Bailout Has Devilish Details

I've but one word for the drafters of the Emergency Economic Stabilization Act Of 2008:

GO2HELL!

Honestly, was this really the best we could do?

Unlike many on the left and the overwhelming majority of PrezTard Bush's former supporters who now conveniently run from their leader like Pavlovian mutts who rolled around in their own shit for eight years suddenly realize they smell bad at the ding, ding, ding of Bush's name -- I still think the bailout is essential. I haven't heard anything else out there that would more effectively unclog the credit market's tubes in the time frame necessary to mitigate the disastrous supply-side damage directly caused by the conventional voodoo since the dark day that Ronald Reagan was sworn in.

If you aren't convinced this was all orchestrated, consider Naomi Klein's take on this bit of theater even before Drama Queen McCain brought his circus act into the West Wing. Unfortunately (and this is where I differ with John Amato), even though it sure looks like this is a manufactured crisis, it's a crisis nonetheless.

That said, the plan still sucks.

Or at least we have a lot more work to do, some of which will probably have to wait until we see if we get a filibuster-proof Senate and impose a progressive version of the Shock Doctrine. What a strange dynamic when the outnumbered children in the House GOP caucus were allowed to pull the strings this time. Come January, no one will give a damn what they have to say. All they did was give John McCain and a couple of other worried Republican Senators cover as they acted their predictable douchey selves. I think America is finally weary of their stunts.

So why Mark? Why does it suck?

Glad I asked: Inadequate help for distressed homeowners.

I don't care what they tell you, I've looked at the Act carefully on this point, which magnanimously expands Chris Dodd's Hope For Homeowners Act to include not just FHA, but also Fanny Mae and Freddy Mac covered loans and anything covered by one of these junk mortgage backed securities we're buying or owned by a bank opting into the bailout. The EESA allows for renegotiation of distressed loans, by changing the interest, the term of years, or sending anyone with 10% equity into a 30 year fixed, which cuts out the house flippers.

Okie, Dokie. That sounds like a good thing, but it isn't cuz it's optional at the discretion of the bank. Under H4H, it's still the banks which decide which loans to renegotiate -- and only folks whose loan is over 31% of their income are eligible. In other words, only folks that got a loan from an almost criminally irresponsible loan officer would qualify, and only if their bank already tanked, the loan is held by Uncle Sam or out of the goodness of their heart the bank decides to give you a break.

There are a lot of otherwise perfectly solvent lending institutions that don't need to opt into the bailout who will laugh at this legislation unless homeowners are empowered to initiate the process and make the thing mandatory if the homeowner qualifies -- whether the lender is opting in or not. Homeowners are still at the mercy of the bankers in this to a large degree.

Sorry, that doesn't cut it, it doesn't help the real people who pay the real taxes that will fund this monstrosity. Barney Frank had the right idea. It needs teeth, like the ability of a Bankruptcy Judge to restructure a loan if they rule that's a just result even if the bank doesn't. Leaving this solely to a bankers discretion is simply pointless.

Take a look at this language from the full EESA (pdf). It's even worse since we're buying the paper guaranteeing the mortgages and not the debt instrument itself. The folks collecting the payment have no incentive to help out the little guy. Go figure.

SEC. 109. FORECLOSURE MITIGATION EFFORTS. (a) RESIDENTIAL MORTGAGE LOAN SERVICING STANDARDS.—To the extent that the Secretary acquires mortgages, mortgage backed securities, and other assets secured by residential real estate, including multifamily housing, the Secretary shall implement a plan that seeks to maximize assistance for homeowners and use the authority of the Secretary to encourage the servicers of the underlying mortgages, considering net present value to the taxpayer, to take advantage of the HOPE for Home owners Program under section 257 of the National Housing Act or other available programs to minimize foreclosures. In addition, the Secretary may use loan guarantees and credit enhancements to facilitate loan modifications to prevent avoidable foreclosures.

So what's Paulson going to say to these fat cats? "Pretty Please, with serfs and handmaidens on top?"

Such is the sausage making that creates laws. We gave up on Bankruptcy reform. We threw away community centric housing relief, where the hopelessly ignorant wingnuts could claim victory over ACORN, an outfit that gives them a perpetual dose of Cialis. They also will dance with joy that they get to play more privatization games with an insurance "solution" to this thing -- which for the life of me I have no clue how it's supposed to work, or help.

So what did we get, politically or for, you know, fixing that whole crisis thingy? Well, very strict reporting on exactly which millionaire can only take home a half million next year without paying (gasp) higher taxes; and "oversight!" on every billion dimes they'll be handing out to the richest financial institutions on the planet. (As long as they don't get lost and shipped to Baghdad in the meantime.)

Look suckers, just be grateful they didn't eliminate the capital gains tax or really deregulate everything -- or do what Gingrich and Bill Kristol prayed for, using the FDIC to create a safe haven for their millions that don't have a safe place to sit this out. The ultimate game of corporate/wingnut welfare yet concieved.

So bitch, moan, and never forget that when Republican are anything more than an obstructive bunch of nay-sayers, but actually get to run things, their ability to fuck up your world is beyond imagination. Meanwhile, just pay up or they'll make Wall Street and Main Street look like Burbon Street. You should feel privileged to be allowed to participate in cleaning up their mess, you ungrateful peasant.

UPDATE: One more thing. I was negligent not to mention that Krugman deems the plan "sufficiently not-awful" since it includes his deal breaker demand for an equity stake so we have a non-zero chance of recouping something on this. Otherwise it was just a handout. I always figured that and the populist red meat of curbing CEO golden parachutes would be a part of this. Nobody buys a pig-in-a-poke without going home with either the pig or the poke, especially if it steals away enough cash to buy it's own lipstick factory.

McCAAaaaiiiinn! You Moron

Is this idiot still pushing the fiscally stupid and morally wrong DE-regulation snake oil that got us into this problem in the first place?  Maybe not.  But it was still his side of the aisle, lead by John Boener, who dug in their heels after inserting presidential politics into negotiations he has no clue about, and may have hopelessly derailed.

Republicans like John Boehner brought up the concerns of House GOPers and McCain acknowledged hearing about their concerns. And McCain, and staffers, did seek to gauge the level of support of the GOP working group's white paper. The Democrats were left with the impression that McCain endorsed the GOP efforts, but they concede that he did not raise them directly.

Cuz he didn't read the randsome note from the treasury.

The fact is that Boehner doesn't have 100 votes from his conference -- 100 votes that Nancy Pelosi really wants. And that's not McCain's fault.

But Boehner and the White House -- and McCain -- if they want to get something passed -- do have the responsibility to persuade these Republicans to support the bailout .

After all, if not to get these recalcitrant Republicans on board, why did McCain go to Washington in the first place?

Funny that the leaders of the banking committees in both houses, from both parties announced they had a deal on the basic principle and simply just had to write the thing -- until Bush, at McCain's behest based on an idea by his Maverickynessitude himself, held a photo-op which had the effect of trashing all the work of the last week.

Nice rescue Mr. McCain.  Glad you showed up.  If McSame hadn't stuck his ego into the negotiations something terrible -- like approval of a plan to rescue the economy -- might have gotten done.

Which might not be a bad thing.  Every day there's no deal, it's another day where Wall Street doesn't collapse, bringing down the rest of the nation -- thus exposing the canard of what might be a manufactured crisis.  The gamesmanship is all too obvious, as obvious as the GOP's last minute plan introduced at the Save McCain White House Photo Op.

One the proposals -- favored by House Republicans -- would relax regulation and temporarily get rid of certain taxes in order to lure private industry into the market for these distressed assets.

I'm shocked, shocked I say that tax cuts and deregulation is the Republican approach to a problem only exasperated by eight years of tax cuts and a steady diet of continual deregulation since Reagan showed the GOP that tax cuts were how to win elections and ruin the government they hate in one fell swoop.

If the nearly extinct trickle down crowd insists that there's no way, no how they'll stand for any "socialist" interference in the free markets, then a trickle up approach is the only other option -- one the Democrats can do without demanding any GOP participation.

If this actually gets traction, liquidate your savings and retirement plan -- what's left of it, especially if it was at WaMu -- and move to Malaysia.  I hear they need all the day laborers they can get.  Or Alaska!  They pay you to live there since they've cut taxes and live off drill, drill, drill.  Dress warm.

And you better put your sell order in early, cuz the market is going to tank, again.

On the more promising news front, Katie Couric reports that Sarah Palin's approval ratings are approaching Shrub level, 34%, down from 47% a month ago.  TS at Instaputz insists the more he hears from Caribou Barbie, the more he appreciates "the eloquence of George W. Bush."  McCain lost this election two stunts ago.

Eat the Rich

One congressional reaction that emerged — Senate Banking Committee Chairman Chris Dodd’s (D-Conn.) response to the rescue package — wasn’t favorable to many of K Street’s banking clients, who oppose one provision in particular: giving bankruptcy judges the power to lower mortgages for distressed homeowners.

“We are vigorously opposing that,” said Steve Verdier, a lobbyist for the Independent Community Bankers Association (ICBA). “If that happens, then the mortgage rates for other consumers are going to go up.”

[H/T: dday]

Well, what can I say except fuck you, Mr. Verdier and the limo you rode in on.

OK, perhaps our next president puts it more…politically:

“First, the plan must include protections to ensure that taxpayer dollars are not used to further reward the bad behavior of irresponsible CEOs on Wall Street. There has been talk that some CEOs may refuse to cooperate with this plan if they have to forgo multi-million-dollar salaries. I cannot imagine a position more selfish and greedy at a time of national crisis. And I would like to speak directly to those CEOs right now: Do not make that mistake. You are stewards for workers and communities all across our country who have put their trust in you. With the enormous rewards you have reaped come responsibilities, and we expect and demand that you to live up to them. This plan cannot be a welfare program for Wall Street executives.”
—Barack Obama

And don’t even try blackmail us you rich asshole (and that goes for you too Paulson), we’re in no mood and no longer care what you idiots think. Not one thin dime should be spent on this problem until every single ARM in this country is turned into a reasonable fixed-rate mortgage for every homeowner who can afford it. If that doesn’t fix the problem then you can get in line behind them. And while you’re bent over the hood of your Towncar, you can explain to me a bigger “moral hazard” that giving you corrupt traitors hundreds of billions more taxpayer-backed dollar so you can keep ripping us off and sending a mortgage for the country’s future to the Chinese.

[Cross-posted at E Pluribus Unum]

What the Heck Is Wrong With AP?

The Associated Press, a news outlet that permeates our information consumption, badly as I pointed out the other day, has just reach a new low.

AP, or as skippy properly calls them, AssPress, is going after lowly bloggers at the Drudge Retort (not to be confused with the fedora wearing rumor monger who runs Drudge RePort), including commenters for Pete's sake, for copyright violations -- for simply duplicating a headline linking back to the original article and running the minimum of excerpts.

Read more about it here.

This is a cautionary tale to those who would try and become "successful" bloggers. The Old Media won't go away without a fight.

Attention Righties, A Mirror Image Is Backwards

See here's how it works. If you want to accomplish something similar, but looking at things and doing them in exactly the opposite manner as how things have been the last eight years, you use a mirror.

Got it?

Like when the Vice President met privately with leaders of a disgraced industry to form energy policy is a mirror image, exactly the opposite phenomenon as when a a private citizen who did business with a company that is now disgraced along with its industry is commissioned to vet a Vice President, not to form policy for that industry.

I know it's kinda hard for folks foolish enough to still think our C+ Augustus is Teh Aw-Sum to grok in the abstract without talking-points arriving in their inbox, but it really is something quite different.

Now just for the record, the head of Obama's VP selection team didn't hand out fraudulent loans or anything, right? He wasn't a lobbyist for Countrywide, was he, or one of it's executives?

He was an extremely good credit risk who took out some loans with the company, and paid them back. So WTF? This isn't reporting, it's a smear job.

The Beast That Shall Not Be Named

by shep

George Will may have been right after all. He famously contended that apathetic political participation in this country may be simply because people were basically satisfied with their government and society. With the intense grassroots political giving, participation and record primary turnouts we’re seeing at the moment, it seems that may no longer be the case.

So The Village gasbags tell us that the exit polling tells us that people are sick of the partisan gridlock in Washington and they want change. I agree. Many of them claim that unity is the answer. But if this partisan gridlock represents a sort of stasis in the struggle between two diametrically opposed forces – let’s call them Republican conservatism (so-called) and Democratic progressivism – then one of those forces must give way to end gridlock and create change. Unity or bi-partisanship is obviously no solution.

We’ve had nearly thirty years of near constant progress in one of these two forces, to the point that it is now considered the political center by the entire elite class. We’ve warred, tax cut, de-regulated and politically demonized the opposing political force to the point where we find ourselves today: An unsustainable global military empire that is despised by most of the world. A beggar’s economy where we borrow our money from our former (and possibly future) mortal enemy and build their industrial might to feed the mostly mindless material consumption of our middle class, all to create grotesque wealth for the operators of the system. The ever-increasing stripping and burning the planet’s naturals resources at an ever-more unsustainable rate to feed that consumption. Health and safety deregulation that sickens and kills huge numbers of the public, many of whom haven’t the means to get help without bankrupting their families. And last but not least, a public media that isn’t the slightest bit interested in telling the public the truth about how and why we got here.

So, can there be any question as to what the people shall not be told: that one political force needs to give way to end gridlock and create needed change and that force is Republican “conservatism”? And that it is not a governing force anyway, but a set of largely disreputable beliefs, the cornerstone of which is that “government is the problem.” And that to continue more of the same and expect a different result is a form of mass insanity. And that bi-partisan unity, half consisting of Republican conservatism, cannot constitute a way forward from the mess created by Republican conservatism. But the people will not be told because Republican conservatism, the force of corporate greed and political elitism and aggressive militarism and social Darwinism and shameless selfishness is both the beast that shall not be named and the beast that does the naming.

[Cross-posted at E Pluribus Unum]

Be Afraid

They are:

"I'm concerned about anti-corporate and populist rhetoric from candidates for the presidency, members of Congress and the media," he said. "It suggests to us that we have to demonstrate who it is in this society that creates jobs, wealth and benefits -- and who it is that eats them."

The U.S. Chamber Of Commerce, the lobbyists/PAC/527 for all the other corporate lobbyists, is ready to spend over the $60 million it paid to take down John Kerry, to fight the populist candidates, which would be Edwards, Huckabee, Obama and even Hillary.

After this year, the Switboaters will be seen as amateurs. We're all going to be taught a lesson.