Tuesday, September 30, 2008

What Did Bush Tell Gonzales?

Friday 26 September 2008

by: Murray Waas, The Atlantic

Sources say Alberto Gonzales now claims that President Bush personally directed him to John Ashcroft's hospital room in the infamous wiretap renewal incident. (Photo: Lawrence Jackson / The Associated Press)

Sources say Alberto Gonzales now claims that President Bush personally directed him to John Ashcroft's hospital room in the infamous wiretap renewal incident.

In March 2004, White House Counsel Alberto Gonzales made a now-famous late-night visit to the hospital room of Attorney General John Ashcroft, seeking to get Ashcroft to sign a certification stating that the Bush administration's warrantless wiretapping program was legal. According to people familiar with statements recently made by Gonzales to federal investigators, Gonzales is now saying that George Bush personally directed him to make that hospital visit.

The hospital visit is already central to many contemporaneous historical accounts of the Bush presidency. At the time of the visit, Ashcroft had been in intensive care for six days, was heavily medicated, and was recovering from emergency surgery to remove his gall bladder. Deputy Attorney General James B. Comey has said that he believes that Gonzales and White House Chief of Staff Andrew Card, who accompanied Gonzales to Ashcroft's hospital room, were trying to take advantage of Ashcroft's grievously ill state-pressing him to sign the certification possibly without even comprehending what he was doing-and in the process authorize a government surveillance program which both Ashcroft and the Justice Department had concluded was of questionable legality.

Gonzales has also told Justice Department investigators that President Bush played a more central and active role than was previously known in devising a strategy to have Congress enable the continuation of the surveillance program when questions about its legality were raised by the Justice Department, as well as devising other ways to circumvent the Justice Department's legal concerns about the program, according to people who have read Gonzales's interviews with investigators. The White House declined to comment for this story. An attorney for Gonzales, George J. Terwilliger III, himself a former deputy attorney general, declined to comment as well.

Although this president is famously known for rarely becoming immersed in the details-even on the issues he cares the most about-Gonzales has painted a picture of Bush as being very much involved when it came to his administration's surveillance program.

In describing Bush as having pressed him to engage in some of the more controversial actions regarding the warrantless surveillance program, Gonzales and his legal team are apparently attempting to lessen his own legal jeopardy. The Justice Department's inspector general (IG) is investigating whether Gonzales lied to Congress when he was questioned under oath about the surveillance program. And the Justice Department's Office of Professional Responsibility (OPR) is separately investigating whether Gonzales and other Justice Department attorneys acted within the law in authorizing and overseeing the surveillance program. Neither the IG nor OPR can bring criminal charges, but if, during the course of their own investigations, they believe they have uncovered evidence of a possible crime, they can seek to make a criminal referral to those who can.

In portraying President Bush as directly involved in making some of the more controversial decisions about his administration's surveillance program, Gonzales may, intentionally or unintentionally, be drawing greater legal scrutiny to the actions of President Bush and other White House officials. And what began as investigations narrowly focused on Gonzales's conduct could easily morph into broader investigations leading into the White House, and possibly leading to the appointment of a special prosecutor.

Dan Richman, a former federal prosecutor in Manhattan and professor at Columbia Law School, told me that Gonzales appears to be attempting to walk the thin line of taking himself out of harm's way while at the same time protecting the president, a strategy that very well could work: "I think he is serving his own purposes and the White House's purposes," Richman says.

According to Richman, by invoking Bush's name and authority, Gonzales and his legal team are making it more difficult for investigators to seek a criminal investigation of his actions, or for other investigators to later bring criminal charges against him: "The clearer it is that Gonzales did what he did at the behest of the president of the United States, the safer that he [Gonzales] is legally," says Richman. At the same time, by saying that he is advising the president, Gonzales also makes it easier for those at the White House to claim executive privilege if they do indeed become embroiled in the probe.

Moreover, according to one senior Justice Department official, Gonzales, his legal team, and the White House also know that Justice's IG and OPR are unlikely to press senior White House officials, let alone the president, to answer their questions.

But this legal strategy could also backfire.

One scenario feared by the White House is that the IG or OPR could send a public report to Congress concluding that Gonzales or some other official may have committed a crime. At a minimum, that would make the conduct of Gonzales, or of any other official deemed to be under suspicion, the subject of a criminal investigation.

If the report also raised unanswered questions about possible misconduct by other senior administration officials, or even the president, that could lead to the appointment of a special prosecutor. Some consider this unlikely; Attorney General Mike Mukasey has said that he is not an advocate of special prosecutors, and his critics in Congress have said that Mukasey tends to use his position for the political benefit of the White House. But in the hands of congressional Democrats, a public report accusing Gonzales and other administration officials of misconduct could make it difficult for Mukasey to resist their calls for the appointment of a special prosecutor.

Inside the White House, this is what is called the "nightmare scenario." White House Counsel Fred Fielding, who served in the Nixon White House during Watergate and as a White House counsel during the Reagan administration, has told others in the White House that although he does not consider this a likelihood, it should not be ruled out, and Bush and his staff should be ready for such a contingency. In addition to the Justice Department's IG and OPR investigations regarding the surveillance program, Gonzales is also under investigation by the IG as to whether he lied to Congress about the politicized firings of nine U.S. attorneys. Fielding has told White House colleagues that there is an outside possibility that a special prosecutor could be appointed to conduct a broader investigation.

In the meantime, however, it will be increasingly difficult for the president to claim he was detached from the major decisions regarding his surveillance program. One fiction that has been set aside is that the regrettable incident in Ashcroft's hospital room was the work of overzealous or insensitive staff.

The narrative of a detached Bush delegating to his staff and to his vice president continues to be the predominant one. Gonzales and Vice President Cheney have been only too happy to serve as lightning rods for criticism of the administration, drawing fire away from many of President Bush's most controversial decisions on national-security policy.

Washington Post reporter Barton Gellman's recently published book on Cheney, The Angler, once again implies that it was Cheney who was running the show. An excerpt published in The Washington Post about the president's role in pressing for the surveillance program was headlined "Cheney Shielded Bush From Crisis." The article was also summarized as follows on the newspaper's Web site: "President was nowhere in the picture as Cheney fought to keep surveillance program on track."

But seemingly contrary to the book's broader conclusions was a story corroborating Gonzales's account to investigators that Bush ordered him and Card to go visit Ashcroft in the hospital. Indeed, if Gellman is correct, Gonzales and Card would never have been admitted to Ashcroft's hospital room without the president's intercession in the first place. Gellman wrote:

The phone started ringing in the makeshift command center next to John Ashcroft's hospital room. Janet Ashcroft had been at her husband's side for six days. He was in intensive care, sedated, recovering from emergency surgery to remove his gallbladder. Mrs. Ashcroft's orders were unequivocal: no calls, from anyone, for any reason. According to two people who saw the FBI's handwritten logs, the White House operator-on behalf of Gonzales or Card, it was unclear which-asked to be connected to the attorney general. The hospital switchboard, following orders, declined.

That evening, the FBI logged a call from the president of the United States. No one had the nerve to refuse him. The phone rang at Ashcroft's bedside. Bush told his ailing cabinet chief that Alberto Gonzales and Andy Card were on their way.

Tipped off by Ashcroft's chief of staff, Acting Attorney General Comey and other Justice Department officials raced to the hospital so they would be there when Gonzales and Card arrived. It will never be known whether Ashcroft would have been competent to understand what they were telling him and whether they would have persuaded him to sign.

Had he gone ahead and done so, he would be have been signing a document facilitating a program that he and his top aides had only recently concluded was of questionable legality.

As Gonzales and Ashcroft made their way to the George Washington University Medical Center, where Ashcroft was recovering from surgery, an upset Mrs. Ashcroft called her husband's chief of staff to tell him that Gonzales and Card were on their way to the hospital. He in turn called Comey.

Comey's account of what transpired next is now well known. Comey, FBI Director Robert Mueller, and Jack Goldsmith, head of the Justice Department's Office of Legal Counsel, whose office had recently written a legal opinion concluding that the surveillance program was of questionable legality, have all testified about what transpired just before and during the showdown in Aschcroft's hospital room. But it bears some repeating, if only to show what we now know President Bush set in motion.

Comey was on his way home the evening of March 10, 2004, when he received the call. He ordered his security detail to get him to the hospital immediately.

Comey later told the Senate Judiciary Committee: "I was concerned that, given how ill I knew the attorney general was, that there might be an effort to ask him to overrule me when he was in no condition to do that."

Careening down Constitution Avenue at high speed and with sirens blaring, Comey arrived only minutes before Gonzales and Card did. Similarly alerted, Goldsmith had also raced to the hospital and run up the steps to arrive, out of breath, at Ashcroft's bedside.

On the way, Comey had frantically called FBI Director Robert Mueller. Mueller was so concerned about what Gonzales and Card were attempting to do, according to Comey, that he instructed FBI agents who constituted Ashcroft's and Comey's security details that Comey was not "to be removed from the room under any circumstance."

Within minutes after Comey and Goldsmith reached Ashcroft's bedside, Gonzales and Card also arrived. Comey would later recall to Congress that Gonzales was "carrying an envelope" with him. The envelope contained the certification that President Bush so badly wanted him to sign.

"I was angry," Comey testified. "I thought I just witnessed an effort to take advantage of a very sick man, who did not have the powers of the attorney general because they had been transferred to me."

Gonzales, in an attempt to persuade Ashcroft to sign the certification, simply misled Ashcroft. Gonzales told Ashcroft he had met earlier that day with congressional leaders who, he claimed, supported the continuation of the program without Department of Justice approval, and were determined to find a legislative remedy that would address the legal concerns of Comey and others. Several of the legislative leaders who had been at that meeting with Gonzales and Vice President Cheney say that Gonzales's account of what transpired was simply not true.

In response to Gonzales's and Card's gambits, Ashcroft, according to Comey, "stunned me ... lifted his head off the pillow," and then told Gonzales and Card, "I'm not the attorney general." Mustering all the energy he had left, he pointed toward Comey and resolutely said, "There is the attorney general."

Even in the face of Ashcroft's refusal to certify the program as being within the law, President Bush initially reauthorized the surveillance program on his own. In The Angler, Barton Gellman suggests that this move "may have been the nearest thing to a claim of unlimited power ever made by an American president, all the more radical for having been issued in secret. Not only would the will of Congress be flouted, but if the White House had its way, Congress would never know."

Learning of the reauthorization, Ashcroft, Comey, and more than a dozen officials at the highest levels of government became concerned that if the surveillance program was allowed to continue on as it had been, the government could be engaging in an illegal activity at the direction of the president, and they quietly spoke of resigning en masse.

The mass resignation of so many senior officials of the government would have been all but unprecedented in modern American political history.

One former Justice Department official personally involved in the events said that the only historical precedent would have been the Saturday Night Massacre, when Attorney General Elliot Richardson resigned rather than carry out an order from President Nixon to fire the Watergate special prosecutor, Archibald Cox. With Richardson out of the way, Nixon ordered the new acting attorney general, William Ruckelshaus, to fire Cox; Ruckelshaus also refused and resigned as well. The next in line for succession as acting attorney general was the solicitor general, Robert Bork, who finally fired Cox and ordered the FBI to seal and seize Cox's office.

The former Justice Department official says that the Saturday Night Massacre would have "been nothing compared to what almost came to be ... I mean, it would have been poof! and the attorney general would have been gone. The deputy attorney general would have been gone. Goldsmith-he would have been gone. The FBI director would have resigned."

If all those men had resigned, top aides to each of them would have resigned as well. Ashcroft's chief of staff and two deputy chiefs of staff said they would go with their boss. Comey's top aides would have resigned with him. The general counsels of the CIA and FBI said they were going to resign as well.

Adding to this constitutional spectacle would have been the fact that the administration's warrantless surveillance program was considered one of the most closely held national-security secrets in government at the time. There would have been no immediate explanation of why a portion of the government just up and resigned at once.

Ultimately, confronted with the possible resignations of his own top aides, Bush backed down. The president agreed to address the concerns of the Justice Department and to make significant changes in the program so that it would be conducted within the law. But the president did not do so without first defiantly telling Comey, "I decide what the law is for the executive branch."

Bush's change of heart apparently had little to do with the rule of law, but rather more to do with political pragmatism and his fear that the entire affair might become public.

Before Gonzales and Card met with Ashcroft in the hospital, Gonzales and Cheney met with congressional leaders so as to enlist their possible aid in finding a legislative means for continuing the eavesdropping program if Comey and others continued to disagree about its legality. Bush personally instructed Gonzales to write notes of what was said at the meeting, according to a report released on September 2, 2008, by the Justice Department's inspector general. The disclosure came because the IG was investigating whether Gonzales had mishandled classified information while attorney general.

A single sentence in the report says: "Gonzales told the OIG [Office of Inspector General] that President Bush directed him to memorialize the March 10, 2004 meeting."

Among those present at the meeting besides Gonzales and Cheney, according to the IG report, were National Security Agency Director Michael Hayden, the speaker of the House of Representatives, the House minority leader, the Senate majority and minority leaders, and the chairmen and vice chairmen of the congressional intelligence committees.

Regarding the notes that Gonzales made about the meeting, the IG report went on to say:

Gonzales stated that he drafted notes about the meeting in a spiral notebook in his White House Counsel's Office within a few days of the meeting, probably on the weekend immediately following the meeting. Gonzales stated that he wrote the notes in a single sitting except for one line, which he told us he wrote within the next day.

A congressional source familiar with the meeting said in an interview that he believed it was significant that Bush personally directed Gonzales to write notes as to what occurred at the meeting. Ordinarily members of Congress don't take notes at briefings concerning such highly classified issues. Very likely, Gonzales's notes are the only ones that exist. [The Justice Department is investigating whether former Attorney General Alberto Gonzales created a set of fictitious notes so that President Bush would have a rationale for reauthorizing his warrantless eavesdropping program. For that story click here.]

The September 2 report by the IG narrowly focused on the question of whether Gonzales "mishandled classified documents" during his tenure as attorney general. The report concluded that Gonzales "violated Department security requirements and procedures" in handling 18 documents, classified as Top Secret or higher. Several were marked as SCI, or "sensitive compartmented information," a category for the most highly classified records in government.

Among the most sensitive of those documents mishandled were the notes that Gonzales made of his March 10, 2004, meeting with congressional leaders.

It is unclear, based on what Gonzales wrote in his notes, what exactly he was told by the congressional leaders during the White House's meeting with them.

But on July 24, 2007, when questioned before the Senate Judiciary Committee about the events of March 10, 2004, Gonzales testified that the members of Congress he met with that day had told him that "despite the recommendation of the deputy attorney general," the government should still "go forward with very important intelligence activities."

Several of the members of Congress who were at the March 10 meeting-House Minority Leader Nancy Pelosi and Senate Minority Leader Tom Daschle among them-have said they said no such thing.

Shortly before Gonzales resigned from office in August 2007, the Justice Department's inspector general, Glenn A. Fine, wrote to inform Congress that he was investigating whether statements made by Gonzales under oath during congressional testimony were "intentionally false, misleading, or inappropriate."

Among the statements that Fine is apparently investigating is one in which Gonzales claimed that the congressional leaders had wanted him to move forward with the program despite Comey's refusal to certify it as legal.

Gonzales is also in legal jeopardy for having earlier told the Senate Judiciary Committee that there had never been any "serious disagreement" about the legality of the administration's surveillance program: "There has not been any serious disagreement about the program the president has confirmed," he testified in February 2006.

At the time Gonzales made that statement, the public had no idea about his late-night hospital-room visit with John Ashcroft-and he apparently had no expectation that it would ever come to light.

In one additional instance, President Bush was the person responsible for a controversial decision regarding his surveillance program.

This involved an effort to prevent his very own Justice Department from investigating the surveillance program in the first place. During 2006 and 2007, I wrote a series of stories for National Journal about how the Justice Department's Office of Professional Responsibility wanted to investigate the administration's surveillance program, but was unable to because its investigators were being denied security clearances to do their work. (Those articles can be found here, here, and here.) Over time, it was revealed that Gonzales had denied those security clearances, and later that Bush himself had made the decision disallowing them.

The story that I wrote for the March 15, 2007, edition of National Journal began as follows:

Shortly before Attorney General Alberto Gonzales advised President Bush last year on whether to shut down a Justice Department inquiry regarding the administration's warrantless domestic eavesdropping program, Gonzales learned that his own conduct would likely be a focus of the investigation, according to government records and interviews.

Bush personally intervened to sideline the Justice Department probe in April 2006 by taking the unusual step of denying investigators the security clearances necessary for their work.

It is unclear whether the president knew at the time of his decision that the Justice inquiry-to be conducted by the department's internal ethics watchdog, the Office of Professional Responsibility-would almost certainly examine the conduct of his attorney general.

At the time the story was published, Gonzales was fighting for his political life. Republicans in Congress had joined Democrats in sharply criticizing Gonzales for his role in the firings of nine U.S. attorneys. A whole new controversy might make his resignation from office imminent.

Gonzales immediately fought back. On March 22, 2007, a senior Justice Department official wrote Congress on his behalf, saying not only that it was President Bush who had made the decision to deny security clearances to the OPR investigators, but also that Gonzales had advised the president that the investigation should be allowed to move forward, and that Bush had overruled that advice.

A senior Justice Department official told me that the letter was approved in advance by the White House: "It was decided that in this instance the attorney general could no longer take the heat for the president ... This time the president was going to take responsibility and deflect criticism for [his attorney general] instead of the other way around."

At the time, it appeared that the president had halted the Justice Department's probe in order to protect his attorney general, whose conduct was going to be a central focus for investigators. But as more information continues to come to light, the president's denial of the security clearances raises an important question: Were the president's actions designed to protect his attorney general-or himself?

--------

Murray Waas is a writer in Washington, DC.

Jobless Claims Pushed to Seven-Year High

Thursday 25 September 2008

by: The Associated Press

Hundreds gather to sign up for a Denver, Colorado, job fair. (Photo: John Moore / Getty Images)

Washington - New claims for unemployment benefits jumped last week to their highest level in seven years due to the impact of a slowing economy and Hurricanes Ike and Gustav, the Labor Department reported today.

The department said new requests for jobless benefits for the week ending Sept. 20 increased by 32,000 to a seasonally-adjusted 493,000, much higher than analysts' expectations of 445,000.

Wall Street was more focused on Washington, though, where lawmakers and the administration appeared to be moving closer to a $700 billion bailout package for the financial system. Stocks rose, with the Dow up more than 200 points in early trading.

The two hurricanes added about 50,000 new claims in Louisiana and Texas, the department said. The four-week moving average, which smooths out fluctuations, rose to 462,500. That's the highest it has been since Nov. 3, 2001.

The level of new claims was the highest since shortly after the 9/11 attacks, when it reached 517,000.

David Resler, chief economist at Nomura Securities, said Thursday's figure is the second-highest since July 1992. Claims have topped 500,000 only a handful of times in the past twenty years, he said, and were consistently above that level during the 1991 recession.

Even excluding the effects of the hurricanes, jobless claims remain at elevated levels. Weekly claims have now topped 400,000 for ten straight weeks, a level economists consider a sign of recession. A year ago, claims stood at 309,000.

The report "reflects a marked deterioration in the job market," Resler wrote in a note to clients. "That deterioration may well accelerate as the distress in the financial markets deepens and the effect of credit impairment spreads to other sectors."

The number of people continuing to draw jobless benefits last week was 3.54 million, up 63,000 from the previous week and nearly a five-year high. The four-week average of continuing claims was 3.49 million.

Other economic indicators Thursday were also negative. The Commerce Department said that orders for big-ticket manufactured goods fell by 4.5 percent in August, far more than the 1.6 percent decline economists expected.

And new home sales fell by 11.5 percent in August, the Commerce Department said in a separate report, to a seasonally adjusted annual rate of 460,000, the lowest level in more than 17 years.

Hurricane Gustav first had an impact on jobless claims for the week ending Sept. 13. The department said Thursday that Louisiana reported an increase in claims of 18,409 during that week, mostly due to Gustav.

The financial crisis, falling home prices and slowing consumer spending continue to apply the brakes to the U.S. economy. The unemployment rate jumped unexpectedly to 6.1 percent in August, the highest level in five years.

Last week, drug maker Schering-Plough Corp. said it plans to cut 1,000 sales jobs to reduce costs, part of a 10 percent reduction in staff announced in April. Also, the nation's largest chicken producer, Pilgrim's Pride Corp., announced it would reduce 100 jobs besides the 600 job losses it previously announced.

The 3 AM Call

Sunday 28 September 2008

by: Paul Krugman, The New York Times

(Photo: Redhotphones.com)

It's 3 a.m., a few months into 2009, and the phone in the White House rings. Several big hedge funds are about to fail, says the voice on the line, and there's likely to be chaos when the market opens. Whom do you trust to take that call?

I'm not being melodramatic. The bailout plan released yesterday is a lot better than the proposal Henry Paulson first put out - sufficiently so to be worth passing. But it's not what you'd actually call a good plan, and it won't end the crisis. The odds are that the next president will have to deal with some major financial emergencies.

So what do we know about the readiness of the two men most likely to end up taking that call? Well, Barack Obama seems well informed and sensible about matters economic and financial. John McCain, on the other hand, scares me.

About Mr. Obama: it's a shame that he didn't show more leadership in the debate over the bailout bill, choosing instead to leave the issue in the hands of Congressional Democrats, especially Chris Dodd and Barney Frank. But both Mr. Obama and the Congressional Democrats are surrounded by very knowledgeable, clear-headed advisers, with experienced crisis managers like Paul Volcker and Robert Rubin always close at hand.

Then there's the frightening Mr. McCain - more frightening now than he was a few weeks ago.

We've known for a long time, of course, that Mr. McCain doesn't know much about economics - he's said so himself, although he's also denied having said it. That wouldn't matter too much if he had good taste in advisers - but he doesn't.

Remember, his chief mentor on economics is Phil Gramm, the arch-deregulator, who took special care in his Senate days to prevent oversight of financial derivatives - the very instruments that sank Lehman and A.I.G., and brought the credit markets to the edge of collapse. Mr. Gramm hasn't had an official role in the McCain campaign since he pronounced America a "nation of whiners," but he's still considered a likely choice as Treasury secretary.

And last year, when the McCain campaign announced that the candidate had assembled "an impressive collection of economists, professors, and prominent conservative policy leaders" to advise him on economic policy, who was prominently featured? Kevin Hassett, the co-author of "Dow 36,000." Enough said.

Now, to a large extent the poor quality of Mr. McCain's advisers reflects the tattered intellectual state of his party. Has there ever been a more pathetic economic proposal than the suggestion of House Republicans that we try to solve the financial crisis by eliminating capital gains taxes? (Troubled financial institutions, by definition, don't have capital gains to tax.)

But even President Bush has, in the twilight of his administration, turned to relatively sensible people to make economic decisions: I'm not a fan of Mr. Paulson, but he's a vast improvement over his predecessor. At this point, one has the suspicion that a McCain administration would have us longing for Bush-era competence.

The real revelation of the last few weeks, however, has been just how erratic Mr. McCain's views on economics are. At any given moment, he seems to have very strong opinions - but a few days later, he goes off in a completely different direction.

Thus on Sept. 15 he declared - for at least the 18th time this year - that "the fundamentals of our economy are strong." This was the day after Lehman failed and Merrill Lynch was taken over, and the financial crisis entered a new, even more dangerous stage.

But three days later he declared that America's financial markets have become a "casino," and said that he'd fire the head of the Securities and Exchange Commission - which, by the way, isn't in the president's power.

And then he found a new set of villains - Fannie Mae and Freddie Mac, the government-sponsored lenders. (Despite some real scandals at Fannie and Freddie, they played little role in causing the crisis: most of the really bad lending came from private loan originators.) And he moralistically accused other politicians, including Mr. Obama, of being under Fannie's and Freddie's financial influence; it turns out that a firm owned by his own campaign manager was being paid by Freddie until just last month.

Then Mr. Paulson released his plan, and Mr. McCain weighed vehemently into the debate. But he admitted, several days after the Paulson plan was released, that he hadn't actually read the plan, which was only three pages long.

O.K., I think you get the picture.

The modern economy, it turns out, is a dangerous place - and it's not the kind of danger you can deal with by talking tough and denouncing evildoers. Does Mr. McCain have the judgment and temperament to deal with that part of the job he seeks?

Divide Iraq into three separate states and get the hell out‏

newsviewsnolose@yahoogroups.com on behalf of dick.mcmanus (dick.mcmanus@yahoo.com)

Divide Iraq into three separate states and get the hell out

Commentary:

"We just can't pull out of Iraq." YES, we can and we must.

What we need to do is divide Iraq into three separate states with the UN and/or NATO keeping them apart. In fact, the US has already ethnic cleaned sunni and shita neighborhoods and that is why the violence has decreased. We have become a world policeman and a nation builder which AWOL Bush professed he was against.

We should use the UN and/or NATO to make sure the oil profits are shared fairly. see enclosed new article.

Corporations as natural persons....

On the issue of corporations as being natural persons....they now get to use money that should be paid to shareholders, to bribe politicians and buy elections.

They can also pay lobbyist to pressure Congress to pass bills in their interests and to hell with the working folks. This has given us outsourcing of jobs and our industries overseas which has resulted in the super rich (the aristocracy) getting wealthier and the working class not building any wealth and lacking health care.

What we need to do is put tariffs back on imports on produces made with sweat shop wages.

But all this said... it is too lack. The biggest issue is we have to reduce our and the worlds population because we done have the resources to feed them and keep their house warm in the winter. See enclosed.

The super rich in America know this and they are preparing to form kingdoms with private armies to protect their estates. This is why the invaded Iraq...to keep the dollar from collapsing, and the Russians and Chinese from having access to the oil and cuting off the US and British oil corporations.

Now Corporations Claim The "Right To Lie"

by Thom Hartmann

http://www.commondreams.org/views03/0101-07.htm

Join us in our ROE caucus. Two must read books in order to understand this... Join us in Join our ROE caucus. Two must read books in order to understand this... The Long Emergency by James Kunstler and Power down by Richard Heinberg

Dick

Speech by the head of the Cuban delegation to the general debate of the 63rd session of the United Nations General Assembly, New York, September 2008

September 26, 2008:... While a trillion of dollars is spent on weapons in the world, more than 850 million human beings are starving; a 1.1 billion people don't have access to drinking water, 2.6 billion lack sewage services and more than 800 million are illiterate.

More than 640 million children lack adequate housing, 115 million do not attend primary school and 10 million die before the age of five, in most cases as the result of diseases that can be cured.

The populations of the South are suffering with increasing frequency from natural disasters, whose consequences have been aggravated by climate change. Haiti, Jamaica, Cuba and other Caribbean countries are examples of that. Let us make a plea for solidarity especially for our sister country of Haiti as it faces its dramatic situation

Cuba has just been lashed by two intense hurricanes which have devastated its agriculture and seriously affected part of its infrastructure and damaged or destroyed more than 400,000 homes.

http://dandelionsalad.wordpress.com/2008/09/27/cuba-at-un-the-very-existence-of-the-human-species-is-at-risk/

SATELLITE IMAGES SHOW ETHNIC CLEANOUT IN IRAQ

September 19, 2008 WASHINGTON -- Satellite images taken at night show heavily Sunni Arab neighborhoods of Baghdad began emptying before a U.S. troop surge in
2007, graphic evidence of ethnic cleansing that preceded a drop in
violence, according to a report published Friday.

The images support the view of international refugee organizations and
Iraq experts that a major population shift was a key factor in the
decline in sectarian violence, particularly in the Iraqi capital, the
epicenter of the bloodletting in which hundreds of thousands were
killed.

Some 2 million Iraqis are displaced within Iraq, while 2 million more
have sought refuge in neighboring Syria and Jordan. Previously
religiously mixed neighborhoods of Baghdad became homogenized Sunni or
Shi'ite Muslim enclaves.

The study, published in the journal *Environment and Planning A*,
provides more evidence of ethnic conflict in Iraq, which peaked just
before President Bush ordered the deployment of about 30,000 extra
U.S. troops.

http://wiredispatch.com/news/?id=361985

Amazing - Chemtrail Plane switches trail on and off
http://www.disclose.tv/action/viewvideo/9176/

Major General Taguba Accuses AWOL Bush Of War Crimes

June 19, 2008: The Bush administration is guilty of committing "war crimes" and ought to be held to account, according to retired Maj. Gen. Antonio Taguba in a new report on medical evidence of torture at U.S. facilities around the world.

In the new report by Physicians for Human Rights, Taguba wrote, "After years of disclosures by government investigations, media accounts, and reports from human rights organizations, there is no longer any doubt as to whether the current administration has committed war crimes. The only question is whether those who ordered the use of torture will be held to account."

http://www.nbc4.com/news/16656748/detail.html

NATO's war cirmes against the Serbia and Kosovo

August 20, 2008: In 1999, NATO bombed Serbia and Kosovo for 78-day which killed hundreds of people in hospitals, schools, churches, parks and television studios, and destroyed economic infrastructure.

The former chief prosecutor of the International Criminal Tribunal for Yugoslavia in the Hague was Carla Del Ponte. Carla Del Ponte, this year published her memoir The Hunt: Me and War Criminals. This book reveals unpalatable truths about the West's intervention in Kosovo. Under pressure from Washington and London, an investigation into NATO war crimes at this tribunal were scrapped.

The justification for the NATO bombing was that the Serbs were committing "genocide" in the secessionist province of Kosovo against ethnic Albanians. David Scheffer, U.S. ambassador-at-large for war crimes, announced that as many as "225,000 ethnic Albanian men aged between 14 and 59" may have been murdered.

The tribunal announced the final count of the dead in Kosovo: 2,788. Iinternational teams descended upon Kosovo to exhume the mass graves. The FBI failed to find a single mass grave and went home. The Spanish forensic team did the same and said the stories of mass graves were all war propaganda machines."

Del Ponte in her book states that the KLA kidnapped hundreds of Serbs and transported them to Albania, where their kidneys and other body parts were removed; these were then sold for transplant in other countries. She also says there was sufficient evidence to prosecute the Kosovar Albanians for war crimes, but the investigation "was nipped in the bud" so that the tribunal's focus would be on "crimes committed by Serbia." She says the Hague judges were terrified of the Kosovar Albanians--the very people in whose name NATO had attacked Serbia.

KLA was ethnically cleansing more than 200,000 Serbs and Roma from the province. Kosovo has no formal economy and is run, in effect, by criminal gangs that traffic in drugs, contraband and women.

This included combatants on both sides and Serbs and Roma murdered by the KLA. There was no genocide in Kosovo. The genocide was a lie. The NATO attack had been fraudulent.

http://socialistworker.org/2008/08/20/how-yugoslavia-was-destroyed

We are in a Depression and US generals planning for resource wars

Comment: The super rich are trying to set themselves up financially as kings so they can pay private armies, as the depression and end of peak oil causes a long emergency - an extreme disaster.

"We face a potential return to traditional security threats posed by emerging near-peers as we compete globally for depleting natural resources and overseas markets."

The document, however, contains no such lofty pretences. It goes on to list as a pre-eminent threat to the security of the US and its allies "population growth - especially in less-developed countries - [which] will expose a resulting 'youth bulge'."

This youth bulge, the document goes on to state, will present the US with further "resource competition" in that these expanding populations in the developing world "will consume ever increasing amounts of food, water and energy".

The document goes on to describe in broad-strokes the manner in which its downsized military might ensure survival of the fittest for the US and its allies in future resource wars for water, food and energy.

As a consequence of identifying growing populations in the developed world as a threat in itself, the strategy document highlights a number of paradigm shifts in the way future wars are to be conducted.

Source via Mark Nagel

http://www.irishtimes.com/newspaper/opinion/2008/0922/1221998220381.html

Global warming pollution increases 3 percent

Sep 25,2008: WASHINGTON - The world pumped up its pollution of the chief man-made global warming gas last year, setting a course that could push beyond leading scientists' projected worst-case scenario. The new numbers, called "scary" by some, were a surprise because scientists thought an economic downturn would slow energy use. Instead, carbon dioxide output jumped 3 percent from 2006 to 2007.

Meanwhile, forests and oceans, which suck up carbon dioxide, are doing so at lower rates than in the 20th century, scientists said.

China's emissions increased 7.5 percent from the previous year, accounted for more than half of the worldwide increase. China passed the United States as the No. 1 carbon dioxide polluter in 2006.

Emissions in the United States rose nearly 2 percent in 2007, after declining the previous year. The U.S. produced 1.75 billion tons of carbon (1.58 billion metric tons).

"Things are happening very, very fast," said Corinne Le Quere, professor of environmental sciences at the University of East Anglia and the British Antarctic Survey. "It's scary."

Developing countries not asked to reduce greenhouse gases by the 1997 Kyoto treaty — and China and India are among them — now account for 53 percent of carbon dioxide pollution.

Nature can't keep up with the carbon dioxide from man, Le Quere said. She said from 1955 to 2000, the forests and oceans absorbed about 57 percent of the excess carbon dioxide, but now it's 54 percent.

http://news.yahoo.com/s/ap/20080925/ap_on_sc/warming_emissions

Joining the ROE caucuses

We have started a Running on Empty (ROE) caucus of Washington State Democrats . We have also started a national ROE caucus. The goal of this caucus is to bring more emphasis by our Party to the coming end of cheap oil and natural gas which will result in an extreme disaster.

To become a member of our caucus we require some more information from you. If you agree or basically agree with the following statements and you are a Democrat, then we will accept you into our caucus.

1. There are no sustainable energy sources that will rescue us at our current population levels.

2. Population reduction must be a part of any plan to rationally deal with peak oil (the end of cheap oil, natural gas, and coal), global climate change, biological/species decline, and natural resource depletion.

3. Global climate change will only be mitigated with extremely stringent emissions policies that reduce consumption rates and this must be done before fossil fuels are depleted.

4. Absent immediate attention to peak oil, our government and/or political system have no chance whatsoever to react soon enough to help us.

Fred Krupp & Miriam Horn: Earth: The Sequel. The Race to Reinvent Energy and Stop
Global Warming.

"Conspiracy" just means, more than one person being involved in something

News and View you don't have to Lose, news emails, I summarized news items. If you really are interested in the subject, I recommend you go to the link or web address (orgininal source). You can always go to my website and read the archieves at http://groups.yahoo.com/group/NewsViewsnolose

In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit for research and educational purposes. MY NEWSLETTER has no affiliation whatsoever with the originator of this article nor is MY NEWSLETTER endorsed or sponsored by the originator.

Due to Presidential Executive Orders, the National Security Agency may read this email without warning, warrant, or notice. They may do this without any judicial or legislative oversight. You have no recourse or protection and everything you type may be used against you to detain you in a secret prison.

My ON-LINE book SOME UNKNOWN HISTORY OF THE U.S. http://groups.yahoo.com/group/SomeUnknownUSHistory/
http://groups.yahoo.com/group/RunningOnEmptyDemocratCaucusWA/
and http://groups.yahoo.com/group/RunningOnEmptyCaucusDemocratsUSA

__._,_.___

FW: John McCain hopes you delete this!‏

Hello T. Scott,

If you're like tens of millions of others, you've gotten an email with a subject line like that. A forward of an email with a catchy, titillating subject.

Only they are never about John McCain. They're about Barack Obama. And they are almost always filled with distortions, misstatements, and outright lies.

We started TruthFightsBack.com to deal with smears, and those types emails were a big motivator for us. And, thanks to all of you, TruthFightsBack has been a great success.

But we can do better. We know that when you get a smear email, you want to get the truth fast, and you want it laid out in a way that can convince the undecided, swing voters. So we began a new project of TruthFightsBack.com called the Center for Political Accuracy focused specifically on this aspect of fighting anonymous smear emails in real-time, and we've got an exciting new tool to use in this battle.

You can email me at brian@politicalaccuracy.com with your smear and our system can read your smear and get me our researched response immediately, and I'll email back a reply debunking the original email. This can all happen in 10 minutes or less, so you can be armed with the truth and reply to everyone who got the original smear.

Just copy this email address into your address book, and make sure to email me right away next time you get a smear.

brian@politicalaccuracy.com

Thank you so much for joining the fight against smears.

Brian Young

Contributions or gifts to Campaign For Our Country are not tax-deductible for federal income tax purposes.

An individual may contribute a maximum of $5,000 per calendar year.

Corporations and individuals are strictly prohibited from reimbursing another person for making a contribution to Campaign For Our Country. To comply with Federal law, we must use best efforts to obtain, maintain, and submit the name, mailing address, occupation and name of employer of individuals whose contributions exceed $200 per calendar year.

Bailout bill fails; the people are having an impact‏

September 29, 2008

Dear T. Scott,

Thank you for taking action to stop the bailout. We had a major breakthrough today when the House of Representatives voted down the bill by a 228 to 205 margin. This is a real opportunity to keep pushing for more reforms.

Please call Congress at 202-224-3121 and demand -- "Bailout homeowners, not the bank owners." The U.S. needs to build its economy from the ground up not from the top down. Tell Congress to reconsider this bill and develop a bill that builds the economy not bails out speculators who undermine the economy.

We have made a lot of progress since Bush-Paulsen came forward with their 2 page blank check. The more than 100 page bill is moving in our direction but not far enough. If this bill is to pass it needs to put emphasis to ensure homeowners have their mortgages rewritten so they can afford to stay in their homes rather than lose them to the banks.

This populist revolt is heartening. Let's keep up the pressure. Call 202-224-3121 and go to www.FreshAirCleanPolitics.net and send a letter to Congress. Tell your friends to do the same.

The people are having an impact.

Sincerely,

Kevin Zeese

Executive Director

Campaign for Fresh Air and Clean Politics
2842 N. Calvert St.
Baltimore, MD 21218

443-708-8360

Copyright 2006-2008 Campaign for Fresh Air & Clean Politics All rights reserved.

IMA MAIL ON WEBOTH‏ From: Representative Adam Smith

September 29, 2008

Dear T. Scott,

Thank you for contacting me regarding the financial recovery package recently considered by Congress; I appreciate hearing your thoughts and concerns on this issue. This package failed by a vote of 205-228. I voted for this legislation, and I'd like to take a moment to explain my thinking about this complex problem.

Like many Americans, I had major concerns with the Bush Administration's initial financial recovery proposal. It contained no help for ordinary Americans struggling with their mortgage payments, no oversight and no protection for taxpayers. It was a major power grab attempt by the Administration in the form of a $700 billion blank check and Congress correctly rejected that plan. I also worried about the true extent of this economic crisis - would it just punish Wall Street people who acted unwisely? Or would it impact us all? And, if the latter was true was action by Congress required?

After listening to many of my constituents, small business owners, local bankers, and many others in the business and financial world, I have concluded that this crisis is more serious than just the normal downside of the business cycle; that failure to act by Congress could turn a severe economic slow down into a panic-a run on banks and all financial institutions that could plunge us into a deep and lasting recession; and that the plan before Congress, while offering no guarantees, represented a prudent and necessary step to prevent this much more painful economic outcome.

I now believe strongly that this crisis affects all Americans. If it only impacted the financial institutions on Wall Street who made outrageously risky investments then I would not have supported this plan. But the credit crunch and the economic slow down will hit us all. Loans for college, cars, homes, or any other consumer need will be almost impossible to obtain. As this reality spreads, businesses in all communities in our country will be forced to cut back, leading to significant job loss. The markets will go down also, placing in jeopardy pensions, 401K plans, and many other investments for all people in our country.

I also want to make clear that significant economic hardship is coming no matter what we do. Our nation has lived on credit for far too long, from the federal government's growing debt right down to average households where we have been collectively spending more than we earned for years. The housing boom only made it worse, enticing people in all walks of life to take on even greater debt with the illusion that the ever rising value of homes would always cover that debt. Wall Street made all of this immeasurably worse with risky financial deals designed to maximize short term profit with no thought whatsoever to long term consequences. Now we all have to find a way to mitigate the damages and begin digging our way out of the mess.

Over the past week, through bipartisan cooperation and thoughtful deliberation, Congress delivered a plan that addresses the drastic shortcomings of the Bush Administration's proposal and protects the interest of taxpayers. The revised plan helps to prevent home foreclosures crippling the American economy. It cuts the requested $700 billion in authorized purchasing of troubled assets by the Secretary of the Treasury in half, and requires Congressional review for future payments. It has a profit-sharing provision that ensures tax payers benefit from the use of their money and requires in five years that the President put forth a plan to recoup the taxpayers' money from institutions that benefit. I am particularly pleased that this provision was included, as it makes certain that taxpayers receive a maximum return on our money.

This financial recovery package also ensures strong independent and Congressional oversight and transparency mechanisms throughout this process, and imposes strict limitations on excessive compensation for CEOs and executives of participating financial institutions. The plan requires strong oversight by a board appointed by bipartisan leaders of Congress as well as strict over sight by the Government Accountability Office. It makes sure to prevent the further enrichment of the people who contributed so much to creating this crisis in the first place, and that any actions by the Treasury Secretary are transparent and open to scrutiny and review

This was not an easy vote and I do not believe for a second that this legislation will somehow solve all our economic problems. We must make major changes in how we regulate our financial institutions. We must also change our spending priorities in Congress and throughout our nation so that we build a fiscally sound economy-one that focuses on long-term sustainable growth, not just short-term profit.

This bill was not a perfect solution and it is not exactly how I would have drafted it. However, I do believe that it would have helped reduce and reverse the negative trends in our economy today. Now that the bill has been defeated, I will continue to consider all views and options and work with my colleagues to build consensus for a solution that will protect Americans from more economic harm.

Again, thank you for contacting me. I hope this has helped explain my thoughts on this complex issue. Please feel free to contact me in the future should you have additional comments or concerns.

Sincerely,

Adam Smith

Member of Congress

AS:kk

McCain's Health Plan: You're on Your Own

By Jared Bernstein, Huffington Post. Posted September 29, 2008.

An estimated 20 million people would lose employer coverage under McCain's plan.

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Which Candidate's Health Plan Would Do the Most for Ordinary Americans?

By Trudy Lieberman , Columbia Journalism Review. Posted September 29, 2008.

Neither candidate is talking much about the people who fall through gaps in our public safety net. And neither plan is truly universal.

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McCain's Health Plan: You're on Your Own
Jared Bernstein

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Maggie Mahar

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Sheldon J. Segal

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Trudy Lieberman

FDA Says Chemical with Links to Reproductive Problems Is Safe for Humans
Ashley Shelby

Most Results of Drug Studies Never Published

By Maggie Mahar, Health Beat. Posted September 29, 2008.

The results of over half of all clinical trials on drug safety and effectiveness are not published within five years of the drug going on the market.

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McCain's Health Plan: You're on Your Own
Jared Bernstein

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Trudy Lieberman

How to Treat the Rare Diseases That Big Pharma Leaves Behind
Sheldon J. Segal

Obama and McCain's Health Care Plans: The Story Mainstream Press Won't Tell
Trudy Lieberman

FDA Says Chemical with Links to Reproductive Problems Is Safe for Humans
Ashley Shelby

Medical Bills Stack Up, Americans Pack Up

Posted by Ella Hushagen, Stand Up for Health Care at 12:52 PM on September 29, 2008.

Medical debt is closely tied to the mortgage crisis that's pushing working families out of their homes and our economy to the brink of collapse.

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We all know that working families in America are squeezed in the current economic recession, plagued by skyrocketing health care costs and rampant home foreclosures. But how much does one have to do with the other? The answer is: A lot.

It turns out that medical debt is closely tied to the mortgage crisis that's pushing working families out of their homes and pushing our economy to the brink of collapse. One recent study found that medical crises contribute to half of all home foreclosure filings, with 23 percent attributable to medical bills.

A report by the Center for Studying Health System Change found,

The percentage of Americans in families with problems pay°©ing medical bills increased from 15.1 percent in 2003 to 19.4 percent in 2007... That translates to more than 57 million Americans of all ages in families in 2007 reporting problems paying medical bills in the previous 12 months-an increase of more than 14 million people since 2003.

According to the authors, the number of families struggling to pay medical bills increased at all income levels, and about 10 percent of respondents were burdened by more than $12,000 in medical debt. About 62 percent of families were contacted by a collection agency, and more than half borrowed money to pay medical bills. What's worse, one in five people with medical bill problems considered filing for bankruptcy.

The findings of both reports are consistent with finds from our December 2007 report, Too Great a Burden: America's Families at Risk. We found that nearly one out of four non-elderly Americans-61.million-is in a family that will spend more than 10 percent of its pre-tax income on health care costs in 2008. Some 17.8 million Americans are in families that will spend more than 25 percent of their pre-tax income on health care costs in 2008.

As Congress discusses how to pull Wall Street back from the edge of catastrophe, they must bear in mind the daily struggles of working Americans who cannot afford to pay their medical bills-a burden that has already thrown many off the cliff into financial ruin. While families struggle to make ends meet, it is imperative that Congress and the next President take action on this immediately.

Tagged as: health care, bankruptcy, foreclosures, housing crisis, financial crisis, medical bills

Fueling the Fire of Real Change

Published on Monday, September 29, 2008 by TruthDig.com

Fueling the Fire of Real Change

by Chris Hedges

Turn your back on Wall Street. Walk a few blocks up from the gleaming and soulless towers of disintegrating capitalism to the shabby, brick Catholic Worker house at 55 E. Third St. Sit, as I did recently, in one of the chairs in the basement dining room with its cracked linoleum and steel utility tables.

"Works of mercy and contact with the destitute sustain the spark in the ashes," William Griffin, who has been with the Catholic Worker for 34 years and writes for the newspaper, told me. "It is with the poor and the indigent that you sense the imbalance and injustice. It is this imbalance that inspires action. Generations come in waves. One generation is inspired by these sparks, as Martin Luther King was during the civil rights movement. These fires often fall away and smolder until another generation."

The coals of radical social change smolder here among the poor, the homeless and the destitute. As the numbers of disenfranchised dramatically increase, our hope, our only hope, is to connect intimately with the daily injustices visited upon them. Out of this contact we can resurrect, from the ground up, a social ethic, a new movement. Hand out bowls of soup. Coax the homeless into a shower. Make sure those who are mentally ill, cruelly cast out on city sidewalks, take their medications. Put your muscle behind organizing service workers. Go back into America's resegregated schools. Protest. Live simply. It is in the tangible, mundane and difficult work of forming groups and communities to care for others and defy authority that we will kindle the outrage and the moral vision to fight back. It is not Treasury Secretary Henry Paulson who will save us. It is Dorothy Day.

Day, who died in 1980, founded the Catholic Worker in the midst of the Great Depression with Peter Maurin. The two Catholic anarchists published the first issue of the Catholic Worker newspaper in 1933. They handed out 2,500 copies in Union Square for a penny a copy. The price remains unchanged. Two Catholic Worker houses of hospitality in the Lower East Side soon followed. Day and Maurin preached a radical ethic that included an unwavering pacifism as well as a hatred of unfettered capitalism. They condemned private and state capitalism for its unjust distribution of wealth. They branded the profit motive as immoral. They were fervent supporters of the labor movement, the civil rights movement and all anti-war movements. They called on followers to take up lives of voluntary poverty. The Catholic Worker refused to identify itself as a not-for-profit organization and has never accepted grants. It does not pay taxes. It operates its soup kitchen in New York without a city permit. The food it provides to the homeless is donated by people in the neighborhood. There are some 150 Catholic Worker houses around the country and abroad, although there is no central authority. Some houses are run by Buddhists, others by Presbyterians. Religious and denominational lines mean little.

Day cautioned that none of these radical stances, which she said came out of the Gospels, ensured temporal success. She wrote that sacrifice and suffering were an expected part of the religious life. Success as the world judges it should never be the final criterion for the religious and moral life. Spirituality, she said, was rooted in the constant struggle to fight for justice and be compassionate, especially to those in need. And that commitment was hard enough without worrying about its ultimate effect. One was saved in the end by faith, faith that acts of compassion and justice had intrinsic worth.

Many of the old stalwarts of the movement do not place their hopes in Barack Obama or the Democratic Party. They see their task as sustaining the embers of social and religious radicalism. They hope that this radical ethic can once again ignite a generation shunted aside by a bankrupt capitalism.

"If you lived through the civil rights movement as I did, you would want very much to vote for Obama," said Tom Cornell, who first came to the Worker in 1953, "but I don't think I will be able to, given Obama's foreign policy and his failure to promote a health care system for all Americans. I can't vote for someone who leaves an attack on Iran on the table."

Those within the Worker, however, worry that the looming economic dislocation will empower right-wing, nationalist movements and the apocalyptic fringe of the Christian right. This time around, they say, the country does not have the networks of labor unions, independent press, community groups and church and social organizations that supported them when Day and Maurin began the movement. They note that there are fewer and fewer young volunteers at the Worker. The two houses on the Lower East Side depend as much on men and women in their 50s and 60s as they do on recent college graduates.

"Our society is more brutal than it was," said Martha Hennessy, Day's granddaughter. "The heartlessness was introduced by Reagan. Clinton put it into place. The ruthlessness is backed up by technology. Americans have retreated into collective narcissism. They are disconnected from themselves and others. If we face economic collapse there are many factors that could see the wrong response. There are more elements of fascism in place than there were in the 1930s. We not only lack community, we lack information."

I do not know if our hope lies with the Catholic Worker. Institutions, even good ones, ossify. They can become trapped in the deification of their own past and the rigid canonization of the views of those who began the movements. But as our society begins to feel the disastrous ripple effects from the looting of our financial system, the unraveling of our empire and the accelerated rape of the working and middle class by our corporate state, hope will come only through direct contact with the destitute. The ethic born out of this contact will be grounded in the real and the possible. This ethic will, because it forces us to witness suffering and pain, be uncompromising in its commitment to the sanctity of life.

"There are several families with us, destitute families, destitute to an unbelievable extent, and there, too, is nothing to do but to love," Day wrote of those she had taken into the Catholic Worker House. "What I mean is that there is no chance of rehabilitation, no chance, so far as we see, of changing them; certainly no chance of adjusting them to this abominable world about them-and who wants them adjusted, anyway?

"What we would like to do is change the world-make it a little simpler for people to feed, clothe, and shelter themselves as God intended them to do. And to a certain extent, by fighting for better conditions, by crying out unceasingly for the rights of the workers, of the poor, of the destitute-the rights of the worthy and the unworthy poor, in other words-we can to a certain extent change the world; we can work for the oasis, the little cell of joy and peace in a harried world."

Chris Hedges, who graduated from seminary at Harvard Divinity School, is the author of "American Fascists: The Christian Right and the War on America."

Wrecking, Wrecking, Wrecked

Published on Monday, September 29, 2008 by The Huffington Post

Wrecking, Wrecking, Wrecked

by Thomas Frank

The great fear that hung over the business community in the 1970s was death by regulation, and the great goal of the conservative movement, as it rose to triumph in the 1980s, was to remove that threat--to keep OSHA, the EPA, and the FTC from choking off entrepreneurship with their infernal meddling in the marketplace.

Defunding those agencies was one way to stop the killer bureaucrats; another was to stuff them full of business-friendly personnel who would go easy on regulated. The signature conservative regulatory idea became "voluntary enforcement", because everyone now knew that efficient markets regulated themselves. Bad practices or tainted products drove away consumers; therefore firms had an incentive to behave, an incentive far more powerful than some top-down scheme in which big brother told them what to do.

Whether people ever truly believed this nonsense or not, its application over the years makes up the basic story of conservative governance as I tell it in my book, The Wrecking Crew. This is the philosophy by which conservatives gutted the EPA and the Labor Department, turned over the Interior Department and the FDA to the industries they were supposed to regulate, let the CEO of Enron advise the vice president on energy policy, and generally came to regard business, not the public, as government's "customer" (a word that crops up with disturbing frequency in conservative regulatory history).

But it is only now, as we watch the financial system crumble around us, that we can really see the devastating consequences of this folly. It turns out the Securities and Exchange Commission (SEC), which was responsible for regulating investment banks, did a significant part of its job through a voluntary program which firms could participate in or not as they saw fit. As the New York Times told the story on Saturday, this system had--of course--been pushed for by the investment banks themselves, who wanted it in order to avoid the stricter rules from European governments that they would otherwise have had to obey.

And now, as a consequence, the SEC has almost no industry left to regulate. Bear Stearns, Merrill Lynch, Lehman Brothers, Goldman Sachs, Morgan Stanley: All of them are gone or restructured. At business's urging, business was left up to its own devices; its own devices turned out to be precisely the things that our grandparents set up regulatory agencies to guard against: euphoria that leads to panic; perverse incentives that lead to fraud; boom that leads to bust.

As you watch the world crumble, try taking your Armageddon with this sprinkling of irony: Over the last three decades, business has got virtually everything it wanted, and its doomsday scenario from the 1970s has come true because of it. The regulators have indeed killed the regulated--not by intrusive meddling but by doing nothing, by taking a nap while the financial sector puffed up the bubble and blew itself to pieces.

Thomas Frank is the author of The Wrecking Crew, What's the Matter with Kansas? and One Market Under God.

We Have the Money

Published on Monday, September 29, 2008 by TomDispatch.com

We Have the Money

If Only We Didn't Waste It on the Defense Budget

by Chalmers Johnson

There has been much moaning, air-sucking, and outrage about the $700 billion that the U.S. government is thinking of throwing away on rich New York bankers who have been ripping us off for the past few years and then letting greed drive their businesses into a variety of ditches. In fact, we dole out similar amounts of money every year in the form of payoffs to the armed services, the military-industrial complex, and powerful senators and representatives allied with the Pentagon.

On Wednesday, September 24th, right in the middle of the fight over billions of taxpayer dollars slated to bail out Wall Street, the House of Representatives passed a $612 billion defense authorization bill for 2009 without a murmur of public protest or any meaningful press comment at all. (The New York Times gave the matter only three short paragraphs buried in a story about another appropriations measure.)

The defense bill includes $68.6 billion to pursue the wars in Iraq and Afghanistan, which is only a down-payment on the full yearly cost of these wars. (The rest will be raised through future supplementary bills.) It also included a 3.9% pay raise for military personnel, and $5 billion in pork-barrel projects not even requested by the administration or the secretary of defense. It also fully funds the Pentagon's request for a radar site in the Czech Republic, a hare-brained scheme sure to infuriate the Russians just as much as a Russian missile base in Cuba once infuriated us. The whole bill passed by a vote of 392-39 and will fly through the Senate, where a similar bill has already been approved. And no one will even think to mention it in the same breath with the discussion of bailout funds for dying investment banks and the like.

This is pure waste. Our annual spending on "national security" -- meaning the defense budget plus all military expenditures hidden in the budgets for the departments of Energy, State, Treasury, Veterans Affairs, the CIA, and numerous other places in the executive branch -- already exceeds a trillion dollars, an amount larger than that of all other national defense budgets combined. Not only was there no significant media coverage of this latest appropriation, there have been no signs of even the slightest urge to inquire into the relationship between our bloated military, our staggering weapons expenditures, our extravagantly expensive failed wars abroad, and the financial catastrophe on Wall Street.

The only Congressional "commentary" on the size of our military outlay was the usual pompous drivel about how a failure to vote for the defense authorization bill would betray our troops. The aged Senator John Warner (R-Va), former chairman of the Senate Armed Services Committee, implored his Republican colleagues to vote for the bill "out of respect for military personnel." He seems to be unaware that these troops are actually volunteers, not draftees, and that they joined the armed forces as a matter of career choice, rather than because the nation demanded such a sacrifice from them.

We would better respect our armed forces by bringing the futile and misbegotten wars in Iraq and Afghanistan to an end. A relative degree of peace and order has returned to Iraq not because of President Bush's belated reinforcement of our expeditionary army there (the so-called surge), but thanks to shifting internal dynamics within Iraq and in the Middle East region generally. Such shifts include a growing awareness among Iraq's Sunni population of the need to restore law and order, a growing confidence among Iraqi Shiites of their nearly unassailable position of political influence in the country, and a growing awareness among Sunni nations that the ill-informed war of aggression the Bush administration waged against Iraq has vastly increased the influence of Shiism and Iran in the region.

The continued presence of American troops and their heavily reinforced bases in Iraq threaten this return to relative stability. The refusal of the Shia government of Iraq to agree to an American Status of Forces Agreement -- much desired by the Bush administration -- that would exempt off-duty American troops from Iraqi law is actually a good sign for the future of Iraq.

In Afghanistan, our historically deaf generals and civilian strategists do not seem to understand that our defeat by the Afghan insurgents is inevitable. Since the time of Alexander the Great, no foreign intruder has ever prevailed over Afghan guerrillas defending their home turf. The first Anglo-Afghan War (1838-1842) marked a particularly humiliating defeat of British imperialism at the very height of English military power in the Victorian era. The Soviet-Afghan War (1979-1989) resulted in a Russian defeat so demoralizing that it contributed significantly to the disintegration of the former Soviet Union in 1991. We are now on track to repeat virtually all the errors committed by previous invaders of Afghanistan over the centuries.

In the past year, perhaps most disastrously, we have carried our Afghan war into Pakistan, a relatively wealthy and sophisticated nuclear power that has long cooperated with us militarily. Our recent bungling brutality along the Afghan-Pakistan border threatens to radicalize the Pashtuns in both countries and advance the interests of radical Islam throughout the region. The United States is now identified in each country mainly with Hellfire missiles, unmanned drones, special operations raids, and repeated incidents of the killing of innocent bystanders.

The brutal bombing of the Marriott Hotel in Pakistan's capital, Islamabad, on September 20, 2008, was a powerful indicator of the spreading strength of virulent anti-American sentiment in the area. The hotel was a well-known watering hole for American Marines, Special Forces troops, and CIA agents. Our military activities in Pakistan have been as misguided as the Nixon-Kissinger invasion of Cambodia in 1970. The end result will almost surely be the same.

We should begin our disengagement from Afghanistan at once. We dislike the Taliban's fundamentalist religious values, but the Afghan public, with its desperate desire for a return of law and order and the curbing of corruption, knows that the Taliban is the only political force in the country that has ever brought the opium trade under control. The Pakistanis and their effective army can defend their country from Taliban domination so long as we abandon the activities that are causing both Afghans and Pakistanis to see the Taliban as a lesser evil.

One of America's greatest authorities on the defense budget, Winslow Wheeler, worked for 31 years for Republican members of the Senate and for the General Accounting Office on military expenditures. His conclusion, when it comes to the fiscal sanity of our military spending, is devastating:

"America's defense budget is now larger in inflation-adjusted dollars than at any point since the end of World War II, and yet our Army has fewer combat brigades than at any point in that period; our Navy has fewer combat ships; and the Air Force has fewer combat aircraft. Our major equipment inventories for these major forces are older on average than any point since 1946 -- or in some cases, in our entire history."

This in itself is a national disgrace. Spending hundreds of billions of dollars on present and future wars that have nothing to do with our national security is simply obscene. And yet Congress has been corrupted by the military-industrial complex into believing that, by voting for more defense spending, they are supplying "jobs" for the economy. In fact, they are only diverting scarce resources from the desperately needed rebuilding of the American infrastructure and other crucial spending necessities into utterly wasteful munitions. If we cannot cut back our longstanding, ever increasing military spending in a major way, then the bankruptcy of the United States is inevitable. As the current Wall Street meltdown has demonstrated, that is no longer an abstract possibility but a growing likelihood. We do not have much time left.

Chalmers Johnson is the author of three linked books on the crises of American imperialism and militarism. They are Blowback (2000), The Sorrows of Empire (2004), and Nemesis: The Last Days of the American Republic (2006). All are available in paperback from Metropolitan Books.

Obama's Missed Opportunity

Published on Monday, September 29, 2008 by Foreign Policy in Focus

Obama's Missed Opportunity

by Stephen Zunes

Democratic presidential nominee Barack Obama missed a number of key opportunities during the presidential foreign policy debate on September 26 to challenge the dangerous and reckless foreign policies of Republican nominee John McCain.

Obama did remind viewers that he strongly opposed the invasion of Iraq. He pointed out that the invasion created a tragic situation in that country that McCain - who vociferously supported the invasion and defends his decision to this day - now claims he's better qualified to redress. Yet, in what was perhaps his most stunning failure of the evening, the Democratic nominee effectively conceded McCain's claim that President George W. Bush's "troop surge" in Iraq - long advocated by the Republican nominee and opposed by Obama - brought about the dramatic reduction of violence in that country in recent months.

In reality, a shift in the alignment of internal Iraqi forces and the tragic de facto partitioning of Baghdad into sectarian enclaves contributed more to lowering the death toll, and the current relative equilibrium is probably temporary. The decision by certain Sunni tribal militias that had battled U.S. forces to turn their weapons against al-Qaeda-related extremists took place before the announcement of the surge, and militant opposition leader Muqtada al-Sadr's unilateral ceasefire resulted from internal Shia politics rather than any U.S. actions.

Nor did Obama raise questions over McCain's assertion that Iraq, as a result of the U.S. invasion and occupation, was well on its way to becoming a "stable ally." McCain's claims of stability are questionable. There's an ongoing conflict between the two groups that the United States depends on to maintain stability - the Shia-led government and the Sunni militias of the Awakening Council. In addition, there are ongoing attacks by Sunni extremists and a continuing risk that the radical Shia Mahdi Army will once again end its ceasefire.

Nor should the United States consider the Iraqi government an "ally," given that the two largest parties in the ruling coalition have historically allied themselves with Iran. During Saddam's rule, Iran recognized the largest party now in government, the Supreme Iraqi Islamic Council (then known as the Supreme Council for the Islamic Revolution in Iraq), as Iraq's government-in-exile, and the Iranian Revolutionary Guard organized and trained the Council's militia - known as the Badr Corps - which fought on Iran's side during the Iran-Iraq War. The Iraqi government identifies far more with the ruling Iranian clerics and other Shia movements than with the United States or with America's traditional Middle Eastern allies. For example, Iraqi Prime Minister Nouri al-Maliki strongly sided with Hezbollah in the 2006 conflict with Israel.

Falsehoods Unchallenged

A glaring failure of Obama's during the debate was his unwillingness to counter some of McCain's demonstrably false statements. On no less than three occasions during the debate, for instance, the Republican nominee claimed that Iranian president Mahmoud Ahmadinejad had threatened to "wipe Israel off the map." In reality, Ahmadinejad never said that. That idiom does not even exist in the Persian language. The Iranian president was quoting the late Ayatollah Khomeini from more than 20 years earlier when, in a statement largely ignored at the time, he said that "the regime occupying Jerusalem should vanish from the pages of time." While certainly an extreme and deplorable statement, the actual quote's emphasis on the Israeli "regime" rather than the country itself and its use of an intransitive makes the statement far less threatening than McCain made it sound.

McCain even claimed that Ahmadinejad "is now in New York, talking about the extermination of the state of Israel, of wiping Israel off the map." In reality, in response to a reporter's question while in New York to attend the opening of this year's UN General Assembly session, Ahmadinejad used the analogy of the Soviet Union disappearing from the map. In other words, as with his previous clarifications that McCain deliberately ignored, the Iranian president was calling for Israel's dissolution as a state, not the country's physical destruction. McCain, however, unchallenged by Obama, was trying to make Iran appear to be a greater and more imminent threat than it actually is.

When McCain criticized Obama for his refusal to support the Kyl-Lieberman amendment, which urged the Bush administration to designate Iran's Revolutionary Guards as a "terrorist organization," Obama conceded that he indeed believed they were "a terrorist organization. I've consistently said so." Ironically, even the Bush administration has been unwilling to designate the entire Iranian Revolutionary Guard as a terrorist group, which they correctly recognized as an irresponsibly sweeping characterization of the largest branch of Iran's armed forces. Despite congressional pressure, the Bush administration only designated the al-Quds Force - a sub-unit of the Revolutionary Guards that has indeed engaged in terrorist operations, but doesn't always operate with the full knowledge and consent of the leadership of the Revolutionary Guards or even Iran's central government - as a terrorist group.

In another falsehood during the debate, McCain defended his support for Pervez Musharraf's dictatorship in Pakistan by insisting that "there was a failed state in Pakistan when Musharraf came to power. Everybody who was around then, and had been there and knew about it, knew that it was a failed state." While the democratically elected civilian government of Nawaz Sharif was certainly corrupt and inept in many respects at the time Musharraf staged his 1999 coup, Pakistan didn't fit the usual definition of a "failed state." This term is generally reserved for countries experiencing a near-total collapse of order and central authority, such as Somalia, Afghanistan, and such West African countries as Liberia and Sierra Leone during the 1990s. Again, Obama failed to call McCain on this rewriting of history.

Other Misleading Statements Unchallenged

Obama even failed to challenge McCain's statement that "the Russians are preventing significant action in the United Nations Security Council" against Iran's ongoing refusal to abide my edicts of the International Atomic Energy Agency. In fact, the Russian government agreed to support a U.S.-sponsored resolution that very day, which included the toughest language to date, to force Iran to abide by legally binding Security Council edicts.

McCain then launched into his proposal for the formation of what he referred to as a "league of democracies" to bypass the UN system due to the alleged failure of the Security Council to enforce its resolutions, such as those targeting Iran's nuclear program. In response, Obama could have pointed out that the United States has blocked enforcement of UN Security Council Resolution 1172, which calls on India and Pakistan to eliminate their nuclear arsenals and their long-range missiles. Or that the United States has blocked enforcement of UN Security Council Resolution 487, which calls on Israel to place its nuclear facilities under the trusteeship of the International Atomic Energy Agency. Or that the United States has blocked the Security Council from adopting a resolution calling for a nuclear weapons-free zone for the entire Middle East. Or that, over the past 40 years, the United States has vetoed more Security Council resolutions than Russia and all other members of the UN Security Council combined. But Obama failed to do so.

Obama also failed to challenge McCain's dubious statement that "Iranians are putting the most lethal IEDs into Iraq which are killing young Americans" and that "there are special groups in Iran coming into Iraq and are being trained in Iran." Despite repeated claims to this effect by both McCain and the Bush administration, they haven't put forward any credible evidence to support them. Obama also failed to point out that the vast majority of U.S. casualties in Iraq have come from attacks by anti-Iranian Sunni groups, and that the political movements in Iran most closely allied with Iraq are part of the U.S.-backed government. Nor did he remind listeners that McCain had earlier made the ludicrous claim that the Iranians were bringing al-Qaeda forces into Iran for training and sending them back into Iraq to kill Americans, something that McCain himself eventually acknowledged was false.

When the Republican nominee characterized Georgian leader Mikheil Saakashvili as a "great young president," Obama could have pointed out that Saakashvili's disastrous decision to launch a massive assault against South Ossetia prompted the devastating Russian attacks on his country. Doing so would have enabled Obama to defend himself from McCain's criticism during the debate that Obama was wrong to have initially appealed to both sides "to show restraint" and that he should have instead placed all the blame on the Russian side for their illegitimate and disproportionate counter-attack. Obama could also have noted that Saakashvili responded to antigovernment protests within the Georgian capital of Tbilisi late last year with severe repression, shutting down independent media and detaining opposition leaders. Human Rights Watch criticized Saakashvili's government for using "excessive" force against protesters and the International Crisis Group warned of growing authoritarianism in the country. Obama might have then been able to ask McCain what makes Saakashvili so "great" in his eyes and why McCain retains as his chief foreign policy advisor someone who served as the leading paid lobbyist for Saakashvili's government.

Hawkishness Unchallenged

The hawkish approach of both Obama in particular and the Democratic party overall hampered his ability to more effectively challenge McCain during the debate on several key issues. For example, Obama couldn't challenge McCain's calls for increasing Bush's already bloated military budget since Obama and the Democratic platform also calls for increasing the military budget. Most Americans are unaware that the United States, at less than 4% of the world's population, accounts for approximately half of the world's military spending. Military-related spending already accounts for a full 54% of the discretionary U.S. federal budget. Indeed, the only criticism during the debate regarding excessive Pentagon spending came from McCain, who challenged the waste caused by the cost-plus formula regularly awarded to military contractors.

When McCain insisted that the United States pursue a highly provocative policy of bringing Georgia into NATO, thereby risking embroiling the United States in the complex armed ethnic conflicts of the volatile Caucasus region, Obama largely agreed with the Republican nominee. He said that the United States should insist that Georgia be able to join NATO and that NATO "should have a membership action plan immediately to start bringing them in."

Obama couldn't challenge McCain's call to send more troops to Afghanistan because Obama himself has called for increasing U.S. troop strength in that country. To his credit, Obama has called for holding the Afghan government to greater accountability, curbing the poppy trade, and dealing more forcefully with Pakistan, which has provided support and sanctuary for Taliban fighters. Yet the reality on the ground in Afghanistan contradicts the shared assumption of the two candidates that additional forces would stabilize that country. The U.S.-led war has worsened the security situation and the American bombing of civilian areas has led to a popular backlash that has strengthened the Taliban.

Flawed Logic Unchallenged

Obama also failed to fully challenge McCain's flawed logic on several points, such as his claim that Iran's possession of nuclear weapons would pose an "existential threat" to Israel. While nuclear weapons controlled by any state can theoretically be an existential threat to anybody, the Iranians surely recognize that, given Israel's massive nuclear deterrent capability, any such attack would be suicidal. If Iran indeed does have ambitions to acquire nuclear weapons, they would most likely be designed to deter threatened Israeli and American attacks. It's also noteworthy that, while both expressed alarm at a hypothetical Iranian attack on Israel, neither expressed any concern about a far more plausible Israeli attack on Iran.

Similarly, Obama didn't challenge McCain's claim that Iranian possession of nuclear weapons would lead other countries in the region to "feel [a] compelling requirement to acquire nuclear weapons as well." Obama could have pointed out that Israel's procurement of nuclear weapons nearly 40 years ago had not led to any other Middle Eastern countries acquiring nuclear weapons, nor had Pakistan's procurement of nuclear weapons in the 1990s - after India already joined the nuclear club - led additional countries in the region to develop nuclear weapons either. Instead, Obama conceded the point, claiming that a nuclear Iran would indeed "create an environment in which you could set off an arms race in this Middle East."

Obama also gave a surprisingly weak retort to McCain's preposterous claims that meeting with a foreign leader would be "saying they've probably been doing the right thing" and it would "legitimize their illegal behavior." Obama could have pointed out that Bush and other U.S. presidents - as well as McCain himself - have met with foreign leaders who have also engaged in severe repression against their citizens and engaged in illegal behavior.

If Obama expects to defeat John McCain, who indeed has more foreign policy experience, he must be more willing to challenge his opponent's record. McCain is in fact extremely vulnerable in the foreign policy realm. Obama, however, must be more rigorous in pointing out their differences and more effective in challenging McCain's weaknesses.

Stephen Zunes, a senior analyst at Foreign Policy in Focus, is a professor of politics and international studies at the University of San Francsico.

Top 5 Reasons to Vote Against Wall Street's $700 Billion Bailout

Published on Monday, September 29, 2008 by Campaign for America's Future

Top 5 Reasons to Vote Against Wall Street's $700 Billion Bailout

by David Sirota

There's news this Sunday afternoon of a congressional deal to bailout Wall Street fat cats with $700 billion of taxpayer cash (you can read the draft legislation here). Though the deal negotiated between congressional leaders and the White House is better than what Treasury Secretary Henry Paulson originally proposed early last week, it remains an insulting atrocity, having omitted even basic aid to homeowners, bankruptcy reforms and any modicum of future financial industry regulation. Now, the New York Times reports that the Democratic leadership may not have the votes to pass this bailout. So without further ado, here are the top 5 reasons (in no order) why every single member of Congress - Democrat and Republican - should vote this sucker down. Please feel free to copy and paste this post into an email to your congressperson. They are deciding right now - let them hear your voice.

1. BAILOUT'S INHERENT FISCAL INSANITY COULD MAKE PROBLEM WORSE

When an individual consumer uses a new credit card to pay off astounding debt from an old credit card, it's akin to check kiting, which is is illegal. Apparently, though, when the government does it, it's billed as Serious Public Policy. Because that's what this supposedly prudent bailout bill would do: Force taxpayers to borrow $700 billion from foreign banks to pay off the bad debt of Wall Street banks. During a crisis that is aimed at preventing interest rates from skyrocketing, nobody has been able to explain how adding almost a trillion dollars to the interest rate-exacerbating national debt would do anything other than undermine the plan's underlying objective. Worse, the U.S. Treasury Department itself admits that the $700 billion number is "not based on any particular data point" - that is, they created it out of thin air because "We just wanted to choose a really large number." Slapping that amount of money onto the national credit card when our government can't even justify the amount is beyond absurd - it is insane.

It didn't have to be this way, of course. As I noted in my newspaper column this week, Senator Bernie Sanders proposed a temporary tax on millionaires to finance part of this bailout. Similarly, Blue Dog Democrats proposed a future tax on financial firms if and when taxpayers lose cash on the deal. These proposals were discarded in favor of language asking the government to "submit a plan to Congress on how to recoup any losses," according to the Associated Press. Not only is that language toothless, but it opens up the possibility of a plan being submitted that says we should raise middle-class taxes or slash middle-class social programs to pay for Wall Street's misbehavior.

2. EXPERTS ON BOTH THE LEFT AND RIGHT SAY THIS BAILOUT COULD MAKE THINGS WORSE

Primum non nocere is the latin phrase for "first do no harm" - the priority principle for any EMT working on a sick patient. It should be the same priority for Congress at this moment - and a growing group of esteemed experts on both the Right and Left are insisting that this bailout bill could make things worse. Here's a review:

The Washington Post reported on Friday, almost 200 academic economists "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."
NYU's Nouriel Roubini, the visionary who had been predicting this meltdown, says "The Treasury plan (even in its current version agreed with Congress) is very poorly conceived and does not contain many of the key elements of a sound and efficient and fair rescue plan."
Harvard's Ken Rogoff, a Former Federal Rerserve and IMF official, insists that the prospect of this bailout is, unto itself, taking a manageable problem and making it into a more intense crisis. He says that credit is frozen primarily because banks want to avoid dealing with other banks that might drive a hard bargain, and instead would rather wait for free money from the government. Without the prospect of that free money, Rogoff suggests that credit would probably begin moving again, if slowly.
Dean Baker of the Center on Economic and Policy Research says that spending so much cash so quickly on such a poorly conceived plan could have the effect of making it impossible to fund economic stimulus that is the real way out of this mess. "Suppose the Paulson plan goes through," he writes. "It is virtually certain that the economy will weaken further and the number of foreclosures and people without jobs will continue to rise. This is the fallout from a collapsing housing bubble...When families respond to their loss of home equity by cutting back their consumption it will deepen the recession. In this context it might prove very important to have the resources needed to provide a substantial stimulus. [and] there is no doubt that this bailout will make further stimulus much more difficult to sell politically."

Meanwhile, it's not even close to clear that this is a problem that requires such an enormous response. As mentioned above, the Treasury Department admits it has absolutely no factual basis for requesting $700 billion - an amount equivalent to about 5 percent of our entire economy. Additionally, the Washington Post reports that "Banks throughout the United States carried on with the business of making loans yesterday even as federal officials warned again that their industry is on the verge of collapse, suggesting that the overheated language on Capitol Hill may not reflect the reality on many Main Streets." Indeed, "many smaller banks said they were actually benefiting from the problems on Wall Street" and "even some of the nation's largest banks, which have pushed hard for a federal bailout, deny that the current situation is forcing them to reduce lending."

The questions, then, are simple: In the face of this bipartisan opposition from objective experts, why should a lawmaker instead believe the same Bush officials who helped create this crisis with their deregulation, the same Bush officials who just months ago said everything was AOK? Shouldn't there be almost complete unanimity among both objective and partisan observers before spending 5 percent of our entire economy after just one harried week of White House demands? Fool me once shame on you, fool me twice, shame on me. It's time, as The Who said, that we "don't get fooled again."

3. THERE ARE CLEARLY BETTER AND SAFER ALTERNATIVES

The mantra throughout the week has been that America has "no choice" but to pass Treasury Secretary Henry Paulson's $700 billion giveaway - that, in effect, there are no alternatives. But that's an out-and-out lie - one with a motive: Making it seem as if the only thing we can do is hand the keys to the federal treasury over to both parties' corporate campaign contributors.

The truth is, there are a number of alternatives. Here are just a few:

In the Washington Post last week, Galbraith outlined a multi-pronged plan shoring up and expanding the FDIC, creating a Home Owners Loan Corporation, resurrecting Nixon's federal revenue sharing, and taxing stock transactions (a tax that would fall mostly on speculators) to finance the whole deal.
The Service Employees International Union has drafted a plan based around a massive investment in public services and national health care, and regulatory reforms preventing foreclosures and forcing banks to renegotiate the predatory terms of their bad mortgages.
For those in the mindless, zombie-ish "someone has to do something, so we have to do what the White House says!" camp, consider the possibility that you are under the spell of the same kind of White House fear that led us to invade Iraq because of Saddam's supposed WMD. Consider, perhaps, that there may not even be a compelling basis for doing anything just yet (or at least not anything nearly so huge), and that the whole reason there is this urgent push right now has nothing to do with the financial situation, and everything to do with creating the political dynamic to pass a wasteful giveaway - one that couldn't be passed otherwise without a sense of emergency. And ask yourself why you would listen to this White House instead of listening to those experts who have been predicting this crisis and are now advising against this bailout - experts like CEPR's Baker. In two separate posts (here and here), he says that letting the problem play out could be the best path, because Treasury and the Fed may already have the tools they need. Following this path, the worst thing that happens is "The Fed and Treasury will have to step in and take over the banks [which] is exactly what many economists argue should happen anyhow," Baker writes. "So the outcome of the worst case scenario is a really frightening day in which the whole world financial system is shaken to its core, followed by a government takeover of the banks. Eventually the government straightens out the books and sells them off again. But the real threat here is not to the economy, it is to the banks."
Then there is the idea of simply taking the $700 billion and simply give it to struggling homeowners to help them pay off part of their mortgages. This hasn't even been discussed but the thought experiment it involves is important to understanding why there is, indeed, an alternative to the Paulson plan. If the root of this problem is people not being able to pay off their mortgages, and those defaults then devaluing banks' mortgage-backed assets, then simply helping people pay their mortgages would preserve the value of the mortgage-backed assets and recharge the market with liquidity. That would be a bottom-up solution helping the mass public, rather than a top-down move helping only financial industry executives.

On this latter proposal, some may argue that giving any relief to homeowners is "unfair" in that those homeowners created their problems, so why should taxpayers have to help them? But then, is helping homeowners any less fair than simply giving all the money away to Wall Street, no strings attached? I'd say no - and helping homeowners also serves a second purpose: namely, keeping people in their homes, which not only helps them, but helps an entire neighborhood (as any homeowner knows, nearby properties can be devalued when foreclosures hit).

4. ANY INCUMBENT VOTING FOR THIS PUTS THEMSELVES AT RISK OF BEING THROWN OUT OF OFFICE

As a preface, let me state that I think we live in a country where politicians too often listen to their donors and to the Establishment rather than their constituents, not the other way around. America is a country where our leaders dishonestly invoke the concepts of "Statesmanship" and "Seriousness" and their supposed hatred of "pandering" to justify ignoring what the public wants (as if giving the public what it wants is somehow not the objective of a democratic republic). So, in short, I don't think there's anything wrong with this bill being "politicized" by coming down the pike right before an election - in fact, I think it's a good thing because the election - and the fear of being thrown out of office forces our politicians to at least consider what the public wants. I mean, really - would we rather have this decision made after the election, when the public can be completely ignored?

Polls overwhelmingly show a public that sees voting for this bill as an act of economic treason whereby the bipartisan Washington elite robs taxpayer cash to give their campaign contributors a trillion-dollar gift. As just two of many examples, Bloomberg News' poll shows "decisive" opposition to the bailout proposal, and Rasmussen reports that their surveys show "the more voters learn about the proposed $700 billion federal bailout plan for the U.S. economy, the more they don't like it." Put another way, this bailout proposal has unified both the Right and Left sides of the populist uprising that I described in my new book and that is now even more angry than ever.

Any sitting officeholder that votes for this - whether a Democrat or a Republican - should expect to get crushed under a wave of populist-themed attacks from their opponents. We've already seen it start. In Oregon, Democratic challenger Jeff Merkley (D) is airing scathing television ads hammering Republican incumbent Gordon Smith for potentially supporting the deal. Similarly, this morning on Meet the Press, we saw Republican Senate challenger Bob Schaffer (CO) dishonestly papering over his own votes for deregulation and ripping into his opponent Rep. Mark Udall (D) for potentially supporting the deal. Incumbents, get ready for that kind of election-changing heat in your face if you vote "yes."

This, by the way, could play out in the presidential contest. Barack Obama has been taking the advice of the Wall Street insiders in his campaign in endorsing this bailout. McCain has endorsed the vague outline, but he may ultimately back off once he sees the details, allowing him to then run the last month of the campaign as the economic populist in the race. I'm not saying it would work, considering McCain's 26-year record of supporting the deregulatory agenda that created this crisis. But such a move could end up help him flank Obama on the defining economic issues of the race.

5. CORRUPTION AND SLEAZE ARE SWIRLING AROUND THESE BAILOUTS - AND AMERICA KNOWS IT

The amount of brazen corruption and conflicts of interest swirling around this deal is odious, even by Washington's standards - and polls suggest the public inherently understands that. Consider these choice nuggets:

Warren Buffett is simultaneously advising Obama to support the deal, while he himself is investing in the company that stands to make the most off the deal.
McCain's campaign is run by lobbyists from the companies that stand to make a killing off a no-strings government bailout.
The New York Times reports that the person advising Paulson and Bernanke on the AIG bailout was the CEO of Goldman Sachs - a company with a $20 billion stake in AIG.
The Obama campaign's top spokesman pushing this deal is none other than Roger Altman, who Bloomberg News reports is simultaneously "advising a group of investors who are trying to prevent their shares from being diluted in the U.S. takeover of American International Group Inc." - that is, who have a direct financial interest in the current iteration of the bailout.

Add to this the fact that the negotiations over this bill have been largely conducted in secret, and you have one of the most sleazy heists in American history.

**********

If this bill passes, it will be a profound referendum on the dominance of money over democracy in America. That - and that alone - would be the only thing an objective observer could take away from the whole thing.

Money will have compelled politicians to not only vote for substantively dangerous policy, but vote for that policy even at their own clear electoral peril. Such a vote will confirm that the only people these politicians believe they are responsible for representing are are the fat-cat recipients of the $700 billion - the same fat cats who underwrite their political campaigns, the same fat-cats who engineered this crisis, and want to keep profiteering off it. Any lawmaker who takes that position is selling out the country, as is any issue-based political non-profit group - liberal or conservative - that uses its resources to defend a "yes" vote rather than demand a "no" vote. This is a bill that forces taxpayers to absorb all of the pain, and Wall Street executives to reap all of the gain. It doesn't even force the corporate executives (much less the government leaders) culpable in this free fall to step down - it lets them stay fat and happy in their corner office suites in Manhattan.

Even if they believe that something must be done right now, lawmakers should still vote no on this specific bill, and force one of the very prudent alternatives to the forefront. They shouldn't just vote no on Paulson's proposal - they should vote hell no. Our economy's future depends on it.

David Sirota is a bestselling author whose newest book is "The Uprising." He is a fellow at the Campaign for America's Future and a board member of the Progressive States Network-both nonpartisan organizations. His blog is at www.credoaction.com/sirota.

The Rich Are Staging a Coup This Morning

Published on Monday, September 29, 2008 by CommonDreams.org

The Rich Are Staging a Coup This Morning ...a Message From Michael Moore

by Michael Moore

Friends,

Let me cut to the chase. The biggest robbery in the history of this country is taking place as you read this. Though no guns are being used, 300 million hostages are being taken. Make no mistake about it: After stealing a half trillion dollars to line the pockets of their war-profiteering backers for the past five years, after lining the pockets of their fellow oilmen to the tune of over a hundred billion dollars in just the last two years, Bush and his cronies -- who must soon vacate the White House -- are looting the U.S. Treasury of every dollar they can grab. They are swiping as much of the silverware as they can on their way out the door.

No matter what they say, no matter how many scare words they use, they are up to their old tricks of creating fear and confusion in order to make and keep themselves and the upper one percent filthy rich. Just read the first four paragraphs of the lead story in last Monday's New York Times and you can see what the real deal is:

"Even as policy makers worked on details of a $700 billion bailout of the financial industry, Wall Street began looking for ways to profit from it.
"Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages.
"At the same time, investment firms were jockeying to oversee all the assets that Treasury plans to take off the books of financial institutions, a role that could earn them hundreds of millions of dollars a year in fees.
"Nobody wants to be left out of Treasury's proposal to buy up bad assets of financial institutions."

Unbelievable. Wall Street and its backers created this mess and now they are going to clean up like bandits. Even Rudy Giuliani is lobbying for his firm to be hired (and paid) to "consult" in the bailout.

The problem is, nobody truly knows what this "collapse" is all about. Even Treasury Secretary Paulson admitted he doesn't know the exact amount that is needed (he just picked the $700 billion number out of his head!). The head of the congressional budget office said he can't figure it out nor can he explain it to anyone.

And yet, they are screeching about how the end is near! Panic! Recession! The Great Depression! Y2K! Bird flu! Killer bees! We must pass the bailout bill today!! The sky is falling! The sky is falling!

Falling for whom? NOTHING in this "bailout" package will lower the price of the gas you have to put in your car to get to work. NOTHING in this bill will protect you from losing your home. NOTHING in this bill will give you health insurance.

Health insurance? Mike, why are you bringing this up? What's this got to do with the Wall Street collapse?

It has everything to do with it. This so-called "collapse" was triggered by the massive defaulting and foreclosures going on with people's home mortgages. Do you know why so many Americans are losing their homes? To hear the Republicans describe it, it's because too many working class idiots were given mortgages that they really couldn't afford. Here's the truth: The number one cause of people declaring bankruptcy is because of medical bills. Let me state this simply: If we had had universal health coverage, this mortgage "crisis" may never have happened.

This bailout's mission is to protect the obscene amount of wealth that has been accumulated in the last eight years. It's to protect the top shareholders who own and control corporate America. It's to make sure their yachts and mansions and "way of life" go uninterrupted while the rest of America suffers and struggles to pay the bills. Let the rich suffer for once. Let them pay for the bailout. We are spending 400 million dollars a day on the war in Iraq. Let them end the war immediately and save us all another half-trillion dollars!

I have to stop writing this and you have to stop reading it. They are staging a financial coup this morning in our country. They are hoping Congress will act fast before they stop to think, before we have a chance to stop them ourselves. So stop reading this and do something -- NOW! Here's what you can do immediately:

1. Call or e-mail Senator Obama. Tell him he does not need to be sitting there trying to help prop up Bush and Cheney and the mess they've made. Tell him we know he has the smarts to slow this thing down and figure out what's the best route to take. Tell him the rich have to pay for whatever help is offered. Use the leverage we have now to insist on a moratorium on home foreclosures, to insist on a move to universal health coverage, and tell him that we the people need to be in charge of the economic decisions that affect our lives, not the barons of Wall Street.

2. Take to the streets. Participate in one of the hundreds of quickly-called demonstrations that are taking place all over the country (especially those near Wall Street and DC).

3. Call your Representative in Congress and your Senators. (click here to find their phone numbers). Tell them what you told Senator Obama.

When you screw up in life, there is hell to pay. Each and every one of you reading this knows that basic lesson and has paid the consequences of your actions at some point. In this great democracy, we cannot let there be one set of rules for the vast majority of hard-working citizens, and another set of rules for the elite, who, when they screw up, are handed one more gift on a silver platter. No more! Not again!

Yours,
Michael Moore
MMFlint@aol.com
MichaelMoore.com

P.S. Having read further the details of this bailout bill, you need to know you are being lied to. They talk about how they will prevent golden parachutes. It says NOTHING about what these executives and fat cats will make in SALARY. According to Rep. Brad Sherman of California, these top managers will continue to receive million-dollar-a-month paychecks under this new bill. There is no direct ownership given to the American people for the money being handed over. Foreign banks and investors will be allowed to receive billion-dollar handouts. A large chunk of this $700 billion is going to be given directly to Chinese and Middle Eastern banks. There is NO guarantee of ever seeing that money again.

P.P.S. From talking to people I know in DC, they say the reason so many Dems are behind this is because Wall Street this weekend put a gun to their heads and said either turn over the $700 billion or the first thing we'll start blowing up are the pension funds and 401(k)s of your middle class constituents. The Dems are scared they may make good on their threat. But this is not the time to back down or act like the typical Democrat we have witnessed for the last eight years. The Dems handed a stolen election over to Bush. The Dems gave Bush the votes he needed to invade a sovereign country. Once they took over Congress in 2007, they refused to pull the plug on the war. And now they have been cowered into being accomplices in the crime of the century. You have to call them now and say "NO!" If we let them do this, just imagine how hard it will be to get anything good done when President Obama is in the White House. THESE DEMOCRATS ARE ONLY AS STRONG AS THE BACKBONE WE GIVE THEM. CALL CONGRESS NOW.

The Power of 'No' and the Need to Keep the Pressure on Congress

Published on Monday, September 29, 2008 by CommonDreams.org

The Power of 'No' and the Need to Keep the Pressure on Congress

by Dave Lindorff

Incredible! This time, when the People spoke, Congress listened.

At least 228 members of the House listened. They voted early this afternoon to reject the Bush Administration's scaremongering, and the cowardly Democratic Congressional leadership's attempt at ducking and covering by attaching some meaningless verbiage to what remains a case of legalized highway robbery. At least for the moment, the bailout scam is killed.

Earlier in the day, the Congressional switchboard was jammed. You could get through, but it took a dedicated finger on the redial button of your phone. Operators at the Capitol say it's been that way for a week now, as Americans across the country have been flooding their Congressional delegations with phone calls (and emails) urging them to vote "No" on the Bush/Paulson Wall Street bailout.

That today was no exception, even after Democratic Party leaders (and both major party presidential candidates, John McCain and Barack Obama) had bought into the plan following their adding of some window-dressing measures designed to make it look more palatable, showed that the public is not being fooled (calls were reportedly running better than 9:1 or more like 999:1 against a bailout, perhaps more like 99:1).

People see clearly that this proposal is a trillion-dollar giveaway to the very people who have been hollowing out and destroying the US economy for over a decade or more by convincing both parties to let them do whatever they want to get rich, free of any kind of significant oversight or regulation.

As Nobelist economist Joseph Stiglitz has written of this outrageous rip-off, there are four problems facing the financial system, and the bailout proposal only addresses one--getting the toxic mortgages off the banks' books and onto taxpayers' hands. Left unsolved is the gaping hole in banks' balance sheets in the form of loans made to people and companies which cannot be repaid, which will mean they still won't start lending money again. Left unaddressed too is the continuing collapse of housing prices, which will inevitably lead to more bank collapses even after the bailout. Finally, Stiglitz says there is the general loss of faith in the financial system--a major crisis which the bailout will also not solve.

Stiglitz doesn't even address a fifth problem which is that this trillion-plus-dollar boondoggle (and when you add in the bailouts of Fannie Mae, Freddie Mac, AIG, Bear Stearns, the multiple mega-bank failures and the pending auto-industry bailout, you're already talking $1.5 trillion and counting), all of it with borrowed money, the stage is being set for a collapse in the US dollar, with consequences that will reverberate through the economy. Consider: if the dollar collapses, as many experts say is almost inevitable with this kind of huge addition to the national debt, oil prices (which are set in dollars) will soar to compensate, the price of all the other goods that Americans import--more than half of everything we use in daily life thanks to the decimation of American manufacturing--will rise dramatically, and ultimately, in an effort to stem the bleeding, interest rates will have to be raised, thus bringing what's left of the economy to a grinding halt.

All of this is readily predictable--and indeed a group of over 200 prominent economists has written Congress joining Stiglitz in opposing the bailout plan--but that doesn't matter to the proponents of the bailout in Washington. What they want is to get past Election Day, and the bailout may do that, unless the public gets really aroused.

The tsunami of calls and emails to Congress, and last week's nationwide demonstrations against the bailout suggest that the public is waking up to this looming disaster and to the fact that they are being sold a bill of goods.

But it ain't over yet. We can be sure there will be arm-twisting now to try and get 12 members of Congress to change their votes and win passage in the House (the Senate, where two-thirds of the members aren't facing election for two or four years, will probably pass the bill easily). A continued expression of public outrage and of a promise of retaliation at the ballot box against those who vote for the bailout needs to be expressed.

If you haven't made an effort to call your two senators and your representative to demand that they vote "No" on this bailout, do it now (the number is 202-225-3121 or 202-224-3121), and don't give up when you get a busy signal. That's a sign that you are not alone. Just keep hitting "redial" until you get through. At that point, get the operator, before switching you, to give you direct numbers for your three members of Congress, so you can bypass the main switchboard number after that. If you did call, call again and say you don't want anyone changing their vote to become a bailout backer.

Unlike the 2002 rush to war against Iraq, we've shown that this latest bum's rush can still be stopped. We did stop it.

To make your next call more impactful, make sure you tell each member of your congressional delegation that any yes vote on the bailout means you will vote against them next election. To read about this strategy, go to:

ThrowThemAllOut.com...and then spread the word.

Keep the pressure on!

And don't forget to contact the Obama campaign too. How embarrassing for candidates Obama and McCain, who both got suckered into backing the bailout, which it is now abundantly clear the American people recognize as a ripoff.

PS: Imagine if the same kind of pressure had been brought on Congress back in October 2002 when Bush was scare-mongering Congress into approving a war against Iraq. We'd have 4500 young Americans still alive, 40,000 other young Americans would still have their limbs and other body parts. A million-plus Iraqis would still be alive. And the country would have an extra $500 billion with which to deal with the current economic crisis.

Dave Lindorff is a Philadelphia-based journalist and columnist. His latest book is "The Case for Impeachment" (St. Martin's Press, 2006). His work is available at www.thiscantbehappening.net

The End of Free-Market Fundamentalism?

Published on Monday, September 29, 2008 by American News Project

The End of Free-Market Fundamentalism?

But is it really? And where is American capitalism headed?

Amid the chaos and chatter about this week's financial bailout, one clear theme emerged in some quarters: The era of free-market fundamentalism is over. But is it, really?

Correa Celebrates Victory In Constitutional Referendum

Published on Monday, September 29, 2008 by Agence France Presse

Correa Celebrates Victory In Constitutional Referendum

QUITO, Ecuador - Ecuadoran President Rafael Correa celebrated victory Monday after winning what he said was a "crushing victory" in a constitutional referendum aimed at broadening his powers.

A supporter of Ecuador's President Rafael Correa shows a new Ecuadorean constitution autographed by Ecuador's President Rafael Correa, in Quito, Ecuador, Sunday, Sept.28, 2008. Ecuadoreans voted Sept. 28 to approve a new constitution that guarantees free education through university, widens social security benefits and significantly expands Correa's powers, allowing him to run for two more consecutive terms. (AP Photo/Patricio Realpe)

Initial official returns, reflecting just five percent of the ballot, indicated 65-percent popular backing for the new basic law. But they were supported by unofficial exit polls showing that Correa's proposal had won between 66 percent and 70 percent of the vote.

"The new constitution has had a crushing victory," Correa said in opposition stronghold Guayaquil, on the Pacific coast. "It's a historic moment that transcends by far the people who by luck or accident have been involved in this process."

Organization of American States General Secretary Jose Miguel Insulza, in a statement, congratulated Correa "on very strong support granted by Ecuadoran people."

In a bid to avert unrest, Correa asked the opposition and all "no" voters to remain calm and issued a called to unity.

"We extend them our hand. Let them acknowledge defeat and let's strike out together in the new direction the great majority of Ecuadorans, as well as all Latin America, are setting: a society with more justice, much more equality and without so much ... misery."

Correa earlier had voiced hope for a solid "yes" vote, as he strives for what he calls a "21st century socialism" to more closely align Ecuador with leftist allies Venezuela and Bolivia, making it the latest South American country to chart a leftward course.

Passed by a Constitutional Assembly on July 24, the new Basic Law would strengthen the government's hold on the economy of this small nation of 13.9 million people -- half of whom live in poverty -- which is based chiefly on oil exports and money sent home by its emigrants.

The proposed constitution is inspired by the leftist majorities in power in Venezuela and Bolivia and their repudiation of the neoliberal policies of the 1990s, but falls short of nationalizing the country's national resources as Bolivia and Venezuela have done.

Its 444 articles expand presidential powers in an attempt to end political instability in a country that in the last 10 years has sent three presidents packing before their terms were up.

The new constitution would allow the president to run for two consecutive four-year terms, dissolve Congress and call early elections.

Correa, 45, has already announced his intention to run for reelection in February 2009, if it is approved, in which case early elections would be convened by the Constitutional Assembly.

The new constitution would also close down all foreign military bases in Ecuador, forcing the United States to move its regional anti-drug operations, run for nearly 10 years from an air base in the port city of Manta.

Opposition leader and Guayaquil Mayor Jaime Nebot has railed against the new constitution he says would create a centralized form of government that would threaten private property and which has already proven to be inefficient.

"Do you think we can model ourselves after Venezuela, a country swimming in oil money but whose people have to line up to get food, or Bolivia, a country split down the middle because its government doesn't understand?" Nebot recently told AFP.

The Roman Catholic Church, a major player in this predominantly Catholic nation, has also criticized the new constitution, especially the articles it says will lead to the legalization of abortion and same-sex marriage.

Correa addressed those doubts in his victory speech to supporters.

"Let's see if the new constitution is pro-abortion, centralist, hyperpresidentialist, a harbinger of dictatorship. Let's see if all that is true."

He called on all sectors in Ecuador to join forces to move the country forward, but warned: "Not a single step backwards. All the progress we've made we'll not give up. We can only look to the future.

"Let's move forward together, but on the path of change, of the future."

An Appropriately Populist Anti-Bailout Rant

Published on Monday, September 29, 2008 by The Nation

An Appropriately Populist Anti-Bailout Rant

by John Nichols

Ohio Congressman Dennis Kucinich responded appropriately Sunday, when House and Senate leaders announced early a bipartisan agreement for a variation on Treasury Secretary Henry Paulson's $700 billion (plus-plus-plus) bailout plan Wall Street.

Kucinich wasn't buying into the idea that everyone in Congress would climb on board for the bailout. "If the votes were there, this would be on the floor. The votes aren't there," Kucinich said Sunday.

Clearly, the congressman was not on board.

On the floor of House Sunday, Kucinich declared that:

The $700 billion bailout for Wall Street, is driven by fear not fact. This is too much money in too a short a time going to too few people while too many questions remain unanswered. Why aren't we having hearings on the plan we have just received? Why aren't we questioning the underlying premise of the need for a bailout with taxpayers' money? Why have we not considered any alternatives other than to give $700 billion to Wall Street? Why aren't we asking Wall Street to clean up its own mess? Why aren't we passing new laws to stop the speculation, which triggered this? Why aren't we putting up new regulatory structures to protect investors? How do we even value the $700 billion in toxic assets?
Why aren't we helping homeowners directly with their debt burden? Why aren't we helping American families faced with bankruptcy. Why aren't we reducing debt for Main Street instead of Wall Street? Isn't it time for fundamental change in our debt based monetary system, so we can free ourselves from the manipulation of the Federal Reserve and the banks? Is this the United States Congress or the board of directors of Goldman Sachs? Wall Street is a place of bears and bulls. It is not smart to force taxpayers to dance with bears or to follow closely behind the bulls.

That Kucinich is spot-on comes as no great surprise.

When he bid for the Democratic presidential nomination this year, he spoke more consistently and more bluntly about the economic crisis than any of the other contenders.

Kucinich was not treated particularly seriously the media or his fellow Democratic candidates.

Now that Kucinich has been proven right, however, Barack Obama might want to pay attention to what the former mayor, state legislator and veteran congressman is saying.

He actually gets it.

House Votes Down Financial Bailout Deal

Published on Monday, September 29, 2008 by Associated Press

House Votes Down Financial Bailout Deal

by Julie Hirschfeld Davis

The House today defeated a $700 billion emergency rescue for the nation's financial system, ignoring urgent warnings from President Bush and congressional leaders of both parties that the economy could nosedive into recession without it.

Stocks plummeted on Wall Street even before the 228-205 vote to reject the bill was announced on the House floor.

Bush and a host of leading congressional figures had implored the lawmakers to pass the legislation despite howls of protest from their constituents back home. Despite pressure from supporters, not enough members were willing to take the political risk just five weeks before an election.

Ample no votes came from both the Democratic and Republican sides of the aisle. More than two-thirds of Republicans and 40 percent of Democrats opposed the bill.

The overriding question for congressional leaders was what to do next. Congress has been trying to adjourn so that its members can go out and campaign. And with only five weeks left until Election Day, there was no clear indication of whether the leadership would keep them in Washington. Leaders were huddling after the vote to figure out their next steps.

A White House spokesman said that President Bush was "very disappointed."

"There's no question that the country is facing a difficult crisis that needs to be addressed," Tony Fratto told reporters. He said the president will be meeting with members of his team later in the day "to determine next steps."

"Obviously we are very disappointed in this outcome," Fratto said. "There's no question that the country is facing a difficult crisis that needs to be addressed. The president will be meeting with his team this afternoon to determine the next steps and will also be in touch with congressional leaders."

Monday's mind-numbing vote had been preceded by unusually aggressive White House lobbying, and Fratto said that Bush had used a "call list" of people he wanted to persuade to vote yes as late as a short time before the vote.

Lawmakers shouted news of the plummeting Dow Jones average as lawmakers crowded on the House floor during the drawn-out and tense call of the roll, which dragged on for roughly 40 minutes as leaders on both sides scrambled to corral enough of their rank-and-file members to support the deeply unpopular measure.

They found only two.

Bush and his economic advisers, as well as congressional leaders in both parties had argued the plan was vital to insulating ordinary Americans from the effects of Wall Street's bad bets. The version that was up for vote Monday was the product of marathon closed-door negotiations on Capitol Hill over the weekend.

"We're all worried about losing our jobs," Rep. Paul Ryan, R-Wis., declared in an impassioned speech in support of the bill before the vote. "Most of us say, 'I want this thing to pass, but I want you to vote for it - not me.' "

With their dire warnings of impending economic doom and their sweeping request for unprecedented sums of money and authority to bail out cash-starved financial firms, Bush and his economic chiefs have focused the attention of world markets on Congress, Ryan added.

"We're in this moment, and if we fail to do the right thing, Heaven help us," he said.

The legislation the administration promoted would have allowed the government to buy bad mortgages and other rotten assets held by troubled banks and financial institutions. Getting those debts off their books should bolster those companies' balance sheets, making them more inclined to lend and easing one of the biggest choke points in the credit crisis. If the plan worked, the thinking went, it would help lift a major weight off the national economy that is already sputtering.

The fear in the financial markets send the Dow Jones industrials cascading down by over 700 points at one juncture. As the vote was shown on TV, stocks plunged and investors fled to the safety of the credit markets, worrying that the financial system would keep sinking under the weight of failed mortgage debt.

"As I said on the floor, this is a bipartisan responsibility and we think (Democrats) met our responsibility," said House Majority Leader Steny Hoyer, D-Md.

Asked whether majority Democrats would try to reverse the stunning defeat, Hoyer said, "We're certainly not going to abandon our responsibility. We'll continue to focus on this and see what actions we can take."

Several Republican aides said House Speaker Nancy Pelosi, D-Calif., had torpedoed any spirit of bipartisanship that surrounded the bill with her scathing speech near the close of the debate that blamed Bush's policies for the economic turmoil.

Without mentioning her by name, Rep. Adam Putnam, R-Fla., No. 3 Republican, said: "The partisan tone at the end of the debate today I think did impact the votes on our side."

Putnam said lawmakers were working "to garner the necessary votes to avoid a financial collapse."

But the defeat was already causing a brutal round of finger-pointing.

"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."

More than a repudiation of Democrats, Frank said, Republicans' refusal to vote for the bailout was a rejection of their own president.

"The Republicans don't trust the administration," he said. "It's a Republican revolt against George Bush and John McCain."

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."

Monday, September 29, 2008

BREVITAS

OUTLYING PRECINCTS

Washington Post - Alaska Gov. Sarah Palin, who has made a crackdown on gift-giving to state officials a centerpiece of her ethics reform agenda, has accepted gifts valued at $25,367 from industry executives, municipalities and a cultural center whose board includes officials from some of the largest mining interests in the state, a review of state records shows. The 41 gifts Palin accepted during her 20 months as governor include honorific tributes, expensive artwork and free travel for a family member. They also include more than $2,500 in personal items from Calista, a large Alaska native corporation with a variety of pending state regulatory and budgetary issues, and a gold-nugget pin valued at $1,200 from the city of Nome, which lobbies on municipal, local and capital budget matters, documents show.

Enter your 2008 personal tax information in the form below and then press calculate to see how the candidates' promised tax plans will affect your taxes over the next four years based on "McCain and Obama Tax Plan for Individuals". For more information about an input item,

Mercury News, CA - With strong support from Latinos, a slim majority of California voters favor a statewide ballot initiative that would require doctors to notify parents before teenagers have abortions, according to a Field Poll. Similar parental notification measures have failed twice in California in the past four years. But the new poll found a slightly stronger base of support for Proposition 4 than the measures in 2005 and 2006, which also showed early leads in polls. Forty-nine percent of likely California voters favor Proposition 4, while 41 percent oppose it and 10 percent are undecided, according to the Field Poll. Undecided voters who tend to oppose new initiatives could make a crucial difference on Election Day, but Field Poll director Mark DiCamillo sees a significant factor at play this year. "If there's a shift going on, it's coming from the Latino voters," DiCamillo said. "Because this is a presidential election, Latino voters will constitute a larger proportion of the turnout than was true two years ago." Latino voters, who are overwhelmingly Catholic, are expected to be 17 percent of the electorate in November. They appear to be favoring the measure 62 percent to 31 percent - a 31-point margin. In 2006, the margin among Latinos was 22 percentage points, DiCamillo said.

Daniel De Groot, Open Left - More than one person has witnessed Palin asking the librarian about "removing" books from the library. What books did she want to ban? Turns out she was incensed about some gay-positive books. So what do conservatives think about this idea of banning pro-gay books from libraries? Well, if we asked them today, it would be hard to trust the answer given the incentive they have to support Palin. Fortunately, it turns out the GSS has been askin:g this for many years, so conservatives are on record. Survey says [on removing gay books from libraries]

In short, 62% of convervatives are more enlightened on this subject than Palin

WATCHING THE COUNT

Technology Review - California's secretary of state, Debra Bowen, believes that open-source software should be used in elections involving electronic voting machines, to protect against error and fraud. Speaking in Cambridge, MA, at the Emtech organized by Technology Review, Bowen noted that individual counties are currently responsible for purchasing voting machines. Often the choice is left up to an IT professional who may lack detailed knowledge of cryptography and computer security. But the biggest concern, according to Bowen, is a lack of access to the machines' underlying code. "Many times, a person has no legal right to review the software, even if they could," she said. . . Under Bowen's stewardship, San Francisco will experiment with new software in November. It's one of the few cities already using instant-runoff voting, a system that lets voters rank candidates in order of preference instead of choosing just one. The rankings data can be used to determine a winner if no candidate receives a majority of the vote.

As the election nears, and when it's over, you'll be hearing more about vote counting fraud. Here are some good sources for background on how elections are being stolen.

FUN WAYS TO STEAL ELECTIONS
BRAD BLOG
SCOOP ARCHIVES
REVIEW ARCHIVES

DRUG BUSTS

Daily Camera, CO - Outside the University of Colorado Police Department, cheers erupted from a crowd of marijuana advocates - some of whom were dressed as giant pot leaves - when a student was given back medical marijuana that police took from him in May. "I wish I had a chance to talk to the officers who said I'd never get this back," said CU sophomore Edward Nicholson, 20, who's a medical-marijuana cardholder in Colorado. CU police confiscated about two ounces of marijuana from Nicholson in his residence hall last spring, even though the then-freshman has a card legally certifying him to hold and administer the drug to his brother. Nicholson said his brother suffers from chronic, debilitating pain from football injuries and has been prescribed marijuana to help deal with the discomfort. Nicholson faced criminal charges for drug possession and was suspended from CU over the summer. But, after he hired an attorney and threatened to sue CU, the school has dropped its case against him and changed its rules. CU hasn't changed its policy against campus drug possession, but students living on campus who hold medical-marijuana cards can now request to move off campus to avoid school punishment if they are found with the drug. Someone with a card who is living on campus still will be held to the no-drugs policy at CU.

FURTHERMORE. . . .

WSAZ, WV - As if getting a DUI wasn't enough, a man arrested for driving under the influence got in a lot more trouble at the police station. Police stopped Jose Cruz on Route 60 in South Charleston for driving with his headlights off. Then, he failed sobriety tests and was arrested. When police were trying to get fingerprints, police say Cruz moved closer to the officer and passed gas on him. The investigating officer remarked in the criminal complaint that the odor was very strong. Cruz is now charged with battery on a police officer, as well as DUI and obstruction.

Telegraph, UK - Research by the University of Iowa found applicants - especially women - with a firm handshake are far more likely to get the job than candidates with a limp grip. A solid handshake was found to be more important than dress or physical appearance as it set off the interviewer's impression of that person. . . The study, to be published in the Journal of Applied Psychology, was conducted with 98 students at a business school participating in mock job interviews with local business representatives. The interviewers graded each student's overall performance and employability while five trained handshake experts also scored students on their handshake. The scores were then compared. Mr Stewart said the researchers found that those students who scored high with the handshake experts were also considered to be the most employable by the interviewers and seen as having more extroverted personalities and greater social skills. . . The key to a good handshake? A complete, firm grip, eye contact and a vigorous up-and-down movement, said Stewart.

EVEN THE RIGHT IS FINDING CHARTERS & VOUCHERS TO BE SUBPRIME

Frederick M Hess, American Enterprise Institute - Milwaukee's voucher program initially allowed a few hundred students to attend local private schools with public scholarships. When it was launched, advocates voiced expansive claims on behalf of "choice." In 1990, scholars John Chubb and Terry Moe argued in their seminal volume Politics, Markets, and America's Schools, "Without being too literal about it, we think reformers would do well to entertain the notion that choice is a panacea. . . . It has the capacity all by itself to bring about the kind of transformation that, for years, reformers have been seeking to engineer in myriad other ways."

The record of markets in advancing prosperity, opportunity, and innovation is compelling. It seemed almost axiomatic that market reforms would deliver similar results in schooling, spurring the emergence of good schools and pushing traditional districts to improve.

Yet things have not worked out as intended. Chester E. Finn Jr., president of the Thomas B. Fordham Institute and a champion of choice-based reform since the 1980s, has voiced "growing sympathy" with choice skeptics and warned against "too much trust in market forces. . .

Even staunch proponents of school choice are conceding disappointment. Earlier this year, Weekly Standard contributor Daniel Casse reported, "The two most recent studies show that, since the implementation of the voucher program, reading scores across all Milwaukee schools are falling." Howard Fuller, patron saint of the voucher program, has wryly acknowledged, "I think that any honest assessment would have to say that there hasn't been the deep, wholesale improvement in MPS [Milwaukee Public Schools] that we would have thought." Manhattan Institute scholar Sol Stern, one-time choice enthusiast and author of Breaking Free: Public School Lessons and the Imperative of School Choice, brought the concerns to a boiling point earlier this year when he declared, "Fifteen years into the most expansive school choice program tried in any urban school district [there is] . . . no ‘Milwaukee miracle,' no transformation of the public schools has taken place.". . .

Today, the Milwaukee voucher program enrolls nearly twenty thousand students in more than one hundred schools, yet this growing marketplace has yielded little innovation or excellence. The Milwaukee Journal Sentinel recently described 10 percent of voucher schools as having "alarming deficiencies." These include Alex's Academics of Excellence, which was launched by a convicted rapist, and the Mandella School of Science and Math, whose director overreported its voucher enrollment and used the funds to purchase two Mercedes-Benzes. Veteran Journal Sentinel writer Alan Borsuk has opined, "[The Milwaukee Parental Choice Program] has preserved the status quo in terms of schooling options in the city more than it has offered a range of new, innovative, or distinctive schools."

Wisconsin headline writers have had a field day, with the Capital Times and Milwaukee Magazine featuring the likes of "The Failure of School Choice," and "Whoops, We Goofed: School Choice Doesn't Work Like Its Supporters Promised. Gulp. Now What?" . . .

While research suggests that some participating students benefit from private school vouchers, these results may largely reflect the ability of students in places like New York City or Washington, D.C., to find empty seats in established parochial schools. There is little evidence that voucher or choice programs have succeeded in fostering the emergence or expansion of high-quality options.

Similar concerns plague the charter movement nationally, even as the number of charter schools has surged above four thousand and charter enrollment has passed the one million mark. The U.S. Department of Education's National Center for Education Statistics has compared the performance of students in district and charter schools, reporting, "After adjusting for student characteristics, charter school mean scores in reading and mathematics were lower, on average, than those for public noncharter schools." . . .

Stig Leschly, executive director of the Newark Charter School Fund, has observed that only about two hundred of the thousands of existing charter schools "really close the achievement gap." . . .

Among the eight cities where charter schools enroll 20 percent or more of students are Detroit, Michigan; Youngstown, Ohio; and Washington, D.C. In 2007, Education Week reported that, despite a substantial charter presence, Detroit had the highest dropout rate among the nation's large school systems. A 2007 analysis found that just 57 percent of Youngstown's charter schools, and just 38 percent of its district schools, met Ohio's growth targets for student improvement in reading and math.

In a study of Washington, D.C., which has one of the nation's highest rates of charter school enrollment, researchers Margaret Sullivan, Dean Campbell, and Brian Kisida found no evidence of improvement in D.C. public schools even as they lost nearly a third of their students to charter school competition. They traced inaction to a district "hampered by political dynamics and burdensome regulations." . . .

ATHEISTS IN THE FOXHOLE SUE OVER ABUSE BY MILITARY RELIGIONISTS

Jeremy Hall (second from right) & Dustin Chalker (far right)

Jason Leopold, The Public Record - The U.S. Army has been subjecting soldiers to fundamentalist Christian prayer ceremonies against their will during mandatory military events in violation of their basic constitutional rights, according to a new lawsuit filed against Secretary of Defense Robert Gates by a U.S. Army soldier.

On at least three occasions beginning in December 2007, Army Spc. Dustin Chalker claims he was directed to attend military events, one of which was a barbecue, where an Army battalion chaplain led a Christian prayer ceremony for military personnel. Chalker, who said he is an atheist, asked his superiors for permission to leave the prayer sessions and on each occasion his request to be excused was denied, according to the lawsuit.

Despite Chalker's objections to being subjected to fundamentalist Christian prayer sessions, his Army superiors continuously forced him to attend other military events where the prayer ceremonies continued. . .

Chalker, 23, who has served in Iraq and Korea since February 2002 and was awarded a Purple Heart and a Combat Medic Badge, is the second Fort Riley solider to file a lawsuit against Gates alleging civil rights violations.

Spc. Jeremy Hall, who is also an atheist, sued the defense secretary and his supervising officer last year for allegedly trying to force him to embrace fundamentalist Christianity and then retaliating against him when he refused. . .

ARMY'S OCCUPATION FORCE IN U.S.

We have previously noted that the Army is bringing back an occupation force in Iraq to engage in similar activities in the United States in case of an emergency. While this may not be a first it is precisely what the Posse Commitas Act was designed to prevent

Infowars - Section 1385 of the Posse Comitatus Act states, "Whoever, except in cases and under circumstances expressly authorized by the Constitution or Act of Congress, willfully uses any part of the Army or the Air Force as a posse comitatus or otherwise to execute the laws shall be fined under this title or imprisoned not more than two years, or both."

Under the John Warner Defense Authorization Act, signed by President Bush on October 17, 2006, the law was changed to state, "The President may employ the armed forces to restore public order in any State of the United States the President determines hinders the execution of laws or deprives people of a right, privilege, immunity, or protection named in the Constitution and secured by law or opposes or obstructs the execution of the laws of the United States or impedes the course of justice under those laws."

However, these changes were repealed in their entirety by HR 4986: National Defense Authorization Act for Fiscal Year 2008, reverting back to the original state of the Insurrection Act of 1807.

The original text of the Insurrection Act severely limits the power of the President to deploy troops within the United States.

For troops to be deployed, a condition has to exist that, "(1) So hinders the execution of the laws of that State, and of the United States within the State, that any part or class of its people is deprived of a right, privilege, immunity, or protection named in the Constitution and secured by law, and the constituted authorities of that State are unable, fail, or refuse to protect that right, privilege, or immunity, or to give that protection; or (2) opposes or obstructs the execution of the laws of the United States or impedes the course of justice under those laws. In any situation covered by clause (1), the State shall be considered to have denied the equal protection of the laws secured by the Constitution."

PRESIDENTIAL DEBATE DRINKING GAME

From the Seminal. Sorry we didn't find this in time for the first debate, but there's still time for fun.

Every time John McCain mentions his POW experience, praise his courage and drink a kamikaze. This one is only for the heavy drinkers.

Every time Obama says change everyone has to switch seats and drink the other person’s drink of choice.

Every time John McCain tries to associate Barack Obama with an unsavory character, take a sip of your dirty martini.

Every time someone says bailout you have to finish your drink and pour another.

Every time John McCain says "my friends", spit out your drink and shout "I am not your friend" at the television.

Every time "evil", "evil doers", or anything with evil is mentioned, drink a sip of French red wine.

Every time John McCain threatens Iran, drink a savage car bomb or cherry bomb.

Every time Barack Obama ties John McCain to George W. Bush, drink a sloe gin fizz and wish for better days. . .

When Georgia is mentioned, drink a fuzzy navel.

Every time John McCain mentions Sarah Palin, drink a white russian. After all, if Sarah Palin is around there must be a Russian nearby somewhere.

Every time John McCain smiles creepily, drink a roofie-colada.

If anyone mentions a golden parachute, pound some goldschlager.

Every time John McCain makes an appeal to states rights, lean back and take a sip of that sweet southern comfort. . .

Every time John McCain says anything, take a drink from the oldest, crappiest bottle you have-that skunked beer in the back of the fridge, the two-dollar wine someone gave you for your birthday five years ago, the dregs from that bottle of Popov vodka left over from a party you had in February-because you’ve heard it all before, and you didn’t much like it the first time.

Regardless of what either candidate says, at the end of the debate, drink something that must be lit on fire first, then hit yourself in the face with a shovel.

PASSINGS: PAUL NEWMAN

CNN - [Paul Newman] He stumped for liberal causes, including Eugene McCarthy's 1968 presidential candidacy, and earned a spot on Richard Nixon's enemies list -- "the highest single honor I've ever received," he said. In 1982, Newman and his friend A.E. Hotchner founded Newman's Own, a food company that produced food ranging from pasta sauces to salad dressing to chocolate chip cookies. "The embarrassing thing is that the salad dressing is outgrossing my films," Newman once wryly noted.

Paul Leonard Newman was born on January 26, 1925, in Shaker Heights, Ohio, a suburb of Cleveland. His father owned a successful sporting goods store, but young Paul was taken with his mother's and uncle's interest in the arts and started acting while still in grade school. "I wasn't running toward the theater but running away from the sporting goods store," he said later.

After being kicked out of Ohio University for unruly behavior, he joined the Navy and served for three years during World War II. After the war he attended Kenyon College in Gambier, Ohio, where his unruly ways led him to theater. . .

In 2007, Newman said he was retiring from acting, saying he'd lost confidence in his abilities. Still, he marveled at his own resilience.

"You can't be as old as I am without waking up with a surprised look on your face every morning: 'Holy Christ, whaddya know - I'm still around!' It's absolutely amazing that I survived all the booze and smoking and the cars and the career."

CRASH TALK

Portland Press Herald - The state of Maine could not float a $50 million transportation bond this week because traders told officials there was "no market" at all for large financial transactions such as this one. . . "In 34 years I have never had a trader say, 'I can't give you a sale price. There is no market,' " said Maine Municipal Bond Bank Executive Director Robert Lenna, describing his efforts to sell the bond on Wall Street. A week ago, Lenna said, the interest rate for the AA-rated revenue bond would have been about 3.8 percent or 3.9 percent. But on Tuesday, short-term interest rates, a factor used to calculate interest rates for municipal bonds, soared as high as 9 percent and 10 percent, effectively shutting down market activity.

Our Future - Representatives from top progressive and labor groups-- including the Campaign for America's Future, AFL-CIO, SEIU, AFSCME, AFT, NEA, ACORN, Alliance for Justice, Center for American Progress and Center for Community Change -- met at an emergency closed-door meeting yesterday to develop a statement of principles for bailing the American economy out of its financial woes:

1. Public Oversight. This kind of power can never be centralized in a single individual - much less one who did not even stand for election. Any funds must be controlled by an independent entity, with consumers and workers given seats on its board. Congress should be empowered to name independent monitors and to approve all board members.

2. Protect the Taxpayer. The Treasury bill would have taxpayers buying paper that nobody else wants at prices far above its current value. If a firm wants to auction off its toxic paper to the US Government, taxpayers should get equity in that firm equal to any amount paid in excess of the paper's value. This will deter profitable firms from using the government as a dumpster for their toxic paper. And it will insure that if the bailout works and the firms become profitable, taxpayers, not simply bankers, benefit from the upside.

3. Curb the casino. This crisis was caused because sensible regulations of the banking system that worked for dozens of years were dismantled or went unenforced. No bailout can go forward without requiring the necessary regulation to insure this does not happen again. Any institution, which receives assistance, should agree to come under a microscope going forward in terms of disclosure requirements, and it should have stringent capital requirement imposed upon it.

4. Invest in the real economy. Ending the bankers' strike is not sufficient enough to avoid the recession into which we have been driven. Major public investment in new energy and conservation, rebuilding schools and infrastructure, extending unemployment and food stamps, helping states avoid crippling cuts in police and health services - is vital to get the real economy moving and put people back to work. No bailout should proceed without being linked to support for a major public investment plan to get the economy going.

5. Hold CEOs and Boards of Directors Accountable. Wall Street CEOs shouldn't be pocketing millions while taxpayers are forced to bail them out. Any firm that applies for relief must agree to cancel all stock option programs and CEOs should have stringent limits placed on their compensation until the Company has repaid all taxpayer assistance.

6. Aid the victims, not just the predators. Both bankers and home owners made foolish bets that home prices would keep rising. Many homeowners, however, were misled by predatory lenders into taking mortgages that they didn't understand and couldn't afford. It would be simply obscene to help the predators and not those that they preyed upon. No bail out of the banks should take place without measures to help people in trouble stay in their homes. Explicit provisions should ensure use of the full array of financial and legal tools available to the government to stop foreclosures and restructure home mortgage loans for ordinary Americans, including amending the bankruptcy code to allow judges to modify mortgages. Where workouts are not feasible, people should be allowed to stay in their homes as renters.

Joseph E. Stiglitz, Nation - There are four fundamental problems with our financial system, and the Paulson proposal addresses only one. The first is that the financial institutions have all these toxic products--which they created--and since no one trusts anyone about their value, no one is willing to lend to anyone else. The Paulson approach solves this by passing the risk to us, the taxpayer--and for no return. The second problem is that there is a big and increasing hole in bank balance sheets--banks lent money to people beyond their ability to repay--and no financial alchemy will fix that. If, as Paulson claims, banks get paid fairly for their lousy mortgages and the complex products in which they are embedded, the hole in their balance sheet will remain. What is needed is a transparent equity injection, not the non-transparent ruse that the administration is proposing.

The third problem is that our economy has been supercharged by a housing bubble which has now burst. The best experts believe that prices still have a way to fall before the return to normal, and that means there will be more foreclosures. No amount of talking up the market is going to change that. The hidden agenda here may be taking large amounts of real estate off the market--and letting it deteriorate at taxpayers' expense.

The fourth problem is a lack of trust, a credibility gap. Regrettably, the way the entire financial crisis has been handled has only made that gap larger.

Michael Hudson, Counterpunch - These bad loans are toxic because they can only be sold at a loss - if at all, because foreign investors no longer trust the U.S. investment bankers or money managers to be honest. That is the problem that Congress is not willing to come out and face. Many of these loans are outright fraudulent. And they are being sold by crooks. Crooks who work for banks. Crooks who use accounting fraud - such as the fraud that led to the firing of Maurice Greenberg at A.I.G. and his counterparts at Fannie Mae, Freddie Mac and other companies engaging in Enron-type accounting.

This is not what the magic of compound interest promised. But it is where it had to end up, with mathematical inevitability. It was an advertising come-on for Wall Street money managers and promoters of "pension-fund capitalism" (or "peoples' capitalism" as it was called in Chile by the Chicago Boys working for General Pinochet's murderous regime, and Margaret Thatcher's Conservatives in England). The promise is that if people consign these funds to individuals who make much, much more than they do but have the survival-of-the-fittest advantage of being much, much more greedy, they will receive a perpetual doubling of interest. That is how retirements for American workers are still supposed to be paid - by magic, not by direct investment. Prospective retirees are supposed to ensure a good life by investing savings in loans to corporate raiders who fire, lay off, downsize and outsource these very workers. The trick is to persuade employees to hand retirement funding over to financial managers whose idea was to make money off the economy by extracting interest and dividends off workers, homeowners and companies being bought on debt leverage. In the final analysis it is debt leverage by itself that is supposed to fuel capital gains.

This has led to madness. The maddest solution of all would be for the government to give the extractive financial sector even more money - funds that no private lenders have been willing to provide, not even vulture funds. No private firm has been able to discover what Mr. Paulson and the unfortunate Mr. Bernanke are sanctimoniously promising: that a viable deal, even an almost money-making one, can be made by buying junk now and waiting for "the economy" to make it good. . .

Promises that "taxpayers" will be able to recover a large part of this money are a fiction. If there were a hope of recovering this money, then investors abroad - foreign buyout funds, foreign banks, foreign sovereign wealth funds - would have been willing to buy Bear Stearns, Lehman Brothers, A.I.G. and other companies at some price. But they wouldn't touch this at any price. . .

Here's why the government giveaway logic is fallacious: It's a giveaway, not a bailout. A bailout is designed to keep the boat afloat. But the existing Wall Street boat crafted by the investment bankers seeking to unload their junk must sink. The question as it sinks is simply who will be able to grab the lifeboats, and who drowns.

There is a reason why the banks won't lend: Housing and commercial real estate already are so heavily mortgaged that there is no rental value available (over and above operating expenses, current taxes and debt service) to pledge to the banks. It still costs more to buy a house than to rent it. No increase in the amount of credit, short of hyper-inflation can cure this. No lowering of interest rate, will lead banks to risk making a bad new loan - that is, a loan that probably will go bad and end up with the bank taking a loss after the borrower walks away or defaults. . .

Here's the problem with following Mr. Paulson's orders and lending yet more: Every major real estate advisor on record has forecast a further drop of between 20 to 30 percent in property prices over the coming twelve months. This is now the standard forecast. It means that over and above the five million arrears and foreclosures that Mr. Paulson acknowledged already are on the books, yet more families are to give up the fight by this time next year. Is the $700 billion giveaway fund to try and recoup by evicting them too from their houses - to pay the "taxpayer" enough to bail out Countrywide, Washington Mutual and other predatory lenders for loans that state Attorneys General have accused of being fraudulent?

For the government to even begin to recover some of the value of the $700 billion in junk mortgages it has bought would force new homebuyers to pay even more of their income to the banks. And if they do that, they will have less income to spend on goods and services. The domestic market will shrink, and tax revenues will fall at the state, local and federal levels. The debt overhead will deflate the economy, causing shrinkage all down the line.

It is necessary, even inevitable, for the volume of debt to come down - not up - to restore equilibrium. The economy was well on its way to preparing the ground for this last week. As Alan Meltzer of the American Enterprise Institute (of all places) explained on McNeill-Lehrer, Merrill Lynch was able to be sold at 22 cents on the dollar; and the economy survived Lehman Brothers and Bear Stearns being wiped out.

Such debt writes-offs are a precondition for writing down America's mortgage debts to levels that are affordable. But Mr. Paulson's plan is to fight against this tide. He wants the Wall Street to keep on raking in money at the expense of the economy at large. These are the big banks who lobbied Congress to appoint de-regulators, the banks whose officers paid themselves enormous bonuses and gave themselves enormous golden parachutes. They were the leaders in the great disinformation campaign about the magic of compound interest. And now they are to get their payoff. . .

It gets worse. If Congress should be so destructive as to buy out $700 billion of bad loans (for starters), the sellers will do just what Russia's kleptocrats did. They will take their money and move it abroad to a "hard" currency country. This will help collapse the dollar. Up will go gasoline costs and prices for other imports. America will be turned into a Russian-style post-Soviet economy, having endowed a new domestic kleptocracy of insiders, who use some of their gains to finance the campaigns of American Yeltsins such as McCain.

So let us admit that the economy has been taking a wrong track for a number of decades now. As John Kay noted : "When the dust settles, many banks and hedge funds will have lost more money on their trading activities in the past year or so than they had made in their entire history . . . The pursuit of shareholder value damaged both shareholder value and the business."

Peter J. Solomon & Anders J. Maxwell - Secretary Paulson has united the country - in opposition to the bill to bail out the global credit markets and, as usual, the country's got it right. . . Simply stated, the $3.5 trillion commercial paper market - which finances the short-term credit of U.S. corporations - is on the brink of drying up, the result of which would be a run on the already illiquid banking system. . .

The markets need funding - but like Warren Buffet just provided to Goldman Sachs and the Treasury provided AIG. The Treasury's plan may provide instant liquidity, but it fails to address the underlying issue; namely, the markets need the funding necessary to support refinancings. Paulson's plan fails to address this instant requirement. Ironically, it risks another round of misvaluation of assets at the expense of the U.S. taxpayer, usurps the market's role of price setting, and removes accountability and prospects for eventual loss or gain from the managements and investors who placed these bets in the first place.

The Depression era Reconstruction Finance Corporation was a successful model from 1929 through WWII. It accomplished funding of illiquid and under capitalized private companies such as banks by investing in preferred stocks. The RFC invested $3 billion and got back $3 billion. It was an independent agency with legislative over-sight. It was run professionally.

The Administration has chosen as its model the Resolution Trust created in the 1980's to handle the savings and loan crisis. It was run by the Treasury. Taxpayers lost almost $300 billion. The market was too smart for even the best of our politicians and bureaucrats. Private sector sharpies picked the Treasury's and taxpayers' pockets. . .

Alternatively, follow Buffet's example. Invest the $700 billion in viable financial institutions deemed beneficial to the public interest. Delegate decisions to experienced and disinterested professionals - not politicians.

This and subsequent Administrations and Treasury Secretaries have no business setting the values of securities. The magnitude and risk of the undertaking demand an equity return for taxpayers. Neither of these prerequisites is respected by the current Plan. It's bad politics and it's bad business.

Michael Lewis, Bloomberg - One of the things they say is that, in leaving Goldman for government service, Paulson made the greatest trade of his life. Not only was he required to sell his half-billion dollars in Goldman stock near the high, but also, as Treasury Secretary, he was exempt from capital-gains taxes. By getting out of Goldman while the getting was good, the guy may have doubled his net worth. . .

Think of Wall Street as a poker game and Goldman as the smartest player. It's sad when you think about it this way that so much of the dumb money on Wall Street has been forced out of the game. There's no one left to play with. Just as Goldman was about to rake in its winnings and head home, the U.S. government stumbles in, fat and happy and looking for some action. I imagine the best and the brightest inside Goldman are right this moment trying to figure out how it uses the Treasury not only to sell their own crappy assets dear but also to buy other people's crappy assets cheap.

At any rate, it won't take long for Goldman Sachs to figure out how to make that $700 billion work for Goldman Sachs. This you can trust them to do. After all, Warren Buffett just did.

SF Chronicle - A year ago, as The Chronicle began portraying the strange world of subprime and explaining why people suddenly were so worried about foreclosures, it profiled four Bay Area families facing the loss of their homes, telling their personal stories and tracing the history of their loans. All had subprime mortgages that were clearly unaffordable, with monthly payments that ate up almost their entire income, leaving next to nothing for food, gas or utilities. . .

One homeowner, Johnny Pitts, was a Muni bus driver who had bought an Oakland home for $429,950 in 2005. His mortgage payment, which had started at $2,880, was about to reset to $3,730 a month - plus $750 more for taxes and insurance. Home payments are supposed to be no more than 40 percent of income. By that formula, the necessary income would have been $11,200 a month or $134,400 a year. . . In fact, Pitts's take-home pay was just $4,000 a month. Loans both 100 percent.

The other homeowners, Jeff and Vanessa Hahn of Fairfield, were on the hook for monthly payments of $5,000 - exactly the amount they earned together as a self-employed businessman and teacher.

As for loan to value, in both cases it was 100 percent - hardly a desirable ratio. Pitts had a piggyback second loan; together the two loans accounted for the full purchase price. The Hahns had done a cash-out refinance for their home's full assessed value of $570,000 in March 2007, a few months before the article was written. . . Both borrowers had tarnished credit. Presumably, that high risk was why they both received "low introductory rate" mortgages that started at just above 10 percent.

Letter from a large group of economists - As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. . .

1) Its fairness. The plan is a subsidy to investors at taxpayers' expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.

2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwards.

3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.

For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come.

SWAMPOODLE REPORT: WHERE WILL THE MONEY GO?

Sam Smith

In Washington, for officials and media alike, numbers are treated like adjectives - created, inflated or diminished to serve the purpose of the moment. So instead of saying "awesome," one declares "$700 billion," as confirmed by the Treasury official who admitted to Forbes that the figure had been pulled out of the air.

Everyone just says it's a crisis and goes about their business resolving it with the same disinterest in solid information that got them into the mess in the first place.

Having been taught by Miss Darnell in high school that you can't add apples and pianos, I have been looking futilely for some hint of a budget for the $700 billion, some sign that the hard working negotiators had actually seen some hard spreadsheets and what was on them, some moderately detailed information on who will get the money and what it will be used for. It's what simpler folk call a budget.

I'm not questioning the existence of the crisis, only it's shape. For example, it is widely assumed that housing foreclosures are the central problem. Good, let's see the figures. How much of the $700 billion will go to cover bad housing loans and how much will go for things such as losses that multi-millionaire speculators experienced in wild business ventures or sneaky fiscal manipulations? How much is funny money, created out of leveraging by hedge funds and others? How much of the loss involves foreign speculators or foreign investments by American speculators?

Finally, how much involves the fiscal cleansing of criminal cash, such as from an illegal drug industry estimated to be as large as legal pharmaceutical trade? Bear in mind, for example, that last year the Coast Guard seized nearly $5 billion worth of cocaine. Yet, together, all of law enforcement grabs but a small percentage of the drugs that are out there, the rest generating huge amounts of cash yearning to be laundered.

Now let's take a closer look at those housing foreclosures. Consider this tale of a home's woe from the Washington Post:

"The most recent owner, Phyllis High Jones, refinanced the house through Countrywide Home Loans in 2006, taking out a $208,000 mortgage that would gradually inflate to $226,000. That same year, Fannie Mae bought the loan from Countrywide. Then the housing market collapsed in Prince William County. Jones defaulted this year. The townhouse went up for auction, but there were no takers. Fannie Mae had no choice but to become the buyer of record -- sale price $226,000. This summer, Fannie Mae tried to sell the townhouse for $149,000. Still no reasonable offers. The price has now been lowered to $69,900."

By current bookkeeping, that is a $226,000 loss added to the federal books. But did it have to be? Unless she was trying to sell her home, the fact that the housing market collapsed doesn't explain Jones' default. More likely the increase in the mortgage and/or some personal problems made it impossible for her to cover it. Thus what appears to be a $266,000 loss may in reality only have been one as small as $18,000 (the change in her mortgage) or the $266,000 minus whatever she still able to pay.

Instead of buying the mortgage for $226,000, Fannnie Mae could have become a passive equity partner with Jones in the amount of whatever Jones couldn't handled. Let's say Jones could have supported all but $69,900 of her mortgage; Fannie Mae would assume that portion. Today, Jones would still have her house, Fannie Mae would have saved itself $156,100 plus whatever profit it makes on its equity when the house is sold down the road, and there would be no fire sale going on - lowering other house prices in the neighborhood.

Multiply this approach by the 54,000 foreclosed homes Fannnie Mae had last June, and the national story changes dramatically.

But Washington doesn't deal with numbers that way. Here are a few examples of how numbers are really handled in the capital, with one of the most important facts being that you probably rightly don't recall the media making much of them.

For example, this from the Christian Science Monitor last April:

|||||| The Pentagon has gone hundreds of billions of dollars over budget in recent years on key weapons systems, including aircraft, ships, and satellite, said a government audit. The Government Accountability Office said for the sixth year in a row that the Pentagon had significantly gone over budget, but according to a report presented to Congress this week, the problem is getting worse.

The Washington Post reports: 'The Government Accountability Office found that 95 major systems have exceeded their original budgets by a total of $295 billion, bringing their total cost to $1.6 trillion, and are delivered almost two years late on average. . . Auditors said the Defense Department showed few signs of improvement since the GAO began issuing its annual assessments of selected weapons systems six years ago.

"Every dollar spent inefficiently in developing and procuring weapon systems is less money available for many other internal and external budget priorities – such as the global war on terror and growing entitlement programs (such as social security)," Gene Dodaro, the GAO's acting comptroller general, said in the report." ||||||

$1.6 trillion - double the amount of the current proposed bailout - and it's one day's news in a few papers and then forgotten.

And it's not a new problem. Back in 2002, CBS reported:

|||||||| According to some estimates we cannot track $2.3 trillion in transactions," [Defense Secretary] Rumsfeld admitted. $2.3 trillion - that's $8,000 for every man, woman and child in America. To understand how the Pentagon can lose track of trillions, consider the case of one military accountant who tried to find out what happened to a mere $300 million.

"We know it's gone. But we don't know what they spent it on," said Jim Minnery, Defense Finance and Accounting Service.

Minnery, a former Marine turned whistle-blower, is risking his job by speaking out for the first time about the millions he noticed were missing from one defense agency's balance sheets. Minnery tried to follow the money trail, even crisscrossing the country looking for records.

"The director looked at me and said 'Why do you care about this stuff?' It took me aback, you know? My supervisor asking me why I care about doing a good job," said Minnery.

He was reassigned and says officials then covered up the problem by just writing it off.

Twenty years ago, Department of Defense Analyst Franklin C. Spinney made headlines exposing what he calls the 'accounting games.' He's still there, and although he does not speak for the Pentagon, he believes the problem has gotten worse. 'Those numbers are pie in the sky. The books are cooked routinely year after year,' he said. |||||||||

Closer to the topic at hand, you probably also didn't know that $59 billion (twice what is expected to be needed to bail out Fannie Mae) couldn't even be accounted for when Andrew Cuomo left as head of Housing & Urban Development in 2001. Said a spokesman for the HUD inspector general: "There is no audit of the financial statements for 1999. The department said they decided not to reissue any of the stuff we mentioned that was problematic - they’re not going to give us what we went through. They simply said, ‘Fine, thanks.’ They said, ‘Okay that was 1999 - what a mess now - let’s move on.'"

There recently has been a lot of talk about earmarks - which used to be called pork barrel until the hog industry apparently sent its metaphor police to Washington. In fact, all the earmarks currently in the budget amount to less than one third of the money you didn't even know had been missing over at HUD.

Why are earmarks so important, then? In part because we know exactly how the money is being spent, whether to help fund needed medical research or build bridges to nowhere in Alaska. They are an odd sum in the national budget that everyone can understand. They are, in that sense, a rare virtue: an oasis of specificity in a desert of uncertainty.

In a sense, the mysterious $700 billion is completely in sync with Washington accounting. No one knows what's it is for, how it will be spent and, when it's gone, who will have gotten what and who will have benefited the most. So don't be surprised at all the surprises they forgot to tell you.

Thursday, September 25, 2008

The Financial Crisis: How and Why Congress Should Play for Time

Published on Wednesday, September 24, 2008 by CommonDreams.org

The Financial Crisis: How and Why Congress Should Play for Time

by Robert Weissman

Here's the situation: Thanks to its own inability to control itself, Wall Street is now facing a crisis unmatched since the Great Depression. Unfortunately, a collapse of the financial sector would not only hurt rich investors, it would devastate the global economy. So, government action is imperative.

Treasury Secretary Henry Paulson and Federal Reserve Chair Ben Bernanke say immediate Congressional legislation is imperative. And Congress is adjourning at the end of this week, with Members eager to get back to their districts and states to campaign.

But there is no way to handle the complexity of a $700 billion bailout in a few days.

There are some really hard questions about how to structure a Wall Street bailout program. Financial firms have to be subsidized, but they also have to feel some serious pain. Figuring out who to subsidize, and how much, is tricky. Determining how to ensure taxpayers get the best and fairest payback from the subsidized financial institutions is complicated. And developing a transparent and accountable structure to administer a $700 billion program buying and selling exotic securities is no easy matter.

Meanwhile, it would be unconscionable to bail out Wall Street but not protect homeowners and renters in homes that may be foreclosed on. Between allegedly super-sophisticated Wall Street hot shots and people who were fooled into taking bad mortgages -- or who have the misfortunate of renting from a landlord who's being foreclosed on -- it's obvious who is more deserving of government assistance. But Congress and the President have not been able to agree on plans anywhere near commensurate with the scale of the problem over the past year-plus. It's very hard to see how a proper and sufficiently scaled system of protection and assistance for homeowners and vulnerable renters is agreed upon in a few days.

The current financial mess is the outgrowth of a quarter-century rollback of regulations that controlled what financial firms could do, and protected financial titans from their own worst instincts. Wall Street is chastened right now, but it is a 100 percent certainty that the speculative culture will reemerge with a vengeance -- and in much shorter order than many now seem to believe -- unless regulatory standards are imposed to prevent a repeat of the current disaster. Legislation affording Wall Street what may be the biggest bailout in history is the time to attach new, robust regulatory rules. There are a lot of good ideas floating around about sound financ

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Tuesday, September 30, 2008

Fueling the Fire of Real Change

Wrecking, Wrecking, Wrecked

We Have the Money

If Only We Didn't Waste It on the Defense Budget

Obama's Missed Opportunity

Falsehoods Unchallenged

Other Misleading Statements Unchallenged

Hawkishness Unchallenged

Flawed Logic Unchallenged

Top 5 Reasons to Vote Against Wall Street's $700 Billion Bailout

The Rich Are Staging a Coup This Morning ...a Message From Michael Moore

The Power of 'No' and the Need to Keep the Pressure on Congress

The End of Free-Market Fundamentalism?

But is it really? And where is American capitalism headed?

Correa Celebrates Victory In Constitutional Referendum

An Appropriately Populist Anti-Bailout Rant

House Votes Down Financial Bailout Deal

Monday, September 29, 2008

Thursday, September 25, 2008

The Financial Crisis: How and Why Congress Should Play for Time