We Need A Truth and Reconciliation Commission

Although mostly, we need truth. Senator Patrick Leahy explains:

I have proposed the idea of a truth and reconciliation commission to investigate abuses during the Bush-Cheney Administration -- so they never happen again. These abuses may include the use of torture, warrantless wiretapping, extraordinary rendition, and executive override of laws.

Please consider signing Leahy's petition here.

Baby Slippers

Too great.

(From Gizmodo via Ben -- thanks!)

Let's Be Clear; There Are Two Kinds of Bailouts:

(1) Those that actually buy something for the money; and

(2) Those that throw good money after bad.

As an e.g. of (2), see this from a CitiBank employee:

I'm involved with a $300 million condo-hotel development in the Caribbean. Citi has the whole loan (i.e., they didn't securitize or otherwise sell participations in the loan). Even now, we expect the hotel needs at least another $100 million to finish construction and open . . . . Hence, one might plausibly value this $275M loan at zero (i.e., a complete write off). I cannot imagine any stress test would uncover what a huge loss is on the way in the next 12 months. In fact, this loan has not even been pawned off to the nonperforming/distressed debt/workout section of Citi because the interest reserves make it "seem" like the loan is still performing, not to mention that completely out of date pro formas make it "seem" like (i) equity will come in to finish the project and (ii) condo sales will pay down a huge part of the principal once construction is complete. This scenario must be present in a large number of Citi loans, especially in their somewhat active foreign development divisions. Citi must be so far from solvent that it's not even funny. Only hyperinflation in the dollar could ever make it possible for the borrowers to pay back some of these loans. I'd bet that the sooner we face reality on some of these loans and just halt future fundings, the less money the taxpayers are going to lose. As it is, it's almost too late. Too bad for the US taxpayer.

(Emphasis supplied.) Full text here.

The (1) kind would be the kind that actually helps us plebes.

We Can't Fix the Economy Without Knowing What Broke

Really great article at HuffPo. Among other highlights:

Fact Checking Time's List of 25 People to Blame

* * * * *

2. Phil Gramm Bottom Line: He deserves to be at the top of the list. It's hard to overestimate the damage he caused.

Unmentioned by Time: Gramm slashed the SEC's budget, stacked the CFTC with his cronies, helped emasculated investor protections under the SEC acts. [E.g., Gramm led the charge to repeal Glass-Steagall, among other things, which, during the decades since the '29 Crash until repealed, had worked to protect against losses by prohibiting banks from engaging in the kinds of excessively risky investments that caused the 1929 crash.]

3. Alan Greenspan Bottom Line: Time sanitizes Greenspan's record.

Greenspan recklessly ignored parts of his job description, which included correcting the regulatory loopholes that allowed predatory lenders like Ameriquest to flourish. And he recklessly ignored evidence of the risks. After the S&L crisis of the early 1990s, everyone knew the hazards of unregulated mortgage lending. (Greenspan had championed S&L deregulation and was a big booster of Charles Keating.) Everyone knew that subprime mortgage lending was fraught with peril and could lead to financial disaster by June 2000, when First Union wrote down its entire $2.8 billion investment in The Money Store, a subprime lender acquired two years earlier. But Time gives it all a "mistakes-were-made" spin, merely noting that "his long-standing disdain for regulation underpinned the mortgage crisis."

Time's Conspicuous Omission: The Republican Congress.

"Federal lawmakers didn't pose much of a threat to the subprime industry in recent years. Members of Congress received at least $645,000 in donations from Ameriquest and large sums from other big subprime lenders, Federal Election Commission records indicate. They debated new oversight of the industry, but took no action." The Wall Street Journal, December 31, 2007

* * * * *

5. American Consumers Bottom Line: Part of the phony "plenty-of-blame-to-go-around" narrative.

"We really enjoyed living beyond our means... Household debt in the U.S.--the money we owe as individuals--zoomed to more than 130% of income in 2007, up from about 60% in 1982... Now we're out of bubbles." Time neglects to mention how those bubbles were inflated with artificially low interest rates and a new tax exemption on dividends during the run up to the 2004 election.

Time's Conspicuous Omission: Republican Tax Cuts. In terms of living beyond our means, consider this. In 2000 Federal revenues (excluding social security) were $1.54 trillion versus $1.46 trillion in outlays. In 2003, long past a recession that ended in November 2001, Federal revenues were $1.26 trillion (an 18% decline) versus outlays that were $1.8 trillion. Revenues had declined three years for three years in a row, something unprecedented since the Great Depression. And this was before we started tallying the cost of the Iraq war.

6. Hank Paulson Bottom Line: Time gets it right, though Paulson should be in the top 3.

Stimulus v. Iraq

Stimulus Bill Requires RSS Feeds of How the Money Is Spent

Re-blogged from boingboing.

As one commenter not entirely unknown to you observes,

Any step toward transparency is helpful -- if info given turns out to be false, at least someone can be embarrassed by it, if not prosecuted. The next challenge is to get someone who knows what they're doing to actually read it.
I think we can count on the Republicans to scrutinize Dem expenditures; not so sure that'll be reciprocated.
Note: The same IT our fearless leaders are using to mine all our e-mails, etc. for items of interest [terrorism/peace activism] can theoretically be used by us plebes to monitor our gummint (would someone pls DO this; otherwise, impt. info could easily be buried in mountains of less useful data).

I also liked Comment #13: "US$1,200,000,000.00 . . . Poof!" [most of you should probably skip to 1.52 min., although the video starts with a more successful take-off, which I enjoyed, since to me Stealth bombers are the best thing next to Batman]:

Who Says Guys Can't Dance.

(Via boingboing.) Can't wait to hear him 10 yrs. from now. (Thanks, Ben!)

Juan Enriquez on Homo Evolutis

I liked this talk. As I wrote in 2000, "We may already have commenced our greatest creation, the species that will succeed us and carry on." I wish we could hurry up and engineer better bankers and Congresscritters.