Wednesday News

Good Morning Conflucians!!

Barack Obama had an op-ed piece in yesterday’s WSJ. In it he says we need to balance regulation with businesses need to create jobs and, well, make lots of money. For example:

Sometimes, those rules have gotten out of balance, placing unreasonable burdens on business—burdens that have stifled innovation and have had a chilling effect on growth and jobs. At other times, we have failed to meet our basic responsibility to protect the public interest, leading to disastrous consequences. Such was the case in the run-up to the financial crisis from which we are still recovering. There, a lack of proper oversight and transparency nearly led to the collapse of the financial markets and a full-scale Depression.

Over the past two years, the goal of my administration has been to strike the right balance. And today, I am signing an executive order that makes clear that this is the operating principle of our government.

This order requires that federal agencies ensure that regulations protect our safety, health and environment while promoting economic growth. And it orders a government-wide review of the rules already on the books to remove outdated regulations that stifle job creation and make our economy less competitive. It’s a review that will help bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislators of both parties and the influence of special interests in Washington over decades.

Note that this move is right as Republican’s take over the House and have increased numbers in the Senate, with momentum at their back. So as we see and have seen before, Obama is moving to compromise and move to the right even before debate begins on the topic. That is of course not surprising to us as we’ve noticed his right leanings from before the primaries. This problem is also noticed at Salon:

But on the day before House Republicans are expected to vote to repeal the Affordable Care Act, primarily on the specious grounds that it is a “job-killing” regulatory Frankenstein, the White House’s decision to suddenly be concerned about the right balance between public safety and commerce is strange and discomfiting. The big battles of the next two years are going to be all about defending the regulatory achievements of the Obama administration — healthcare reform and bank reform — in addition to ensuring that the Environmental Protection Agency isn’t hamstrung by Republican opposition as it carries out its Supreme Court mandate to treat greenhouse gases as pollutants under the Clean Air Act.

The Salon article goes on to make the case that this is a terrible fumble by Obama:

The strategy is unfathomable, and the notion that we must now seek to strike the “proper” balance — as if the proponents of greater regulation had been carrying the day in recent years — is just plain nutty.

Here we go again. Why do they keep being deluded with example after example, with signal after signal, with appointment after appointment? Deluded that Obama is left leaning? That he’s even liberal? Other than a few speeches, just words, what in his past would lead them to think this? Haven’t they noticed who funded him, who basically created him? Why do we keep having these perfect examples, perfect demonstrations of who Obama really is only to have places like Salon or HuffPo or others gasp, act surprised, and shake their heads thinking he’s made a mistake or is getting bad advice.

No, it’s not a mistake. It’s not nutty. It’s not a fumble. This is who Obama is. It’s who he has always been. How many more examples do you people need? Have you bothered to read the health care bill or noticed who wrote it? Did you not notice the tax cut for the very wealthy. Did you not notice the lack of regulations or strings attached with the financial bailouts. This stuff has been from day 1 people.

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In related news, we’re going to see a new tone as the Republicans make noises like they want to repeal the health insurance lobbies hard fought victory represented by the Obamacare bill:

Obama issued a statement late Tuesday said he is “willing and eager to work with both Democrats and Republicans to improve the Affordable Care Act. But we can’t go backward.”

Republicans largely ignored an attempt by Democrats to rename the “Repealing the Job-Killing Health Care Law Act” to temper the language following the Arizona shooting this month that killed six and injured 13, including Rep. Gabrielle Giffords (D-Ariz.).

But Republicans now mainly refer to the “job-destroying” health care law.

“Obviously there are strong feelings on both sides of the bill and we expect the debate to ensue along policy lines,” said Rep. Eric Cantor (R-Va.), the majority leader. “We are going to be about decency here and engage and promote an active debate on policy.”

Of course what they want to do is repeal any good parts of the bill. And there may even be a few good parts stuck in there against the wishes of the lobbyists who wrote most of the bill. Republicans don’t really have the numbers to do anything in this round of kabuki theater. So this show is about setting the stage for later “compromises” and possible defunding efforts. Which sadly Obama will likely to all to wiling to go along with.

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Another front in the battle Republicans are waging against the working class should be of no surprise. Obama set up Elizabeth Warren in a pseudo position just for the purpose of giving the Republicans something to knock down. And that process looks to be starting soon:

The chairman of a financial services oversight panel sent a letter to Elizabeth Warren, head of the Consumer Financial Protection Bureau, saying he is skeptical of the new bureau’s very existence and demanded details about how it will operate.

Rep. Randy Neugebauer (R-Texas), who chairs an oversight panel of the Financial Services Committee, said in the letter sent Tuesday that he thinks Warren is “tasked with executing a fatally flawed plan.”

He then asked Warren to answer three pages worth of questions about the new bureau. Some of the queries are operational, including how Warren will staff and organize the agency. Others are more broad, inviting her to explain how Congress should best perform its oversight role, given the body is not funded through the traditional appropriations process.

Neugenbauer also wants details on meetings Warren has held with the Securities and Exchange Commission, the Federal Reserve, and other financial regulatory agencies.

“What policies are in place to avoid potential duplicative, conflicting or overlapping rulemaking that are currently underway, but will ultimately be under the regulatory authority of the CFPB?” he asked.

He concludes asking Warren to explain how she plans to “avoid the kind of over-regulation that might stifle innovation.”

And so it begins. The only hope we have of some sanity in consumer protection and financial regulations is about to be taken out. And it appears to have been planned this way from the beginning.

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As mentioned last night, Joe Lieberman has announced he won’t run for a fifth term. Which means he’ll server two more years. Does that mean he’s planning on running for President? Does that mean he’ll join whoever the Republican party bosses select for their presidential candidate on the ticket as VP? Or maybe he’ll just head over to K-street and collect is rewards.

Also mentioned last night, Sargent Shriver died at age 95. And Don Kirshner died at age 77.

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In strange political news, “Baby Doc” Duvalier decided to return to Haiti – never a good idea if you stole nearly 1B. And now he has been arrested and charged with corruption:

Jean-Claude “Baby Doc” Duvalier was charged with corruption and the theft of his country’s meagre funds last night after the former Haitian dictator was hauled before a judge in Port-au-Prince

Two days after his return to the country he left following a brutal 15-year rule, a noisy crowd of his supporters protested outside the state prosecutor’s office while he was questioned over accusations that he stole public funds and committed human rights abuses after taking over as president from his father in 1971.

“His fate is now in the hands of the investigating judge. We have brought charges against him,” said Port-au-Prince’s chief prosecutor, Aristidas Auguste.

He said his office had filed charges against Duvalier, 59, of corruption, theft, misappropriation of funds and other alleged crimes committed during his period in power.

What was he thinking?

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After Goldman Sachs invested gobs of money in Facebook with the intent to offer investment opportunities here and abroad, they’ve decided not here. Mostly to skirt around some SEC requirements. You know, being the upstanding corporate citizens that they are:

There was another question about the planned Facebook stock offering that went beyond whether the social media leader is a good investment now or if it’s overpriced. A more serious issue was how investment banker Goldman Sachs was structuring a “private placement” deal to skirt U.S. securities law.

Now it seems Goldman Sachs has decided that “intense media attention” no longer made it worthwhile to go forward with offering a piece of Facebook in the U.S.

Does that mean the deal is over? Does it mean that Facebook will do a deal in the U.S. with proper financial disclosure?

Unfortunately, neither. Instead, the Wall Street Journal is reporting today that Facebook will go ahead with its private stock sale but exclude U.S. investors from the deal.

“In a statement provided to The Wall Street Journal, Goldman said the move came after officials at the New York securities firm ‘concluded the level of media attention might not be consistent with the proper completion of a U.S. private placement under U.S. law,’ ” Aaron Lucchetti reports for the Wall Street Journal.

Under the planned offering, only wealthy clients of the investment firm would have been allowed to purchase a piece of Facebook. The arrangement sounded fairly complex; but basically, the idea was to put all the Goldman investors into a single fund and then count that fund as “one” investor. Why? By doing so, they would get around required public financial disclosures for any company with 500 or more investors. (There was more money coming in from another investment firm in Russia.)

Money for nothing and the clicks are free. Yea, I just made that up. TM by DT. So we the taxpayers make all this possible because they have our money backing them up allowing them to make riskier deals, and the deals they make are not just risky, but they’re fashioned only around the wealthiest clients. And the funny part here, it looks like it’s going to make suckers and losers out of these wealthy clients because they may be making yet another bubble with what they’re doing, that will just pop down the road. Time will tell.

And speaking of Facebook, they were planning on opening up users phone numbers and addresses to third parties, but have backed down, for now, after some complaints:

Just before the weekend, Facebook announced that it had expanded the information users are able to share with external websites and applications, to include home addresses and mobile phone numbers.

This enables developers of e.g. an ecommerce site to more easily fetch the address and phone number of a potential customer to streamline the checkout process.

For the record: users needed to explicitly opt to share this data before any application or website could access it, and they were evidently not able to share their friends’ addresses or mobile phone numbers with applications.

Sure enough, the dialog box (see below) wasn’t super clear about that, so Facebook was unequivocally opening itself up for a new sh*tshorm to hit the deck.

This morning, Facebook announced that it has temporarily disabled the sharing feature, looking to relaunch it in the next few weeks after making some changes.

Facebook dubs these future changes ‘improvements’ repeatedly, but of course the company is responding to the wave of criticism it has received for quietly releasing the new sharing feature, on a Friday evening no less.

I suspect they’ll enable it. But perhaps just add a bit more complexity to the privacy settings systems so there is an additional way to opt out. If you can figure it out of course.

That’s a bit of what’s in the news this morning. Chime in with what you’re reading.