The Top 10 Conservative Idiots, No. 352

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The Top 10 Conservative Idiots, No. 352

The Top 10 Conservative Idiots, No. 352

September 22, 2008
Asleep At The Switch Edition

This week the Bush Administration (1) wants your money, John McCain (2,3) wants his mommy, and Sarah Palin (4) wants a better job. Don't forget the key!

The Bush Administration

So much for the Republican dream of a pure free market economy. Remarkably, after eight solid years of GOP leadership, the so-called fiscal conservatives in the Bush administration are now demanding $2,300 from every man, woman and child in the United States to pay for the mistakes of their buddies on Wall Street. Heck of a job, BushCo.

Treasury Secretary Henry Paulson last week insisted that the price tag for bailing out Wall Street would come to a princely $700 billion - cha-ching! - a vast pile of cash that we could somehow never seem to find when it was needed for silly things like healthcare or education or fixing Social Security. But here comes Wall Street, cap in hand, and what do you know? There it is.

To be sure, something needs to be done to clean up this fiscal mess. But the Bush administration's initial proposal sounds strangely familiar...

President Bush is "asking for a huge amount of power," said Nouriel Roubini, an economist at New York University who was among the first to predict the crisis. "He's saying, 'Trust me, I'm going to do it right if you give me absolute control.'"

Er, excuse me - after the eight years we've just been through, he's saying what? You have got to be joking.

Or maybe I'm being too hasty. Maybe we should give George the benefit of the doubt this time. After all, he's clearly given this monumental plan the thought and consideration it deserves...

The decision to finally take a radical, systemwide step came after an endless stream of conference calls involving Fed, Treasury and Securities and Exchange Commission officials, one participant recalled, when Mr. Bernanke said: "We have got to go to Congress." Mr. Paulson concurred.

On Thursday afternoon, the two men, along with Christopher Cox, the S.E.C. chairman, went to the White House to explain their plan. "The president said, 'Let's do it,' " an official said. "There was no hesitation."

Whoopee!

Anyway, according to the Huffington Post, here's what Treasury Secretary Paulson is actually proposing:

Paulson's storyline is that the credit markets are frozen, and unless Congress passes a "clean bill" -- his way -- disaster lies ahead. He spent a busy Sunday morning on the talk shows ducking questions on what would happen if Congress didn't act -- and what might still happen if it did.

(snip)

Paulson's bill would give him carte blanche to spend up to $700 billion over the next 24 months to buy toxic securities from financial firms. This presumably would "unclog" capital markets, the financial economy would begin functioning normally again, and then the government would recoup what it could.

Unfortunately...

The plan is outrageous on several levels. It demands nothing from these firms in return. It holds the Treasury Secretary accountable to no one. And it extends the most generous terms to Wall Street while offering nothing to Main Street.

A larger question is whether Wall Street even needs to be bailed out to the tune of $700 billion. According to the Washington Post:

The plan is being marketed under false pretenses. Supporters have invoked the shining success of the Resolution Trust Corporation as justification and precedent. But the RTC, which was created in 1989 to clean up the wreckage of the savings-and-loan crisis, bears little resemblance to what is being contemplated now. The RTC collected and eventually sold off loans made by thrifts that had gone bust. The administration proposes to buy up bad loans before the lenders go bust. This difference raises several questions.

The first is whether the bailout is necessary. In 1989, there was no choice. The federal government insured the thrifts, so when they failed, the feds were left holding their loans; the RTC's job was simply to get rid of them. But in buying bad loans before banks fail, the Bush administration would be signing up for a financial war of choice. It would spend billions of dollars on the theory that preemption will avert the mass destruction of banks. There are cheaper ways to stabilize the system.

And Paul Krugman, a professor of economics and international affairs at Princeton University, is equally suspicious:

I hate to say this, but looking at the plan as leaked, I have to say no deal. Not unless Treasury explains, very clearly, why this is supposed to work, other than through having taxpayers pay premium prices for lousy assets.

(snip)

Here's the thing: historically, financial system rescues have involved seizing the troubled institutions and guaranteeing their debts; only after that did the government try to repackage and sell their assets. The feds took over S&Ls first, protecting their depositors, then transferred their bad assets to the RTC. The Swedes took over troubled banks, again protecting their depositors, before transferring their assets to their equivalent institutions.

The Treasury plan, by contrast, looks like an attempt to restore confidence in the financial system - that is, convince creditors of troubled institutions that everything's OK - simply by buying assets off these institutions. This will only work if the prices Treasury pays are much higher than current market prices; that, in turn, can only be true either if this is mainly a liquidity problem - which seems doubtful - or if Treasury is going to be paying a huge premium, in effect throwing taxpayers' money at the financial world.

And there's no quid pro quo here - nothing that gives taxpayers a stake in the upside, nothing that ensures that the money is used to stabilize the system rather than reward the undeserving.

But let's be clear - the Bush administration and friends are quite certain about the fact that under no circumstances should Democrats in Congress attempt to do anything for Main Street, or add any additional oversight or regulations, or try to actually clean up any of the excesses that helped create this disaster in the first place.

(Barney) Frank, who has been in phone discussions with Paulson, said the secretary appeared receptive to adding some foreclosure-relief language. The second Democratic proposal - to impose compensation limits on Wall Street executives - is meeting more resistance.

"Hank says it's a poison pill," Frank said. "I say I don't think it's very patriotic for someone to not give up his golden parachute when we're trying to save the markets."

Yes folks, according to Paulson and Co., this is an urgent, pressing crisis and we must take action immediately! Unless of course Congress tries to give the White House anything other than a simple blank check and unlimited power to the Treasury Secretary, in which case Bush might just veto the whole thing.

After all, why on earth would anyone want to put a stop to stuff like this?

Fury at $2.5bn Lehman bonus

Staff at Lehman's New York office who helped to cause the world's biggest corporate bankruptcy are to share in a $2.5 billion bonanza.

The bonus, which has been described by London staff as a "scandal" has been pledged by Barclays Capital, the British-based bank that last week acquired Lehman's American operation and took on 10,000 staff.

The $2.5 billion (£1.4 billion) pot, which has been ring-fenced as part of the acquisition, has caused huge resentment among the 5,000 staff in the firm's European and Middle Eastern operations who are not guaranteed to be paid after this month.

John McCain

And to think - a bit of regulation here, a touch less laissez-faire capitalism there, and this whole fiasco could have been avoided.

But John McCain and his merry band of deregulators just couldn't stop themselves. McCain has championed "greed is good" deregulation at every turn during his 26 years in Washington, and he continued to champion it right up to the brink of disaster last week.

Of course he has good reason to put his head in the sand, because the senator is up to his neck in this crisis. Here's just one example: in 1999 his good friend and economic guru Phil Gramm was responsible for overturning the Glass-Steagall Act that prevented banks from running wild. Last month McCain put Gramm in the sin bin after he called America a "nation of whiners," but don't be fooled - he's now back on McCain's team. Word is that if elected, McCain will make Gramm Secretary of the Treasury.

Phill Gramm also happens to be vice chairman of the U.S. division of UBS, the giant Swiss bank. He also lobbies for UBS.

As Josh Marshall http://talkingpointsmemo.com/archives/218587.php">noted last week:

The New York Times reports this evening that "foreign banks, which were initially excluded from the (Wall Street bailout) plan, lobbied successfully over the weekend to be able to sell the toxic American mortgage debt owned by their American units to the Treasury, getting the same treatment as United States banks."

The Times further reports that two of the biggest foreign banks in need of such relief are Barclays and UBS. In fact, my understanding is that UBS is more on the line here than any other foreign bank.

Isn't that a happy coincidence?

And yet, somehow, John McCain now wants you to believe that, guided by Phil Gramm's steady, principled hand, he is the only person capable of cleaning up this hot mess and rescuing us from financial ruin. Never mind that McCain has spent his entire career as a staunch deregulator, never mind that his most important economic adviser bears a great deal of responsiblity for the current crisis and is now trying to profit from it, never mind that his campaign staff is lousy with lobbyists for the financial industry - including his campaign manager Rick Davis, who according to Fannie Mae's former Senior Vice President for Government and Industry Relations...

...was paid by Fannie Mae and Freddie Mac several hundred thousand dollars early in this decade to head up an organization to lobby in their behalf called The Homeownership Alliance. ...

I worked in government relations for Fannie Mae for more than 20 years, leading the group for most of those years. When I see photographs of Sen. McCain's staff, it looks to me like the team of lobbyists who used to report to me.

And never mind McCain's plan for Social Security...

Wall Street turmoil left John McCain scrambling to explain why the fundamentals of the U.S. economy remained strong. It also left him defending his support for privately investing Social Security money in the same markets that had tanked earlier in the week.

Or his plan for healthcare...

JOHN McCAIN, SEPTEMBER 2008: Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation.

Never mind all that. John McCain is suddenly a reformer who will bring change to Washington!

Yes, it seems that McCain has stopped running against Barack Obama and started running against reality. Even USA Today called him "erratic" last week. Check it out:

Monday: Speaking at a rally in Jacksonville, McCain declares that "the fundamentals of our economy are strong." Coming as the Dow plunges more than 500 points and Lehman Bros. goes belly up, this makes McCain sound somewhat out of touch.

Tuesday: McCain explains that he meant to say American workers are fundamentally sound, and the economy itself is in "crisis." But, he adds, this crisis does not warrant bailing out insurance giant American International Group, which should be allowed to fail. McCain adviser Carly Fiorina, the former Hewlett-Packard CEO, unhelpfully opines that no one on either presidential ticket would be capable of running a company such as H-P.

Wednesday: After the government takes over AIG, McCain says the rescue was regrettable, but unavoidable.

Thursday: McCain, who over the years has described himself as a deregulator, recasts himself as a pro-regulation, anti-Wall Street populist.

With his poll numbers tanking McCain decided that decisive action was required, so he checked his gut and decided to announce that as president he would fire the head of the SEC. A bold move! Just one problem - the president can't fire the head of the SEC. Oh, plus, the head of the SEC already announced that he was quitting. Ages ago.

And still this didn't stop McCain, who repeated his demands the following day. At least, I think he did - for some reason he started talking about the FEC instead of the SEC. I know this is confusing but come on dude, you're running for president.

Bleeding-heart liberal George Will immediately nailed McCain for his nonsense proposal.

Conservative columnist George Will practically boiled out of his trademark bow tie Thursday night, lashing out at Republican presidential nominee John McCain's call for Securities and Exchange Commission Chairman Christopher Cox's resignation.

(snip)

Will took a call from Cox shortly before taking the stage Thursday and was visibly perturbed when he hung up his phone.

"This is why some thoughtful conservatives have grave doubts about his ability to be president," Will said.

Ouch. Meanwhile those ultra-lefties on the Wall Street Journal editorial board had a few things to say to Sen. McCain too...

Was Mr. Cox dishonest? No. He merely changed some minor rules, and didn't change others, on short-selling. String him up! Mr. McCain clearly wants to distance himself from the Bush Administration. But this assault on Mr. Cox is both false and deeply unfair. It's also un-Presidential.

Oof. Perhaps it's time for another change to McCain's campaign slogan.

John McCain

But let's be fair to Sen. McCain. He obviously knows jack squat about the economy - foreign policy is his real area of expertise. Fortunately he was able to remind us of that fact during an interview with Spanish radio network Union Radio last week.

QUESTION: Senator, finally, let's talk about Spain. If you're elected president, would you be willing to invite President Jose Luiz Rodriguez Zapatero to the White House to meet with you?

MCCAIN: I would be willing meet, uh, with those leaders who our friends (sic) and want to work with us in a cooperative fashion, and by the way, President Calderon of Mexico is fighting a very very tough fight against the drug cartels. I'm glad we are now working in cooperation with the Mexican government on the Merida plan. I intend to move forward with relations, and invite as many of them as I can, those leaders, to the White House.

QUESTION: Would that invitation be extended to the Zapatero government, to the president itself?

MCCAIN: I don't, you know, honestly I have to look at relations and the situations and the priorities, but I can assure you I will establish closer relations with our friends and I will stand up to those who want to do harm to the United States of America.

QUESTION: So you have to wait and see if he's willing to meet with you, or you'll be able to do it in the White House?

MCCAIN: Well again I don't, all I can tell you is that I have a clear record of working with leaders in the hemisphere that are friends with us, and standing up to those who are not, and that's judged on the basis of the importance of our relationship with Latin America, and the entire region.

Whoa, hold on a second. Latin America? Does McCain know he's being asked about Spain here?

QUESTION: Okay... what about Europe? I'm talking about the President of Spain?

MCCAIN: What about me what?

QUESTION: Okay... are you willing to meet with him if you are elected president?

MCCAIN: I am willing to meet with any leader who is dedicated to the same principles and philosophy that we are for human rights, democracy and freedom, and I will stand up to those that do not.

Curious. So self-described foreign policy expert John McCain either doesn't know who Zapatero is and thinks Spain is part of Latin America, or he's actually suggesting that he might not meet with Zapatero, even though Spain is a NATO member and a U.S. ally. Which could it be?

And the winner is...

Republican presidential nominee John McCain suggested this week that he would continue President Bush's policy of having cool relations with the government of Spain, despite having made starkly contrasting statements to the Spanish press earlier this year saying he looked forward to normalized relations with the NATO ally.

In comments that have caused a kerfuffle in Spain, McCain seemed to lump Spanish Prime Minister Jose Luis Zapatero in the same category as the anti-American leaders of Venezuela, Bolivia and Cuba.

(snip)

McCain foreign policy adviser Randy Sheunemann said McCain's answer was intentional.

"The questioner asked several times about Senator McCain's willingness to meet Zapatero (and id'd him in the question so there is no doubt Senator McCain knew exactly to whom the question referred). Senator McCain refused to commit to a White House meeting with President Zapatero in this interview," he said in an e-mail.

Well I guess that makes sense, because if it wasn't intentional, then it can only follow that McCain is losing his marbles. So to clarify, if he's elected president, John McCain will make important foreign policy decisions by selecting the least personally-damaging excuse after committing a gaffe, and then refusing to back down.

Could be an interesting four years...

Sarah Palin

Judging by the way he's running his campaign, John McCain is shaping up to be the absolute worst possible choice for president ever. Just when we need someone with a cool head who can make careful, considered decisions, Sen. McCain is going off like an accident at a fireworks factory. Just one day after George W. Bush announced his intention to bail out Wall Street, I heard one of McCain's surrogates screaming on TV that Barack Obama hadn't come up with a plan yet! Sorry, I didn't realize this was a contest to see who could have the fastest knee-jerk reaction. I expect that unlike the McCain campaign, Obama is trying to come up with a plan that he won't have to completely retract after 24 hours.

Mind you, this could all be moot in a few weeks anyway because it looks like John McCain might not even be the head of the Republican ticket come November. Last week, while campaigning in Iowa, Sarah Palin had this to say:

PALIN: Our family knows that the best way to help small business is to take less from them and leave more for them, so that they can expand and then jobs can be created. That's exactly what we're gonna do in a Palin and McCain administration.

A Palin and McCain administration? Indeed. Last week the San Diego Union-Tribune reported that Palin has taken to calling John McCain her "running mate" - a title usually reserved for the vice-presidential candidate.

But that's not the worst of it for McCain. The Minneapolis Star-Tribune recently noted that, "In Blaine, a small but noticeable crowd left after Palin stopped talking and introduced McCain." This is apparently not a one-off occurrence.

Concerned politics-watchers will no doubt be scanning upcoming FEC reports to see if McCain is employing a food taster yet.

Todd Palin

The Last Frontier's famous First Separatist was in the news last week after he apparently decided - with a little help from John McCain's lawyers - that subpoenas are for Americans, not Alaskans. Todd Palin was ordered to talk to the Alaska legislature about his wife's ongoing "Troopergate" scandal, but despite her previous insistence that she would cooperate fully with the investigation, Todd and friends have come to the conclusion that it's too much of a bother to show up. Who does this guy think he is, Karl Rove?

Alaska legislators were scheduled to meet Friday to review the investigation after the state attorney general declared that Palin and her staff would reject subpoenas seeking their testimony.

Todd Palin, husband of the Alaska governor, on Thursday announced he would refuse to testify. Palin had been subpoenaed to appear Friday in the probe. McCain-Palin spokesman Ed O'Callaghan said Todd Palin no longer believes the Legislature's investigation is legitimate.

Oh! Well, that's fine then. If I'm ever subpoenaed and I don't feel like dragging my ass all the way to court, I'll just email the judge and let him know that I don't believe the investigation is legitimate. I had no idea you could do that.

The bad news is, Todd's probably going to get away with it. According to the Mudflats blog:

Todd, along with other witnesses, can stall without penalty for months, pushing this investigation well past election day. To bring contempt charges, which are punishable by a fine up to $500, or up to six months in jail, the full Legislature must be in session. That happens after Christmas.

Reform? Change? Given the Bush administration's stubborn stonewalling of investigations for the past eight years, this sure as hell sounds like more of the same to me.

Carly Fiorina

Au revoir, Carly Fiorina. Yes, another of John McCain's go-to economic advisers jumped on the gaffewagon last week during an interview with MSNBC when she announced that neither Sarah Palin nor John McCain could run a major corporation.

Fiorina failed to mention that she evidently couldn't run a major corporation either, given that she was forced out by the Hewlett-Packard board in 2005. (It's okay though, on her way out the door she received a $21 million golden parachute - something else John McCain used to be for before he was against.)

Anyway, McCain was obviously, er, displeased with Fiorina's remarks. Word is that you could actually see steam shooting out of the windows of the M Floor at McCain campaign headquarters. According to CNN:

Another top campaign adviser was far less diplomatic. "Carly will now disappear," this source said. "Senator McCain was furious."

Wow, that sounds pretty terrifying. It's not as bad as it sounds though...

Asked to define "disappear," this source said, adding that she would be off TV for a while - but remain at the Republican National Committee and keep her role as head of the party's joint fundraising committee with the McCain campaign.

So basically the campaign is just going to keep her out of McCain's way for a week or two until he completely forgets what happened, at which point they'll bring her back and he'll greet her like an old friend.

Douglas Holtz-Eakin

Another McCain economic adviser, Douglas Holtz-Eakin, was riding shotgun aboard the gaffewagon.

Asked what work John McCain did as chairman of the Senate Commerce Committee that helped him understand the financial markets, the candidate's top economic adviser wielded visual evidence: his BlackBerry.

"He did this," Douglas Holtz-Eakin told reporters this morning, holding up his BlackBerry. "Telecommunications of the United States is a premier innovation in the past 15 years, comes right through the Commerce committee so you're looking at the miracle John McCain helped create and that's what he did."

Apparently Mr. Holtz-Eakin was in a coma during the 2000 presidential election.

Michelle Malkin

A fascinating study published in the journal Science last week revealed that "people who are sensitive to fear or threat are likely to support a right wing agenda." According to the BBC:

In the study, conducted in Nebraska, 46 volunteers were first asked about their political views on issues ranging from foreign aid and the Iraq war to capital punishment and patriotism.

Those with strong opinions were invited to take part in the second part of the experiment, which involved recording their physiological responses to a series of images and sounds.

The images included pictures of a frightened man with a large spider on his face and an open wound with maggots in it. The subjects were also startled with loud noises on occasion.

By measuring the electrical conductance of the volunteers' skin and their blink responses, the scientists were able to work out the degree of fear they were experiencing - how sensitive they were to the images and sounds.

They found that subjects who were more easily startled tended to have political views that would be classified as more right wing, being more in favour of capital punishment and higher defence spending, but opposed to abortion rights.

Ha ha! Surely this can't be true. Surely liberals are the bed-wetting pansies who jump at their own shadows, while conservatives are tough, macho, terrorist-rasslin' hard-men.

Right, Michelle Malkin?

Warning: If your neighbor's got an "Obama '08" bumper sticker or lawn sign, you might want to double-check your door locks at night. The One has commanded his Purveyors of Change to go forth and proselytize to the unbelievers. And they're not going to be knocking gently like Avon Ladies.

Aieee! Lock up your daughters and batten down the hatches! The Democrats are in town, and they're going to break into your house and threaten you with physical violence!

Waaa.

Lynn Forester de Rothschild

Uh oh! A top supporter of Hillary Clinton last week announced her intention to vote for John McCain. Lady Lynn Forester de Rothschild, who is worth hundreds of millions of dollars and owns an enormous mansion in Buckinghamshire, England, announced that she simply could not vote for Barack Obama because - are you ready for this? - he's an elitist.

I'm not kidding.

Lady Rothschild went on to explain to CNN that Barack revealed his elitism when he said, "the people, you know, who are the rednecks or whoever, are bitter."

I'm really not kidding.

Gabriel Schwartz

And finally, Gabriel Schwartz, a Republican delegate from Denver, was a real hit at the recent Republican National Convention. During an interview at the Convention, he spewed forth these classics:

REPORTER: What is your vision for change under a John McCain administration?

SCHWARTZ: Less taxes and more war.

(snip)

REPORTER: Where should the United States bomb next?

SCHWARTZ: Iran, baby.

(snip)

REPORTER: So what would that look like? What would a war on Iran look like?

SCHWARTZ: Hopefully just bomb the hell out of them from the sky.

(snip)

REPORTER: How would we pay for a war in Iran?

SCHWARTZ: We should plant a flag. Take the oil. Take the money. We deserve reimbursement.

Three cheers for the solid conservative values of piracy and theft!

Now, are you ready for the hilarious irony? One day later...

He met her in the bar of the swank hotel and invited her to his room. Once there, the woman fixed the drinks and told him to get undressed.

And that, the delegate to the Republican National Convention told police, was the last thing he remembered.

When he awoke, the woman was gone, as was more than $120,000 in money, jewelry and other belongings.

(snip)

In a statement released today, Gabriel Nathan Schwartz, 29, of Denver, put the figure at much less.

"It's embarrassing to admit that I was a target of a crime. I was drugged and had about $50,000 of personal items stolen, not the inflated number that the media is reporting from an inaccurate police report," he said.

What's the problem, Gabe? Surely she deserved reimbursement.

See you next week!

-- EarlG