If someone hasn’t already grabbed you and insisted that you must stop everything and read Matt Taibbi’s stellar piece of explanatory journalism about the global economic crisis in the upcoming issue of Rolling Stone, allow me to grab you and insist now.
Taibbi swears a whole lot, and one can nit pick about whether he did or did not blame everybody who needed to be blamed for gutting the Glass-Steagall Act and the like, but those are small quibbles.
Whether you agree with all of his takes and analysis doesn’t really matter. (I agree with some more than others). The vibrancy of thought, and the diamond-hard clarity with which he presents what he, as an enraged citizen and journalist has learned about this whole mess—and what he thinks you goddamn well ought to know too—-make it essential reading.
So read it, already.
Here’s a representative taste from the article’s middle:
There are plenty of people who have noticed, in recent years, that when they lost their homes to foreclosure or were forced into bankruptcy because of crippling credit-card debt, no one in the government was there to rescue them. But when Goldman Sachs — a company whose average employee still made more than $350,000 last year, even in the midst of a depression — was suddenly faced with the possibility of losing money on the unregulated insurance deals it bought for its insane housing bets, the government was there in an instant to patch the hole. That’s the essence of the bailout: rich bankers bailing out rich bankers, using the taxpayers’ credit card.
The people who have spent their lives cloistered in this Wall Street community aren’t much for sharing information with the great unwashed. Because all of this shit is complicated, because most of us mortals don’t know what the hell LIBOR is or how a REIT works or how to use the word “zero coupon bond” in a sentence without sounding stupid — well, then, the people who do speak this idiotic language cannot under any circumstances be bothered to explain it to us and instead spend a lot of time rolling their eyes and asking us to trust them.
That roll of the eyes is a key part of the psychology of Paulsonism. The state is now being asked not just to call off its regulators or give tax breaks or funnel a few contracts to connected companies; it is intervening directly in the economy, for the sole purpose of preserving the influence of the megafirms. In essence, Paulson used the bailout to transform the government into a giant bureaucracy of entitled assholedom, one that would socialize “toxic” risks but keep both the profits and the management of the bailed-out firms in private hands. Moreover, this whole process would be done in secret, away from the prying eyes of NASCAR dads, broke-ass liberals who read translations of French novels, subprime mortgage holders and other such financial losers.
Some aspects of the bailout were secretive to the point of absurdity. In fact, if you look closely at just a few lines in the Federal Reserve’s weekly public disclosures, you can literally see the moment where a big chunk of your money disappeared for good…..
Dodd’s Wife a Former Director of AIG Controlled Company? No wonder Senator Christopher Dodd went wobbly last week when asked about his February amendment ratifying hundreds of millions of dollars in bonuses to executives at AIG. Dodo Dodd has been one of AIG’s favorite recipients of campaign contributions. But it turns out that Senator Dodd’s wife has also benefited from past connections to AIG as well, being a Former Director of Bermuda-Based IPC Holdings, an AIG Controlled Company.
Hey “Duh” – if you’re going to simply post a quote from a screed by an ex-state senator from Connecticut attacking Chris Dodd, would you at least post the link so we can read the entire piece by Kevin Rennie at RealClearPolitics and judge it’s worth. You come off like a half-baked troll shooting spitballs.
This is a great piece – I’ve been emailing it around this week to friends as a “must read.” I’d also, as a thought-experiment in complexity, recommend the letter of resignation from an AIG-FP guy in today’s times. I must say, it wasn’t what I expected when I started reading.
http://www.nytimes.com/2009/03/25/opinion/25desantis.html?pagewanted=1&_r=1&ref=opinion
I’m not wasting tears on this guy, but it’s a window into the complexity of effectively unraveling the mess we’re in – even at a company like AIG where the biggest villians have already done the damage and run off with their undeserved millions – as opposed to posturing and manufacturing outrage along the way. That’s especially true of our elected officials. I thought Obama’s substance and tone in his press conference last night hit the right notes. It’s crucial in this moment that populist outrage – which is, more often than genuine hurt, formulaic and calculated to cover political asses or give journalists who have dropped the ball for a decade a cheap angle – not run ahead of promoting substantive policy that addresses the crisis on the one hand and the need for effective regulatory reform on the other.
I’m not going to defend Chris Dodd because he’s clearly culpable in many of the problems we’re seeing (although the sniping by rightwing rats this past week was dishonest and petty at best) but I know for a fact that he gets campaign contributions as a matter of course from the banking sector because of his Senate Banking committee chairmanship. It’s campaign kabuki that has little or nothing to do with Dodd’s record. I know of two top financial services CEOs who donated to his Presidential campaign, which is funny because I also know that personally they’re both solidly GOP free-market numbskulls who are blindered in nitty gritty political matters by their narrow self-interest (although they play a great game of being “socially liberal”) and would never vote for Dodd or probably any national Democrat. They just want their names on Dodd’s contributions list – along with their CFO and other top execs. It’s a two-way street of sheer hypocrisy.
But the bigger problem isn’t that Chris Dodd gets campaign contributions from these guys but that huge amounts are spent by these same guys systematically lobbying Congress for the kind of deregulatory shit that we’ve been subjected to – and they succeeded. Dems like Dodd are more than complicit in this affront to democracy and, frankly, fiscal sanity but brickbats in his direction from the right are the worst kind of hackery. The sole reason Dodd gets criticized from the right is an attempt to deflect our attention from the roots of this disaster in pols bending to the false “free market” ideology that every GOP hack from Reagan to Bush has relentlessly promoted. That attempt to create smokescreens is why we got crap like blaming the subprime crisis on the Community Reinvestment Act from idiots like Woody. There’s an agenda out there that’s far more toxic, irresponsible, perverse and dishonest than anything Chris Dodd could come up with in his worst nightmares.
Liberals need to be clear about the Democrats flaws and the caving to corporate interests, but also we need to push back when rightwing rabble attempt to deflect from the root cause of our problems – the kind of “free market” nonsense promoted systematically by truly sinister characters like Phil Gramm who were 100% GOP clones of the worst motives of the banking industry. At least the ranks of Democrats reflect a debate over this garbage and some dissent from the downward spiral into opening the gates to barbarians. The GOP represents nothing more than decades of lock-step support for deregulation as a supposed inherent good promoed by “Reagan revolutionaries.” In this scenario, familiar to folks here deluged by singularly repulsive ravings by the resident wingnut, the government is ALWAYS the problem. This crisis and breakdown proves that knee-jerk thinking not just false, but dangerous. If you want a poster boy for a Beltway pol who embodied the most venal, narrow banking interests, operating under a facade of “free market” ideology – aka the “Reagan mask” – Phil Gramm is definitely the man.
I was against bail-outs from the start–even going back to Chrysler and New York City. I also oppose bailouts of individuals who made bad choices and bought more than they could afford.
Obama campaigned on helping “Main Street” rather than Wall Street. He hasn’t done much on that and, now, he appears to be reneging (not a bad word–like the one meaning a change of shifts at the car wash) on his so-called tax rebates also known as wealth re-distribution.
The attaacks against good financial managers who earned their bonuses and the proposed limits on executive compensation have already started a raid on our executives by companies in other parts of the world. That will leave us with managers who aren’t worth more than $500,000 a year, and that will end up costing companies a lot more than the bonuses for the best executives who left.
The piece is total idiocy. A lot of the facty facs are right, but the motivations, conspiracies, etc indicate a need for a frequent doses of antipsychotics. Next someone will be telling me that the government caused the Trade Towers to fall [oh, that’s right, these people exist – they’re called “Truthers” and are equally looney).
The financial crisis is complex, and the actions of the players are not as easily described. It is certainly true that the invention of CDO’s and CDS’s caused the huge financial contagion from the mortgage crises. It is also true that allowing CDS’s to be sold without regulation was a big oops (to put it mildly).
But there are a lot more causes and the players were a lot less knowledgeable about what was going on than the article would imply.
Yes, there was inexcusable greed and looting, and it pisses me off. It doesn’t cause me to become a “financial crisis truther.”
Excuse me, but what motivation is there posed in the article other than greed and what is implied other than massive irresponsibility and lack of oversight. Phil Gramm wasn’t a captive of the banking interests ? Lots of pols on both sides of the aisle didn”t allow a big “ooops(to put it mildly)” because they caved to bank lobbyists desires ?
It strikes me that reality has stripped yammering clowns like you of any basis for your crank ideological predispositions. All you’re left with is a bit of whining out of both sides of your mouth because the analysis that was put forward by folks who believed that there was a dangerous combination of de-regulation and lax oversight by existing regulators have been prove absolutely right, while characters on your side of these arguments were in denial. To compare the reporting in this article to “9/11” truthers is just slanderous bullshit. Of course, what else is new, coming from your direction.
No, Phil Gramm is a captive of his economic views, and his actions were totally consistent with that. Not every mistake in Washington by the right is a result of corruption.
Beyond that, you devolve into your usual personal attacks, displaying your psychological problems which I have no interest in dealing with.
From David Plotz’s Slate article on Gramm, 9/7/0:
Gramm preached a conservatism in which all Americans would have to sacrifice. But over time, Gramm has shucked any pretense of libertarianism. Gramm spoke of belt-tightening, but forced it only on folks he didn’t need, notably immigrants and the poor. He began his career railing against corporate subsidies, but he never pulled the trigger. Instead he became one of the biggest recipients of campaign contributions from energy, banking, health-care, and insurance companies. As an economist, Gramm knows that farm subsidies grossly waste taxpayer money, but he has never moved against them. And Gramm became one of Congress’ leading pork dealers: He once bragged that he steered so much government spending to Texas that he was getting trichinosis. Gramm, who once claimed that all Americans needed to sacrifice, excluded anyone who gave him money, voted for him, or lived in Texas: They never had to get off the wagon. (One of his rivals coined a term for Gramm’s habit of going home to Texas to take credit for spending bills he has nothing to do with: “Grammstanding.”)
Sorry, that was 9/7/01
What a shock. A guy whose basic philosophy would naturally balance certain interests gets contributions from those interests. Duh. So what?
The rest is just Graham bashing and irrelevant to the discussion. OTOH, since it isn’t personally insulting foul language, I guess it represents an improvement. Have they increased your meds?
Lame…you got shown to be blowing smoke out of your ass, so you retreat into adolescent horseshit. But since it didn’t involve murdering journalists, I guess it represents an improvement. Have they increased….naaah! Don’t want to descend to the level of your little rathole.
Reg, ever since you advocated man-boy love, I’ve tired of you.
That was brilliant…and obviously your best shot.