Capitalism Takes a Hit

The Scene of the Crime -- Picture courtesy of Wikipedia

by blogSpotter

GREED IS NOT GOOD

Today, we are in the aftermath of the worst stock slide in history (the DOW lost 777 points yesterday). I was actually undecided through much of this election about my 2008 vote. I'm a centrist Democrat who supported Hillary in the primaries. Then the week of September 15th, our already-wounded economy was chopped to its knees by a credit crunch. Four investment banks and a major insurer defaulted on their debts and had to be rescued with a combination of penny-on-the-dollar buyouts and Federal intervention. This week, we've had two widely known commercial banks taken down, and a much-maligned $700 billion bipartisan bail-out vote fail in the House. Speaker of the House Nancy Pelosi fell to the occasion -- in a moment that called for grace, understanding and cooperation she chose to unleash a scorching partisan attack. I don't think her remarks are what torpedoed the bailout but they certainly didn't help. People on hand for the vote reported that Barney Frank hurried the roll call along at one point when the Republicans were scrounging up "Yes" votes. Were both parties trying to undermine the bailout for political ends? It's hard to say -- maybe Frank was afraid they were scrounging up "No" votes.

I'm now voting for Obama. I still don't warm to him very well and wish that Hillary was the candidate, but I couldn't in good conscience contribute to four more years of Bushanomics. The Democrats could probably nominate a folding chair at this point, and have a good chance of winning.

THE END OF WILD WEST CAPITALISM

In war, a soldier might fall on a hand grenade to protect his fellows. In maritime travel, a captain goes down with his ship. In both cases, there is a since of stewardship and duty that says a person of authority in dire straits will suffer with those who suffer under his guidance. In an opposite analogy, imagine a Titanic that strikes an iceberg; before most passengers know there is danger, the captain has been airlifted to a tropic isle, suitcase in hand. His suitcase has the safe contents he raided before leaving. What I've just described is "Wild West" crony capitalism -- what we have on Wall Street. Our economic engine which determines all that we have and do is in the hands of greedy manipulators -- people whose every action is determined by profit. If the $700 billion bailout fails, we can probably look to a series of "mini-Enrons". Corporate officers will feast on the carcasses of dying corporations, leaving cartilage and bones for the minority shareholders and tax payers to scavenge. How have we constructed such a society, where greed is the primary motive? "Might makes right" and "Winner takes all" are mantras of the caveman era -- have we gone back to that? I think it's amusing that Republicans don't blame Republican principles in general for any of this -- it's just that crooked Republican over there.

TEMPERED CAPITALISM

Benjamin Franklin said something to the effect, "If only men wouldn't be such wolves to each other, we could have Heaven on earth right now". Ben was very prescient and one has to wonder now if capitalism can survive. I think that it will, albeit a reasonable man's capitalism. There will be government oversight in every economic activity and practical economic caps to prevent huge income disparity. Such systems already exist in a few places like Scandinavia and Western Europe. Someone might ask if this impedes creativity. Do we want to be so creative that we set our economic house on fire?

In Conan O'Brien’s monolog last night, he joked that Bush had one more thing to check off on his presidential "bucket list". Guest Bill Mahr opined that Bush wouldn't have a sense of completion until he saw the black smoke of America's banking system swirling in the air. I say that it's time for common sense, and yes, decency to return. It's time for both profit and principled stewardship to be the twin virtues of our economic enterprise.

© 2008 blogSpotter

Spotlight on Henry Paulson

Strange Fascination's Man of the Year? -- Picture courtesy of Wikipedia

by blogSpotter
In a recent column, op ed columnist Paul Krugman despaired that there are no adults present to handle our current banking crisis. In his article titled “Where are the Grownups?”, Krugman was dismissive and critical of Treasury Secretary Henry Paulson. He said that Paulson’s $700 billion bailout would benefit his cronies, and that Paulson is partly to blame for the current crisis.

I’m generally a liberal who concurs with other liberals – I might choose to close ranks with a liberal columnist in lambasting a conservative leader. However in this case, Krugman is way off-base. His reaction to the proposed bailout is fairly knee-jerk, like reactions we’ve had from both the far left and the far right. (More about that in a minute).

As a former CEO of Goldman Sachs and as a former staff assistant under the Nixon administration, Paulson’s conservative credentials are pretty substantial. But Paulson actually has some liberal credentials too. He as done work for the Nature Conservancy, and worked toward solving global warming and as well as saving endangered bird species. Other items in Pauson's mini-biography color in more details -- he is a serious, thoughtful and accomplished man. Pauslon is a devoted Christian Scientist; he distinguished himself early on in life as a Dartmouth Phi Beta Kappa and an All American offensive lineman.

Paulson isn’t proposing to make America socialistic – his personal ideals are not aligned that way. Also, he isn’t trying to give the store back to rich financiers who already “pissed it away” the first time. Rather, he is working toward a bipartisan solution that will save our banks from a credit crisis – a matter that affects every living American with a bank or retirement account.

Paulson is reaching across the aisle with such "intimidating" Democrats as Christopher Dodd and Barney Frank to help ensure that some of the debt can be recovered, struggling home owners can stay in their homes, and that nefarious tycoons get salary caps along with much-needed bank regulations. None of this sounds bad to me – it sounds pretty reasonable in fact. The solution will be painful and costly no matter what – that’s what we get for laissez-faire management and lax rules.

We’ve had many trials throughout American history. If we’re lucky someone steps into the role to steer the ship to a safe harbor. For the first few months of the Civil War, we had no Lincoln but one finally came to the fore. Paulson isn’t an elected official, nor is he running, but I think we have a captain nonetheless.

© 2008 blogSpotter

Socialism Brought to you by the GOP...

Lehman's HDQ the day the bomb was dropped -- Picture courtesy of Wikipedia

by blogSpotter

Socialism sans revolution?

As a centrist Democrat, the idea that government might be involved with the business world doesn’t bother me. Uncle Sam may regulate private enterprise, tax it, set bench marks for it, and sometimes even compete with it. Several areas of human endeavor are important enough that we don’t leave it to a pure “profit motive” to see that they get done – national defense, highway system and public education to name three. We should add national health care to that list on some future date. I’m intrigued that last week, Americans became 80% share holders in AIG, an insurance company. Uncle Sam is branching into new things. If plans carry thru for this weekend, Uncle Sam will pick up ½ a trillion dollars in mortgages. We’re quasi-socialistic now, and here’s the rub – extreme right-wing free-market ideologues are what brought us to this point.

Meltdown

On September 14, 2008, several business wires were murmuring that three companies were on the ropes: Lehman Brothers, Merrill Lynch and AIG. How these situations snuck up on us with such quiet ferocity is beyond me. Merrill Lynch eked out a deal to be purchased by Bank of America (at 30% of its 2007 valuation) the following day. Lehman Brothers was forced to declare Chapter 11, and after two days of begging, AIG was given a lifeline of 85 billion dollars from the federal government on September 16th. The financial devastation wrought over these two days was the worst we’ve had since the Great Depression, without any exaggeration or mincing of words.

Uncle Sam already has been expanding his role of “business savior” throughout the year of 2008. Since January, the federal government has bailed out Bear Stearns as well as mortgage giants Fannie Mae and Freddie Mac – all to the tune of $600 billion. And the meter is still running.

Political implications

John McCain lashed out at the titans of wall street – he said they were exhibiting a Casino mentality and gambling away other peoples’ money with little ill consequence to themselves. Columnist Froma Harrop points out a problem with this. McCain (who recently said the economy was “fundamentally sound”) also had Phil Gramm as his chief financial advisor until recently. Gramm is known as a deregulation zealot who personally put through legislation that deregulated “financial derivatives” – the TNT that ignited much of the current meltdown. Gramm’s wife was also on the Enron Board of Directors – why does it seem like these are all the wrong connections? In the space of 3 days, realclearpolitics.com showed McCain going from 6 points ahead to 2 points behind Obama. It’s a well-deserved shift.

Secretary of the Treasury, Henry Paulson, is the man saddled with the most strenuous weight of this magna-bailout. He recently worked in the private sector himself and was a “champion” for free market dynamics. Mr. Paulson said this week, “Pure capitalism is dead”. If pure capitalism is the unbridled, blood-lust greed, hubris and arrogance served in a pita wrap of macho egotism that we’ve seen, he is certainly right. Most Americans are hard-working people that want a square deal and a retirement savings. That the very foundation of our financial well-being would be placed in the hands of jackals and con artists is unbelievable. These men should not be turned loose with our money again – some should probably be serving prison time.

Both Presidential candidates have pledged to bring regulations back to the process – a necessary pledge given that this financial hurricane hit six weeks ahead of Election Day. Laissez-faire Republicans have had their run and one has to pose, “Who let the dogs out?” The perfect storm that hit last week confers an advantage to Obama and that is very much as it should be.

© 2008 blogSpotter

Burnt Offering?

Is this Osborne Cox? -- Picture courtesy of Working Title Films

by blogSpotter
Saturday I treated myself to the latest movie by Joel and Ethan Coen, Burn After Reading. The Coen brothers have been accused of treating their characters with contempt or treating them as cartoon characters. I have to say that many of their depictions are right on -- if the shoe fits, wear it. They frequently lampoon small town Americans, be it in Fargo or an Arizona trailer park. If it pains people to see such gullible culpability in a main character, guess what? The audience is probably finding discomfort in a hidden truth about themselves.

The Coen brothers have done a couple of movies which are serious allegories of Good and Evil -- Barton Fink and No Country for Old Men come to mind. They've lightened things up along the way with Raising Arizona, Fargo and The Big Lebowski to name a handful. Big Lebowski has even become a latter-day cult hit among college slackers some 10 years after its initial theater run.

In Burn After Reading, the brothers are back to their comic games -- showing the inept efforts of two Washington DC fitness trainers (played by Frances McDormand and Brad Pitt) attemping to blackmail a recently fired CIA analyst. They inadvertently obtain a copy of the analyst's unpublished memoire (left on a CD in a gym locker). The CIA man, played by John Malkovich, is a sad, disgruntled alcoholic with no secrets worthy of blackmail. He is however going thru a painful divorce with an emotionally frigid Brit wife (played by Tilda Swinton), and she in turn is having a torrid affair with a federal marshal played by George Clooney.

Much like a Seinfeld episode, these separate plot lines interlace in a manic (but not especially credible) way. The characters in this movie are all deeply flawed -- unintelligent or otherwise addled with lust, anger or arrogance. It was a disappointment to see two of my favorites (I won't say which) get blown away toward the end of the movie. Funny that you can grow a momentary attachment to such silly-acting people.

Richard Corliss of TIME Magazine panned this movie. Peter Travers of Rolling Stone gave a better, more circumspect opinion -- the movie is still funny and well worth viewing. It's not the best product from the Coen brothers, but that's because they've raised the bar so very high with all of their other marvelous movies. I would love to meet these two brothers in person -- their world view is so sharp and their take on it all is so witty. Burn After Reading is worth seeing, if only to see Brad Pitt acting against type, as a blond-highlighted surfer dude kind of guy.

© 2008 blogSpotter

Encroaching Night

Never should anyone forget ... -- Picture courtesy of Wikipedia

by blogSpotter
One of my purchases in Washington D.C. was the powerful and compelling novella Night, by concentration camp survivor Elie Wiesel. I bought it at the Holocaust museum, and it is an excellent read for anyone. At 105 pages, and with large print it can be read in one sitting – although the import of its words might take much longer to distill and digest.

Night chronicles the Wiesel family (Elie, his parents and 3 sisters) and their horrific internment in German concentration camps. The Wiesel family and all the Jews of Sighet, Transylvania were deported to camps in late 1944, as the war was actually approaching its end. The timing availed the Wiesel’s nothing – Eric’s parents and youngest sister perished. I carried away from my reading some general impressions and ideas – ideas that extend to current events and social phenomena by the way.

The Jews of Sighet could not believe that a religious group was being singled out for persecution – they were in denial. In early 1944, a synagogue custodian had escaped an internment train and told the townspeople what was happening in the camps; they just wrote him off as a madman. Then Hungary turned the government reigns over to Germany, and German officers settled into Sighet’s guest houses and hotels. The townspeople were told they had to be moved to a new encampment; they rationalized that the move was a protective one, to keep Sighet’s Jews from the dangerous battlefront. They also speculated that Germany just needed their tradesmen for special war efforts – nothing sinister at hand.

They couldn’t have been more tragically mistaken. Within weeks, the Germans had corralled the Jews into a ghetto, then packed them in a cattle car train off to Aushwitz. At the front gate, Germans did “selection” to separate slave labor (the physically robust) from the others. The others – slight women, children, infants, the elderly, the disabled and the ill were immediately gassed. Elie’s mother and baby sister were killed the very day they arrived at Auschwitz. I was impressed that competent “block workers” as they were called were actually allowed to have Hebrew services, and they were fed pretty well at least at the outset – before Russian tanks rolled near. The “select” really were needed for back-breaking labor in the war effort. Also interesting is that the Nazis targeted homosexuals – noteworthy because some of the camp administrators were closeted homosexuals and they would shield young boys from punishment or death for nefarious sexual purposes. (Although in retrospect, one might willingly endure rape as an alternative to gassing).

Toward the end of the war, food rations became scant for SS soldiers and even more so for prisoners. The prisoners had to be moved (marched by foot, in the snow, under SS armed watch) to new encampments. Food was so scarce that fathers, sons and lifetime friends would fight to bitter death over a loaf of bread. Elie couldn’t believe how the circumstances transformed men into animals. Elie, age 15, had the fortune to be encamped with his 50 year old father. However, the cold and starvation took a serious toll on his father and he died only weeks before the camp was freed. Wiesel feels guilt and remorse to this day, that he had resentments – that he was having to carry his dying father and that it might call attention to them both.

When the Russians were about to prevail, the SS could see the handwriting on the wall. The SS officers called all the block denizens to the front of the camp – usually done for roll call or formal announcements. Only this time, resistance fighters had knowledge that the troops were going to simply kill the remaining prisoners. Mow them all down with guns – they were no longer “of use” as slave labor. The prisoners remained in their blocks. It’s heartening to know that even this late in game, even after 6 million deaths, the victims had the moxie to fight back. The resistance fighters had somehow obtained guns and started shooting at the SS troops. The beleaguered SS troops were now fighting Russians and resistance fighters – they had to run.

I’ve already read much about the Holocaust, although I never read such a firsthand account as this. Wiesel had trouble getting the book published in 1955 – publishers at the time thought the topic was too dark and troubling. It’s to Wiesel’s everlasting credit that he persevered and told the story of an evil night that encroached, a night that nobody quite could believe even after it passed.

In closing, here is Elie’s poetic testament to what happened in that critical time:

“Never shall I forget that night, the first night in camp, which has turned my life into one long night, seven times cursed and seven times sealed. Never shall I forget that smoke. Never shall I forget the little faces of the children, whose bodies I saw turned into wreaths of smoke beneath a silent blue sky.
Never shall I forget those flames which consumed my faith forever.
Never shall I forget that nocturnal silence which deprived me, for all eternity, of the desire to live. Never shall I forget those moments which murdered my God and my soul and turned my dreams to dust. Never shall I forget these things, even if I am condemned to live as long as God Himself. Never.”

© 2008 blogSpotter

Mrs. Smith Goes to Washington

Anything you can do, I can do better -- Picture courtesy of Wikipedia

by blogSpotter
In 1939 Frank Capra directed a movie classic called Mr. Smith Goes to Washington. In that movie Jefferson Smith is a naive, small-town scout master who gets appointed to a position of influence in Washington, somewhat by fluke. He comes to blows with party bosses and is very nearly undone by his own charm and innocence. Jefferson is played to halting, stammering perfection by a young Jimmy Stewart.

When I watched Sarah Palin give her speech at the St. Paul 2008 GOP Convention last night, I thought of Jefferson Smith -- without the stammering. I also thought of Calamity Jane and Annie Oakley. The 44-year old Palin is a moose-eating, gun-toting, snuff-chawing, varmint wrasslin' gal; she also happens to be a former beauty queen and an attractive plain-spoken mother of five with an extremely wholesome appeal. Palin who is currently in her 3rd year as Alaska's governor even has a vague resemblance to actress Tina Fey.

In the week since McCain chose her, people have taken all manner of pot-shots. Apparently her unwed 17 year old daughter is pregnant. Her husband, a commercial fisherman, had a DWI some 22 years ago. (Excuse me, didn't W Bush have a DWI in 1976?). Apparently, Palin was trying to get her former brother-in-law, an Alaska state trooper, fired -- that's now being investigated as a possible abuse of power. Nothing brought forth by the media has required me to get out my smelling salts. The Palin family seems normal and if that's the worst ammo anyone has, she doesn't much need to duck. Her speech last night was well-delivered and landed several good punches. She zinged Obama for various things like the cling-to-religion remark and she also zapped the "liberal" media. She seems poised and ready for election year combat.

When I look at her though, what do I see? A hockey mom, mother of five, Tina Fey-look-a-like. I don't necessarily see a President, except maybe in a custodial, finish-up-the-term Gerald Ford context. Could she summon the depth, power and knowledge that Roosevelt did at Yalta? Could she navigate all the complexities of the mortgage crisis? I'm not dissing women -- I think that Kay Hutchinson has been very effective in steering the ship in North Texas. I think Hillary has insight, weight and intelligence albeit for the other party.

We already have a "newbie" President who struggles with weighty concepts -- do we need another? The obvious retort is that Obama is also a newbie and that is absolutely true. We have an experience-challenged ticket on both sides and that will certainly affect how people vote. I myself prefer a more wizened person who's been a few steps through the mill. I'm still deciding how I'll vote. I used to think that undecideds should have "stupid" stamped across their foreheads, but I never faced such a tepid, tweedledee-tweedledum choice before.

© 2008 blogSpotter