Bipartisan BOHICA

---

---

Every time you hear how “the Republicans are worse” you should think about this story from Moneynews:

---

A bill that homeowners advocates warn will make it more difficult to challenge improper foreclosure attempts by big mortgage processors is awaiting President Barack Obama’s signature after it quietly zoomed through the Senate last week.

The bill, passed without public debate in a way that even surprised its main sponsor, Republican Representative Robert Aderholt, requires courts to accept as valid document notarizations made out of state, making it harder to challenge the authenticity of foreclosure and other legal documents.

The timing raised eyebrows, coming during a rising furor over improper affidavits and other filings in foreclosure actions by large mortgage processors such as GMAC, JPMorgan and Bank of America.

Questions about improper notarizations have figured prominently in challenges to the validity of these court documents, and led to widespread halts of foreclosure proceedings.

The legislation could protect bank and mortgage processors from liability for false or improperly prepared documents.

The White House said it is reviewing the legislation.

“It is troubling to me and curious that it passed so quietly,” Thomas Cox, a Maine lawyer representing homeowners contesting foreclosures, told Reuters in an interview.

A deposition made public by Cox was what first called attention to improper affidavits by GMAC.

Since then, GMAC, JPMorgan and others have halted foreclosure actions in many states after acknowledging that they had filed large numbers of affidavits in which their employees falsely attested that they had personally reviewed records cited to justify the foreclosures.

Cox said the new obligation for courts to recognize notarizations of documents filed by big, out-of-state companies, would make it more difficult and costly to challenge the validity of the documents.

[…]

“Constituents” Pressed For Passage

After languishing for months in the Senate Judiciary Committee, the bill passed the Senate with lightning speed and with hardly any public awareness of the bill’s existence on Sept.27, the day before the Senate recessed for midterm election campaign.

The bill’s approval involved invocation of a special procedure.

Democratic Senator Robert Casey, shepherding last-minute legislation on behalf of the Senate leadership, had the bill taken away from the Senate Judiciary committee, which hadn’t acted on it.

The full Senate then immediately passed the bill without debate, by unanimous consent. The House had passed the bill in April.

The House actually had passed identical bills twice before, but both times they died when the Senate Judiciary Committee failed to act.

Some House and Senate staffers said the Senate committee had let the bills languish because of concerns that they would interfere with individual state’s rights to regulate notarizations.

Senate staffers familiar with the judiciary committee’s actions said the latest one passed by the House seemed destined for the same fate.

But shortly before the Senate’s recess, Judiciary Committee Chairman Patrick Leahy pressed to have the bill rushed through the special procedure, after Leahy “constituents” called him and pressed for passage.

The staffers said they didn’t know who these constituents were or if anyone representing the mortgage industry or other interests had pressed for the bill to go through.

These staffers said that, in an unusual display of bipartisanship, Senator Jeff Sessions, the committee’s senior Republican, also helped to engineer the Senate’s unanimous consent for the bill.

Neither Leahy’s nor Session’s offices responded to requests for comment Wednesday. (emphasis added)

---

Hey Mr. Leahy! In the immortal words of Richard B. “Dick” Cheney:

---

“Go fuck yourself!”

---

To which I add “And the donkey party you rode in on!”

---

---

_____________________________________________
UPDATE:

(From WCMB in the comments)

They are obfuscating because the problem isn’t the foreclosures themselves. The problem is all the mortgage-backed securities that spun off of those original notes – all the “side bets” that leveraged the original mortgage up to many multiples of the first note. Those are sitting on the big banks’ and hedge funds’ fake balance sheets of “assets” like big ole stinking turds.

The law required due diligence, and that non-performing loans did not get bundled into those “assets”. And the banks all winked and nodded and proceeded to pile garbage by the truckload into those “baskets” of derivatives, not bothering with the paper trail that was legally required. They were making money hand over fist on this Ponzi scheme, and figured they would never get caught because the housing bubble would never pop.

It’s not the foreclosures that will blow the whole thing sky high, it’s the side bets. Hillary knew this, which is why she wanted to actually unwind the MBS market, identify the toxic assets, and put them in a federal “bank”, a separate “pile” to isolate them from the rest of the system. Isolate them FIRST, leaving the banks healthy, then make decisions as to solutions for the toxic pile.

Our corporate govt is going to write a law, give a waiver, whatever they have to do to make sure that all that shaky leverage the banks took on is never exposed. Because if the banks are forced to take their real losses, many of them implode immediately.

The 700 billion bailout did NOTHING to clean up their balance sheets. Not one goddamn thing. They are as insolvent in reality as they were when this shit started, no matter what their fictional balance sheets say.

Making them eat their losses in a structured, organized way, with some help from the treasury so that the whole system didn’t go down, would have been a difficult time for the economy. It would have sucked for the country. But we would have come out of it with clean accurate balance sheets and a solid foundation to rebuild.

Instead, we spent 700 billion papering over the theft, only to wind up now right back where we started, with the rot still lurking there underneath, threatening at any moment to go kaboom once again.

---

Was Obama Wall Street’s BIGGEST Short?

Blankfein (left) and Jamie Dimon (center) at the White House, March 2009

You gotta love Lloyd Blankfein for finally telling it like it is.  Wall Street thinks we’re all suckers.  If you don’t specifically ask whether a security or CDO is crap, shitty or junk, they have no obligation to tell you.  That’s not their job.  They just sell the stuff.  It’s the 2010 version of “I just take orders”.  There’s got to be another Milgram experiment just waiting for a post doc in yesterday’s hearings.

Here are some gems from Lloyd:

Levin asked Blankfein if Goldman has to disclose to investors in securities it sells that the firm plans to take and keep the short side of the transaction.

“I don’t think we have to tell them,” the chief executive replied. In addition, he said that when underwriting a securities offering, Goldman has an obligation to conduct thorough due diligence and provide full disclosure of the assets and risks involved in the deal.

Mortgage-related securities that Goldman underwrote and sold delivered the specific exposure that clients wanted, Blankfein explained. “There are a lot of opinions about how a security will perform against the market it’s in.

“Investors we’re dealing with on the long or the short side know what they want,” he continued. “If they ask the salesperson their opinion, they have a duty of honesty. But we’re selling securities all the time that are weak. The same securities that were the subject of those comments can probably be bought today for pennies on the dollar.”

and this from the NY Times:

Mr. Blankfein was asked repeatedly whether Goldman sold securities that it also bet against, and whether Goldman treated those clients properly.

“You say betting against,” Mr. Blankfein said in a lengthy exchange. But he said the people who were coming to Goldman for risk in the housing market got just that: exposure to the housing market. “The unfortunate thing,” he said, “is that the housing market went south very quickly.”

Senator Levin pressed Mr. Blankfein again on whether the his customers should know what Goldman workers think of deals they are selling, and Mr. Blankfein reiterated his position that sophisticated investors should be allowed to buy what they want.

Mr. Blankfein was also pressed on the deal at the center of the S.E.C. case. He said the investment was not meant to fail, as the S.E.C. claims, and in fact, that the deal was a success, in that it conveyed “risk that people wanted to have, and in a market that’s not a failure.”

Risk.  That’s what Goldman Sachs was selling.  It was all wrapped up in a pretty fiction of established Wall Street investment houses, where bankers arrive at their offices in chauffered limos and eat in luxurious dining facilities and work out in gold plated gyms.  It all looks very clubby.  But the reality was that these people were running a giant Monte Carlo casino using the hard earned retirement funds of carpenters and other working class people.

Behind the plush digs and $600 suits and cottages on The Pond are a bunch of guys with serious gambling addictions.

Sometime back in 2006 as housing prices peaked and started to decline some of them must have started to get a little concerned.  In fact, Michael Lewis, who wrote The Big Short, says that outsiders looking in had the bankers’ number in 2003-2004.  It was March 2007 when the money started to drain away in earnest.

So, when did Wall Street decide to short the presidential election?

Think about it:  Many of the people on Wall Street should be at Gambler’s Anonymous.  in 2007, they were about to lose everything if they couldn’t find suckers to play their games and cover their bets.  Politics could have had a big influence on how much of a hit they actually had to take.  Charlie Ledley, the garage-band head fund guy with a conscience who actually tried to explain the bets to the SEC, was concerned with his own short positions.  He naively thought that if the federal government came to the rescue of homeowners, his CDS’s would be worthless.  As it turned out, the government bailed out the banks instead so Charlie made out big.  The CDO’s are still crap.

But if you are a Wall Street banker, you have to account for all kinds of possibilities.  Picture the following three scenarios:

1.) A Republican wins.  His party saw what happened during the last financial meltdown 80 years ago.  That New Deal thing was a disaster for his party.  He’s not going to make that mistake.  Screw Keynes, enter The Great Depression 2.0.  Oddly, Wall Street is probably not too keen on this idea.  You can’t play the game if you don’t have easy marks on the other side of the bet.  Depressions severely depress the number of easy marks.

2.) Democrat #1 wins.  But she’s too much of a New Dealer type.  She’s got mortgage bailout written all over her.  That would mean regulation and mortgages will be adjusted and bankers will have to take a loss.  That’s too much reality.  She’s like frickin’ rehab.  And besides, there’s always that remote possibility that the people who took out “liar’s loans” will suddenly have stupendous wage increases just in the nick of time when their 2 year teaser rate is up.  It could happen.  So, no, Democrat #1 is out.

3.) Democrat #2 is narcissistic one-trick pony with a pregnant mistress.  Nominating him means the Republican wins.  Moving on.

4.) Democrat #3.  Ooooo, this one is intriguing.  Did Wall Street court him or did he court Wall Street?  Recklessly ambitious type.  Muy simpatico.  He certainly looks like he could fit into Wall Street.  He wants to “form multi-disciplinary task forces to re-engineer our core processes so that we’re a world class organization”.  He speaks their language.  It’s meaningless, of course, and they all know that way down deep inside.  It’s code.  He’ll scratch their backs if they scratch his, to the tune of $900K in campaign contributions from Goldman Sachs employees alone.  With Dem #3, it will be an exciting spin of the wheel.  They’ll get close to the edge, probably a little too close for comfort, but in the end, they’ll be able to walk away with big profits, big bonuses and they can keep on playing.  This guy is an enabler.  Double down.

Obama sure made a lot of campaign money from Wall Street.  His small donors accounted for something like 30% of his campaign stash.  You don’t get a cool billion to run for president without making a lot of banker friends.  It was their biggest short.

In light of that very real possibility, can we on the left finally dispense with the idea that Obama was the Change! agent?  Lots of money will get you a very good PR firm with all of the marketing, astroturfing and social engineering you can eat.  Maybe he’s not the civil rights hero, politically brilliant, 11 dimensional chess playing, post partisan Messiah everyone thought he was.  Maybe he was just the best hedge Wall Street ever made and nothing more than that.  You can stop pinning your hopes and dreams on him.

As Lloyd would say, “the investment was not meant to fail, as the S.E.C. claims, and in fact, that the deal was a success, in that it conveyed “risk that people wanted to have, and in a market that’s not a failure.””

The Obots bought it and made suckers of us all.

Extra: Michael Lewis has a lengthy piece in Slate where he plays his tiny violin for the bond market traders who are suddenly getting blamed for everything they do.

Simon Johnson at BaselineScenario.com has a piece about how some parts of Europe have slipped into “emerging market” status overnight and how the rest of the world is turning their eyes to Obama for comfort and guidance to stem the ensuing panic.  Good luck with that.

Common Sense and the sensus communis: anatomy of an American pressure cooker

Gay-Lussac

The pressure of a fixed mass and fixed volume of a gas is directly proportional to the gas’s temperature.

This relationship is known as the Gay-Lussac’s Law and a pressure cooker is an example of the law in practice. Cooking under pressure creates the possibility of cooking with high temperature liquids because the boiling point of a liquid increases as its pressure increases. High pressure and high heat can result in delectable dishes.

Cooking under pressure can be also dangerous because as liquids change phase into gases their volume expands greatly. For example, at atmospheric pressure the volume of steam is about 1700 times greater than the volume of water. To prevent pressure cookers from becoming bombs, relief devices (pop safety valves) are employed that are capable of relieving all of the steam the vessel is capable of producing.

America the Beautiful Pressure Cooker

The political pressure cooker is beginning to heat up. The power brokers and institutions that drive the nation have arrived unannounced on the doorsteps of America like a gaggle of unwanted, high maintenance relatives that demand hospitality for an unforeseeable time and that won’t take no for answer. Furthermore, they’ve announced that more relatives are on the way. Whatever plans America’s householders had, they’ve just gone out the window, with their household budgie and the relatives’ cat in hot pursuit.

People are justifiably angry with this incursion. Their budgie might not have been much, but it was “their budgie”, nurtured from birth into what it had become. Justifiably angry householders are trying to work out why the relatives arrived on their doorsteps and why they brought their fucking cat.

The Culture of Cannibalism in US Politics: The Cycle of Corruption

Mark Twain, in “Cannibalism in the Cars,” suggested that cannibalism of the body politic is a logical outcome of the practice of the political values of the elected representatives of the United States, in dire circumstances. What would occur, if such dire circumstances did not require a natural disaster, but became a systemic feature of the political landscape?

The current economic crisis and America’s abject failure to provide economically-efficient, affordable healthcare are two examples of dire circumstances that are systemic features of America’s political landscape. Both crises are the results of bad governance. Both circumstances are direct products of the growth of influence of en-corporated political interests (encorps) in the system of governance of the United States. Bad governance, in both cases, involves a betrayal of the public trust that is manifested in not regulating the encorps in a way that protects the public’s interests, especially with respect to not meaningfully regulating the encorps ability to influence government officials.

The United States was born wary of the power of vested interests to influence public policy. Alexander Hamilton’s comments in the Federalist Papers are an example of this concern. .

In republics, persons elevated from the mass of the community, by the suffrages of their fellow-citizens, to stations of great pre-eminence and power, may find compensations for betraying their trust, which, to any but minds animated and guided by superior virtue, may appear to exceed the proportion of interest they have in the common stock, and to overbalance the obligations of duty.

Unfortunately, keeping the vested interests out is not a simple matter. How can it be when parties themselves are collective expressions of a set of weighted interests? Frankly, it is sensible for people of like purpose to strive together to achieve their aims, and there is nothing necessarily insidious about the practise. In fact, it’s a cornerstone of Democracy and civil society.

It is also, however, the entry way for corruption because the crux of the matter is not that people have differing and competing interests: it’s that they differ so greatly in terms of their power to realize those interests. When the power to realize those interests is used to unjustly deny the interests of less powerful, but equally or more deserving citizens, through a donation that is traded for a piece of unjust legislation, then it can be said that a positive feedback loop of corruption has been initiated.
The overly simple analysis that follows attempts to describe the basic workings of this system.

Did Hank Paulson Use TARP as a “Ruse” to Rescue Citigroup?

Be sure you’re sitting down before you read this, Okay? Barry Rithholtz speculates in his forthcoming book, Bailout Nation that the entire multi-trillion dollar boondoggle was

a giant ruse, a Hank Paulson engineered scam to cover up the simple fact that CitiGroup (C) was teetering on the brink of implosion. A loan just to Citi alone would have been problematic, went this line of brilliant reasoning, so instead, we gave money to all the big banks.

From the book:

As of October 2008, the other banks, while somewhat worse for wear, neither wanted nor needed the capital injection. None of them were in the same trouble as Citi. Even Bank of America’s problems via Merrill Lynch wouldn’t become acute until December 2008. Washington Mutual, the most troubled on the list, had already been put into FDIC receivership the month before.26 JPMorgan bought WaMu from the FDIC for under $2 billion, and Wachovia was swept up by Wells Fargo for about $15 billion. Thanks to a change in the tax law, Wells Fargo got to shelter $74 billion in profits from taxation. Instead of the FDIC absorbing a few billion in losses from Wachovia’s bad assets, the taxpayers lost 35 times that amount.

According to Rithholtz, today’s news that ten banks are going to pay back the TARP funds provides support for his thesis:

The hurry to repay this cheap cash confirms that the fix was in. If these banks were really in the bad shape Paulson suggested, they would hold onto this cheap source of credit. Instead, they want to throw the yoke of government monies off as soon as possible. The desire to return to their old compensation packages for executives cannot be the only factor . . .

In other words (or as President Obama would say, “Let us be clear”) our government spent $2.25 trillion and put our social safety net and maybe even the future of our country in jeopardy in order to rescue one huge bank that should have just been allowed to go bankrupt. I think I’m going to scream now.

Rithholtz went into more detail in an interview with Bloomberg Radio yesterday. You can listen to it here. In the interview, he makes the argument that huge corporate bailouts always seem to happen in election years. {{Sob!}} There’s a little good news in the broadcast, I guess; since Rithholtz says that while things are still getting worse, it isn’t happening as quickly as before. He thinks maybe we are going to pull out of this without falling all the way into another Great Depression.

Oh goody. But I’d feel a whole lot better about that prediction if I could see any sign that the government cares even a tiny bit about jobs and health care and such mundane needs of ordinary people as opposed to protecting banksters from their own stupidity and greed.

(See also Dakinikat’s post from earlier today.)

UPDATE: The Wall Street Journal has a new article in which they argue that Citigroup should be broken up.

Resolving Citi — by either forcing it into a strategic partnership, if anyone will have it, or selling off its assets and breaking it up — wouldn’t be cheap, but it would have a number of benefits. It would remove the leading candidate for zombie-bankdom from the financial system. It would also, finally, put an end to the slow bleeding of taxpayer money into the bank.

Please DIGG!!! and SHARE!!!

Your Breakfast Read, Served By The Confluence

The “homosexual agenda” on the march
After MA, CT, IA, VT, ME too has decided to get into the “marriage-ruining” business. NH is waiting around the corner.
Maine Governor Signs Same-Sex Marriage Bill

Gov. John Baldacci of Maine signed a same-sex marriage bill on Wednesday minutes after the Legislature sent it to his desk, saying he had reversed his position because gay couples were entitled to the state Constitution’s equal rights protections.

Isn’t it about time Obama undertakes something about this pervasive homosexual agenda? So far he’s been silent on DADT, hasn’t said a word about the proliferation of gay marriages, and has kept mum while some are talking about a gay Justice on the SCOTUS. At least we know Hillary would have shot gays in the face.
With Gay Issues in View, Obama Is Pressed to Engage

Dems to Specter: Watch out!
I count myself amount those who were happy Arlen Specter left the Republican Party to join to Dems, not for the sake of Specter himself but simply because it’s a zero-sum game. He has to be reminded that Dems have him by the nuts sack.
Meltdown: Specter stands alone

Since declaring himself a Democrat last Tuesday, Specter has defied Senate Majority Leader Harry Reid and the White House on virtually everything that’s come down the pike: the budget, mortgage reform, the Al Franken-Norm Coleman race, even President Barack Obama’s appointment of Dawn Johnsen to head the Justice Department’s Office of Legal Counsel.
All while quibbling over whether he said he’d be a “loyal Democrat” — and insisting that he had an “entitlement” to transfer his Senate seniority from one side of the aisle to the other.

Specter Isn’t Sitting Too Pretty These Days

What to do with “Torturegate” architects?
Bush attorneys who wrote terror memo face backlash

Iraq, the good and the bad

The Good:
Blackwater era ending in Iraq

The Bad:
Ambush by an Ally Chills Trust in Iraqi Units

When the gunfire broke out, Capt. Sean K. Keneally scrambled over to Master Sgt. Anthony Davis, who was lying flat on his back, and dragged him to a nearby building.
It was too late. Sergeant Davis, a member of a small team of American military advisers embedded with an Iraqi Army battalion in this remote town, was dead.

Af-Pak
Civilian Deaths Imperil Support for Afghan War

Clinton expresses ‘deep regret’ over deadly US airstrike in Afghanistan

Pakistan Strife Fills a Hospital With Refugees

Obama applauds Afghan and Pakistan cooperation

Entertainment recommendation for SoS Hillary Clinton
Hillary Clinton, Watch These Movies!

High Noon, Godfather II, Grand Illusion, and 22 other indispensable movies for understanding war and diplomacy.

Staving off a Depression
Budget Proposes Cuts in 121 Programs

President Barack Obama’s detailed 2010 budget plan, due out Thursday, will propose to eliminate or consolidate 121 domestic and defense programs to save $17 billion, administration officials said Wednesday.

After being stress-tested, BofA needs another $34,000,000,000, Wells Fargo $15,000,000,000 and Citi $5,000,000,000
Fed’s Bank Results ‘Reassuring,’ Show No Insolvency

Banks Need at Least $65 Billion in Capital

American stocks surge after leaked results of banking stress tests bring relief to investors

Timmy explains the methodology. (Wasn’t it some giant Monte Carlo simulation?)
How We Tested the Big Banks (Timothy Geithner)

U.S., Europe Are Ocean Apart on Human Toll of Joblessness

Rupert wants to charge the Internets
News Corp will charge for newspaper websites, says Rupert Murdoch

He wasn’t only a big time crook
The Bernard Madoff I knew: former secretary tells of sexist, sex-mad swindler

What Does “Qualified” Mean?
People opposed to identity politics on the SCOTUS like to propagate the trope about the “most qualified” person for the job. Let’s forget the fact that a SC Justice doesn’t have to be a lawyer, there are a gazillion people with a law degree in the US. Who’s the most “qualified” for any single job among them? “The SCOTUS is not the place for identity politics.”Really? Why not? It’s all about the best fit.
Identity Politics Not New to Supreme Court

W.E.B. Du Bois was quick to endorse the appointment of Louis Brandeis to the Supreme Court. “As a Jew,” Du Bois said, quoting Isaiah, Brandeis knows the experience of “being despised and rejected of men.”

Prepare to be awed by Odd Day

---

Please DIGG & SHARE:

Your Breakfast Read, Served By The Confluence

The fight over Souter’s replacement on the SCOTUS
From The Politico

The top candidate, on paper, is Sotomayor, 54, a Clinton appointee to the Second Circuit Court of Appeals. She meets the empathy criteria, having grown up poor in the South Bronx, as well as Obama’s preference for sterling credentials, having graduated from Yale Law School.

Even before Souter’s retirement was formally announced, some in the GOP already say they’re gearing up for a fight with Obama over his nominee, particularly if he picks Sotomayor. “The GOP obviously does not have much power in D.C. these days, but just like we helped ourselves by opposing the deficit-busting stimulus, opposing left-wing nominees like her is our path back to the majority,” one Republican source said.

Souter’s Retirement Sets Stage for Nomination Fight

Obama may break with tradition for high court pick

Obama to Seek a Justice Attuned to ‘Daily Realities’

James Walcott reads Ed Whelan from NRO who “lays out the staggering toll facing the nation once Souter’s seat is filled by an Ivy League amalgam of William Kunstler, Susan Sarandon, and Richard Dawkins’ selfish gene dressed in a Che Guevara t-shirt.” He goes through the “horror list” and does his darndest best to assuage Whelan’s angst
Radical Left-Wing Agenda to Raise Army of Clones

---

GOP Quo vadis?
Here is SC Senator Jim DeMint’s reaction after Senator Specter switched parties:
“I would rather have 30 Republicans in the Senate who really believe in principles of limited government, free markets, free people, than to have 60 that don’t have a set of beliefs.” (Sweet Jesus may that wish be granted!)

The good Senator from SC took his case to the op-ed page of the WSJ in a column oxymoronically titled
How Republicans Can Build a Big-Tent Party

Here’s Kimberly Strassel from on the same pages
The GOP After Specter

Once she was done drooling all over Obama’s performance during his last press conference (I didn’t know she had much drool left after slobbering for years all over George Bush), Peggy Noonan also offered her 2c
‘Shrink to Win’ Isn’t Much of a Strategy

Tobin Harshaw at the NYTimes Opinionator has a very good compendium of the debate
Weekend Opinionator: Souter, Specter and the Future of the G.O.P.

---

I know it’s already the 102nd(?) day of the Obama administration but we can still catch up and we will. Preety Aroon from the FP Blog has a
Roundup of Hillary Clinton’s first 100 days

---

What should we do about the “swine” flu?
Why Swine Flu Isn’t So Scary

Flu fighters warn against complacency, seek clues

Nestlé bans staff travel to US

A Spotty Response to the Flu Threat

Gail Collins chimes in
Joe Biden, the Flu and You

---

Oh no! Obama to his Liberal base: “So long suckers”. Again. Is it status quo we’re smelling?
U.S. May Revive Guantánamo Military Courts (h/t myiq2xu)

The Obama administration is moving toward reviving the military commission system for prosecuting Guantánamo detainees, which was a target of critics during the Bush administration, including Mr. Obama himself.

---

We’re not quite done with Iraq (will we ever) but the next nightmare is already here
US faces Iraq-like spending problems in Afghanistan

The US record on reconstruction spending in Iraq continues to be less than stellar, lawmakers complain, raising fears that US spending in Afghanistan could be plagued by the same kinds of excess and lack of accountability.

Gates reluctant to bolster U.S. Afghan force further

As it leaves Iraq, Britain looks warily to Afghanistan

Pakistan is fighting the Taliban
Pakistan gains some ground against Taliban

---

The latest from “Torturegate”
The lowly prison guards jailed for “prisoners abuse” are sick of being scapegoated and are asking themselves while they are sitting there. Somebody tell Condoleezza Rice.
‘Abu Ghraib US prison guards were scapegoats for Bush’ lawyers claim

Prison guards jailed for abusing inmates at the Abu Ghraib jail in Iraq are planning to appeal against their convictions on the ground that recently released CIA torture memos prove that they were scapegoats for the Bush Administration.

---

Thoughts on the Chrysler Bankruptcy
Union Takes Rare Front Seat in Chrysler Deal

The Business Week: Chrysler’s Holdouts

Why we should thank the Chrysler hold-outs (Felix Salmon)

---

What did the Monte Carlo simulation performed on the banks tell us?
Stress test results to be released on Thursday

Citi Said to Need Up to $10 Billion

---

Life in The Big Apple is about to become even more expensive
Bloomberg Proposes Sales Tax Increase

---

This wasn’t Jane Harman’s doing, was it?
U.S. Drops Case Against Ex-Lobbyists
Former AIPAC Employees Faced Espionage Charges

---

Women are on the march.
Girl power: Is there a new revolution in China?

---

Please DIGG & Share:

Your Breakfast Read, Served By The Confluence

US has its first flu death
First U.S. swine flu death confirmed

A two-year-old child in Texas has become the first fatality from swine flu in the United States, officials said Wednesday.

Arlen Specter decides to make life even more miserable for the GOP
Specter Leaves GOP, Shifting Senate Balance

GOP Confronts Its Future Viability

In losing control of the House and Senate over the past four years, congressional Republicans have also lost much of their ideological and geographic diversity — raising questions about the GOP’s viability as a national party. The party has suffered in particular in the Northeast and mid-Atlantic regions, and among moderates.

100-day boost for Obama as Republican senator defects

In a huge boost for Barack Obama and his reformist programme, the veteran Pennsylvania Republican Arlen Specter announced yesterday he was switching to the Democrats. The shock move underlines the growing marginalisation of the Republicans in US politics, and makes it more than likely his new party will soon have a filibuster-proof majority in the Senate.

The swine flu is all over the place and is serious
Virus’s Arrival Is Reported on Four Continents

More evidence of the global spread of a deadly flu emerged Tuesday, with new cases reported on four continents and a growing number of people in the U.S. requiring hospital treatment.

Swine flu spread points to global pandemic

Barack Obama sought an extra $1.5bn from Congress on Tuesday as the US sharply stepped up its response to the growing spread of swine flu from Mexico around the world.

More on Obama’s first 100 days
Obama marks whirlwind first 100 days in office

Liberal Dems want co-tortured architect Jay Bybee impeached
Pressure grows to impeach Judge Jay Bybee over ‘torture memos’

Friday: Now, let me get this straight…

Outland by Berkeley Breathed

Goldman-Sachs (G-S) and AIG go to the government last fall for money.  Hank Paulsen, our former Treasury secretary is a former CEO of G-S.  AIG hires a new CEO because the old one was under fire.  The new one, Edward Liddy, takes up the thankless task for token compensation- and $3M dollars for sitting on the board of…

wait for it

…Goldman-Sachs.

Yes, this is the same G-S that produced the faniciful earnings statement that ingeniously did away with the month of December 2008.  Yep, didn’t exist.  You know that painfully awkward holiday dinner you spent with the fam?  Never happened.

This is the same G-S who miraculously “raised” $10B dollars so that it can now give back the TARP money that it got from the government.  And the reason they want to give it back is because they don’t want no stinkin’ government telling them how much money they can give their stellar executives in bonuses.  It’s not the American Way.  It’s unnatural.

But this very same G-S, whose bank board member, Edward Liddy now sits as head of AIG, was funneled mucho dinero from the last bailout from AIG to cover its losses while other investors were forced to take losses.  No conflict of interest there:

He has said that he considers his work at A.I.G. to be a public service, performed on behalf of the taxpayers, who ended up with nearly 80 percent of the insurance company. His goal is to dismantle the company and sell its operating units, using the proceeds to pay back the rescue loans. On Thursday, A.I.G. said it had sold its car insurance unit, 21st Century Insurance, to the Zurich Financial Services Group for $1.9 billion.

Along the way, Mr. Liddy has clearly disclosed that A.I.G. was serving as a conduit, with much of the rescue money passing through and ending up in the hands of A.I.G.’s trading partners.

Goldman has said in the past that it had collateral and hedges to reduce the risk of its exposure to A.I.G.

Still, his stake could represent a potential conflict and is likely to reignite questions about Goldman’s involvement in A.I.G., and about why taxpayer money was used to shield A.I.G.’s trading partners from losses, when asset values plunged everywhere and most investors suffered greatly.

Had A.I.G. simply declared bankruptcy, the financial institutions doing business with it would have ended up in court, as they did in the case of Lehman Brothers, fighting to get pennies on the dollar for their claims.

Instead, Goldman Sachs received $13 billion of the Federal Reserve’s rescue money to close out various contracts it had outstanding with A.I.G. It was one of the biggest beneficiaries of the government rescue.

Yes, Edward Liddy is performing a public service no less valuable than the social worker who handles hundreds of foster care cases or the firefighter or the friendly and helpful IRS phone support that helps you finish your tax return on time.  Surely, SURELY, Mr. Liddy deserves some respect for the sacrifices he is making on our behalf.

Simon Johnson is very concerned about the possible conflict of interest and the criminality of this setup.  He has some very Watergate-esque questions for these dedicated public servants:

According to the NYT report, Mr Liddy has an apparent conflict of interest.  Please answer these question as simply and directly as possible, because otherwise they will be repeated indefinitely.  When did Mr Liddy disclose this and to whom at the Federal Reserve Bank of New York (or to which other responsible government officials)?  What did Hank Paulson, then Secretary of the Treasury and former CEO of Goldman Sachs, know and when did he know it?

Tut=tut, Mr. Johnson.  You are behaving like these men are criminals.  Is that any way to speak to people who are doing us a favor in these troubled times?  Antitrust indeed!  These are our betters.  You’re British.  You understand noblesse oblige and upstairs/downstairs stuff better than we do.  Why can’t you just accept the natural order and show us Americans how it’s done?

Meanwhile, Paul Krugman is being a fricking crepe-hanger again and stamping all over everyone’s greenshoots.  It’s spring, Paul, fergawdssakes.  Go outside and smell the periwinkle.

B-B-B- But we MUST pay the Bank (Health Care is Still Off the Table)

Taking health care off the table wouldn’t bother me so much if actually made some sort of financial (or logical) sense. Or for that matter if it was actually possible. But, I’m sitting here waiting to go for a doctor’s appointment and a blood test and no one took my diabetes or the co-payment off the table.

You see, we are already paying for health care. A National Single Payer Health Care Plan would only shift some of the money that’s going to pay for administrative costs to private insurance companies murder-by-spreadsheet — using it to cover the medical expenses of the un (and under) insured. From the Physicians for a National Health Plan, Single Payer FAQ:

Won’t this raise my taxes?

A universal public system would be financed in the following way: The public funds already funneled to Medicare and Medicaid would be retained. The difference, or the gap between current public funding and what we would need for a universal health care system, would be financed by a payroll tax on employers (about 7%) and an income tax on individuals (about 2%). The payroll tax would replace all other employer expenses for employees’ health care, which would be eliminated. The income tax would take the place of all current insurance premiums, co-pays, deductibles, and other out-of-pocket payments. For the vast majority of people, a 2% income tax is less than what they now pay for insurance premiums and out-of-pocket payments such as co-pays and deductibles, particularly if a family member has a serious illness. It is also a fair and sustainable contribution.

Currently, 47 million people have no insurance and hundreds of thousands of people with insurance are bankrupted when they have an accident or illness. Employers who currently offer no health insurance would pay more, but those who currently offer coverage would, on average, pay less. For most large employers, a payroll tax in the 7% range would mean they would pay slightly less than they currently do (about 8.5%). No employer, moreover, would gain a competitive advantage because he had scrimped on employee health benefits. And health insurance would disappear from the bargaining table between employers and employees.