Mark Morford points out the cynical repackaging of Bush's legacy that's beginning to show up here and there. As the Dixie Chicks put it, I'm not ready to make nice with someone who dragged our nation so low.
Like thereisnospoon, I've been on hiatus during the holidays but dipping back in now and then to see what's going on. And like thereisnospoon, I must urge you to read Paul Krugman's column, "Bigger Than Bush".
He has so succinctly described the moral bankruptcy of the Republican party. His indictment follows John Dean's in Conservatives without Conscience.
Let's hope Mr. Krugman's column breaks through the wind barrier in the chattering classes. Of course, this has been discussed before on dkos as thereisnospoon points out in his post. Perhaps if they read dkos, they'd have better input for their crystal balls.
~ It seems there's a some splintering and falling out going on at the premier neocon think tank, AEI. Jacob Heilbrunn has the details. [via]
~ Dean Baker takes on the Washington Post which has chosen to allow an oped declaring that it's all of us who are responsible for the real estate bubble. He makes some good points. Pay attention WaPo.
~ Look at the list of who all wants to be a bank now that there's money with no strings attached available in the TARP fund. (Teeth grinding over the incompetence in the Treasury Department.)
~ Sully calls attention to Melissa Etheridge's post at HuffPo.
Brothers and sisters the choice is ours now. We have the world's attention. We have the capability to create change, awesome change in this world, but before we change minds we must change hearts. Sure, there are plenty of hateful people who will always hold on to their bigotry like a child to a blanket. But there are also good people out there, Christian and otherwise that are beginning to listen. They don't hate us, they fear change. Maybe in our anger, as we consider marches and boycotts, perhaps we can consider stretching out our hands.
Sounds like a good plan. As someone at dkos pointed out to one angry raver, sometimes you get a lot further with honey than you do with hate.
~ Another comment on the discussions over at dkos about Warren and gays that makes a lot of sense.
Ben Folds has a great line: "God help me if I'm right. I'm lonely and I'm right."
Did Warren and his ilk hurt the LGBT community? Yes. Did Obama reopen that wound by inviting him to give the invocation? Yes. Is bigot accurate? Sometimes; ignorance is much more applicable because most people simply don't know better. People can be unaware of their prejudice, and "bigot" is too harsh for those people. They need an eye-opening education, not a heart-closing insult. Using the word bigot on everyone else, because one is hurt, will just make one lonely in his/er rightness.
Actually the original diary and the discussion in comments on this particular diary is one of the more thoughtful and useful ones that I've seen. NCrissieB is a lawyer with an articulate writing style. Worth watching out for her posts.
Josh Marshall has a guest blogger at TPMCafe with an interesting insight on the state of affairs in Israel. Bernard Avishai writes about a visit to Hebron. Seeing up close the proximity of the Israeli Arabs and the radical settlers who are trying to take their land makes it clear that it's not a minor problem.
Thank you Tim DeChristopher. Who is Tim DeChristopher you ask?
Well, here's what he did. [via]
He didn't pour sugar into a bulldozer's gas tank. He didn't spike a tree or set a billboard on fire. But wielding only a bidder's paddle, a University of Utah student just as surely monkey-wrenched a federal oil- and gas-lease sale Friday, ensuring that thousands of acres near two southern Utah national parks won't be opened to drilling anytime soon.
Tim DeChristopher, 27, faces possible federal charges after winning bids totaling about $1.8 million on more than 10 lease parcels that he admits he has neither the intention nor the money to buy -- and he's not sorry. [...]
The auction had been under way for a couple of hours when energy company representatives became suspicious of a man wearing an old red down parka after he won bids on more than 10 parcels numbered consecutively, all around Arches and Canyonlands.
They told BLM officials that the man, brandishing bidding paddle No. 70 and unknown to the regular buyers, also seemed to be bidding up on parcels, raising prices on leases that others eventually won.
The auctioneer took a break and police asked the man, later identified as DeChristopher, to leave the room. After questioning him for more than an hour behind closed doors, BLM and law-enforcement officials requested assistance from the U.S. Attorney's Office. [...]
After the auction, Kent Hoffman, the BLM's state deputy director for lands and minerals, announced there had been a bogus bidder. ... Hoffman said successful bidders who believed their offers had been run up illegally due could withdraw their bids.
BLM official Terry Catlin said the agency didn't want to reopen the bidding on the parcels DeChristopher snagged unless all interested parties were able to compete for the leases. That means the parcels won't be available again until at least February -- after Obama takes office -- during the next scheduled auction.
DeChristopher, who acknowledged upping other bids by about $500,000, said he would be willing to go to jail to defend his generation's prospects in light of global climate disruption and other environmental threats.
"If that's what it takes," he said.
Here's Tim's statement on why he stepped up at the auction. He's eloquent. Go thank him here and if you've got the resources, donate a little to his legal defense fund. He could use the help.
Matt Yglesias did a little plain speaking on his blog as he is wont to do. What happened next is more unusual. The self-described "acting CEO of the Center for American Progress Action Fund, Jennifer Palmieri, decided to post a note on Matt Yglesias's blog.
Poorly done Ms. Palmieri. This commenter detailed the reasons correctly. You've undercut Matt's credibility tremendously. Plus you've now begged the question: Just who can pressure CAP to change its positions and how often does this happen?
Not to mention that Third Way now looks like the crybaby on the playground. And to a much larger audience than would ever have read Matt's blog post in the first place. Front page of Daily Kos, Open Left, Atrios. And as of right now, your post is the #1 item on Mememorandum which also shows links from Salon, TalkLeft, American Power, Outside the Beltway, Brendan Nyhan, Rising Hegemon, Grasping Reality and The Jed Report.
Epic fail.
I suspect that you're another one of those inside-the-beltway types who doesn't really "get" blogs. You know they're there and that someone needs to pay attention to them but you don't really get how it all works. Well, pay attention.
You just hurt yourself, your organization and the organization that you were supposedly protecting. Which, as Matt so rightly pointed out, is a bunch of namby-pambies pushing a domestic agenda that's "hyper-timid incrementalist bullshit".
Jay Rosen adds his insight to the mess in this comment and I couldn't agree more.
You decided to have the wrong "tough" conversation. The tough conversation you should have had is with the people or person at Third Way who asked that you do something to separate yourself from this Matt Yglesias and his damn opinions. You should have told that person who Matt is, why he was hired and what he does at your site, rather than telling us about Third Way is and how supportive your Center is of their work. Your protected the wrong guy, put the wrong people on notice, undercut your own blogger, and-alas-now you are getting what you deserve.
One more thing: in the real world of the Web, as against the back-scratching fantasyland that you feel you can extend to the Web, the right way to handle this is for someone with a voice at ThirdWay to write a letter to Matt, objecting to his post. He'd run it, and there would be a debate. Instead you chose the cozy Washington way, and projected it onto the Web. Please learn from that.
Ms. Palmieri, alas, you've proved once again that inside the beltway = clueless.
Awhile ago an AIG media guy named Peter Tulupman responded to a post by one of the Front-pagers aka Contributing Editors at Daily Kos which, in turn, started the building of a list of questions for AIG. [1, 2, 3, 4, 5]
Look what's happened now.
This interactive format is not typical for most companies, including AIG. Our communications to the public have generally been our SEC filings, press releases, and presentations to investors, industry analysts, and other members of the investment community. But we understand our company is in a very different position since we received support from the U.S. government, and we wanted to try something different to be more accountable to taxpayers.
We know that there are tough questions out there. Some questions we may not be able to answer, and if that's the case, I will try to explain why. Other questions may take time to answer, as we gather accurate information from proper channels.
Finally, we know many questions will revolve around the day-to-day decisions AIG makes as a business. AIG's top priority is to pay back the U.S. government's investment in AIG. To do that, we have to make the decisions necessary to run our business successfully. We know that our business rationale for some of those decisions may not always be accurately portrayed by some, and that's one of the reasons that we want to do this forum, to explain how AIG's decisions are in the interest of maintaining the value of its businesses and repaying taxpayers.
We appreciate this opportunity, and hope that we can contribute constructively to the conversation on Daily Kos.
Peter Tulupman
AIG Media Relations
Props to AIG for going where the questions are. Just a note of caution. Language on the blogs tends to be rougher than that normally sanctioned in polite company so turn down your profanity sensitivity meter and listen to what they're really saying.
Posted without comment from the New York Times:
Mr. Kim's colleagues, not only at his level, but far down the ranks, also pocketed large paychecks. In all, Merrill handed out $5 billion to $6 billion in bonuses that year. A 20-something analyst with a base salary of $130,000 collected a bonus of $250,000. And a 30-something trader with a $180,000 salary got $5 million.
But Merrill's record earnings in 2006 -- $7.5 billion -- turned out to be a mirage. The company has since lost three times that amount, largely because the mortgage investments that supposedly had powered some of those profits plunged in value.
Unlike the earnings, however, the bonuses have not been reversed.
As regulators and shareholders sift through the rubble of the financial crisis, questions are being asked about what role lavish bonuses played in the debacle. Scrutiny over pay is intensifying as banks like Merrill prepare to dole out bonuses even after they have had to be propped up with billions of dollars of taxpayers' money. While bonuses are expected to be half of what they were a year ago, some bankers could still collect millions of dollars.
Critics say bonuses never should have been so big in the first place, because they were based on ephemeral earnings. These people contend that Wall Street's pay structure, in which bonuses are based on short-term profits, encouraged employees to act like gamblers at a casino -- and let them collect their winnings while the roulette wheel was still spinning.
"Compensation was flawed top to bottom," said Lucian A. Bebchuk, a professor at Harvard Law School and an expert on compensation. "The whole organization was responding to distorted incentives."
Even Wall Streeters concede they were dazzled by the money. To earn bigger bonuses, many traders ignored or played down the risks they took until their bonuses were paid. Their bosses often turned a blind eye because it was in their interest as well.
"That's a call that senior management or risk management should question, but of course their pay was tied to it too," said Brian Lin, a former mortgage trader at Merrill Lynch.
There's more. Go read.
Well, maybe not completely without comment. Remember that this was brought to you courtesy of the Republicans and the Reagan Revolution and the attitude that government regulations are bad. And one really has to wonder how Alan Greenspan and Hank Paulson ever thought that the economy was solid back in 2005, 2006, and 2007. And given that they did and said so, why on earth would we listen to ANY advice they have to give now?
The slow-motion demise of the print news media organizations leaves American democracy at risk. But it's in competition with the bad economic news, financial frauds, the ailing auto industry, and the last days of a pathetic Bush administration and it's not getting much coverage. The New York Times notes what's happening:
The much greater loss, the journalists say, is the decline of Washington reporting on local matters -- the foibles of a hometown congressman or a public works project in the paper's backyard. One after another, they cited the example of the San Diego paper's Washington bureau for exposing the corruption of Representative Randall Cunningham, who is known as Duke.
In accepting a Pulitzer Prize for that work in 2006, "we were bold enough to hope that it would be the first of many, but it turned out to be the high point," said George E. Condon Jr., the last bureau chief. "No matter how much great journalism is done by national organizations, they're simply not geared to monitor closely a member of Congress from, say, San Diego, who's not a national leader."
[...]
As bureaus shrink, they cut back on in-depth and investigative projects and from having reporters assigned to cover specific federal agencies.
"We used to cover the Pentagon, combing through defense contracts, and we're covering some of that out of Dallas now, but basically we don't do it anymore," said Carl Leubsdorf, chief of The Dallas Morning News bureau, which had 11 people four years ago, and now has four. "We had someone at the Justice Department, but no longer. We can't free someone up for a long time to do a major project."
Few newspapers travel with the president now -- only three or four on some trips -- where a dozen would have been the bare minimum a few years ago. For those that still participate, the shared cost of travel and the rotating burden of providing pool reports has soared. The Senate press gallery was recently remodeled in a way that left room for fewer reporters' carrels, and no one complained. [...]
"From an informed public standpoint, it's alarming," said Representative Kevin Brady, a Republican from the Houston area, who has seen The Houston Chronicle's team in Washington drop to three people, from nine, in two years. "They're letting go those with the most institutional knowledge, which helps reporters hold elected officials accountable."
An active and investigative press is an essential component of our democracy as recognized by our founders its inclusion in the First Amendment:
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances."
Here's to hoping that the journalists and newspapers figure out how to uphold their responsibility to monitor our government on behalf of citizens everywhere. As much as we bloggers protest when they fail in some portion of holding the government responsible, the bottom line is that their role is an essential part of our democracy.
One does wonder if the greed that infected Wall Street has not also infected the corporate ownership and management of the news media organizations to the point of endangering their existence. When is too much profit squeezed from an organization that can't support it and remain viable in the long term? Who sets the line? Are they thinking about the importance of the press's mission to our democracy? I suspect the answer is no.
Paul Krugman picked out this quote from Matt Yglesias' post about confusing support of the troops with criticism of the missions selected by the Commander in Chief and his cronies.
The harsh reality is that this was not a noble undertaking done for good reasons. It was a criminal enterprise launched by madmen cheered on by a chorus of fools and cowards. And it's seen as such by virtually everyone all around the world -- including but by no means limited to the Arab world.
Krugman notes that Yglesias is both shrill and correct in opposing the tendency of many to rush past the faults, misdeeds and crimes of the Bush administration. As Krugman puts it:
Right now, there's a major effort underway to flush the sheer crazy/vileness of the Bush years -- and the cravenness of those who enabled it -- down the memory hole. We shouldn't let that effort succeed. The fact is that an American president deliberately misled the nation into war, probably for political gain -- and most of the country's elite went cheerfully along with the scam.
Yglesias and Krugman are both right. We must hold criminals responsible for law breaking. We are a country formed and based on the rule of law. It is the essential foundation of our country's existence and success. It necessarily includes criminals within government as well as without.
Yglesias made another point about the misdeeds of the last 8 years and their impact on the US role in world affairs.
But it's impolitic to point this out in the United States, and it's clear that even a president-elect who had the wisdom not to be suckered in by the War Fever of 2002 has no intention of really acting to marginalize the bad actors. Which, I think, makes sense for his political objectives. But if Americans want to play a constructive role in world affairs, it's vitally important for us to get in touch with the reality of what the past eight years of US foreign policy have been and how they're seen and understood by people who aren't stirred by the shibboleths of American patriotism.
The world is watching to see how we deal with putting our house in order and restoring the rule of law within the United States. President-Elect Obama's primary focus will likely be on restoring our economy and the people of the United States. But there must be some attention paid to the restoration of the rule of law. And the chattering classes who are so anxious to let bygones be bygones would do our country a huge favor if they would shut up.
Roger Cohen has written an ode to Pan Am and his days of travel on it. I remember flying on Pan Am myself and getting a plastic junior pilot wings pin. He goes onto to opine that perhaps the auto manufacturers should go the way of Pan Am along with some other imprecise and ill-informed maundering.
Not that the optimism of his outlook doesn't have appeal.
Churn -- of people and businesses -- has always defined America. Nobody subsidized U.S. Steel or the automaker Packard in the belief that the world without them was unthinkable.
Coming to the United States from Europe, I found this constant reinvention bracing. Look at the top 40 companies by market capitalization in Europe and most have been there for decades. Not in the United States, land of Google and eBay. Churn requires death as well as birth. The artificial preservation of the inert dampens the quest for the new.
That is true. New technology and innovation are tremendously appealing as economic fuels. But there are a few details missing from Mr. Cohen's summation and one of his commenters provides them in a heavily-reader-recommended response to Mr. Cohen's column. It is an excellent response to so many in government and media who chatter on about the automotive and manufacturing industry in the United States without real knowledge of what they are talking about.
It's all well and good to declare that the market should decide the fate of the auto companies, and that that's what keeps America dynamic, but the market, since becoming International, is not what it used to be. American manufacturers are forced to compete against countries that, for one thing, provide healthcare to their workers, instead of leaving it to the unions to fight for it. You suggest that we shouldn't go the way of European-style subsidies, but at the same time, we are being forced to compete with heavily subsidized manufacturers around the world. You blame the failure to produce the cars people want when in fact Detroit has produced precisely the cars (and trucks) that people wanted, at least until the price of gas went through the roof. Sure, there's plenty of blame to be directed at Detroit for short-sightedness and bad decisions, but this isn't only about Detroit. Our entire manufacturing base has been decimated because we are being forced to compete with countries that support their manufacturing bases, while at the same time refuse to allow us to export to them. Japanese can't buy American cars. Koreans can buy very few. Europeans do allow us to trade more freely, and General Motors as well as Ford are very successful in Europe manufacturing fuel-efficient, reliable cars. I believe the same is true for China, although I may be wrong on that one. A large part of the problem for General Motors is the cost of providing healthcare for former employees. In any civilized country, healthcare would be provided by the state, and at less of a cost.
We're all having fun beating up on the Detroit executives and the "greedy" unions and being so self-righteous about how they should be punished, but the truth is a bit more complicated. We're selling our manufacturing base, and our entire country, to the highest bidder. We give billions to banks with no questions asked. Politicians are getting rich. Oil companies are getting rich. Healthcare companies are getting rich. Workers, people who actually make things, are getting poor. That's what's killing dynamism. Where are our priorities?
-- Jim Doyle, Honolulu
When the average worker has no job, no income, no place to live, the economy comes to a halt. That's what the greedy financial types have actually been betting on. That they could get rich without creating too many of those out-of-work workers. Out-of-work workers created by sending their work overseas and with constant cuts in headcount creating the vaunted productivity increase, and for those who retained their jobs, cuts in their benefits, benefits whose loss is not underwritten by the government. Workers have been squeezed and abused and have not shared in the economic boom times. Their wages, if they have them, have stagnated, while CEOs' wages have soared and the average Wall Street worker gathers in unbelievable wealth.
In all of this boom time for business, one point has been repeatedly ignored. The worker at the bottom of the real economy is also the consumer who supposedly powers the economic engine of the country. And now we're finding out what happens when government, financial and business leaders give lip service to doing the best for the country and yet in reality have squeezed so hard that they've seriously injured their source of power, the American worker.
The Republican free market ethos that Reagan championed and Republicans since Reagan have propagated wildly without thought for consequence has finally met its end. And Bernard Madoff is the perfect symbol of the excess, the greed, the misdirection and lying that those policies have inflicted on our country. The only real question is, "How many more are there out there like him?" How many other leeches and parasites have drawn away wealth from the real economy?
So despite the "optimism" of the churn of the free market philosophy that Cohen finds so appealing, considerable resources must be spent on building back up the real engine of our economy, the workers. Their role in the equation has been reduced by all the free market proponents to that of a commodity whose price is to be minimized. Of course, when the economy relies on that same commodity to spend income that it doesn't have, it comes to a screeching halt.
The equation must be changed. A little less for the welfare kings on Wall Street and a little more for the workers on Main Street.
Peggy Noonan has written a WSJ column which she begins by noting the sense of loss and pessimism and the loss of faith in our institutions. As one woman whom she talked with put it,
"It's the age of the empty suit." Those who were supposed to be watching things, making the whole edifice run, keeping it up and operating, just somehow weren't there.
That's such an apt phrase to describe our current institutions. She goes onto to recount a conversation that she had with another friend who holds a position of some authority in Washington.
An old friend ... told me the other day, from out of nowhere, that a hard part of his job is that there's no one to talk to. I didn't understand at first. He's surrounded by people, his whole life is one long interaction. He explained that he doesn't have really thoughtful people to talk to in government, wise men, people taking the long view and going forth each day with a sense of deep time, and a sense of responsibility for the future. There's no one to go to for advice.
He senses the absence too.
It's a void that's governing us.
And that void, that predominance of empty suits has wrought a profound change in the confidence of the American people and a palpably real downturn in their lives. Depression, worry, insomnia, anger, tears. These are all part of the daily battle for so many Americans whose lives have been thrown into such turmoil by people epitomized by Bernard Madoff and the government agencies that failed to stop him.
Peggy must spend a lot of time chatting because she then reports a conversation with yet another friend about what the future holds for us.
People are angry but don't have a plan, and they'll give the incoming president unprecedented latitude and sympathy, cheering him on. I told a friend it feels like a necessary patriotic act to be supportive of him, and she said, "Oh hell, it's a necessary selfish act--I want him to do well so I survive. We all do!"
Well, Peggy, I'm glad to see that there are some Republicans who see that it's in their own self-interest to support President-Elect Obama. You might want to try passing that concept along to some Republican Senators.
And thank you, Peggy, for ending with this:
The other day I called former Secretary of State George Shultz, because he is wise and experienced and takes the long view. I asked if he thought we should be optimistic about our country's fortunes and future. "Absolutely," he said, there is "every reason to have confidence." He told me the story of Sumner Schlicter, an economics professor at Harvard 50 years ago. "He was not the most admired man in his department, but he'd make pronouncements about the economy that turned out to be right more often than his colleagues'." After Schlicter died, a friend was asked to clean out his desk, and found the start of an autobiography. "It said, I'm paraphrasing, 'I have had a good record in my comments on and expectations of the American economy, and the reason is I've always been an optimist. How did I get that way? I was brought up in the West, where the future is more important than the past, in a family of scientists and engineers forever developing new things. I could never buy into the idea that we had crossed our last frontier, because I was brought up with people crossing new frontiers.'"
Mr. Shultz laid out some particulars of his own optimism. There is "the ingenuity, the flexibility, the strengths of the national economy." The labor force: "We are so blessed with human talent and resources." And the American people themselves. "They have intelligence, integrity and honor."
We should experience "the current crisis" as "a gigantic wake-up call." We've been living beyond our means, both governmentally and personally. "We have to be willing to face up to our problems. But we have a capacity to roll up our sleeves and get down to work together."
As a household whose income is directly dependent on the automotive industry, the situation has been grim, the nights long and filled with worry. We need hope. We need more people speaking out as George Schultz and we need to recognize that we can indeed do well. That enormous challenges also provide enormous opportunities.
The Arena over at Politico posed this question recently for its Arena participants.
Should the DOJ consider prosecuting Bush administration officials for detainee abuse as the NYT and others have urged?
Scrolling through the responses revealed this one by Maurice (Mickey) Carroll who's the director of the Quinnipiac University Polling Institute.
Is it a good idea for a new administration to look for prosecutable crimes by the old administration? Even if their opinion is that there WERE crimes? By and large, the answer is no. Even if the true believers (and the true-believer editorial writers) are pestering the Obama administration to do it. One of the strengths of the American political system is that it's not a blood sport. We disagree without looking to put the other guys in jail. Which is a longish way of saying: There'll be a new slate. Shouldn't we wipe the old slate clean?
There have been times this year when I've wondered at some of the phrasing utilized in the Q-poll surveys and at some of the comments made by Mr. Carroll on the local NPR news outlet. But this comment seals the deal. Mr. Carroll is specifically saying that it is okay for people in government to break the law. That it's okay for those responsible for investigating and prosecuting law-breaking to ignore the activities. That a government administration that has broken the law is above the law.
I cannot imagine a more irresponsible position for Mr. Carroll to take. Why is someone with such a spurious view in charge of a what was a well-regarded university research center? If Quinnipiac University wants its polling research center to maintain its position, it would do well to identify a new leader.
~ Via dkos:
Bruce Raynor on the obvious attempt by Republicans to destroy the UAW:When one compares how the auto industry and the financial sector are being treated by Congress, the double standard is staggering. In the financial sector, employee compensation makes up a huge percentage of costs. According to the New York state comptroller, it accounted for more than 60% of 2007 revenues for the seven largest financial firms in New York.
At Goldman Sachs, for example, employee compensation made up 71% of total operating expenses in 2007. In the auto industry, by contrast, autoworker compensation makes up less than 10% of the cost of manufacturing a car. Hundreds of billions were given to the financial-services industry with barely a question about compensation; the auto bailout, however, was sunk on this issue alone.
~ Here's a step-by-step analysis of September, October and November's economic news and how it combined to bring the country to the edge of another depression. The day-by-day itemization of September events is eye-opening.
~ Many of the left blogosphere went up in flames yesterday when it was announced that Rick Warren would deliver the Invocation at the Inauguration. As Salon points out:
This time, though, the decision to get involved with Saddleback was actually not Obama's. The Joint Congressional Committee on Inaugural Ceremonies, run by the House and Senate, put together the program for the swearing-in ceremony. Congress, not Obama, invited Warren
And there is a second pastor on the schedule whose credentials are impeccable. Phoenix Woman has the details on Joseph Lowery.
The Morning Reaction post by kula2316 at dkos starts off summarizing all the news about welfare applications skyrocketing around the nation and then moves onto a report of Goldman Sachs' year-end results:
Um... with all the news about welfare applications skyrocketing, more and more Americans needing food stamps or food banks, numerous states slashing their budgets, and our national debt increasing by the second, what is wrong with this picture?
Goldman Sachs Group Inc., which got $10 billion and debt guarantees from the U.S. government in October, expects to pay $14 million in taxes worldwide for 2008 compared with $6 billion in 2007.
The company's effective income tax rate dropped to 1 percent from 34.1 percent, New York-based Goldman Sachs said today in a statement. The firm reported a $2.3 billion profit for the year after paying $10.9 billion in employee compensation and benefits.
$14 million, eh? On profits of $2.3 billion? After receiving assistance from the federal government?
The rate decline looks "a little extreme," said Robert Willens, president and chief executive officer of tax and accounting advisory firm Robert Willens LLC.
"I was definitely taken aback," Willens said. "Clearly they have taken steps to ensure that a lot of their income is earned in lower-tax jurisdictions."
This is insane. The article mentions $14 million in worldwide taxes. I wonder how much of that will actually go to the government that bailed them out?
"This problem is larger than Goldman Sachs," Doggett said. "With the right hand out begging for bailout money, the left is hiding it offshore."
::::::
Oh, but I certainly hope all those Goldman Sachs execs enjoy their holiday bonuses, as The Guardian (UK) reports:
A multimillion-pound bonus pot will still be shared by workers at Goldman Sachs, which benefited from a US bank bail-out and yesterday posted its first loss since going public nine years ago.
The payout, worth around £55,000 per employee, was confirmed as the Wall Street bank blamed "extraordinarily difficult operating conditions" for a fourth-quarter loss of $2.12bn (£1.4bn). It still achieved a $2.32bn profit for the full year to November, although this was sharply lower than last year's $11.6bn.
I know there are so many things to be outraged about lately, but this really sets me off. Working and middle class Americans are losing their jobs and relying, in ever increasing numbers, on welfare or food stamps or soup kitchens. Meanwhile, Goldman Sachs takes $10 billion of taxpayer money and pays barely any taxes and then distributes its profits for bonuses. Am I missing something here or is this definitely an outrage?
What she said.
Since the economic meltdown in September, I've posted a couple of diaries, with permission, from Prof. Steven Ramirez, professor of law at Loyola University Chicago. In the first diary, he provided an analysis -- from a law professor's point of view -- of the bailout. The second diary outlined his further thoughts on the September financial crisis, along with his analysis of why the Paulson Bailout that the Senate passed was wrong.
In this diary, Prof. Ramirez reviews the current economic climate, based on events since the September meltdown, reviews the lessons learned since then, and provides concrete advice & pragmatic solutions to get us on the road to economic recovery.
Please take time to read Prof. Ramirez's insightful (and very well sourced!) analysis on the uncertain economic times we're in.
President Elect Obama has announced plans for a massive fiscal stimulus package which he hopes he can sign into law shortly after his inauguration. Very soon our government will also take up the task of dealing with our failing auto makers and the possible request from the Bush Administration to access the second part of the $700 billion dollar Wall Street bailout bill that squeezed through Congress in October. This comes shortly on the heels of a recent Bloomberg analysis showing that the US Government (primarily thru the Fed) has already racked up $7.7 trillion in obligations to stem the financial crisis now engulfing the world.
Economist Brad DeLong argues that "old fashioned Keynesian fiscal stimulus" is the only way now to avoid a depression. Nobel laureate Joe Stiglitz suggests a stimulus of up to $1 trillion because "a deep and long downturn" looms. This year's Nobel laureate, Paul Krugman, says "I'm getting scared" because of the grim jobs numbers and the possibility that fiscal stimulus will take too long. Krugman now sees a "depressed" global economy until at least 2011. Krugman has posted this grim picture of the job contraction suffered at the hands of the Bush Administration:
McCain adviser, Kenneth Rogoff, sees a "collapse" in consumption that will need to be offset by $1 trillion in economic stimulus, or we could face an economic "disaster."
Thus, this much is clear: we are facing a spiraling economic cataclysm that will require trillions in government expenditures between 2008 and into 2010. Moreover, it appears darker days are yet to come, as the real estate market gets worse and, according to the IMF, bank losses have yet to peak.
The essential problem is this:
The amount of debt in the US relative to GDP simply exploded under trickledown economics starting in 1980. As incomes stagnated and jobs contracted (see chart above) for too many the debt burden could no longer be serviced, and a cascade of defaults starting with subprime mortgages has inexorably led to massive deleveraging. Paul Krugman recognized the dangers of deleveraging late last summer. Deleveraging means: banks reduce lending and hoard capital; consumers cut consumption in order to enhance savings; firms and individuals sell assets liquidate debts; businesses layoff workers to reduce expenses and reduce debt; and, severe risk aversion to conserve capital. Deleveraging thereby leads to deflation, which creates a dangerous psychology whereby purchases are deferred in the belief that prices will continue to fall. "Once started the process is hard to stop."
So now we stand at the brink of the Great Depression II or the Great Deleveraging and our leaders seem clueless about what to do other than stuff billions in the pockets of their pals. The big bailout was a big bust, with inadequate oversight and no assurance that it would lead to enhanced credit flows. The primary reason was that it allowed a massive flow of capital into the insatiable insolvency sponges at the center of our economy, whether called Citigroup, AIG or American Express. These zombie banks who ran off the risky leverage cliff like lemmings will not lend because they know they are insolvent or will be shortly when the next massive waves of losses peak. It seems at least theoretically likely that bank CEOs like everyone else just want to hang onto their jobs as long as possible, even if that means mass layoffs for the rest of the workforce. In fact, Wall Street alone is poised to cut $100 billion in wages.
~ BarbinMD says all that needs saying about the state of the media this week:
The unifying theme throughout this [Blagojevich] coverage is, when you have a corrupt politician, caught on tape peddling influence and cursing like a sailor, guilt by imaginary association trumps boring issues like the economy and health care any day of the week.
~ Counting absentee votes mistakenly set aside in the Minnesota election has become the big issue. Here's a video that helps clarify what's at stake. [via]
Also, as TPM's Eric Kleefeld notes, the number of wrongly rejected ballots continues to mount:
At least 358 Minnesotans did everything right on their absentee ballots -- they sent them in on time, signed them where they should have and were properly registered -- but their votes were not counted.
Those voters live in just 12 of the state's 87 counties and their ranks will undoubtedly grow. Counties and the state have just begun figuring out how many mistakenly or improperly rejected absentee ballots there are.
The fate of those ballots is hotly contested but unclear.
The state's canvassing board meets on Friday to consider the fate of these and other uncounted votes.
~ Here's an interesting, if unsettling, interview with Michael Ware, CNN's Iraq war correspondent. I wonder if he ever posted the video he talks about anywhere on the net. [via]
John Dean, Nixon White House and Watergate alumni, offers some advice to President-Elect Obama on how to respond to the Blagojevich scandal.
I am writing with a suggestion that might help to remove you and your new administration from the still metastasizing scandal of Governor Blagojevich trying to sell your senate seat. Needless to say, until the news media is satisfied that you and your new administration have no complicity in this matter, they will continue to focus on it. Because of my own personal experience with Watergate, the mother of modern presidential scandals, not to mention being a student of scandals that followed, I speak as someone who learned the hard way by making mistakes and then watched as others made their own similar and unnecessary blunders. First, a bit of background.
It is trite but true that the best antidote to a growing scandal is transparency, and that making all relevant information, both good and bad, public sooner rather than later is vital, as is releasing more information rather than less, for all these actions help resolve matters more quickly - presuming innocence or, at worst, innocent mistakes. If, however, you or your aides are guilty, up to your ears in dealing with Blagojevich, I still recommend that you ignore the Nixon presidency precedents - for we wrote the book on what not to do. If Blagojevich has poisoned your presidency, you might confer with Vice President Dick Cheney, who has taken "stonewalling" to new heights and shown that cover-ups can actually work if you do not mind having a thirteen percent public approval rating. But this is exactly the type of behavior in Washington that you have promised to change. I submit that the lessons of Watergate remain relevant to this day and apply to the Blagojevich situation, as a few examples might suggest.
Nixon had many opportunities to prevent the disaster that befell his presidency, none more than at the outset of Watergate. If following the arrests of burglars at the Democratic National Committee offices in the Watergate office complex on June 17, 1972 Nixon had issued a memorandum to his White House and reelection campaign staffs demanding that anyone with any direct or indirect knowledge or involvement with the matter immediately submit a full written explanation to him, an explanation which in turn would be released by the press office, or if not willing to do so submit their resignation, there would have been no Watergate cover-up. In fact, if I learned anything from Watergate it was that in the interest of the nation presidents (which would include presidents-elect) must openly and aggressively confront any and all scandals that affect them. [...]
Speaking of high level resignations, another lesson I learned was that when something goes very wrong memories of those touched by it get very bad, and few volunteer anything. For example, before the first White House meeting, forty-eight hours after the Watergate arrests, with the chief of staff Bob Haldeman, the president's top assistant for domestic affairs John Ehrlichman, the former attorney general and campaign manager John Mitchell, attorney general Dick Kliendienst, and yours truly who was White House counsel, I told Haldeman that since I had heard plans to break-in the Watergate offices being discussed in John Mitchell's office and tried - but clearly failed - to turn them off, I was fully prepared to resign. I expected to hear similar disclosures from others at this meeting to assess how to best deal with the problems created by the Watergate arrests, and protect the president.
To the contrary, no one said anything. Haldeman was silent on his telling me to have nothing to do with such operations when I had informed him after hearing them and he never mentioned my offer to resign; Ehrlichman was silent on having approved an earlier break-in at Dan Ellsberg's psychiatrist's office by the people arrested at the Watergate; Mitchell would not admit he had approved the Watergate break-in plans for almost a year; and Kliendienst would not tell anyone what he told me after the meeting - on a pledge of confidentiality - that the man who had bungled it all, Gordon Liddy, had sought him out on a golf course after the arrests of his men at the Watergate and confessed. In short, no one seemed to have the president's interests in mind only their own.
There's more good advice. Since reading his Conservatives without Conscience book, I've had great respect for John Dean. His advice is worthy.
| | Next »
