AIG and the Undeserving Rich

dry-bones

Charles Blow, the “moderate” who seems to write a lot of words but never takes a clear stand on anything, recently lamented on the op-ed page of the New York Times about what a small matter the $165 million in bonuses really were compared to the $170 billion AIG received in government welfare. Sheryl Gay [...]

The Auto Bailout: A Bad Deal

obama-detroit

With the economy tanking and unemployment skyrocketing, you’d think the Obama administration would be doing all it could to save jobs. But if its auto bailout plan is any indicator of its current direction, we’re on our way to losing a lot more jobs.

The Rich Countries’ Faltering “United Front”

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By now we’ve heard “The worst economic crisis since the 1930s” – or words to that effect – so many times it’s become like a mantra. But as the days roll on it begins to appear that it might just be an understatement and that not only does the economic situation appear more like the [...]

Congress’s Potemkin Populism

bushido

It’s nice to see that when the public gets sufficiently angry about something, Congress responds. In a rare show of bipartisanship, members are eagerly registering shock and outrage at AIG’s bonus payments by coming up with an assortment of ways to reclaim the bonanza, including taxing them away retroactively. Who says democracy is dead? But [...]

In the Wake of AIG: Obama’s First Priority

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AIG is rapidly becoming a nightmarish metaphor for the Obama Administration’s problems administering the bailout of Wall Street. One central problem is the lack of transparency. According to some news reports, Treasury Secretary Tim Geithner knew weeks ago that AIG was planning to issue the bonuses to executives in its notorious credit default swap unit, [...]

Another $8 Billion Or So on the Line for AIG

aig

AIG has finally come clean with the public about who was at the other end of its calamitous financial bets. The recipients of billions of taxpayer dollars were … well … pretty much the banks that we expected: Societe General, Goldman Sachs, and Deutsche Bank, to name a few. The full list is here . [...]

The Real Scandal of AIG

rich-cigar

The real scandal of AIG isn’t just that American taxpayers have so far committed $170 billion to the giant insurer because it is thought to be too big to fail — the most money ever funneled to a single company by a government since the dawn of capitalism — nor even that AIG’s notoriously failing [...]

Is Obamanomics Conservative or Revolutionary?

obama_hat

There are two ways to see Obamanomics. The first, much preferred by the White House, is as a set of initiatives so modest as to hardly merit a raised eyebrow. Yes, steps must be taken to deal with the current economic crisis. But assuming the economy recovers next year, Obama’s budget projects that government spending [...]

Obama Rescuing Capitalism: That’s a Lot of Weight for One Brother

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Back in December, when it was obvious that the economy was in bad shape and before we knew how precarious it could get, Fareed Zakaria, editor of Newsweek International and columnist for Newsweek and the Washington Post, wrote, “For Obama to be remembered as a great president, he has to do nothing less than rescue [...]

A Nation of Tax-Evaders

boligandollarchicken

The furor over the non-payment of taxes by Tom Daschle and a few other recent nominees for public office should not obscure the deeper truth that the United States has become a nation of tax-evaders. On the simplest level, this tax evasion is exemplified by the fact that vast numbers of people, including some who [...]

With Obama, It’s 1935 All Over Again

Obama, Roosevelt, Jindal, "Purcell"

As President Obama follows a $800 billion recovery act by proposing nearly $700 billion for universal health care, and financially ambitious programs for energy independence and education, the United States is experiencing 1935 all over again. That’s the year that followed huge Democratic gains in the 1934 election, and which saw Congress enact the two [...]

Worse Than Expected on the Economy

Keep your eyes on the gap between what the economy could produce at full employment and the paltry level of aggregate demand (consumers plus businesses plus exports). That’s why the stimulus is too small — and why my bet is the President will be back for more stimulus. The Commerce Department reported Friday that the [...]

Finally, A Progressive Budget

obama-saves

President Obama’s new budget is, well, audacious — not just because it includes several big, audacious initiatives (universally affordable health care, and a cap-and-trade system for coping with global warming, for starters) but also because it represents the biggest redistribution of income from the wealthy to the middle class and poor this nation has seen [...]

Obama’s Goal: Halving the Budget Deficit by 2012. Really?

economy-under-water

The President’s message on fiscal responsibility — that he’ll cut the current one by half by the end of his first term — is smart politics right now, but it may be dumb politics by November of 2012, and doesn’t make much economic sense regardless. We’re in a deepening recession, in case you hadn’t noticed. [...]

Foreclosure Fantasy Folderol

excess

The conservative Republican ideology for this first decade of the new millennium (during which they led the world into two holy wars, bankrupted a nation, and linked radical fundamentalist Christianity to governing) is boiled down to 11 words — “screw you, I got mine, grow up and stop your whining!” — is now spinning dangerously [...]

The New Deal and the New New Deal: Countering Conservative Claptrap

gop-on-automatic

The stock market reached a six-year low today. Why? Some blame loose talk (including that of former Fed Chair Alan Greenspan) about nationalizing the nation’s banks. Others blame Obama’s new plan for helping homeowners who may not be able to pay their mortgages. But the real culprit is the accelerating decline in aggregate demand — [...]

The Stimulus and the “Threat to Stability”

uncle-sam-crutches

Well, now it appears that, as the New York Times put it Monday, the “Rise in Jobless Poses Threat to Stability Worldwide.” This comes just after the new United States Director of National Intelligence, Dennis Blair, told Congress instability caused by the global economic crisis had become the biggest security threat facing the United States, [...]

And Now Homeowners

homeowners

The two most important features of the administration’s plan to help homeowners are, first, its support for amending bankruptcy laws to allow judges to modify mortgages. This will give homeowners bargaining leverage with mortgage servicers (and give the servicers more leverage with securitized creditors on up the line) to get better terms; and, second, a [...]

Finally, Too Many Cars

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Rushing to beat a deadline, General Motors and Chrysler last Tuesday afternoon filed required restructuring plans with federal officials. Chrysler wants $5 billion more in federal loans to stay afloat. GM needs another $9.1 billion now, with more requests likely down the road. The short-term question of whether the two auto giants warrant a bailout [...]

Guess What? The New Deal Worked!

wpa

Since the economic crisis we’re now in is being compared to the Great Depression, the solutions being offered are being routinely compared to the New Deal. Republicans in particular have been quick to pronounce the New Deal a failure as a way of justifying their opposition to the new stimulus package and any other federal [...]

The End of the Ownership Society?

greed

In his second inaugural address, President George W. Bush offered a vision of an “ownership society” In America’s ideal of freedom, citizens find the dignity and security of economic independence… To give every American a stake in the promise and future of our country, we will… build an ownership society. We will widen the ownership [...]

Madoff, Stanford, Ponzi and the Media

questionable ethics

Few had heard the name Bernard (Bernie) Madoff, as recently as two months ago. An equally small group was familiar with the term “Ponzi Scheme” when the Madoff scandal broke. And now there is the Sir R. Allen Stanford scandal. Now, in this era of keen observance to rules of fiscal prudence where the public [...]

Obvious Solution to Global Banking Crisis

wall-street-bonuses

It’s been done before, an FDIC/Comptroller of the Currency (or similar insurance or governmental institution elsewhere) bank take-over. I witnessed my first in Miami in 1991 when a former employer in the mid 1980s, Southeast Banking Corporation of Miami, then Florida’s oldest bank, had a deep liquidity crisis. It was a swift, brutal, and painless [...]

Stimulus Bill Limits TARP Executive Pay

Karen Bleier (AFP/Getty): Treasury Secretary Tim Geitner

Top executives at banks that got money from the TARP will face stricter compensation limits thanks to the stimulus bill.  That’s because tucked into the 1,071-page bill is a twelve-page section that goes much further than any limits imposed by the Bush administration or even contemplated by the Obama administration. The limits, which limit bonuses [...]

Spending Money at Home Helps America!

debt

I watched all the Sunday stuff on the telly today. Who was that old guy on the show saying that we should not be spending money on American schools, American students in college, or on the rebuilding of the infrastructure of America? Why? Because, are you ready, he says it will not do any good [...]

Obama, Pelosi Must Rescue Damaged Stimulus Package

pelosi-obama

Senators Ben Nelson (D-NE) and Susan Collins (R-ME) have produced a Senate stimulus bill that kills jobs, eliminates affordable housing, guts education and gives billions in new tax breaks for the rich. Their hypocrisy is shameful. As New York Times columnist Paul Krugman put it, the Senate measure will “lead to substantially lower employment and [...]

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