McCain's Econ Advisor: Sorcerer's Apprentice of Instability and Disaster By: Mark W Adams

It sounds like John McCain is joined at the hip to one of those Disaster Capitalists Naomi Klein warned us about in her book Shock Doctrine. Hilzoy (guesting for Kevin Drum) quotes James Galbraith's discription of former Texas Senator (figures), recent lobbyist, current campaign Co-chair and economic guru for John McCain ...

"Phil Gramm's career was as the most aggressive advocate of every predatory and rapacious element that the financial sector has," Galbraith said. "He's a sorcerer's apprentice of instability and disaster in the financial system."

Hot on the heels of Keith Olbermann's revelation that Gramm, whose deregulatory scemes played a direct role in the Enron scandal, was/is on the payroll of a Swiss bank lobbying Congress (and evidently McCain himself) on how the U.S. should handle the mortgage crisis.

McCain and Gramm have been friends for more than a decade. McCain chaired Gramm’s 1996 presidential run and Gramm says the two men speak every day. McCain reportedly has hinted Gramm might serve as his Treasury secretary.

Last summer, Gramm was widely credited with saving McCain’s presidential campaign.

[snip]

After Gramm passed a law easing regulation of energy-commodity trading, California experienced a sharp run-up in energy costs. The energy-trading company Enron was blamed and soon collapsed.

In 1999, Gramm successfully undid the Depression-era Glass-Steagall Act, removing the decades-old wall between commercial banking, which was heavily regulated, and investment banking, which was not. The Gramm-Leach-Bliley Act did not extend significant new regulation to investment banking.

This may be the last gasp of the anti-New Dealers, but they've come leaded for bear. Or was that Bear Sterns? Hilzoy is flabbergasted.

But it just defies belief that McCain would have, as his main economic advisor and one of the people responsible for his plan to deal with the mortgage crisis, someone who was a paid lobbyist for a bank that was heavily involved in that crisis, a firm that has just advised some of its employees not to travel to the US for legal reasons, and that stands to gain or lose a lot depending on what the federal government decides to do about it. What's next: the revelation that McCain's policy on Iran is being written by a lobbyist for the makers of cruise missiles? Or that he has outsourced his health care policy to a lobbyist for the National Funeral Directors Association?

Without a trace of irony, John McCain's spokesman the GOP nominee "preferred to focus on homeowners "truly in need" and opposed bailouts for affected banks." However, instead of supporting legislation that would have allowed bankruptcy judges the authority to modify loan terms to help home owners stay on their property, he in effect said on March 25th, "The mess you are in is your own fault. Don’t expect any bailouts from me."

Interesting that this is exactly what the banking industry, and Phil Gramm, wanted. The legislation died.

The sooner we are rid of the cancer these "compassionate conservatives" have foisted on us, the better. Let's just hop the rumors that Bush will start bombing Iran to help keep his buddies in power is just that, a rumor.