Matt Taibbi analyzes Jamie Dimon’s appearance before the Senate Banking Committee

Matt Taibbi of Rolling Stone found it hard to watch all of the U.S. Senators giving homage to Jamie Dimon of J.P. Morgan Chase. You can read his detailed report here. And here's the lesson Dimon doesn't get:

You can either be a commercial bank, with all the federal support that entails, or you can be a high-risk gambler. But you shouldn't be allowed to be both. We could have Chase Commercial Bank, and Chase Investments Inc., and they can each be as big as they want, but those companies should be separate. Why do we need companies like Chase that are both things, under one tent? The real answer, from Jamie Dimon’s point of view, is simple – there’s no way he could have a $350 billion hedge fund if he didn’t have mountains of federally-insured money to play with, and a steady stream of low-interest loans from the Fed.

Continue ReadingMatt Taibbi analyzes Jamie Dimon’s appearance before the Senate Banking Committee

Four trillion in secret loans

Keep in mind that all of the U.S. tax receipts for an entire year are only two trillion dollars. Now read this:

""This report reveals the inherent conflicts of interest that exist at the Federal Reserve.  At a time when small businesses could not get affordable loans to create jobs, the Fed was providing trillions in secret loans to some of the largest banks and corporations in America that were well represented on the boards of the Federal Reserve Banks.  These conflicts must end," [Senator Bernie] Sanders said."

Continue ReadingFour trillion in secret loans

Modern political money

From Rachel Maddow's blog:

[T]he playing field has changed in fundamental ways. In the traditional model, we'd see two major-party candidates, each backed by their respective national party. In 2012, President Obama's campaign team will effectively have two extremely well-financed opponents: Mitt Romney and the RNC, which are projected to raise at least $800 million, as well as a $1 billion outside attack operation. Obama, in other words, is going to face a far-right wall of at least $1.8 billion between now and Election Day. To say this is without precedent in a major democracy is a dramatic understatement.

Continue ReadingModern political money

On the state of our dysfunctional political communications

On his most recent show, Bill Moyers discusses the heightened polarization in the political discourse with Kathleen Hall Jamieson, who runs the Annenberg Public Policy Center of the University of Pennsylvania, including the sites FactCheck.org (which monitors the factual accuracy of what is said by major U.S. political players) and FlackCheck.org (which tracks patterns of political deception). This is a high-quality discussion well worth watching. The starting point for the discussion was the defeat of Senator Lugar, who was accused by his more conservative opponent of working with Barack Obama to dismantle the world's stocks of aging nuclear weapons to make sure that they don't fall into the wrong hands. Cooperating with the enemy (in this case, a member of the opposing political party) has become a mortal sin. The result is, politically speaking, we cannot any longer talk with each other. Jamieson spreads the blame in many directions; this is not your typical polarized pundit who aims her arrows only at the other party. For instance, Factcheck.org has challenged Barack Obama's Life of Julia illustration as being based on "some false or dubious assumptions." According to Jamieson, the following questions should be the focus of our budget disputes and the upcoming election: "How do we afford this level of government, if we want to keep it? Do we want to keep it? How are we going to pay for it? If we're going to cut, where are we going to cut?" The campaigns of Obama and Romney are mostly devoid of economic facts, "depriving us of the common ground we need." She explains that if this trend continues, massive damage will be done to this country. What do you do to force these issues? The media needs to take charge: These questions regarding spending priorities need to be repeated endlessly at debates until they are actually answered. (min 12). Check out the simple questions that need to be asked, but usually aren't, and are never answered in political debates (last half of min 12):

That's what we need to do in the presidential debates. We're going to have them. When they don't answer the question, the next person up should forgo his or her question and ask the question again. And if the entire debate simply has to ask the question then let's ask, what about Simpson-Bowles don't you like, Mr. President? You know, Governor Romney? What about it do you like? Are you ready to advance-- to say that we should move the Social Security age to 70 in some kind of a phased-in structure?

Should we be doing means testing in some ways? What are your alternatives? When you say you're going to reform the tax code, is that an excuse for saying you're going to do nothing? How much money can you get out of the reforms that you were offering? And what are you going to eliminate and what are you going to cut? Right now we're playing this game. Right now you've got the Ryan budget proposal.

BILL MOYERS: Paul Ryan of Wisconsin.

KATHLEEN HALL JAMIESON: Uh-huh. And to his credit, there is a proposal there. The first thing the Democrats did a response was to say, "Ha, we're going to assume he's cutting everything across the board." So they started pushing on the assumption that this good thing is going to be cut. This good thing, this good thing by “X” percent.

Congressman Ryan responds, "No, I'm going to get rid of some things entirely, and I'm going to preserve some things entirely. And I'm going to cut some things." That's actually the beginning of a productive exchange. Now the question is what for both sides? And let's get the public on board to accept that there's some things we take for granted now we're not going to have. There's some costs we're not now paying that we're going to have to pay. It's necessary to preserve our country.

Jamieson came to this discussion with ideas for improving our deplorable situation. I very much like this one:

I would like to see a proposal that Harvard floated a number of years ago, that we devote Sunday nights, from the beginning of the general election period through the election, to intensive discussions with presidential candidates about the serious issues of the day. I think you'd find an attentive audience for that. And I think the person who's elected would find that he was better able to govern if the public had had that opportunity. The public isn't stupid. The public actually is smart in some important ways.

Moyers asked whether our political system is close to collapsing "of its own absurdity." Jamieson doesn't mince her words (min 16):

We're close right now to having a campaign run on attack and irrelevant arguments that are highly deceptive and, as a result, make it extremely difficult to solve the problems facing the country, which is what all the concern about money and politics is well justified and why we ought to worry about trying to vigilantly hold the super PACs and the third-party advertisers accountable.

Now, what are the consequences of high level of attack? You don't have a reason to vote for someone. You're only being told why to vote against. Hence, no projection of what the alternatives are and no understanding of the trade-offs in government . . . We're going to have high level of attack; hence, no relevance to governance and votes against. And that we're going to have high level of deception; hence, people who feel betrayed once they see actual governance or who vote against a candidate they might otherwise support.

The problem with modern political advertising is not framed properly by the use of the phrase "negative advertising":

I don't like to use the word "negative" because it conflates legitimate and illegitimate attack and because negative to most people means duplicitous. [The big problem occurs] when there's a differential in spending and a high level of deception tied to a high level attack because now you have the worst possible consequences.

Continue ReadingOn the state of our dysfunctional political communications

National policy regarding fossil fuel subsidies keeps getting distorted by campain contributions

At United Republic, Bill McKibben reports on the obscene amount of Big Oil lobbying each year in Congress. It amounts to $146 Million per year. Bernie Sanders and Keith Ellison have launched a new bill that dramatically cuts subsidies to the fossil fuel industry. McKibben notes that no member of Congress makes rational arguments in favor of fossil fuel subsidies. No arguments need to be made, because money talks:

According to Open Secrets, the oil and gas industry has already spent $37.6 million lobbying the federal government in the first few months of the year alone. They also spend buckets of money on campaign contributions to persuade our elected officials to vote for policies they favor. A recent vote in the Senate revealed just how persuasive campaign cash can be. A bid to end taxpayer subsidies for the five biggest oil companies failed to get the 60 votes it needed. The 57 senators who voted to end the subsidies received about $6 million from the oil and gas industries, compared to a whopping $24 million pocketed by the 41 senators who voted against the bill.

No wonder America is so slow to move to elementary conservation methods and sustainable energy production. This is not a new story, of course, but a continuation of legalized bribery that infests the entire electoral system. Even worse, this is a system that severely punishes representatives who do the right thing.

Continue ReadingNational policy regarding fossil fuel subsidies keeps getting distorted by campain contributions