Tuesday, September 30, 2008

Only with sprinkles

Spot has always liked Captain Fishsticks; he reminds Spot of King Banaian, only with something extra: same doughnut, but maybe with icing and some sprinkles. The brow of the Captain is never furrowed with doubt; he has the certainty of the peasants in the People's Crusade, hacking their way cheerfully through the Jews of Europe on their way to Jerusalem, convinced that God was on their side.

He's at it again with an article at MinnPost titled Who's really to blame for the financial meltdown? With that title and that author, you don't really even need to read the article, boys and girls. The Captain believes the government is to blame, naturally.

But Spot read it anyway.

After tut tutting about conservatives who blame the Community Reinvestment Act for the meltdown, Sticks goes on to say, well, it's things like the CRA:

In a managed economy, when government intervenes in the market on behalf of one industry or pushes a specific social goal – passes a Community Reinvestment Act – that action alters the market for capital. The Community Reinvestment Act with its implicit (now explicit) government guarantee to lenders that Fannie Mae and Freddie Mac would provide liquidity for their mortgage loans created a virtually risk-free investment with an artificially high return. This caused two problems.

First, guaranteed low risk and artificially inflated reward caused money to flow into housing that otherwise would have been more effectively invested in other segments of the economy. Eventually, the bubble had to burst – an unsupported money expansion can't go indefinitely.

The second reason:

Government intervention in housing lured capital away from where it had had been profitably flowing. Deregulation enabled investment banks to get in on the real estate action. Playing outside the bounds of market discipline in a virtually risk-free market where weighing the possibility of gain against the probability of loss was unnecessary, is it really a surprise that greed and recklessness ran amok?

The Captain is conflicted here, but he's not even aware of it. "Market discipline" couldn't work because of deregulation? Really? Spot thought that Sticks would think that repealing Glass-Steagall among other things was a good thing.

But greed to the Captain is not "greed" in the Gordon Gekko sense:

"Greed" may not be the right word, but where is the virtue in a person expecting society to finance a home he cannot afford? [yes, Sticks, all those people bought homes they knew would end up in foreclosure] Ironically, while the CRA provided a path to home ownership for some, the investment it was funneling from other parts of the economy lowered the standard of living for many more – economics is always about trade-offs. [let's see you back that one up, Sticks] The question is, who decides what those trade-offs are going to be? In this case is it going to be the secretary of the Treasury or individuals bound by the market discipline of risk and reward?

Oh, it's all those greedy rascals who wanted a home! Not all the mortgage bankers, loan originators, appraisers, and associated flim-flam artists who worked in the real estate industry. Not the loan syndicators nor the investment bankers who profited from commissions on all the mortgage-backed securities they could sell.

All the "professionals" who stood to profit from the bacchanalia day after day are blameless, while we must focus on poor people  - many unsophisticated in financial affairs - longing for a home and the government. Swell.

This history of financial bubbles demonstrates that you need a lot more than government to create one.

Sticks is no little "d" democrat. He thinks there is no role for a government to make a policy about anything: no political decisions. He wants to live in a world where, as Nick Coleman memorably put it once, "we're fighting with clubs in the ditches for food." Everything that governments do "distorts the market" or interferes with "market discipline" according to Sticks. Only through the market will our salvation be earned!

The Captain says that any departure laissez-faire capitalism means that the economy is "planned," conjuring up Soviet apparatchiki, which is foolish and paranoid. Frankly, we could use a little planning, or maybe just thinking, about new sources of energy and global warming, to mention just a couple of things. The auto industry - the market - certainly hasn't done the job.

Sticks says that the knowledge of the best way to allocate resources is "embedded in the market." Regrettably, the market isn't talking.

Update: More on this tomorrow, but Spot recommends Ollie on the CRA.

In which I foretell the future

Come Friday morning, you just know someone is going to bestow the functional equivalent of this on us:
"By merely showing up at the debate that was to have been her undoing, Sarah Palin emerged as a winner. By opening her mouth and uttering sounds, she took on all comers and showed us what toughness she embodies. But the fact that well over half of what she said were actual words -- my God! THIS is what a Vice President for the ages looks like. I know I couldn't be prouder than I am today in Sarah Palin. Look out liberal scum!"
I'll leave it to our dear readers to contemplate who.

Monday, September 29, 2008

The curious mating ritual of Nancy Pfotenhourolufogus

It's that time of year again. The time when adult specimens of the species Flackus Grandulus make their way out of their gilded abodes and on to the teevee in a display of lovemaking so grotesque that one must question whether or not a just and loving god has an active interest in his own creation.

For those of you unfamiliar with this peculiar dance, it is known among field experts as "setting the bar". You see, the adult Flakus lacks a device by which it can spread its seed. In order for it to procreate, it relies on the graces of another species, the Pundiculous Rex. The process itself is quite simple. When an adult Flakus is ready to mate it emits a signal called a press release which attracts flocks of Pundiculouses who are then willing to carry the Flakus' reproductive material to the only place where it can grow into a viable specimen, the Americanis Publica.

What is truly interesting about this transaction is that Pundiculous is actually a distant cousin of the Flakus' natural enemy, the Journalmalism Primus, but unlike its more fearsome relative, it appears to have developed a taste for publicly gratifying the Flakus. Scientists are not exactly sure why the Pundiculous Rex would submit to such a counter-intuitive and embarrassing procedure, but should the Flakus be unable to find a P-Rex, it would quite literally masturbate itself to death.

Let's take a look at this process in action. In the following excerpt an adult Flakus name Neil Newhouse gives the business to the P-Rex, Miles O'Brien:

O'BRIEN: Neil, let's begin with you. You know, I get the sense that George W. Bush and his team played the expectations game perfectly on round one. What's your sense of it? Was everything played perfectly in the sense that all he had to do was put together a single English sentence and he wins?

NEIL NEWHOUSE, REPUBLICAN POLLSTER: I wouldn't go quite that far. But I think if you look at the Bush debate with Al Gore and then the Dick Cheney debate, I think both men exceeded expectations. I think, in truth, the bar was set fairly low and the bar was set low because there was a sense that Al Gore was an expert debater. He has picked people apart extremely well in the past and I think there was a, maybe an over confidence on behalf of the Gore people that they would population mop the floor with George W. And that clearly wasn't the case.

In my studies of the Flakus' mating ritual I have come across several people who find a certain grace in the "natural" give-and-take between these two creatures. I think these people are sick and in need of immediate psychiatric care. Take a look at this list of mating encounters from the last major Flakus mating season, 2004:

In the run-up to this year's presidential debates, some in the media are once again playing the "expectations game" in favor of President George W. Bush against his Democratic opponent -- the same thing that happened four years ago. In the lead-up to the 2000 presidential debates, the press downplayed expectations for then-Governor Bush, enabling the Bush-Cheney '00 campaign to easily create the perception that Bush "won" and then-Vice President Al Gore "lost."

Media and political scholars noted this troubling phenomenon following the 2000 debates. On PBS's NewsHour with Jim Lehrer on November 7, 2000, Marvin Kalb, executive director of The Joan Shorenstein Center on the Press, Politics and Public Policy, observed: "No one took into account the possibility that if you set the bar real low for Bush, all he had to do was pronounce America properly and it would be a terrific thing. And that is in fact what happened." On December 17, 2000, Pittsburgh Post-Gazette politics editor James O'Toole noted: "In the debates, low expectations were positively liberating for Bush ... He got through them unscathed, and given the political handicapping, that was enough to beat the point spread."

Truly sickening stuff.

Unfortunately, this year's mating season is shaping up to be an even more grotesque and cringe-inducing affair than what we saw a mere 4 years ago. This time around, the entire Flakus population has been put into a twitter by a woman named Sarah Palin, the governor from Alaska, and GOP Presidential nominee John McCain's running mate for VP. As you have already seen in the clip at the top of this post, adult Flakuses are positioning themselves in front of P-Rexes all over the internet and teevee with their sexual glands fully exposed and rubbing up against the screen.

Thankfully, all hope for decency is not lost. Some members of the Journalmalism Primus population have grown tired of seeing their distant relatives behave in such an unbecoming manner. Take a look at what happens when J-Pri Jeffery Toobin approaches P-Rex Gloria Borger during an interview with what can only be described as some sort of gray-bearded succubus:

BLITZER: Gloria, what are you going to be looking for Thursday night?

BORGER: Well, the bar is, first of all, on the floor for Sarah Palin. She -- you know, so I'm looking to see how she goes toe to toe with Joe Biden, who's very experienced in foreign policy, and how he handles her.

BLITZER: But he's pretty capable of having a gaffe himself.

BORGER: Right, he is, and that's why this debate is going to be so interesting because these people are going to look at each other this time. And --

TOOBIN: But I don't think the bar is on the floor. I think the bar is the same place it is for Biden. I mean, who are we to say where the bar is? I think this is their job to say whether she's capable of being vice president --

BORGER: But people don't expect --

TOOBIN: -- and president of the United States.

BORGER: -- a lot. You know, look, if she performs --

TOOBIN: Well, they should.

BORGER: -- fine --

TOOBIN: They should expect a lot.

BORGER: -- it will be better than fine for her. Do you know what I'm saying? That's what I see.

TOOBIN: I understand your point, but I just think we sort of create these expectations that are just not our job -- it's not our job to do.

Decency exists!!! There is a god and not all is afoul with his creation!!!

People often ask me what they can do to stop the atrocious mating habits of the Flakus and its insidious dance of indignity with the nonsensical P-Rex. "Turn away," I tell them. Turn away. You see, for some reason or another when the P-Rex takes a warm money shot to the face on national teevee, its brain mistakenly sends a signal that tells itself "good job, this is how you get to sit at the big boy desk," when, in fact, it should be telling itself "my god, I can't believe I'm sitting here taking this s#&t." This isn't to say that getting openly abused by a Flakus is not in the P-Rexs' best personal interests. Quite to the contrary. You see, Flakuses know people. They know important people and there is nothing P-Rexes like more than knowing people who know people. It makes them feel warm and validated. However, while an individual P-Rex specimen may be overcome with personal feelings of joy when being mounted by an adult Flakus, as a species, and as a community, P-Rexes only serve to embarrass themselves by acting as a facilitator for the Flakuses' lewd behavior. There is no dignity in being another species' whore. I believe that's in Genesis somewhere.

UPDATE: A Minnesota Flakus has made the national news with a disturbing bit of...well, read for yourself:

Several Republicans said that all of this could ultimately play to Ms. Palin’s benefit, lowering expectations for her so much that a mediocre performance in the debate could be hailed as a success.

“Thanks to the mainstream media, quite a low expectation has been created for her performance,” said Ron Carey, chairman of Minnesota’s Republican Party. “The style of Sarah Palin is going to amaze people. She is going to be able to amaze people with the substance she is going to deliver.”

Come Friday, Mr. Carey will have reached climax, having repeatedly thrust his proboscis-like member into the ears of numerous adult P-Rexes. Without their help, by noon tomorrow he would have dry humped himself into a coma and no one would have cared.

Remember folks, these creatures cannot spread their seed if it were not for the willingness of the P-Rex. Who in their right mind would swallow their dirty deeds if it were not for the facilitation of the lowly Rex?

Nancy hurt his feelings!

Poor John Boehner; Nancy Pelosi hurt his feelings today:

WASHINGTON - Several Republican members of Congress said House Speaker Nancy Pelosi, D-Calif., had torpedoed any spirit of bipartisanship that surrounded a $700 billion bailout of the financial system with her scathing speech near the close of the debate that blamed Bush’s policies for the economic turmoil.

"We could have gotten there today had it not been for the partisan speech that the speaker gave on the floor of the House," House Minority Leader John Boehner said. Pelosi’s words, the Ohio Republican said, "poisoned our conference, caused a number of members that we thought we could get, to go south."

Rep. Roy Blunt, R-Mo., the whip, estimated that Pelosi’s speech changed the minds of a dozen Republicans who might otherwise have supported the plan.

Rep. Barney Frank, D-Mass., scoffed at the explanation.

"Well if that stopped people from voting, then shame on them," he said. "If people’s feelings were hurt because of a speech and that led them to vote differently than what they thought the national interest (requires), then they really don’t belong here. They’re not tough enough."

Nancy's sin of course was to point out where blame for this whole fiasco lies:

In her speech, Pelosi had assailed Bush and his administration for reckless economic policies.

"They claim to be free market advocates when it’s really an anything-goes mentality: No regulation, no supervision, no discipline. And if you fail, you will have a golden parachute and the taxpayer will bail you out. Those days are over. The party is over," Pelosi said.

"Democrats believe in a free market," she said. "But in this case, in its unbridled form, as encouraged, supported, by the Republicans — some in the Republican Party, not all — it has created not jobs, not capital. It has created chaos."

A pretty mild rebuke if you ask Spot.

By the way, boys and girls, that's über weasel Eric Cantor, Republican of Virginia, peeking cautiously over Boehner's right shoulder.

It went nowhere

Did you notice the brave little rally at end?

How did Minnesotans vote for the bailout?

Walz: Nay
Kline: Yea
Ramstad: Nay
McCollum: Yea
Ellison: Yea
Bachmann: Nay
Peterson: Nay
Oberstar: Yea

I'll continue to update the post as soon as I can find the votes.

UPDATE: Roll call is finally available here. And no, these aren't your typical vote parings. It looks to be a fairly bi-partisan rejection, as 95 Democrats and 133 Republicans voted against the bill. One really has to wonder why on earth House leadership was so far out in front of a bill that nobody seems to like. It looks like there will be another vote here in the very near future. I'll post the votes as they become available.

UPDATE ii: It looks like a second vote will not happen today. Again, House leadership really seems to have screwed the pooch here (see the wonderful picture below). There will now be bickering about who didn't deliver the votes (the House whips have to be sweating about now) but the fact remains that this thing a) really blew up on Friday with the House GOP plan and b) the vast majority of Americans hate the bailout.

UPDATE iii: With the costs of two wars hovering upwards of $850 billion, one really has to wish that as much worry was extended towards our nation's blood and not just to its Wall Street treasure, as recent events seem to have proved otherwise.

UPDATE iv: Oberstar is now listed as having voted for the bill.

What's wrong with this picture?

Nothing, so long as you don't mind it being called the Pelosi-Reid Bailout Wall Street and Screw the Taxpayer Act of 2008.


John Cole had a post this morning (Tuesday) with more information about how the Republicans were planning to run against the bailout and calling it the Democratic and Obama plan:

For days, it has been obvious what the GOP dream scenario was- have the bailout pass, but with predominantly Democratic support, dub it the the Bush/Pelosi/Reid/Obama bailout, and then run against it. This is the plan that Gingrich and Ruffini and the other next generation Republicans have been salivating over. This was their big chance.

In fact, the RNC was so sure this would be a good strategy, it cut campaign commercials running against the bailout before the vote came up.

Sunday, September 28, 2008

A simple question

Why isn't anybody talking about doing anything about the forces that got us into this financial mess in the first place?

Just asking.

Digby agrees with Spot

Well, maybe not agrees, per se,  but at least expresses similar sentiments. A few days ago, Spot wrote that the Republicans would use the bailout against Dems if it passed. It worries Digby, too:

My question is what is going to be done about this once this fabulous deal is done (if it gets done.) The Republicans have already set themselves up as the scourges of Wall Street and Washington perfidy, (as if they haven't been furiously servicing their Big Money bosses for the past decade like cheap, two dollar whores.) They will get some gold plated pitchforks and immediately begin running against the big spending liberals and their rich friends.

And after this week, it's going to be much easier for them to make that case. Even if it passes, it's clear that it will happen with at least a fairly large number of Republicans voting against it. (It still remains to be seen if McCain will find a way to vote against it. He's a gambler, and he may just go all in... )

The argument over this bailout is going to be with us for a long time to come and unless Democrats play this right, they are going to wind up holding the bag. The "populist Republican" meme is already out there and starting to take hold. They've bet on this economy getting very bad and being able to blame the hated Bush and Clinton for causing it and then blame the Democrats for throwing money at the problem and failing to solve it. Why would the Democrats let them do that?

Right now I'm watching Pelosi and Reid, Frank and Dodd stand there all by themselves taking "credit" for this bill. They are handing out plaudits to all the others who "helped" them get it done like members of "the Hills" at the MTV awards.

The optics are all wrong. If they really feel they have to do this thing each one of them should have a Republican under each arm every time they make an announcement.

This is much sounder political advice than Pelosi, Reid, et al. are apparently getting. It is amazing to Spot that a financial crisis of laissez-faire capitalism may turn into a political disaster for the Democrats.

Please read the entire Digby post.

Drinking Liberally: Whalin' on Palin

Be sure to catch SNL's reprise of the Palin - Couric interview.

Thursday night will be a special Drinking Liberally. We will watch the Palin - Biden debate on a television and on computers at Drinking Liberally. Feverish efforts are even now under way to insure adequate viewing and hearing for all.

Admit it, boys and girls, there isn't a better perch to sit and and make witty observations about Clueless Barbie. Come and test your barb-making machine against the assembled masters of the art.

Drinking Liberally is not until Thursday, October 2nd, so you have advanced warning and plenty of time to prepare. We'll meet at the regular time, six to nine or whenever the debate is over, at the regular place, the 331 Club in northeast Minneapolis.

Behold, the populists!!!

Ladies and gentlemen, the drinks have all been downed or spilled, the music has long since been quited, and the lights have been turned on just in time to capture the post-celebration men and women of the Republican party exiting stage right into a walk of the shameless.

The last week or so has been an interesting period for many a Republican. Once-hardened public defenders of deregulated free markets have been reduced to either willing participants in a great socialist giveaway or fire-breathing populists looking out for the economic interests of the common man.

As you have likely seen for yourself, the actual transformation from free market caterpillar to populist butterfly has been about as beautiful as what goes on inside a cocoon.

Take Orrin Hatch, for example. Orrin has always been a friend of the common man. Here he is protecting the everyday American tax payer from the dastardly deeds of devilish dandies:
Utah Sen. Orrin Hatch said he is also far from impressed with the current plan.

"I am not interested in putting present and future taxpayers' money at risk for the sake of bailing out those who have made greedy or foolish decisions," he said.
Here, here good man.

This Orrin Hatch is far, far removed from the ugly pre-transformational slug that slimed its way through the Bankruptcy Abuse Prevention and Consumer Act of 2005. Here he is talking about his opposition to an amendment that would have capped homestead provisions on individual bankruptcy filings:
Sen. Orrin Hatch (R.-Utah) opposed Kohl's amendment. "The states have the right to set the homestead cap rather than the federal government." He favored the House-passed homestead provision, which, he argued, more fairly targeted bankruptcy abuse, by focusing on activity that suggests the abuse Kohl decries.
This seems simple enough, but what Mr. Hatch was really arguing against was an assault on the millionaire homestead laws in Florida and Texas (which the amendment would have killed) that allow for millionaire bankrupts to keep their mansions (up to an unlimited value). And yes, this is exactly why OJ Simpson lives in Florida.

Hatch showed no such enthusiasm to defend the residents of states with caps that opened up their modest homes to Chapter 7 filings. Note to the executives of Wall Street: move to Florida or Texas as soon as possible and pump as much money as you can into your house. Note to middle and lower America: f-off.

Of course, "states' rights" are as much about states' rights now as they were way back during the days of slavery. In the case of the newly transformed (and completely lovely) butterfly, Mr. Hatch, "states' rights" are only as valuable as their utility towards wealthy people that want to abuse the system. And no, looking away from fraud isn't a state-based experiment in the grand laboratory of democracy.

The problem Republicans are having now (as evidenced by Mr. Hatch) is that they have built up a hybrid electoral/ideological philosophy that rests on the twin pillars of cultural populism and ensuring that the most fantastically wealthy Americans get more, and more, and more money.

Functionally, since Reagan, Republicans have combined their never-to-be-completely-politically-realized cultural populism and overt upper-class handouts with the wonderful little habit of staffing federal, state, county, and municipal government with people who are either openly hostile to the premise of the office/position which they hold or horse-breeders who do a heckuva job.

The plan was never to drown government in a bathtub, but to let it fall apart with mold and neglect....while giving away as much of America's bank account as possible to those who need it the least.

What could possibly go wrong with a fool-proof plan such as this?

The cynicism of the Republican party's governing philosophy has been a sight to behold during the past 2+ decades. With an approach that is 100% geared towards behind-the-wheel tom-foolery, it's hard to imagine that at any point during their reign that things like Katrina, 2 blotched wars, a grand economic failure, and widespread government corruption could have been viewed as anything other than cold, hard inevitabilities--bankable securities, if you will. This is exactly how their system of governance works. This is exactly the type of result that is implicit in their approach to all things Uncle Sam.

There is nothing wrong with wanting conservative principles in government. However, since the Reagan Revolution, conservatives have taken their principles out of government and put them in an electoral setting that frames things as belonging to either your bedroom or the boardroom. As for the day-to-day operation of government, instead of realizing that "reduced size" (which is a joke for another post) requires greater ingenuity, effort, and thought to maintain the aspects of the beast that the American people actually like, want, or require, Republicans have filled the sinking ship with a crew full of boobs who do little more than hand public money and assets away to private interests (or, when it comes to things like risk and massive financial losses, vice versa). It's cynicism at its very finest and now that the fun looks to be over for the vast, vast, vast majority of Americans, the people who willingly and/or recklessly rammed the damn thing into the iceberg are trying to convince the people on board that they should be in charge of the rescue attempt.

No thank you.

Saturday, September 27, 2008

A question about temperment

Putting aside the fact that the "suspension" of his campaign was a lying fraud of a campaign ploy, and putting aside the fact that it appears he single-handedly scuttled a bi-partisan agreement on the bailout bill, after watching last night's debate how do you think John McCain behaves in a situation where the details need to get hammered out on important "country first" legislation? Do you think he looks the Democrats in the room in the eye? Do you think he lectures them on how much they supposedly don't know? Do you think he hides behind numerous references to the troops and his time in a prison camp?

Ladies and gentlemen, the last three days should contain more than enough evidence to show you exactly how well John McCain's temperament is suited for the highest office in the land. The last three days should contain more than enough evidence to show you that he has next to zero interest in the nuts and bolts of policy, the nuances of crafting legislation, and actually working with all interested parties. The man doesn't even understand his own proposals. He also doesn't seem to have a functional grasp of the scope, definition, and importance of earmarks, as his answer to a question about what he would cut in the face of a $700 billion bailout proved. "Well Jim, I'd cut $18 billion in earmark spending and freeze non mil/vet spending." Fantastic. This wouldn't be the first time he has shown he doesn't know the first thing about earmarks. I'm also sure that DHS, the FBI, CIA, INS, and numerous other agencies vital to the day-to-day operation of our national security were thrilled to hear this proposal. (Does anyone know if he made that up on the spot in a fit of know-nothing maverickeyness?)

The man's entire approach to politics is to buzz the tower and then act as if his insane gamble is some sort of grand example of leadership and intelligence. No, no, no, and more no. The man literally tried to pull off a "dog ate my homework" trick this week after lying to the entire country that he was going to suspend his campaign until the crisis was resolved:


  • First he says that the fundamentals of the economy are fine.
  • Then he "suspends" his campaign, which, in reality, was nothing more than walking out on David Letterman
  • Then he says that the debates should be put off until the crisis is resolved.
  • Then he flies into DC and the bi-partisan talks fall apart.
  • The deal becomes decidedly unresolved.
  • He shows up at the debate.
How much more unbalanced does this man need to be in order to prove to the nation that he is completely unfit for office? When was the last time he had a mental health screening?

UPDATE: It wasn't just at the debate that he couldn't look his colleagues in the eyes:

Bush turned to McCain, who joked, "The longer I am around here, the more I respect seniority." McCain then turned to Boehner and Senate Minority Leader Mitch McConnell (R-Ky.) to speak first.

Boehner was blunt. The plan Paulson laid out would not win the support of the vast majority of House Republicans. It had been improved on the edges, with an oversight board and caps on the compensation of participating executives. But it had to be changed at the core. He did not mention the insurance alternative, but Democrats did. Rep. Barney Frank (D-Mass.), chairman of the House Financial Services Committee, pressed Boehner hard, asking him if he really intended to scrap the deal and start again.

No, Boehner replied, he just wanted his members to have a voice. Obama then jumped in to turn the question on his rival: "What do you think of the [insurance] plan, John?" he asked repeatedly. McCain did not answer.

This, of course, was hot off his fantastic performance in front of Senate Republicans:

McCain listened, then, with Sen. Lindsey O. Graham (S.C.), he burst into the Senate Republican policy luncheon. Over a Tex-Mex buffet, Sens. Robert F. Bennett (Utah) and Judd Gregg (N.H.) had been explaining the contours of a deal just reached. House Republicans were not buying it. Then McCain spoke.

"I appreciate what you've done here, but I'm not going to sign on to a deal just to sign the deal," McCain told the gathering, according to Graham and confirmed by multiple Senate GOP aides. "Just like Iraq, I'm not afraid to go it alone if I need to."

For a moment, as Graham described it, "you could hear a pin drop. It was just unbelievable." Then pandemonium. By the time the meeting broke up, the agreement touted just hours before -- one that Sen. Lamar Alexander (Tenn.), the No. 3 GOP leader, estimated would be supported by more than 40 Senate Republicans -- was in shambles.

John McCain: America second.

Again, this man is unstable and Democrats should refuse to move ahead with any negotiations until he is out of DC. They should also demand that his complete medical records be made public, without conditions. I'll ask it again: When was the last time he had a mental health screening?

UPDATE ii: OK, we've already established that McCain is on record as saying he doesn't know as much about economics as he should (he then tried to argue that he had an "extensive" economic background). We know that before hiding like a coward behind the average American worker, McCain said that the fundamentals of our economy were strong 16 times this year. We know that he's taken at least five different positions on the current economic crisis. We know that he didn't read Secretary Paulson's plan until days after it was released. We know that he lied to the nation about "suspending" his campaign. We know he crashed into DC burning up the bailout negotiations. We know that he scuttled the White House meeting with his insistence on letting the House Republican plan have its day in the sun. We now know that he didn't even know what the hell was in the House GOP plan:

Boehner and McCain discussed the bailout plan, but Republican leadership aides described the conversation as somewhat surreal. Neither man was familiar with the details of the proposal being pressed by House conservatives, and up to the moment they departed for the White House yesterday afternoon, neither had seen any description beyond news reports.

At 1:25 p.m., McCain left Boehner's office through a back door, walking across the Capitol's rotunda to the applause of tourists. Graham conceded the group knew little about the plan the nominee had come to Washington to try to shape.

Perhaps this is why he sat quietly by in the White House meeting. He doesn't know what the hell he is talking about. This man is literally willing to tank the negotiations for the single largest economic crisis in American history since the Great Depression for the betterment of his campaign for President. On top of this tomfoolery, he doesn't know the first damn thing about what he came in there to blow up in the first place...nor does he understand the motives and details of who and what he is blowing it up for.

One more time: When was the last time this man had a mental health screening? Is he still on Ambien? Did he ever receive treatment for PTSD? Has he ever received counseling to help him deal with his time spent in prison camp? Folks, this man is exhibiting some rather erratic and dangerous behavior. It's time for him to open up his medical records to the public with no preconditions.

Obama humors the cranky old man

Driftglass posted what Spot believes is the best comment on the debate last night in a post titled The Angry Baby Mantle.

Here's just a snip:

Since John McSame has been bought out by the Bush/Rove machine he has had one note: humorless fury. Every answer tonight was either preceded with a sneer of raged-up petulance, or punctuated with “Senator Obama doesn’t understand…” condescension.

Or both.

Driftglass wishes that Obama had just spanked the petulant old man; Spot does, too.

For all of the economic to-and-fro, this was primarily a discussion of foreign policy: John McSame’s stronghold. And what the Senator from Illinois clearly wanted – and believes in, across-the-board and down to his DNA -- was a gentlemanly, adult exchange about process and judgment, so instead of shooting the big, fat targets McSame kept throwing up out of the sky, he kept trying to drag the whole thing out of the weeds and into the classroom.

Which Senator Obama failed to do because he failed to realize was that Republicans live in the weeds.

But what is absolutely make-the-milk-come-out-your-nose funny is this pronouncement from one of the Power Line boyz, quoted approvingly by Mitch:

McCain was the teacher; Obama was the promising but somewhat disappointing student — the one who knows lots of facts but ultimately doesn’t quite get the big picture[.]

All along, these guys have been saying that Obama is short on specifics - he isn't - but now the knock is that he isn't enough of a big picture guy.

Sweet Jesus, you can't make this up.

Dr. Doom weighs in

Here's the concluding paragraph from his recent blog post:

Thus, the Treasury plan is a disgrace: a bailout of reckless bankers, lenders and investors that provides little direct debt relief to borrowers and financially stressed households and that will come at a very high cost to the US taxpayer. And the plan does nothing to resolve the severe stress in money markets and interbank markets that are now close to a systemic meltdown. [italics are Spot's]

In other words, the plan doesn't really address the credit crunch problem. He apparently doesn't like TARP much.

There are other economists who have their reservations, too:

A funny thing happened in the drafting of the largest-ever U.S. government intervention in the financial system. Lawmakers of all stripes mostly fell in line, but many of the nation's brightest economic minds are warning that the Wall Street bailout's a dangerous rush job.

President Bush and his Treasury secretary, former Goldman Sachs chief executive Henry Paulson, have warned of imminent economic collapse and another Great Depression if their rescue plan isn't passed immediately.

Is that true?

"It's more hype than real risk," said James K. Galbraith, a University of Texas economist and son of the late economic historian John Kenneth Galbraith. "A nasty recession is possible, but the bailout will not cure that. So it's mainly relevant to the financial industry."

Nearly two hundred academic economists (including three Nobel Prize winners) signed a letter opposing the Paulson plan:

But almost 200 academic economists -- who aren't paid by the institutions that could directly benefit from the plan but who also may not have recent practical experience in the markets -- have signed a petition organized by a University of Chicago professor objecting to the plan on the grounds that it could create perverse incentives, that it is too vague and that its long-run effects are unclear. Sen. Richard C. Shelby (Ala.), ranking Republican on the Budget Committee, brandished that letter yesterday afternoon as he explained his opposition to the bailout outside a bipartisan summit at the White House. The petition did not advocate any specific plan, including that offered yesterday by House Republicans.

(Shelby is about the only Senate Republican who has been vocal in opposition to the bailout, as least as far as Spot is aware.)

Here's the letter.

Did Professor Banaian sign the letter, Spotty?

No, he didn't, grasshopper.

Why not?

Spot doesn't know why not. Maybe he didn't want to; maybe he wasn't asked. It is of no moment. Galbraith and Dr. Doom didn't sign it either. What does matter is that a pretty respected group of economists from around the country did take it upon themselves to get up a petition against the Treasury plan.

What also matters is that "crisis" is not at a level that the House Republicans can't play politics with it. If Nancy Pelosi makes this happen in the House, she had better make sure that all of the House Republicans are there as human shields.

Friday, September 26, 2008

Just walk away Renee!

And you too, Nancy and Harry. But you won't. You'll stick it out with Prezident Dimwit and pass a massive bailout plan over the howls of the House Republicans. Minnesota's very own contribution to delusional politics had a piece condemning the bailout in the Strib today.

The Senate Republicans, on the other hand, who could actually block a bailout, as they have done with so much other legislation this session, have been uncharacteristically quiet. But here's the House Minority leader in the NYT today:

House Republicans leaders said they were only trying to protect taxpayers. “We will not agree to a bill that sell taxpayers’ out to bail out Wall Street,” the House Republican leader, John A. Boehner of Ohio, said. Fielding questions in a Capitol corridor, the Congressman told the reporters he would not negotiate in front of them because “last time I checked, you didn’t have a vote.”

But here's good ol' helpful Harry, in the same article:

A short time [after Bush spoke on the same subject], the Senate majority leader, Harry Reid of Nevada, made similar assurances. “We’re going to get this done and stay in session as long as it takes to get it done,” Mr. Reid said.

Well here's what's going to happen: a bailout will pass with the acquiescence of the Senate Republicans - the Republicans want the bailout, after all - and over the objection of the House Republican minority.

And then, Nancy and Harry, on the stump the Republicans will hang the whole unhappy affair around your necks. Come on, Democrats, step right over here and get your very own tire filled with gasoline to wear like a necklace.

The Democrats are talking about "oversight" and limits on executive compensation, but Spot has not read anywhere about at least getting meaningful financial regulation in exchange for putting their heads in a noose: a re-enactment of the Glass-Steagall Act, for example.

My God you people are easy to stampede.

A thump of the tail to Bruce for analysis and to the former Republican, John Cole, for the phrase Just walk away.

Barack Obama debates

. . . a chair!

UPDATE: The debate is on.

That's the prospect anyway. As Mr. Sponge has pointed out, the "suspension" of McCain's campaign to deal with the financial crisis was just a grandstanding stunt:

Senator John McCain had intended to ride back into Washington on Thursday as a leader who had put aside presidential politics to help broker a solution to the financial crisis. Instead he found himself in the midst of a remarkable partisan showdown, lacking a clear public message for how to bring it to an end.

At the bipartisan White House meeting that Mr. McCain had called for a day earlier, he sat silently for more than 40 minutes, more observer than leader, and then offered only a vague sense of where he stood, said people in the meeting.

I hope Spot hopes Obama goes through with it.

Meanwhile, Spot thinks he will suspend blogging for a while and go have a snooze.

Just another MOB meeting

Good that you were at Keegan's last night, Mitch. Did you play trivia? Did you answer these questions from the game announcer?

How many children does John McCain have?

How many children does Barack Obama have, the legitimate ones, anyway?

Where you there when only one couple complained about the odious racism and attempted unsuccessfully to get an apology from the announcer, and then left?

Inquiring minds want to know.

More fun with timelines

  • Wednesday, September 24th: John McCain tells David Letterman that he has to cancel his appearance on the Late Show because he needs to immediately catch a plane to DC to stave off an economic "crater".
    • Shortly after calling Letterman, McCain heads down to CBS Studios in New York where he gets make-up applied (was it the $5,000 make-up?) before giving an interview to Katie Couric...which in no way, shape, or form was a cynical play to try and make sure that Palin's disastrous interview with Couric was overshadowed. Stay tuned to see just how much the McCain campaign works with CBS in the coming weeks.
    • After his interview with Couric, McCain...well, at some point during the day he returned to his hotel in New York to get a good night's rest before his speech at the Clinton Global Initiative the next morning.
  • Thursday, September 25th: The economy is still here.
    • 8:30 AM: John McCain gives speech to Clinton Global Initiative.
    • Before noon: "Fundamental agreement" reached on bi-partisan bailout. McCain's plane still at Newark, NJ.
    • Just after noon: "Straight Talk Air" lands at Reagan National.
    • Around 1PM: McCain meets with House Minority Leader John Boehner to discuss House GOP plan.
    • Around 2PM: McCain has lunch before he leaves the Capitol grounds. According to the WaPo:
      For much of yesterday, McCain shuttled between meetings and his Senate office, but rarely came close to the Capitol suites and committee rooms where the talks were taking place.
    • Around 2:30 PM: Mr. Sponge calls the McCain campaign office and asks if it is still OK to donate to and volunteer for a "suspended" campaign. He is assured this is absolutely fine. BTW: I think I figured out what "suspending the campaign" means. McCain's website has turned off his calendar events. America first my friends, America first. In all seriousness, and as far as I can tell, the only thing the campaign actually suspended was his appearance on Letterman.
    • Late afternoon: McCain attends White House meeting that he requested. After sitting quietly for a few minutes, he blows it up:

      Towards the end, McCain finally spoke up, mentioning a counter-proposal that had been offered by some conservative House Republicans, which would suspend the capital gains tax for two years and provide tax incentives to encourage firms that buy up bad debt. McCain did not discuss specifics of the plan, though, and was non-committal about supporting it.

      Paulson, however, argued directly against the conservative proposal. "He said that he did not think it would work," according to the source. At another point in the meeting, President Bush chimed in, "If money isn't loosened, this sucker could go down" -- and by sucker he meant economy.

      ABC News reported that, following the meeting, Paulson "walked into the room where Democrats were caucusing...at the White House and pleaded with them 'please don't blow this up.'" But this story isn't incomplete, according to sources.

    • McCain returns to his Crystal City condo by 6PM, but not before recording several interviews with NBC, ABC, and CBS.
    • Economy is still here.

Thursday, September 25, 2008

Palin to nation: I have national security experience because commercial flights from Russia may enter Alaskan airspace

Watch CBS Videos Online

COURIC: You've cited Alaska's proximity to Russia as part of your foreign policy experience. What did you mean by that?

PALIN: That Alaska has a very narrow maritime border between a foreign country, Russia, and on our other side, the land -- boundary that we have with -- Canada. [...]

COURIC: Explain to me why that enhances your foreign policy credentials.

PALIN: Well, it certainly does because our -- our next door neighbors are foreign countries. They're in the state that I am the executive of. And there in Russia --

COURIC: Have you ever been involved with any negotiations, for example, with the Russians?

PALIN: We have trade missions back and forth. We -- we do -- it's very important when you consider even national security issues with Russia as Putin rears his head and comes into the air space of the United States of America, where -- where do they go? It's Alaska. It's just right over the border. It is -- from Alaska that we send those out to make sure that an eye is being kept on this very powerful nation, Russia, because they are right there. They are right next to -- to our state.

When I was younger, Mrs. Gorbachev came into a Snyders near my grade school in South Minneapolis. I actually saw Gorby's motorcade head out towards the airport. Consider me qualified.

McCain Comes to Town

Before his plane lands, the framework of a bi-partisan deal is in place.

After his plane lands, the mood sours and the deal goes away.

Note to congressional Democrats: suspend negotiations until McCain leaves DC.

Note to everyone else: second verse, same as the first:

During a meeting Thursday on immigration legislation, McCain and Sen. John Cornyn (R-Texas) got into a shouting match when Cornyn started voicing concerns about the number of judicial appeals that illegal immigrants could receive, according to multiple sources -- both Democrats and Republicans -- who heard firsthand accounts of the exchange from lawmakers who were in the room.

At a bipartisan gathering in an ornate meeting room just off the Senate floor, McCain complained that Cornyn was raising petty objections to a compromise plan being worked out between Senate Republicans and Democrats and the White House. He used a curse word associated with chickens and accused Cornyn of raising the issue just to torpedo a deal.

Things got really heated when Cornyn accused McCain of being too busy campaigning for president to take part in the negotiations, which have gone on for months behind closed doors. "Wait a second here," Cornyn said to McCain. "I've been sitting in here for all of these negotiations and you just parachute in here on the last day. You're out of line."

McCain, a former Navy pilot, then used language more accustomed to sailors (not to mention the current vice president, who made news a few years back after a verbal encounter with Sen. Patrick Leahy of Vermont).

"[Expletive] you! I know more about this than anyone else in the room," shouted McCain at Cornyn. McCain helped craft a bill in 2006 that passed the Senate but couldn't be compromised with a House bill that was much tougher on illegal immigrants.

The man is absolutely uninterested in policy, procedure, or anything that does not benefit his own personal ambition. Remember, this week's buffoonery is from a man who has changed positions 5 times on the crisis since last Monday and who had not read Secretary Paulson's plan until at least Tuesday. Does anyone know if he's read it since? He is in DC for one thing: to help John McCain win. It has nothing to do with the economy or the country. This man is not a hero. Were it not for the horrible actions taken against him in a prison camp, there would be no sympathy for or interest in a washed-up fly boy who causes things to crash and burn because of his recklessness.

Drinking Liberally: discussing the Ted spread

Remember, boys and girls, there will be a meeting of Drinking Liberally in Minneapolis tonight, usual place and time: six to nine or so at the 331 Club in northeast Minneapolis. We'll talk about the bailout, dubbed Bailie Mac or Hanky Panky by the wags at Princeton.

Shorter George Bush

[flop sweat and deer-in-the-headlights look right at the beginning] blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah MONEY POURED INTO THE US blah blah blah blah blah blah blah blah blah GOOD THING blah blah blah BAD THING blah blah blah FANNIE MAE blah blah blah blah blah blah GOVERNMENT blah blah blah blah blah blah blah blah blah FREDDIE MAC blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah IRRESPONSIBLE BORROWERS blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah PROBABLY MINORITIES blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah BOOOOOOOOO! HA! SKEERED JA! blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah GIVE US THE MONEY OR THE ECONOMY GETS IT [NOT THE MONEY OF COURSE] blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah MY GOD, PLEASE GIVE US THE MONEY OR HISTORY WILL HANG THIS AROUND MY NECK LIKE THE WAR IN IRAQ blah blah blah blah blah blah blah blah blah blah blah blah blah blah blah

God Bless.

Wednesday, September 24, 2008


  • Monday, September 15th: On the day where the poo hits the fan John McCain states that the "fundamentals of our economy are strong."
  • Tuesday, September 16th: John McCain calls for a high-level economic commission to deal with the crisis.
  • Wednesday, September 17th, AM: John McCain announces that he is against a bailout of insurance giant AIG.
  • Wednesday, September 17th, PM: John McCain supports bailout of insurance giant AIG.
  • Thursday, September 18th: McCain calls for the firing of SEC Chief Christopher Cox.
  • Friday, September 19th-Tuesday, September 23rd AM: McCain blames Freddie Mac, Fannie Mae lobbyists for current financial crisis.
  • Tuesday, September 23rd, PM: McCain suddenly becomes quiet about blaming Freddie Mac lobbyists when it is extensively reported that his own campaign manager was paid by the company as recently as last month.
  • Wednesday, September 24th, AM: Presidential tracking polls show Barack Obama opening up his lead on John McCain. Fox News tracking poll has Obama at +6.
    • At 8:30 in the morning McCain is contacted by Obama with a proposal to release a joint statement of shared principals concerning the economic crisis.
    • Sometime during the day McCain held a decidedly non-emergency meeting with Lady Lynn de Rothschild to discuss...perhaps drapery for the non-elitist White House. Obama waits by the phone.
    • Around 2:30 in the afternoon, McCain calls Obama to tell him he is on board with the joint statement.
    • A few minutes later he announces to the world that he is "suspending" his campaign to deal with the crisis in Washington. He suggests that this Friday's debate be postponed.
    • Obama rejects McCain's request to suspend the debate.
    • Sometime late in the evening, CNN reports that the McCain camp has suggested that the 1st presidential debate should take the place of the VP debate to be held next Thursday. McCain surrogate answers question about McCain's VP choice with a "Sarah who?" (OK, I made that last part up.)


While I may shop there, I have no desire to live in the sort of Banana Republic that would come about should this dangerously unfit man be elected to the highest office in the land.

I should say that it's nice that the man has finally decided to show up for work this year.

I should also say that even though McCain's decision-making skills resemble those of a man who is highly medicated, and even though I think that this is a snap decision that completely politicizes the process more than it already was, McCain is the major player on the passage of this bill. There is no way on god's green earth that a Democratic-led Congress is going to let a bill pass without McCain's "yea" attached to it right along side Obama's "yea" vote (or no to no), because we all know that no matter what the man believes, says, or does in the time between now and the actual vote, if he breaks from Obama, that will be the centerpiece of his campaign from here on out (he could actually use this power for good, but...). The man is that cynical, that deranged, and that unfit for duty (and judging by the way in which he handled Obama's proposal today, he's that much of a lying coward/bad-actor). At this point it doesn't matter what he believes so long as he can make a case that it is somehow different from whatever position Obama ends up taking.

Now that's some America-firsting we can believe in my friends.

Ready for a break, boys and girls?

Spot is. How about a little Katie, just for old time's sake?

Yesterday, Katie had a post on her "blog" with the title: Do we love ourselves too much? When Katie gets existential, she produces some of her best dreck.

So with a title like that, and with Spot's gathering sense of dread, he read the post. Turns out, it was a previous column that she had "lightly edited." Spot says you should have been more brutal with it, Katie.

Katie opens with how self-absorbed "we" (don't be fooled by the ecumenical use of the word "we" by our Katie, boys and girls; she really means you) are:

We Americans seem to be in the midst of a love affair with “our bodies, ourselves.” Stroll through the supermarket - each can has a label announcing its fat and sodium content, and “me-focused” publications jam the magazine rack. Stop on the way home for a massage at the spa, or a close encounter with a Nautilus at the health club.

But then, Katie turns to the real subject of the column, John Wesley Powell:

We might, for example, consider the predicament of Maj. John Wesley Powell, who spent the afternoon of July 7, 1869, clinging with one arm to a cliff high above the Colorado River.

Katie tell us what a bunch of layabouts we are compared to Powell, who on the afternoon in question was rescued by another man's underwear. Spot isn't making this up, or rather if he is, Katie is, too.

Katie is full of little vignettes about Powell's expedition down the Colorado: it lasted three months, the food was bad, the men were both hot and cold, there were scorpions and rattlesnakes, etc. and etc. Spot figures Katie must have just finished a biography of Powell and was eager to do a report just as she used to do in the sixth grade; maybe she did a book report on Powell in the sixth grade and that's where she got her material.

After telling us that Powell was heroic - he was admirable, but not more than a lot of people doing dangerous and heroic things today - Katie reaches way back to Aristotle for a definition of the heroic:

A true hero, Aristotle wrote, is ready to abandon comfort, possessions, and even honor “to take possession of the beautiful.” The man who is great of soul “would choose to live nobly for a year rather than to pass many years of ordinary life, and would rather do one great and noble deed than many small ones.

So cancel your People Magazine subscriptions, boys and girls, and try to figure out a way to go back in time as far as you can. Try out for Survivor. Whatever.

When Katie gets in one of these moods, Spot often finds himself humming the tune to "Am I Alone," from the Gilbert and Sullivan operetta Patience. It's sung by the character Reginald Bunthorne, identified as a "fleshy poet":

No. 6. Am I alone and unobserved?
(Recitative and Solo)

(Up-stage, he looks off L. and R.)
Am I alone,
And unobserved? I am!
(comes down)
Then let me own
I'm an aesthetic sham!
(and walks tragically to down-stage, C.)
This air severe
Is but a mere
This cynic smile
Is but a wile
Of guile!
This costume chaste
Is but good taste
Let me confess!
A languid love for Lilies does not blight me!
Lank limbs and haggard cheeks do not delight me!
I do not care for dirty greens
By any means.
I do not long for all one sees
That's Japanese.
I am not fond of uttering platitudes
In stained-glass attitudes.
In short, my mediaevalism's affectation,
Born of a morbid love of admiration!
(Tiptoes up-stage, looking L. and R., and comes back down, C.)
If you're anxious for to shine
in the high aesthetic line
as a man of culture rare,
You must get up all the germs
of the transcendental terms,
and plant them ev'rywhere.
You must lie upon the daisies
and discourse in novel phrases
of your complicated state of mind,
The meaning doesn't matter if it's only idle chatter
of a transcendental kind.
And ev'ry one will say,
As you walk your mystic way,
"If this young man expresses himself
in terms too deep for me,
Why, what a very singularly deep young man
this deep young man must be!"
Be eloquent in praise of the very dull old days
which have long since passed away,
And convince 'em, if you can, that the reign
of good Queen Anne was Culture's palmiest day.
Of course you will pooh-pooh whatever's fresh and new,
and declare it's crude and mean,
For Art stopped short in the cultivated court
of the Empress Josephine.
And ev'ryone will say,
As you walk your mystic way,
"If that's not good enough for him
which is good enough for me,
Why, what a very cultivated kind
of youth this kind of youth must be!"
Then a sentimental passion of a vegetable fashion
must excite your languid spleen,
An attachment a la Plato for a bashful young potato,
or a not- too-French French bean!
Though the Philistines may jostle, you will rank
as an apostle in the high aesthetic band,
If you walk down Piccadilly with a poppy
or a lily in your medieval hand.
And ev'ryone will say,
As you walk your flow'ry way,
"If he's content with a vegetable love
which would certainly not suit me,
Why, what a most particularly pure young man
this pure young man must be!"

"Though the Philistines may jostle, you will rank as an apostle in the high aesthetic band." A better description of Katie's aspirations has never been written.

Just send your seconds

John McCain wants to delay the first debate, set for Friday night. On the news, popcorn futures were down sharply. Kidding.

Here's what McCain says:

“I am calling on the President to convene a meeting with the leadership from both houses of Congress, including Senator Obama and myself,” he said in New York Wednesday afternoon. “It is time for both parties to come together to solve this problem.”

Obama thinks, just maybe, the public would be interested in what the candidates had to say:

In fact, aides to Mr. Obama said that he was inclined to go ahead with the debate, and was planning to explain his position during a late-afternoon news briefing in Florida. "There are serious global financial issues at stake and the American people deserve to hear how the next president will handle them," said one senior Obama adviser, speaking on condition of anonymity.

Spot thinks Obama is right. He suggests that the candidates just have their veep choices attend a leadership meeting in Washington.

Is Sarah Palin up to that, Spotty?

That's the point, grasshopper.

(Photo from NYT)

Rocket man

Got this one from Chuckumentary at Twitter:

Tuesday, September 23, 2008

King Banaian favors socializing the losses!

That makes him a traitor to libertarians, doesn't it, Spot?

Nah, grasshopper, remember: it's privatize the gains and socialize the losses. And the Perfesser put up a post today defending the bailout and minimizing its consequences:

First off, let's dispense with the idea that the Paulson plan is a "$700 billion bailout." It isn't. We are borrowing $700 billion from world markets at the rates the U.S. government gets, to buy mortgage-backed securities from banks that want to sell them.

Well, that's different Spotty! How can you argue with that? We'll just borrow the money.

Which will probably drive up the cost of everyone's borrowing, even for the federal government itself. And when the Perfesser says "world markets," he means the Chinese, and maybe a Saudi royal or two.

But Spotty, Professor Banaian says we'll be able to sell the assets we buy later, and we'll get some money back.

Right grasshopper, but under Treas. Sec'y Paulson's plan, the federal government buys assets at a price that reflects a "hold to maturity" price. In other words, there is assumed to be no defaults and no credit risk. That's a pretty creamy price. Those are the kind of assumptions only an economist could love, and apparently the Perfesser does:

The federal government, by dint of its preferred position in borrowing on international markets, can finance the gap between the two prices [described in the data-free graph provided with the text] without fear of having to liquidate its position. The banks, because of the precautionary demand for excess reserves, are induced to liquidate earlier and, in part thanks to Sarbanes-Oxley, have to mark their assets to market not only if they liquidate but if their neighboring banks do so.

Sometimes, the market price isn't the right or real price, according to the Perfesser. Instead of the price established by a willing buyer and a willing seller, the Perfesser thinks the price should just be what a willing seller can get from a bunch of feckless politicians.

It's just socializing the losses.

But Spotty, doesn't the Invisible Hand know what the price should be?

Ask the Perfesser, grasshopper. Apparently, the answer is "yes," except when it is inconvenient to People Who Matter.

Another assumption that the Perfesser makes is that the cost of the bailout is the difference between what is paid for the assets and what is received for them, plus the carrying cost. This is an unknowable number, but it neglects the pressure on the cost of borrowing, as alluded to earlier, the inflationary impact and the downward pressure it will place on the dollar - which is already in the tank - in effect raising the price of oil and everything else, and the reduction of discretionary non-defense spending even further.

It is also pretty rich to argue that the financial community should be essentially held harmless (except for handing out a few warrants to the government) while saying to defaulting homeowners, "Too bad, you made a bad decision. Let's have some personal responsibility." What defaulting homeowner doesn't say, "Just give me a little time to get back on my feet and for the real estate market to recover." (It's unlikely to do that for the foreseeable future, but nevertheless.)

Do you know what happens when you lose you house in foreclosure, grasshopper?

No, Spot, I don't.

In virtually every case, the homeowner loses whatever equity or investment in the property s/he had. That's what the big boyz are trying to avoid now. If they get away with it, both major political parties should go the way of the Whigs. As Prentice Cox, a law professor at the U. of Minn. says, the Paulson plan is like giving restitution to the crooks and putting the victims in jail.