Bush / GOP

Dr. Robert Shapiro, Chair of NDN's Globalization Initiative, and Simon Rosenberg, NDN President, today released the following statement:

The current financial crisis was caused by the persistent failure of the current Administration and the Federal Reserve to appreciate how our financial markets have been rapidly changing or to take minimal care to ensure that those changes did not put the American economy at serious risk. The Treasury and the Fed now are using nearly $1 trillion of Americans' money to bail out financial institutions whose reckless mismanagement they tolerated or ignored. The Congress must put at least as much effort into containing the crisis at one of its critical origins, by helping people keep their homes so the housing market and the derivative instruments based on it can stabilize.

Before Congress leaves, it should enact legislation that allows struggling Americans to renegotiate their mortgages, starting with the huge portfolio the government now holds through Fannie Mae and Freddie Mac. It should not be acceptable for our government to use taxpayers to bail out huge, mismanaged banks and insurance companies that speculated in mortgage-backed securities while allowing many of those same taxpayers to be tossed from the homes that backed up those securities. When Congress returns, it also should turn to the serious business of applying strict and appropriate transparency, capital and other regulatory standards to all significant financial institutions, including investment banks and hedge funds. And the politicians who hailed the hands-off attitude that enabled this crisis to fester and break out, and now blame greed instead of their own negligence, should be held accountable.

You can feel it. The Obama campaign is firing on all cylinders, driving the news cycle now, hitting McCain hard, systematically taking Palin down, announcing an extraordinary fundraising month and expanding its grassroots base, making much better use of Biden and other surrogates, and finding their voice on the economy as never before. The McCain campaign is on the defensive, reeling from harsh criticism of McCain's character and working to contain the downside of Governor Palin. The new McCain ads, issue-based, without the wildness of earlier ads, speak to a chastened McCain camp. The national tracks have shown a 1-2 point shift in the race this week toward Senator Obama.

Today the race is still dead even. But Senator Obama has seized the initiative, and the momentum has shifted from Palin to the Democratic ticket. 

I still think the greatest challenge facing McCain is that he has no real plan for the future, and that running on a culture war and character simply isn't going to be enough in this election given all the very serious stuff going on. As Jake wrote yesterday, the two main arguments of the new McCain TV ad - that lower taxes will create jobs, and drilling will lower gas prices - are not true, and not promises America can bank on. 

The lack of seriousness of the McCain campaign - and the whole national Republican Party at this point - is simply astonishing. 

But at least, as Tina Fey says, the good Governor can see Russia from her porch. 

The further weakening of America's financial markets is tossing a major new issue into the Presidential race, one, that today, appears to make the job of the national GOP and their ticket much harder. U.S. Sen. Barack Obama opened up this new debate with this well-crafted statement:

"This morning we woke up to some very serious and troubling news from Wall Street.

"The situation with Lehman Brothers and other financial institutions is the latest in a wave of crises that are generating enormous uncertainty about the future of our financial markets. This turmoil is a major threat to our economy and its ability to create good-paying jobs and help working Americans pay their bills, save for their future, and make their mortgage payments.

"The challenges facing our financial system today are more evidence that too many folks in Washington and on Wall Street weren't minding the store. Eight years of policies that have shredded consumer protections, loosened oversight and regulation, and encouraged outsized bonuses to CEOs while ignoring middle-class Americans have brought us to the most serious financial crisis since the Great Depression.

"I certainly don't fault Senator McCain for these problems, but I do fault the economic philosophy he subscribes to. It's a philosophy we've had for the last eight years - one that says we should give more and more to those with the most and hope that prosperity trickles down to everyone else. It's a philosophy that says even common-sense regulations are unnecessary and unwise, and one that says we should just stick our heads in the sand and ignore economic problems until they spiral into crises.

"Well now, instead of prosperity trickling down, the pain has trickled up - from the struggles of hardworking Americans on Main Street to the largest firms of Wall Street.

"This country can't afford another four years of this failed philosophy. For years, I have consistently called for modernizing the rules of the road to suit a 21st century market - rules that would protect American investors and consumers. And I've called for policies that grow our economy and our middle-class together. That is the change I am calling for in this campaign, and that is the change I will bring as President,"

It will be interesting to see how the McCain campaign responds. Over the next seven weeks, its goal has to be to talk about anything other than the economic performance of this GOP era.

As the Congress moves closer to bipartisan energy legislation, John McCain is nowhere to be found. Instead his campaign – on the one issue that was supposed to separate him from Bush – is clinging to the old energy paradigm. It's hard to believe, but John McCain is now more out of touch than most of the Republican members of the U.S. Senate.

Bipartisan energy legislation, discussed today at the U.S. Senate’s energy summit, has gained momentum through the work of the "Gang of 10/16/22," and now looks to be one of three proposals that will come up in the Senate next week. (The House is also at work on bipartisan legislation.)

U.S. Sen. Barack Obama has said he is willing to accept a compromise on drilling to advance energy legislation that includes provisions for the expansion of renewable energy and efficiency. McCain, meanwhile, is stuck in a dogmatic anti-tax fuzz. Left behind by much of his party, McCain unwilling to compromise, show up to vote, or take any sort of stand to help make moves on energy.

Meanwhile, the bottom half of the McCain ticket has pledged to try to move him toward drilling in ANWR, which shouldn’t be hard since he only recently moved away from an opposition to drilling in the OCS to a wholehearted, singular support of it, and since he looks to be moving away from supporting Cap and Trade climate legislation.

This move away from Cap and Trade isn’t a surprise, as coming up with a serious energy policy doesn’t seem to be a goal of his ticket. Since his VP candidate knows more about energy than just about anyone else, and doesn’t believe climate change is man made – despite her absurd claims on television last night that she had never said that – John McCain owes American voters a big clarification as to where he stands on energy.

It looks like he may get the chance next week. Will he step up to plate and vote, or will his old, no show ways get left in the dust by Democrats and Republicans alike? Next week, when John McCain finds himself looking to the right on energy and only seeing James "Global Warming is a hoax" Inhofe, he’ll find himself running on empty. (Unless Jackson Browne sues him again.)

Last night, House Leadership came together on a package that dramatically expands both offshore drilling and renewable energy. The bill is designed, as NDN Green Project Director Michael Moynihan writes, to be palatable to Republicans, as it gives them almost all of what they want on drilling.

The comprehensive package, as described by the E&E Daily (subscription required):

The drilling provisions are part of a broad package that includes a repeal of oil industry tax breaks for major companies, new renewable energy mandates and investments, a new fund to speed deployment of carbon control technology, and many other measures.

Have no doubts, this is a moment of truth for Republicans in the House. (Next week, Republicans in the Senate will likely get a similar opportunity.) If Republicans truly are for an "all of the above" energy solution, this package is their chance to vote for one.

If Republicans continue their obstructionism on actually achieving anything on energy by nitpicking at this legislation, they, and not the Democratic Congress, will be responsible for failing to lower energy prices, failing to break America’s dependence on foreign energy, failing to confront climate change, and failing to harness the clean energy economic opportunity.

And just for fun - I think Matt Damon brings up a good point.

I love the comment a VERY conservative friend of mine made when I sent him this video: "Caring or quoting what celebrities think about anything is usually cause for a punch line, but in this case, he happens to be correct."

His comment reflects how during this election, unlike any other, people are switching parties, switching preferences, and reflecting over a broader array of issues that are less substantive but no less relevant - issues like race and age in a Presidential election, the role of a Vice Presidential nominee - much more than in the past.

The price of what are called “credit default swaps” for U.S. Treasury debt is rising sharply. Credit default swaps are financial instruments by which one investor holding debt pays another investor to guarantee that if that debt defaults, he will make the first investor whole. 

This week, the Treasury assumed responsibility for $5.2 trillion in outstanding debts held by Fannie Mae and Freddie Mac. A modest but significant share of that is headed for default, and the Treasury will have to absorb the losses. And the result is a rising price for credit default swaps on the U.S. Government: It now costs $18,000 to insure $10 million of U.S. Treasury debt. The market sees a very small - but not negligible - prospect that the U.S. Government would actually default on its debt, which would be, well, the end of the American and global economies as we know them. That’s how bad it is.

Credit default swaps for subprime mortgage based securities, of course, have played a significant role in the current unraveling in the financial markets. But conservative/Republican disdain for normal regulation of those markets has played the larger, underlying role.  Such regulation isn’t intended to “manage” those markets, but to ensure that the rest of us are protected from serious repercussions when problematic choices by financial market players (for example, to double down on subprime mortgages or their derivatives) collide with adverse conditions that make those problematic choices very reckless.

That’s the essential meaning of the Fannie Mae and Freddie Mac regulatory bailouts. Setting aside the many years of astonishingly reckless and self-interested management at Fannie Mae and Freddie Mac, the mortgage market would freeze up if these two institutions suddenly couldn’t operate. Here’s a brief course in why that’s so: there’s always plenty of credit for new mortgages, because those creating the mortgages promptly sell them, in bundles, to investors, so that the credit can cycle back to finance more mortgages. 

Fannie Mae and Freddie Mac both create and buy trillions of dollars in these mortgage-backed securities, and there’s no financial institution that could step in if they were taken out of the picture. That’s why we need to keep them operating, even if it requires a bailout. By the way, the other major holders of these securities include U.S. banks – expect a line of them to go belly-up in the next six months – and foreign central banks. 

The potential unpleasant fallout for our relations with other countries if their holdings went bust is the other reason that the Bush Administration has taken the largest interventionist step in U.S. financial markets since the Great Depression. Once again, the Bush Administration is moved to act not by what’s happening to Americans, but by the implications for our relations with other countries

A few hours ago, I got off the phone with my Dad who was driving by Franklin and Marshall College in Lancaster, PA. Seeing the large crowds and commotion, he asked if I had heard whether "anyone big" was visiting. He said he thought U.S. Sen. John McCain and Alaska Gov. Sarah Palin were making a stop there, so I looked it up and confirmed to him that he was right, prompting him to react with what seems to be the prevailing assessment surrounding the GOP ticket: everyone was there to see Palin.

McCain, who was quick to label U.S. Sen. Barack Obama as a celebrity, now embraces, perhaps even encourages, the glamorous reception with which his running mate is met. It seems like he was right to do so in the short-term, as the focus of the election, as Simon has mentioned, has shifted to Palin. Though that's not really surprising, given that the timing of her introduction left us either amazed by her acceptance speech or wondering who she is and what she believes.

Yet while the scramble for information over Palin was especially hurried after she was chosen as McCain's running mate, the dust has since settled from her speech in St. Paul. And with the clearing comes more information - from her understanding of institutions like Fannie Mae and Freddie Mac to her conduct as Governor. What little we are learning about Palin comes from her interactions with regular citizens since she has been absent from the talk shows, as well as through close friends who speak well of her personally but seem mixed when the subject turns to politics.

All of this unravels before our eyes, gets us caught up in Alaska drama, and deflects attention away from McCain towards Palin. Recognizing this, and maybe trusting the media and the American people to do its due diligence on Palin, the Obama campaign is bringing the focus back to the GOP nominee and his Party's record. Its latest ads, "No Maverick" and "Naked Lies", as well as his speech on education are good examples of this strategy.

Meanwhile, McCain continues to tout Palin - whose speech is the only one from the GOP Convention that is highlighted on McCain's YouTube channel - and that maverick nature of theirs. As mentioned above, plenty of people have and will sift through Sarah Palin's past and credentials, which frees us up to focus on the notion of the maverick.

One definition from Princeton shows that, as a noun, "maverick" has two meanings: First, a rebel; and second, an unbranded rage animal that belongs to the first person who puts a brand on it. An adjective for the term: irregular.

While the bit about the "rage animal" seems to align itself with one of McCain's purported problems, I must acknowledge that the term maverick does connote a positive image in the "independent in behavior or thought" sense. We're familiar with that image. It's what defined the John McCain of yesteryear and won him public admiration from all sides. Yet things changed for him when he was branded the GOP nominee and started marching to the beat of a different drum, avoiding or outright fleeing from his once admirable stance on a whole slew of issues. Instead of sticking to his guns, he gave into the brush-clearing tactics of his predecessors.

It's almost tragic, really. The glorified way in which he painted his maverick image is now broken, and in its place we are left with an all-too-familiar ideal that begs for real change we can believe in. 

Update: The Huffington Post is chronicling the news sources that are speaking out about the McCain campaign's recent tactics, which seem to evoke the irregular nature of the maverick. 

Update II: Reuters shows how McCain finds the campaign trail to be more hostile when Palin's deference-deserving persona isn't with him on the trail. 

Update III: Brave New PAC weighs in on the maverick's campaign in the video below: 

(Note: You are now free from my random musings and long and tedious '08 Updates, as I have left NDN. Unless a new Kanye West video comes out and I can relate it to the work of the NDNBlog champions, it's safe to say that I will be appearing much less in the months ahead. I do look forward to returning occasionally, and hope to see you all soon! Thanks for putting up with me for so long...)