or] were behind its recent decline," said the White House in a message to lawmakers. " I guess the White House is going to wait until things get really bad here?
Listening to CNN today, the estimate for the bailout is now at a trillion dollars. Add that to a trillion dollar deficit and the money spent is Iraq on the endless boondoggle of a war. To quote and upgrade the late Senator Everett McKinley Dirksen of Illinois, "A trillion hear, a trillion there, pretty soon you're talking real money."
I'm willing to bet the senator spelled "here" correctly.
2 trillion dollars is $20,000 for every family of three. ($6,666.66 per person in the US). Even spread over 10 years, a family of 3 will pay $2000 more a year in taxes. Can you afford it? I certainly can't.
Hey dumb@@@! Do you know anything about economics whatsoever, or should you just get used to me sending snarky comments every time you make a post that shows you are just plain stupid? I understand that you are supposed to know entertainment. You really should not comment about economics. My $0.02.
Okay, it's a little late to add an update and I'm not sure anyone will see this but right now, as I write this, Congress is debating Bush's $700billion bail out of Wall Street. The Bushies and the Repubs — including McCain — are arguing for a "clean" passage of the bill with nothing else added on. They also are insisting a quick passage because it's so vital we do so — which reminds me of how Bush's war powers got pushed through Congress. So that makes me a bit leery.The Dems want what I think are reasonable requests and some that are vital. They insist that the payment and (I think) severance packages of execs of companies wanting/needing bailouts should be controlled by Congress and capped. You bet. If these are the saps that got their respective companies into the shitter in the first place, then I don't want to see taxpayer money going for their bonuses or multi-million dollar severance packages. If they need a Fed payout, then the execs have to forego that and agree to it beforehand and that should be part of the package. I think I'm going to tell my reps in Congress that. You might want to do the same.
The Daily Kos site reports that when a Treasury Department official was asked "Where did the $700 billion figure come from?", the answer was "We just picked a really, really big number."*sigh*