Bailout? Smith yes, Wyden no.

Tonight, the U.S. Senate voted to approve the $700 billion bailout of Wall Street. Senator Ron Wyden was one of just 10 Democrats to vote no. Senator Gordon Smith voted yes.

Senator Wyden, via the AP:

[Wyden] said Congress has an obligation to take the time to ask tough questions before making such a momentous decision.

In 2002, Congress rushed through the process of authorizing the Iraq war and failed to verify the answers it received from the Bush administration, said Wyden, who voted against the war.

"Now, in 2008 we have been rushed into voting on a package that would spend $700 billion to address the credit crisis that threatens our markets. In my judgment, the bill we are considering tonight leaves far too many questions unanswered and misses the mark in addressing both the causes and potential cures for the current crisis."

Senator Smith, via the Oregonian:

Sen. Gordon Smith, R-Ore., voted for the package despite reservations about the cost. Voting for the bill, he said, ``was the only way I could protect Main Street from the greed of Wall Street. If we don't do this I know our economy won't work.''

Jeff Merkley, via the AP:

Merkley said the bill would help Wall Street executives who created the financial crisis in the first place, while doing nothing to end the failure of oversight that allowed the problems to continue unabated for years.

"We cannot ignore the suffering on Main Street, sidelining our homeowners and allowing deceptive practices to lead more families into bankruptcy," Merkley said Wednesday night.

Gordon Smith, responding to Merkley, via the AP:

"My opponent, in opposing the rescue plan, has shamefully placed his partisan ambitions ahead of the retirement, financial and economic security of the people he seeks to serve and once again has demonstrated his willingness to leave Oregon's rural communities behind," Smith said.

Last Friday, Gordon Smith had called Jeff Merkley unpatriotic for opposing the bailout plan.


  • Unreal (unverified)

    County Payments? Smith yes, Wyden and Merkley no.

    Look I can spin a story too!!!

    In other profiles in courage, it was nice of Jeff Merkley to wait until 9pm PST to boldly denounce the plan, after carefully making sure Wyden would give him cover to oppose the most important legislation for rural Oregon in a generation.

    There is leading and being led. The latter applies to Jeff Merkley.

  • (Show?)

    n other profiles in courage, it was nice of Jeff Merkley to wait until 9pm PST to boldly denounce the plan, after carefully making sure Wyden would give him cover to oppose the most important legislation for rural Oregon in a generation.

    Unless you count the fact that Merkley came out against this entire thing before the House voted on it last week..and this bill is virtually the same thing.

    Smith waited to stick his finger in the he always does. I'd be surprised if this vote doesn't turn out to be Smith's anvil.

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    These bailout bills do little to help the average American. They're still losing their homes. Their economic situation only continues to get worse.

    We're going to bail out these companies when they caused the problem in the first place. The companies will then continue to foreclose on homes, putting people out on the streets. And once the economy starts to right itself, the companies will turn around and the companies will sell the houses.

    If Congress truly wanted to help the economy and the people of this country, they'd look at the people first - not Wall Street.

    Why can't those funds be used to help the individuals and families that are struggling right now? Why can't funds be used to get people back on track on their payments to the banks, and those banks be required to bring down the interest rates on those loans, in exchange for help with their short term cash problems (but not a hand out - it would need to be paid back)?

    Many of these banks are in the situation they are because they made loans to people (or credit cards) and then jacked up the interest so far that people couldn't afford them. Were the terms brought back down to the original ones, many people could get back on track to paying down their mortgages. And keeping people in their homes is important - it means more people living in residences they own as opposed to rent, fewer vacant homes sitting around, and keeps our economy strong.

    Help like this would get the banks back on track, keep people in their homes, and get people back to mortgage terms they can pay. And that would go a long way to putting our economy back on track.

    Just bailing out these companies the way Congress has voted on thus far just encourages these companies to continue on with business as usual, without a care beyond the next financial quarter. We're never going to fix our economy with business as usual.

  • Unreal (unverified)

    Smith's anvil? Bill is virtually the same thing? Passed the Senate 75-24 but failed in the House is the same thing?

    Does this sound familiar Carla (btw even for a Merkley staffer you responded quickly to my last comment)?

    "We cannot fail...This is a nation that's faced down war and depression, great challenges and great threats. And at each and every moment, we have risen up to meet these challenges, not as Democrats, not as Republicans, but as Americans, with resolve and with confidence."

    Barack Obama speaking about the Senate bill, which passed with the support of 40(!) Democrats.

    I eagerly await Jeff's denouncement of Barack Obama, Hillary Clinton and Harry Reid.

  • LT (unverified)

    Unreal, as I understand it, the Senate bill is the House bill with added FDIC funding, AMT patch and capital gains tax cuts. Since you seem to know so much, exactly what is the oversight mechanism in this bill? It may have been the best that the negotiators could get in a short time frame, but is it something you are comfortable with?

    DeFazio speaking in one interview (forget which one) specified the paragraph which describes the oversight mechanism. Didn't sound like it said oversight could be done in the coming months, but rather in coming years. Unreal, what did you read in the bill about the oversight mechanism?

  • Peter Ray (unverified)

    Smith doesn't get to hide behind Wyden's county payments bill. Smith had nothing to do with Wyden's bill being in the bailout. Even Smith is too smart to claim credit.

    But beyond that, I think there's a reason that goes well beyond "cover" for Jeff Merkley for Wyden, DeFazio and others to vote against the bill. Unreal, are you saying that Smith voted for a $700 billion bill so Oregon could get 1/10 of 1% of the money? Oregon will get about $700 million from Wyden'sbill, according to the Oregonian story.

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    "My opponent, in opposing the rescue plan, has shamefully placed his partisan ambitions ahead of"

    "Shamefully"? Oh please. Can we tone it down, Gordon?

    People who disagree with policy solutions to complex problems aren't evil or "shameful." And, no, "Unreal," nobody has to "denounce" anyone or even be their sworn mortal enemy to disagree with them. Heck, you might even have a major disagreement with your friends. Such rhetoric from Smith is just silly.

    And besides, Merkley is right--this bail out, whether necessary or not, will help Wall Street more than anybody else. The salaries alone for those guys tell you all you need to know. If we must do this bail-out, we should combine it with widespread prosecutions of the fraudulent loans given out in the first place as well as with very strict new regulations (banning short selling would be a good start.) Hopefully the House will hang tough and say no until there is real reform woven into the bailout package.

    Wyden proves once again why he belongs in the Senate!

    And Gordon Smith proves once again he can give John McCain a run for his money when it comes to acting like Donald Duck in a crisis. Shameful indeed.

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    Democrats aren't always going to agree. The majority of our Democrats in the House voted against almost the same bill the other day. A recent poll in the tri-county area shows that Democrats are evenly divided over the bailout.

  • (Show?)

    KATU just showed a poll they just did. If I heard right, 24% were against any bailout, 64% specifically against this bailout.

  • Laughing (unverified)

    So does this mean Merkley can't work with his fellow Democrats, and the person we hope will be the President? After all, isn't that what he made the entire theme of his campaign against Novick.

    All we have here is that Wyden and Merkley are Western state Democrats who stuck their fingers in the wind, and saw which way it was blowing. After all, Wyden vote FOR Gramm-Leach-Bliley that gave us this mess. Glad they did it, but it's not because either of these guys were doing anything out of principle, except the principle of whatever it takes for them to get elected.

    So we now have Merkley criticizing Obama? Guess he'll have to take this off his website:

    Merkley: Obama will fight special interests

    You also just have to chuckle at what a joke this whole thing has become. The official name of the bill: "Paul Wellstone Mental Health and Addiction Equity Act of 2007".

  • Dave O'Dell (unverified)

    I'm feeling better about Jeff Merkley all the time. I just hope enough voters see this scheme for what it is.

    This bill is a scam to steal money from us and future taxpayers and give it to Henry Paulson's buddies.

    David Sirota has written some excellent posts where he notes that many economists oppose the $700 billion bailout. Read them here: Top 5 Reasons To Vote Against Wall Street's $700 Billion Bailout and here: STRATEGY MEMO: Turning A Wall Street Giveaway Into An Economic Rescue For All Americans

    Anyone who votes for the $700 billion bailout plan in any form is not doing any favors for rural Oregon or urban Oregon for that matter. Peter Defazio's plan actually addresses many of the basic problems with the system without spending any taxpayer money up front.

  • mp97303 (unverified)


    One quick question regarding your post. If I understand you correctly, you support providing banks with funding to meet their short-term needs and then expect them to pay it back later. You also suggest rolling back mortgage payments to their original amounts, something I also support if done for a fixed time period. My question to you is this: would you also expect mortgagees to pay off their debts in full or are you suggesting that they should get a "handout" and not be required to fulfill the obligations to the "bank" that they willingly entered into?

  • Not your typical Customer (unverified)

    The thing about all this that amazes me is that HAD smith voted AGAINST this bill, this article would read "Smith Votes Against Renewing Timber Payments to Rural Counties!!"

    Get real people. This was a catch 22. I'll say that I'm not happy Smith voted for it, and I like him. How about you be fair and shine this same negative light on your own personal savior, Barrack Obama?

    I'm sorry, but I can't take hypocrisy. If someone on here that IS NOT A REPUBLICAN will openly criticize Obama, JUST AS THEY HAVE SMITH, then I will truly accept that person as a fair and balanced person. Anyone who does otherwise is truly a Dem party shill and has no legitimacy.

    Sorry folks, but a "yea vote" is a vote, no matter who it came from. Don't just yell at the person who's convenient.

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    If someone on here that IS NOT A REPUBLICAN will openly criticize Obama, JUST AS THEY HAVE SMITH

    I'll start. Barack Obama should have voted no on this ridiculous bailout package.

    There, I said it.

    But here's the thing: I'm still planning to vote for Obama because I believe his heart is in the right place - and most of the positions he takes are the right ones. This bailout package represents a rare moment of disagreement for me.

    As for Smith, I disagree with him on just about everything. So while I'm annoyed about this yes vote, I'm not surprised or disappointed. My opinion of him can't sink much lower.

    Full disclosure: My firm built Jeff Merkley's website, but I speak only for myself.

  • edison (unverified)

    I'm not a republican and I think Obama's vote was wrong. So was Smith's. As were the votes of the rest of the senators who voted yea.

  • naschkatzehussein (unverified)

    We need a completely new type of economy, and Obama's emphasis on the production of clean energy is a start which will be especially good for Oregon and much of the West. But I notice in this election how divided the country is: half of us are willing and excited to face a brave new world while the other half is so fearful of stepping out of the old ways which have failed and are causing the country to go under. This bailout is for them. Kevin Phillips calls this a FIRE economy, based on the Financial industry, Insurance companies, and Real Estate. It is a shell game, and the capitalists should realize that production is a key element of capitalism now missing from our consumer society. It appalls me that the politicians are only concerned with getting more credit out to the public. My hope is that Obama is only going along with this in order to get elected, and it is only a stopgap measure until them. Meanwhile, I applaud Senator Wyden and Jeff Merkely for telling it like it is.

  • DanOregon (unverified)

    I give Smith credit for voting for the bill. And Merkley a little credit for opposing it, but not slamming Smith for voting for it. Smith was there and made a tough choice. And if you're going to call out Smith for saying Merkley's opposition to the bailout was unpatriotic, you should do the same for Pelosi.

  • Daniel Spiro (unverified)

    I don't have time to post a link but there is an interesting op-ed in the New York Times today (10/2) discussing what happened to the Japanese economy in the 1990s when that nation's government did NOT support a financial bailout. It makes a pretty compelling case that action now is better than inaction -- especially given the prospects of modifying the bill once President Obama takes over.

    Economics was one of my college majors, but I don't profess to understand macroeconomics very well. What I do understand, however, is that this nation's economy cannot survive intact with an extreme credit crunch. In addition, despite all my skepticism, which is at an all time high after the idiotic Iraq War, I have trouble believing that this entire crisis is being fabricated just to protect the greedy.

  • Dave O'Dell (unverified)

    There is a real credit problem, but I don't think there are many advocating doing nothing. This is not a binary choice. There is a real alternative to giving away hundreds of billions to a bunch of crooks. An alternative that actually does something to fix the underlying structural problems. An alternative that will leave an Obama administration with enough of a budget to implement progressive policies. Enough of a budget to ease the inevitable slow down in the economy which is coming whether we pay off the Wall Street extortionists or not. That alternative is Peter Defazio's plan.

    Most economists that have examined the Defazio plan agree that it will prevent a depression and that the $700 billion bailout has a chance to plunge us into a depression. The bailout rewards bad players in the economy by covering their bad bets. This encourages them to take even bigger risks in the future.

    I'm supporting Defazio's plan because it is the best hope for our economy.

  • (Show?)

    Smith's anvil? Bill is virtually the same thing? Passed the Senate 75-24 but failed in the House is the same thing?

    Does this sound familiar Carla (btw even for a Merkley staffer you responded quickly to my last comment)?

    Does it sound familiar? I wrote it myself. And you might want to catch up, Unreal. I haven't been on the Merkley campaign since May.

    Obama shouldn't have voted for the bill. (I'm not a Republican, btw)

    Merkley has already spoken out before about not agreeing with Obama on some issues. So again...time for Unreal to catch up.

  • joel dan walls (unverified)

    We don't have a parliamentary system, folks. That fact goes a long way toward explaining the way congressmembers vote. Vote against your party in, say, the British parliament, and you will be soon find your office is now a broom closet, you have no staff, and at the next election you will be out of office anyway, because the PARTY, not the local electorate, decides who will be the candidate in a particular constituency. In the US system, the same effects are achieved in other ways, mainly by larding important bits of legislation with earmarks.

    But enough of that. I'm really, really angry that the Senate bill did not include anything to pay for remodeling my beach house.

  • Scott J (unverified)

    This bill absolutely stinks...but it had better pass.

    I keep hearing people talk about "bailing out Wall St" or "the little guy bailing out corporate America".

    Nothing could be further from the truth. Guess who get's hurt if the credit markets contiue to freeze up? It certainly won't be the executives. They won't fire themselves.

    They will fire workers when business drops off due to the cost of financing new projects and investments become too costly or un-attainable. We're already seeing this in the banking industy. The bank employees that had nothing to do with poor executive decisions are being the ones laid off, not th executives.

    Guess who's pensions plans will go under-funded and then belly up if the markets plunge 3000 points? That's right, union members. Not only will they lose hours on the job as the economy freezes, pensions will flip upside down. Pensions guarantees will get re-written for public employees, and not to their benefit.

    If the Dem's don't pass this bill (they have the votes to do it without any R's), the political consequences will be heavy.

  • joel dan walls (unverified)

    I'm no economist, either, but the analyses I read are all over the map in terms of whether the present bailout scheme is really going to relieve credit crunch for "regular folks", which, if this is still a functioning democracy, ought to be the ultimate goal, I would suggest. The Senate bill seems to fall short: it seems (again, I'm an economic rookie) to provide relief for the big financial players, does NOT adequately give taxpayers stakes in the big companies that benefit, and they buys votes through via earmarks. Yech.

    The term economists like to use is "moral hazard": do you face consequences for your decisions, including potentially dire consequences? If financial wizards are relieved of moral hazard by government bailouts...well, chances of a repeat seem strong. You know damn well that a President McCain, despite his recent pseudo-conversion experience, would never sign a bill to implement strong regulatory measures. Would a President Obama?

  • DB (unverified)

    I totally agree with you Scott J on the need for the bailout. People keep saying "this is a Wall Street bailout", as if Wall Street and Main Street are different places. It's kind of like the small town/big city thing Palin does. Main Street won't do well if Wall Street falls apart, and vice versa. You can't let Wall Street fail and not feel it on Main Street. If credit markets freeze, we're all screwed.

    One thing that bugged me about Merkley's opposition to the bailout was his statement that he didn't want us to purchase assets from foreign banks. I think it's a terrible idea to discourage foreign investment in the US. It seems like great populism, terrible policy that Jeff's suggesting.

    There is a reason that all the people we respect- i.e. Obama, Krugman, etc. are suggesting we pass the bailout bill. It's not perfect by any stretch of the imagination, but we can't afford the consequences of its failure.

  • Tom Civiletti (unverified)

    in an email from Russ Feingold:

    I will oppose the Wall Street bailout plan because though well intentioned, and certainly much improved over the administration’s original proposal, it remains deeply flawed. It fails to offset the cost of the plan, leaving taxpayers to bear the burden of serious lapses of judgment by private financial institutions, their regulators, and the enablers in Washington who paved the way for this catastrophe by removing the safeguards that had protected consumers and the economy since the great depression. The bailout legislation also fails to reform the flawed regulatory structure that permitted this crisis to arise in the first place. And it doesn’t do enough to address the root cause of the credit market collapse, namely the housing crisis. Taxpayers deserve a plan that puts their concerns ahead of those who got us into this mess.

    -Senator Russ Feingold, October 1, 2008

  • Scott J (unverified)

    A short story:

    The Captain had committed an un-pardonable sin the last time he was at port. Although his was the last ship that would make it into harbor before the winter months set in, the townspeople wanted to punish the captain. He was denied a safe harbor to dock his ship and unload the critical cargo the town so desperately needed.

    "He must be punished", the chief of the town, Russ Feingold shouted from the top of the courthouse.

    With that bold, righteous decree, the ship's guilty captain and hard working, obedient crew, sank off the coast as the storm intensified. With the ship went the very supplies that the town needed to make it through the winter.

    As the townspeople buried their dead throughout the winter, their folly became apparent, yet noone dare speak a word of it, for pride is stronger than common sense.

  • J.I. (unverified)

    Just strip this bill down to two things.

    1. The "rescue/bailout" funding mechanism with an oversight board, and

    2. A two year suspension of the 60 vote rule in the Senate.

    Then the Democrats tell the public...OK we're providing funding, you now need to vote Democrat for congress/senate and we'll figure out the recoupment mechanism and other terms necessary to fix our economy gone haywire by January, 30th 2009.

    If you vote us into a majority,we'll promise to at the very least, cap ALL CEO compensation, re-impose the stock transfer fee (but lets call it insurance towards the bailout, not a fee, because thats what it is really), and impose a surcharge on incomes over $500,000 to go exclusively to debt reduction.

    Other things we'll look at....fixing the AMT, taxing all income in the same way, imposing a $3 million estate tax credit and index it for inflation.

  • Bill Bodden (unverified)

    The Real News Network has some very good videos on the bailout. Well worth listening to.

  • Bill Bodden (unverified)

    If someone on here that IS NOT A REPUBLICAN will openly criticize Obama, JUST AS THEY HAVE SMITH

    If you have been paying attention you will find a few independents/NAVs posting on this site have been critical of Obama (almost) as much as McCain and as critical of the Democrats as much as the Republicans. I entered the "(almost)" because I question McCain's emotional stability and consider Obama the lesser evil - which still leaves him as something other than the great hero some mistakenly believe will lead us to the promised land. His vote for this scam supports that opinion.

    On another thread I said that Obama's plan to add more troops to the Afghanistan battle is as lunatic as McCain's. Change? What change?

    Once again the Senate has seen fit to have the U.S. Capitol live down to its reputation of being the biggest and most expensive whorehouse in the world.

  • Roy McAvoy (unverified)

    I retired in March, and my retirement income depends on the money I have invested in the market, via my 401K. I would gladly go back to work for another 30 years before I would give that group of scoundrels in the banking and credit industry one red tax dollar cent of mine. Of all the representatives speaking for us DeFazio is the only one who is least making some sense, but I will never again vote for any politician who supports this pork filled bill. To hell with em all, and I am ready to suffer the consequences!

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    Dave wrote: "Most economists that have examined the Defazio plan agree that it will prevent a depression and that the $700 billion bailout has a chance to plunge us into a depression. The bailout rewards bad players in the economy by covering their bad bets. This encourages them to take even bigger risks in the future. I'm supporting Defazio's plan because it is the best hope for our economy."

    I don't know which economists you are talking to. I have queried my friends and colleagues and not a single one thinks the Defazio's plan is the best hope for our economy, although they disagree about whether short-selling should be temporarily or permanently banned. None of them believe that issue is significant or that the $700 billion bailout has a chance to plunge us into a depression. Almost all of them now believe it would have been much better if the Treasury plan had been enacted when it was proposed 2 weeks ago.

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    Gordon Smith: "My opponent, in opposing the rescue plan, has shamefully placed his partisan ambitions ahead of the retirement, financial and economic security of the people he seeks to serve...

    Um... wow!

    Smith wanted to place the retirement, financial and economic security of all working Americans - not just Oregonians - at risk by turning SSI over to the very same Wall Street that is now begging and pleading for us to save it from itself!

    Of course, I wouldn't expect the coddled scion of the Smith family fortune to even understand what kind of wreckless risk his bankrupt partisan zealotry posed and still poses to the retirement, financial and economic security of Oregonians. But then again, look who we're talking about here: a guy who could afford to drop $1.2 million for fucking golf clubs.

  • Dave O'Dell (unverified)

    Fred, How about these economists for a start (follow the link):

    Mortgage Protest

    Princeton economist Paul Krugman: "To this day [the bailout proponents] have never been able to explain clearly why buying up bad mortgage assets at market prices will solve the credit crunch...The Wise Men, as far as I can tell, have never had a clear idea of what they're doing."

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    I wouldn't have quibbled about the claim that many economists oppose the Treasury plan. Merely the claim that most do. There are couple of basic laws that hold with respect to my profession, the first is that for every position there is an equal and opposite position. My own expertise is in budgetary and financial policy, not money and banking. But the folks around here who know the most about this issue, Mark Thoma at the University of Oregon (who blogs at Economist's View), Patrick Emerson (who teaches Money and Banking at OSU and blogs at The Oregon Economist), Hiro Ito at PSU, and my colleague at WIllamette University, Michael Dothan, all support the Treasury proposal as the best available, if not the best possible alternative.

    As for the two sources you mention, the first is made up primarily of strong free-market economists who do not like any kind of government regulation of the economy very much, including the kind proposed by Treasury. I sympathize with their position but not enough to live through depression to find out if they are right.

    Paul Krugman's position is more appealing to me. However, he has basically been calling for government takeover of the banks. If he is correct about the seriousness of the problem, it will come to that anyway. In the mean time, as he concludes he would rather "Dodd-Frank-Paulson, which is much better than the original plan, pass than not. The true cost to taxpayers will probably be close to zero, and it would buy some time. But I’m not passionate about this. The real financial rescue still lies in the future, probably under the Obama administration." I think he is mostly right. Where I would differ is that I don't really see any significant difference between the original Treasury plan and Dodd-Frank-Paulson, except that the latter looks a lot more like a Christmas tree.

  • Harry Kershner (unverified)

    Not your typical Customer said: "If someone on here that IS NOT A REPUBLICAN will openly criticize Obama, JUST AS THEY HAVE SMITH, then I will truly accept that person as a fair and balanced person."

    You must be a newbie. Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL.

    Obama supports our system of privatized profits for the rich and socialized costs and risks for the rest of us. He is telling us that we are unpatriotic if we do not roll over and beg for one more crack of the riding crop from his Wall Street investment backers.

    Here is a progressive plan:

    1.No bailouts without conditions and reciprocity in the form of stock warrants.

    1. No more lobbying for any company that is bailed out.

    2. No golden parachutes or get-out-of-jail-free cards for guilty executives.

    3. No bailouts without public hearings.

    4. Reduce the moral hazard in U.S. mortgage markets by introducing covered bonds for the majority of mortgage products, as is done in Western Europe. That gives institutions that finance mortgages an incentive to be prudent, because they cannot just unload them and wipe their hands clean of the liability, but are instead on the hook if the homeowner defaults.

    5. Maintain neighborhood stability and housing security by passing a law with a sunset clause allowing below-median-value homeowners facing foreclosure the right to “rent to own” their homes at fair market value rates.

    6. Avoid future housing bubbles by removing implicit government guarantees for new mortgages that exceed thresholds of greater than 15 to 20 times the annual fair market rent value of the home.

    7. Make the Federal Reserve a Cabinet position, so it is accountable to Congress, as well as make sure all Federal Reserve Bank presidents are appointed by the president and answerable to Congress.

    8. Reduce conflicts of interest by taking away power for auditor and rating agency selection from companies and placing it in the hands of the SEC to be administered on random assignment.

    9. Implement a securities speculation tax, starting with derivatives, to deter casino-style capitalism.

    "Ralph Nader, who has spent his adult life battling corporations, understands more about the rise of the corporate state and the steady fleecing of American citizens by corporations than anyone else in the country. The core of his message is that Republicans and Democrats are hostage to corporate power." (Chris Hedges, Fleecing What’s Left of the Treasury).

  • Dave O'Dell (unverified)

    Fred, The honest truth is I cannot bring myself to trust anything that comes out of the Bush administration. Perhaps "most economists" is wishful thinking. I haven't studied economics in over 20 years, but I've been studying the game of Poker intensively over the last 2 years and my BS detector is finely tuned. I didn't like the Treasury plan from the start because:

    1. They've been working on it for months, but all of a sudden it must be passed in less than a week or economic armageddon will happen.
    2. They want the money with no oversight and no review by any court of law. My understanding is there are no teeth in oversight provisions that have been added since the original proposal.
    3. It seems like a huge transfer of wealth in the wrong direction.
    4. People keep telling me this is all to complicated for me to understand and that I should just leave it to the rich fat cats that got us into this mess or to economists that are smarter or specialize in banking to fix.

    Do you really think we are possibly headed into a Great Depression? Even if we are could it possibly be as bad as the last one?

    My understanding of the Great Depression in a nutshell: very little regulation, big bubble caused by massive leverage, bubble burst, money supply tightened, fiscal conservatives kept government spending low enough to prevent a turnaround until WWII.

    Won't we be OK as long as we avoid McCain who has pledged to veto all spending bills? Didn't we learn our lesson from the last depression? Well, maybe not about deregulation of financial markets, but surely now we have...haven't we?

  • Bill Bodden (unverified)

    While I admire some economists sometimes street smarts can be enough to make a good decision. Consider: (1) George W. Bush is a man who has cried "Wolf" when there was no wolf on more than one occasion and has lost the trust of around 70 percent of the people, most of whom are normally kind of slow at "getting it." (2) Said GWB sent his financial agents - Paulson, Bernanke and Cox - to Congress with a plan to keep Wall Street from collapsing and the world from going into another Great Depression. (3) Said agents presented their hired enablers in Congress - Senator Dodd, Barney Frank and their committee members - with a three-page manifesto to turn over the keys of the Treasury to Secretary Paulson, former CEO of Goldman Sachs, one of the Wall Street operators that helped create this mess. No questions. No oversight. (4) Without considering alternate opinions, said enablers basically agreed to sign this three-page blank check with minor tweaking. (5) Oops. A sizable portion of the people finally got their heads out and noticed the emperors were naked and shouted loudly enough to get the attention of a majority of representatives in the House, many of whom don't normally pay attention to the people. They voted down this bill. (6) Back to the drawing board and the same draftsmen who gave us this crummy bill that was rejected and we get a revision that adds a few crumbs to the people and another reminder the world markets will collapse, you won't get anything out of your ATM machine, mom-and-pop shops by the thousands will collapse, and widows and children will be kicked out onto the streets if this bill doesn't go through immediately. (7) The bill goes to the House where lots of strong-arming will be going on. No time for logic or rational debate. Just plain, vicious hardball. (8) The House votes ... What will happen then?

  • inbf (unverified)

    Harry: "Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL."

    yes yes yes!

  • Dave O'Dell (unverified)

    I like your points Harry, but I would disagree that the difference between Obama and McCain are NIL (although in the overall scheme of things the differences are small). I'll hold my breath and vote for Obama because he is far less likely to veto the good stuff that progessives in the house will send him.

    I'm in the camp of let's takeover the Democratic party from the ground up like the wingnuts did the Republican party.

    I'll also be one to criticize Obama for this vote. He's being advised by some of the same people who were advising Clinton at the time that financial regulations were repealed.

  • Tom Civiletti (unverified)

    A shorter story:

    A stupid and evil man gained control of the throne through trickery. He immediately set out to loot the treasure of the people by scaring them with imaginary dangers, and then paying his friends to "save" the homeland.

    Just before his terrible reign was to end, he created one more emergency that allowed even quicker looting possible. The people knew their leader should not be trusted, but, as usual, their fear prevented them from taking action. Soon all the people of the land paid rent to China or Saudi Arabia.

  • Bill Bodden (unverified)

    Harry: "Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL."

    As much as I agree with Harry, there is one difference. Nobody is questioning Obama's emotional stability. They are both full of BS, but I don't believe Obama's first thought about resolving a crisis will be to unleash the troops. He might get around to that eventually if his backers in the war armaments corporations need some business. The dumb idea he shares with McCain about increasing military forces in Afghanistan supports the plausibility of that theory.

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    Here are the tollfree numbers for Congress: 800 828-0498, 800-473-6711. Our Congressional delegation needs to support Peter DeFazio's position. The sprinkles added to the Paulson cow patty by the Senate do nothing to protect the taxpayer or the homeowner but DeFazio and his group have far better solutions. Now is the time for the change we need

  • Bill Bodden (unverified)

    Here is another interesting viewpoint from Just Foreign Policy:

    Wall Street Bailout Threatens World's Poor: Who Wins and Who Loses?

    On Monday the House voted down the Bush Administration's request that Congress authorize $700 billion for purchasing Wall Street's "toxic assets" linked to the collapse of the housing bubble, after being deluged by phone calls and emails in opposition. The Senate approved basically the same package Wednesday, and the House may vote again Friday.

    Largely missing from debate has been the impact of this plan on U.S. government spending on human needs in the next Administration. What will be the toll exacted on human needs for all Americans in the next budget, and who will win and lose in the latest bailout plan? And there has been almost no mention at all of the impact on our global commitments to help eradicate poverty, reduce illiteracy, address easily preventable disease, provide food and shelter to the world's neediest at home and abroad.

    Can you ask Congress to consider the cost to the world, as well as to the United States, of enacting the Bush Administration's plan, and to consider alternatives?

    Last week, world leaders met at the United Nations. UN Secretary General Ban Ki-moon is asking for the world's wealthy countries to contribute $72 billion per year to help the world meet the modest UN goal of reducing extreme poverty. [1] According to the advocacy group Health Gap, the US share of this would be about 1/3, or $24 billion, based on the US share of the donor countries' wealth. Over the four years of the next Administration, that would be about $100 billion. As Inter Press Service reported, delegates to the UN meeting expressed concern that donor country commitments to reducing global poverty would now be even weaker than before.

    If the Bush Administration's Wall Street bailout is enacted, we will be told that there is no money for additional spending on human needs, nationally and globally, in the next Administration - regardless of whether this is true. Already, in the first Presidential debate, moderator Jim Lehrer pressed the candidates to say what priorities they were going to give up, in light of the expected Wall Street bailout.

    There are alternatives to the Bush Administration's plan that would cost the US taxpayers less, have greater chance of addressing problems in the credit market, and not politically threaten the next Administration's ability to increase spending on human needs. Congress should consider these alternatives before approving the Bush Administration's plan.

    Representative Peter DeFazio has introduced a plan which would strengthen regulations to bolster the banking sector. The plan is based on a proposal made by William Isaac, head of the Federal Deposit Insurance Corporation under the Reagan Administration. Isaac notes that in the 1980s Congress enacted a program which shored up the capital of banks to give them more time to resolve their problems, and the FDIC resolved a $100 billion insolvency in savings banks for a total cost of less than $2 billion.

    Please ask Congress to consider the cost to the world, as well as to the United States, of enacting the Bush Administration's plan, and to consider alternatives.

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    You asked: "Do you really think we are possibly headed into a Great Depression? Even if we are could it possibly be as bad as the last one?"

    Yes, if we don't take appropriate regulatory and fiscal action. No, but then, Americans are used to living a lot higher on the hog than in those days.

    "My understanding of the Great Depression in a nutshell: very little regulation, big bubble caused by massive leverage, bubble burst, money supply tightened, fiscal conservatives kept government spending low enough to prevent a turnaround until WWII."

    Your understanding is correct. The only thing I would add is that both HH and FDR were among the fiscal conservatives who feared deficit spending (during a recession) and neither did anything to expand the money supply. The Treasury plan is aimed directly at expanding money in circulation or, at least, halting its decline. I think another stimulus package is a very good idea. The last one worked quite well. Indeed, if the banking crisis had been averted, it might well have been sufficient.

    Bill Bodden: I take your point. But remember the conclusion of the story: when the wolf actually showed up, the villagers ignored the boy and they all got eaten.

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    Princeton economist Paul Krugman: "To this day [the bailout proponents] have never been able to explain clearly why buying up bad mortgage assets at market prices will solve the credit crunch...The Wise Men, as far as I can tell, have never had a clear idea of what they're doing."

    The answer, of course, is that it converts illiquid assets into cash and stablizes their balance sheets. That allows them to start making loans again.

    Gordon Smith explained why he voted for the bill: Because its good for the country. If even academic economists like Paul Krugman are confused about this, it's no wonder so many voters are also confused, but Smith did the right thing.

    I also appreciate the fact that he used his position to leverage for inclusion of the County Payments Bill (Wyden obviously didn't do it, because he voted "no"). Smith also helped tie it to the mental health parity bill which he has long championed but particularly after his son's suicide.

    Politically, Smith took a risky position. But he did it for the right reason, which I would never expect most of you to acknowledge.

  • wants her own bailout (unverified)

    Ok, I did not take the time to read all of the posts here because there are a lot of them. But, I did read a lot of them so I am sorry if I repeat what someone else already said.

    I just want to say that I am an average american citizen that is a stay at home mom that takes care of her two boys. While her hard working husband and the father of ther two boys goes to work.

    I would like to know who is going to bail my family and the rest of the american citizens? If I am understanding this correctly. Wall street is going to be bailed out because they made risky loans and changed the interest rate and then the people could not pay back the loan. Well, I did not make any mistakes like that in my life and I am finding it harder and harder to make my bills.

    We dont have cable or brand new cars. We did not go on vacation last summer because we could not afford it. We dont have a lot of extras in life. If Wall street can get bailed out because of their mistakes and we did not make them can we get bailed out?

    I think that if they just paid the mortgages for the american citizens to the mortgage companies then the american citizens would benefit and the compaines would benefit. Or they can just send a check out to each adult american citizen. They can pay off their own mortgage and/or credit cards or cars. That way the average citizen would benefit directly.

    I also think that the CEOs should have their pays cut down to less then a million a year because they are not doing thier jobs if the companies are in trouble. The new guy at WaMu worked for only 3 weeks and look at what he was paid. 19 million dollars. I will take the job for one week and take a third of that. Heck, I would do it for 1 million. I could make a huge difference in my life and a lot of other people with the same million.

    One more thing, Did it really make a difference to raise the amount insured in a bank account? How many people have 100,000 let alone 250,000 in their bank account. I am happy if I have any money in my account at the end of the month for about 6 figures. If I had that kind of money I would not need help or wonder if I am going to pay my bills this month on time.

    In closing I just think that they need to stop helping the rich and start helping the working american citizens directly.

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    "Because its good for the country."

    Or at least a few thousand people making money off it, anyway. Almost NO ONE beyond Bush and Paulson says it's good for the country. What supporters (incl people like Krugman) say is that not doing it would be WORSE for the country. And their reluctance to alternate ideas is based on their impression of political pragmatism, not the merits of the competing plans.

    Smith voted to back his rich buddies. He doesn't have a record of looking out for Oregonians in the past, why would he start now?

  • Dave O'Dell (unverified)

    Jack, Republicans have been pissing on our backs and telling us it's raining gold since Ronald Reagan (or maybe before). They called it trickle down economics and it has never worked the way they claimed it would. I don't want to float my boat in the rising tide of Republican effluent anymore.

    Instead of taking $700 billion from the poor and middle class and giving it to the tippy top of the economy why don't we give that money to the poor and middle class through a massive investment in clean energy and other green infrastructure like rail and so on? And I'm not talking about giving the money to GE to build Nuclear Power plants. I'm thinking small local projects like solar cells on every roof (saves the cost of transmission and uses wasted space). Well, small at one end. GE can be one of the winners producing solar panels and such at the other for all I care.

    Let's invest in R&D, education, cleaning up the environment and making cities more livable. We could do a lot of good with $700 billion. If we use it to buy toxic assets it will be gone in a few months and the fiscal conservatives will be able to say there is no money left for economic stimulus.

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    Obama made the right choice, voting for this bill. This shows that Obama can rise above short term partisan interests, and realizes that true economic relief and recovery will have to be bipartisan.

    === wants her own: A bailout of individual mortgage holders is completely infeasible--it would require trillions of dollars. The time it would take to analyze individual mortgages makes this also impossible--the prior Federal plan to help individual mortgage holders (REMEMBER--THIS ALREADY PASSED) has not yet started yet, they are still writing the regulations.


    Bill B: your citations are selective. The European Union, China, and ASEAN have all come out saying that the U.S. is responsible for fixing this crisis. Yes, this is going to hammer the next President. But a recession would hammer the next President a lot more.


    To Harry and others: I ask again what crimes did any chief executive commit? You may be pissed off at these people but there is no evidence of law breaking. The "perpetrators" if there are any are government officials--a Fed that lowered economic rates so low while ignoring a housing bubble, Congress (both Dems and Reps) who relaxed regulations, the SEC and Dept. of Treasury who failed to pay attention to newly developed debt models.

    Wall Street can be held accountable for gambling with investors' money and for taking large risks, but there is no indication of illegality.

    This isn't a witch hunt, folks. 10s of thousands of Wall Street employees have lost jobs, and six major firms have gone bust. How many more pounds of flesh do you want, even at the cost of the economy?


    And finally one more time: this is NOT Iraq. You all have evidence of the impact of this financial crisis all around you--you don't need to rely on CIA intelligence reports.

    Major banks and financial institutions have gone under. The stock market is down 20% plus this year. Short term business loans are completely unavailable. The return on T-bills is down to 0%. The dollar is tanking. Gold is spiking.

    If you haven't seen this, you're just not paying attention. It's a sad commentary on the depth of mistrust in this country that people refuse to believe anything coming out of DC, even if it smacks them right in the face.

  • Tom Civiletti (unverified)

    I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.

    Thomas Jefferson 1802

  • Tom Civiletti (unverified)

    Check your fact, paul g.

    The euro has fallen to its weakest in more than a year against the US dollar

    And, yes, there is a problem with the economy. The question is, what to do about it.

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    Jack Roberts states "Politically, Smith took a risky position. But he did it for the right reason, which I would never expect most of you to acknowledge."

    The reason given was "the good of the country." And, Jack, I will agree that the stated reason is good enough if you don't peer behind that cover statement. Of all the Republicans in Oregon whom I know, you of all people should be able to acknowledge that the ornaments hung on the bailout bill by the Senate to satisfy the Republican urge to return to unregulated markets, irresponsible spending, and negligent tax policy will ruin this country.

    We are already sitting on top of the largest deficit and the largest national debt in the history of the world. And yet the Republicans in the Senate saw fit to add tax cuts and pork barrel spending SIMULTANEOUSLY to the bailout bill that had already been rejected by the House. Worse, it failed utterly to heed DeFazio's proposals to add provisions designed to lower the cost to taxpayers or to send direct aid to imperiled borrowers.

    Wyden was right to vote against that smelly package. The House should reject it and put DeFazio in charge of rewriting it. And I do expect moderate Republicans to acknowledge that the good of the country requires a much, much better product than that produced so far. My Wells Fargo personal banker agrees.

  • rw (unverified)

    Good choice of verbiage, conscious and complete: "their fathers conquered".

  • Tom Civiletti (unverified)

    As I wrote, we agree there is a problem with the economy. Jack Roberts and paul g. seem to favor doing something, anything. I disagree.

    Can a Bailout Succeed? By PAUL CRAIG ROBERTS

  • Bill Bodden (unverified)

    (7) The bill goes to the House where lots of strong-arming will be going on. No time for logic or rational debate. Just plain, vicious hardball.

    Bush, Congressional leaders lobby for bailout bill. No surprise about the likes of Steny Hoyer, but this is disappointing: "Rep. Earl Blumenauer, D-Ore., a liberal opponent, is also reconsidering his vote, but is "not on board yet," Lucia Graves, his spokeswoman, said on Thursday. Blumenauer wants to see a mechanism to pay for the bailout and more help for homeowners staring at foreclosure." Contact

  • Harry Kershner (unverified)

    Dave Odell: Thanks for the praise, but the points are pure Nader, what he put out before Obama or McCain were willing to address the issue even as poorly as they have.

    However, you're wrong if you believe I said, "...the difference between Obama and McCain are NIL."

    I said, "Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL.

    Here is a short list of issues that are important to me that Obama and McCain oppose:

    1. Significantly cutting the bloated, wasteful military budget.

    2. Bringing all corporate and military personnel home from Iraq.

    3. Ending the military conflict in Afghanistan and Pakistan.

    4. No to nuclear power.

    5. Even-handed treatment of Palestinians and Israelis.

    6. Impeachment of Bush and Cheney.

    7. Adopt single payer national health insurance. (I could go on and on.)

    Read Adolph Reed's analysis:

    "So the question is: how are we to break this cycle to be able to try to build the movement we need to do anything more than staunch the bleeding? Consider as well that the staunching looks less and less meaningful to the growing population that gets defined as on the wrong side of the triage line and that each iteration of the losing game further shrinks the ranks of the relatively secure economically, drives more and more people to the margins, and shifts the thinkable terms of political debate, as well as the electorate's center of gravity, more and more to the right." (Adolph Reed, Jr., Where Obamaism Seems to be Going)


    Bill Bodden: I enjoyed your bailout historical reenactment. But I disagree that "Nobody is questioning Obama's emotional stability." His foreign policy is insane. The fact that he is less insane than McCain does not impress me. I feel the same about Biden-Palin; either one of them is a disaster.


    paul g: I'm with Tom C on this. Being pissed off at Wall Street CEO's has nothing to do with rationally determining a strategy instead of jumping into something we hardly understand. Nomi Prins says, "The only real way to stabilize the financial industry is to take it apart, quantify and separate its risks, and begin again" (As Wall Street Collapses, Will Washington Get a Clue?). Throwing money at the problem is the DP stereotype.

  • Dave O'Dell (unverified)

    I agree with your short list Harry. And I mischaracterized your statement about the differences between Obama and McCain. Sorry. But are you advocating voting for someone other than Obama for president?

    I believe I'm as troubled as you are with how far the Democratic Party has shifted to the right, but there is hope for progressives to infiltrate don't you think? I have lost hope for a third party to rise up. I think that is a much longer shot than a takeover.

  • (Show?)

    Lee, thanks for the compliment (I think) but I do have a different take on this.

    I wanted a clean bill originally but I'm not scared off by the "ornaments" hung on this because their combined cost are far less than the revenue we will lose if we slip into a recession(or deeper recession) as a result of doing nothing.

    It's easy to get exercised by the size of our debt but that is only because we lose sight of the size of our economy.

    The $700 billion number was selected by Treasury as their estimate of the maximum size of the package because it represents 5% of the total amount of all mortgages outstanding, which is the percentage they estimate may be bad. That means we have $14 trillion in mortgages.

    The total combined net worth of all Americans was on track to reach $60 trillion this year--at least until this mess started.

    The bottom line is that this is eminently affordable and is almost certainly going to cost us less than doing nothing. I'm not saying this is a perfect bill. I'm saying Gordon Smith was right to vote with Barack Obama, John McCain and Joe Biden, and that Ron Wyden was wrong to vote with Bernie Sanders and Sam Brownback.

  • Bill Bodden (unverified)

    But I disagree that "Nobody is questioning Obama's emotional stability." His foreign policy is insane. The fact that he is less insane than McCain does not impress me.

    I agree the foreign policy that Obama has adopted from his promoters is insane, but I'm not inclined to apply the insanity plea to Obama and let him get away with it. I believe he knows perfectly well what he is doing and is just as cynical in this regard as when he threw the Rev. Wright and his former concern for the Palestinians under the bus for his own political benefit.

    I feel the same about Biden-Palin; either one of them is a disaster.


  • Harry Kershner (unverified)

    Dave: I'm 62 years old and I've heard all my life that progressives were going to take over the DP. That's the "long shot", especially at this time in history when, right, left or center, an uprising is a genuine possibility.

    Naomi Klein says people are gaining resistance to the "shock capitalism" tactics that we're witnessing. Former Bush Treasury Secretary Paul O'Neill says "...the $700 billion Paulson plan is 'crazy' with potentially 'awful' consequences for the economy" (From Democracy to Crazy-ocracy...And Back Again?). Paul Craig Roberts (Can-A-Bailout-Succeed) says, "A failed bailout is the worst possible outcome. The chance of failure rises if the US government tries to turn bad private debt into good public debt without regard to the expansion of the public debt", in other words, without regard to increasing our already insane level of military spending, as Obama and McCain want to do, instead of significantly cutting it, as Nader (Political Issues that Matter for 2008) wants to do.

    If you don't like Nader, support some other candidate who represents your interests. Obama and McCain do not.

  • Tom Civiletti (unverified)

    Jack Roberts wrote:

    The bottom line is that this is eminently affordable...

    You know, Jack, we spend 3/4 of a trillion dollars here and 3/4 of a trillion dollars there, and pretty soon it adds up to real money.

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    "The bottom line is that this is eminently affordable and is almost certainly going to cost us less than doing nothing."

    Of course, those weren't the only two choices. What would have costs us a lot less would have been something from the Isaac camp, and would have the benefit of addressing the primary issue right now, as well.

    The idea that 5% of mortgages are worthless seems like an awful stretch. A 3% default would be a surprise, frankly.

  • Tom Civiletti (unverified)

    Jack Roberts, paul g., et al fail to address the key point in the Paul Craig Roberts piece I reference above as well as in Eric Janszen's piece in Harper's that I referenced in an earlier thread. This is the point: the credit crunch is a symptom of the market's inability to cope with the extreme over-valuation of real estate that has become the dominant force in our economy, and the credit situation cannot be righted without dealing with that over-valuation, which is in the range of $10-12 trillion.

    Roberts writes:

    University of Maryland economist Herman E. Daly points out that the current crisis is really one of the “overgrowth of financial assets relative to growth of real wealth.” Daly believes that “financial assets have grown by a large multiple of the real economy” and that “paper exchanging for paper is now 20 times greater than exchanges of paper for real commodities.” Exploding debt liens have simply outgrown the wealth.

    The problem, in other words, cannot be bailed out. Historically, debt that cannot be redeemed has been repealed by inflation. The same inflation that wipes out debt will wipe out savings.

    A failed bailout is the worst possible outcome. The chance of failure rises if the US government tries to turn bad private debt into good public debt without regard to the expansion of the public debt.

    Unless supporters of a bailout of bad paper address this issue, their words are no more than blather.

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    A few points from Adolph Reed's column that you cite:

    Obama represents a class politics, one that promises to cement an alliance anchored in the professional-managerial class (including, perhaps especially, the interchangeable elements of which now increasingly set the policy agendas for what remains of the women's, environmentalist, public interest, civil rights and even labor movements) and the "progressive" wing of the investor class. (Emphasis added) At base this is a critique of the left-lobbyist based, ersatz "membership" lacking accountability structures in "progressive" politics that Ralph Nader pioneered. It encourages a purchase-your-political-services consumerist mentality rather than deeper engagement. Obviously enough in his presidential run, Nader is not engaging in exactly the politics that Adolph is describing, since he is not in the way described "in alliance with the 'progressive' wing of the investor class," at least not unambiguously, and certainly not with the high-end elements like Robert Ruben or even say Ben of Ben & Jerry's & TrueMajority or some of the folks behind Lefty lawyers and academics and other professionals are another matter. And Nader-founded and modeled organizations are very much part of what he is critiquing. Nader's presidential politics, however good the positions he advocates, do not address the core issues Adolph Reed is raising in this piece.
    it is ironic in the short term -- i.e., considering that he pushed HRC out of the way -- that Obama would be the one to complete Clintonism's redefinition of liberalism as conservatism. So there's no way I'm going to ratify this bullshit with my participation, and I'm ready to tell all those liberals who will hector me about the importance of voting that it's the weakest, most passive and least consequential form of political participation, and I'm no longer going to pretend it's any more than that, or that the differences between the Dem and GOP candidates are greater than they are, just to help them feel good about not doing anything more demanding and perhaps more consequential.
    (Emphasis added.) This applies to your focus on voting for Nader too. He is not advocating for a protest vote.
    To be clear, I'm not arguing that it's wrong to vote for Obama, though I do say it's wrong-headed to vote for him with any lofty expectations.
    This is very different from your position. Adolph goes on to say that he's unsure that the short-term relative superiority of Obama's positions taken as a whole outweigh his potential to further cement the Clintonian shift of the Democratic Party rightward. So I'm sure he also wouldn't say it's wrong to vote for Nader, or McKinney, or whomever the Socialists run either. But
    All that said, I reiterate that, although I've been clear about my own decision to abstain from this charade, I'm not arguing that people shouldn't vote for him. Nor do I see any third-party candidate as a serious alternative. I was a Commoner elector in 1980 and voted for Nader in 2000 (I'm proud to declare that, whatever else I may have done in my life, I've voted against Joe Lieberman at every opportunity I've had to do so), but the fact is that third party candidacies are really the same as not voting, just more costly and time-consuming. They aren't an answer to anything. They don't galvanize movements, and unless they emerge from dynamic, powerful movements - like the Republicans in the 1850s - they aren't more than vehicles for collecting and registering protest by isolated individuals. This can be defensible, so far as it goes, but it is not an alternative or shortcut to building a movement capable of changing the terms of political debate. And that can't happen during the heat of an election period.
    The main message of his article is that what's needed is to rebuild a politically effective left that's focused on structural inequality. A corollary of that is that the kind of politics needed to do so are not in the first instance electoral politics. I know for a fact from working with him that this has been his position for at least 15 years, with consistent antecedents that were somewhat different earlier because the political context and condition of the left and its organizations were different. Adolph offers a critique. It's one I've valued for years, approaching multiple decades, and in many respects find compelling. It also hurts; although when he's using the phrase in this piece, he's addressing a problem in which I don't share (the apotheosization of "youth"), his phrase "lack of will and direction" cuts close to home. That condition does lead to opportunism, as he suggests. But he doesn't offer a program, only a question: "So the question is: how are we to break this cycle to be able to try to build the movement we need...?" You're right that he says voting for Obama isn't the answer. But he also says voting for Nader or anyone else isn't either. If you're going to invoke Adolph Reed, you ought to acknowledge the full scope of his analysis and that it doesn't support your choices regarding the election either. ------- As for differences on issues the matter to progressives being nil, you make a circular argument, since by definition in the way you argue, to disagree with you makes one "not a progressive." You are deeply motivated by issues of conscience in relation to U.S. military actions and foreign policy, it is evident from your writing. That is the area where the differences are least, IMO. On many domestic issues there are differences that are not nil. E.g. access to healthcare. The differences there are not nil, because they are not simply defined by "single payer, yes or no." Obama's proposals more or less prop up the existing system. McCain's would make it worse. There is an analogy to Social Security here. There are lots of reasons to be critical of S.S. from the point of view of how it is funded (regressive tax), what it does and doesn't provide, abstract more progressive potential alternatives, etc. But that doesn't mean that there aren't better and worse choices, with real consequences, to be made about its future within the extant consequences. The differences between Obama and McCain on healthcare are real and consequential. There are other examples. Adolph Reed in the article you cite actually goes into some and says the differences are real. They don't matter to the more fundamental problem of building or rebuilding a left-of-liberal politics that is his central concern, as he understands those issues. But even at that he sees the question of the trade-offs of real short-term differences with his longer term problem as a serious one. Hence what he says about not criticizing other people's different choices from his on voting.
  • (Show?)

    I hope that fixes my error, sorry.

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    And two more things. First, lest you misinterpret what I'm saying about healthcare, I advocate government-provided universal health insurance ("single payer") and think that organizing to get it may be one partial answer to Adolph Reed's problem of rebuilding a politically effective left. But building that movement is IMO a separate process from electoral politics at this stage.

    Secondly, it is of some interest to me that Adolph doesn't address the Employee Free Choice Act in his article, since shifting the conditions of union organizing and reducing the capacity of corporations to prevent the freedom of association of workers in contravention of their human rights and in many instances even of current U.S. law also is important for rebuilding democratic and accountable progressive politics. EFCA isn't a panacea, but it is a substantial difference between Obama and McCain and if Obama is elected can form a useful focus for movement-building, and if it passes, will open up new terrain for organizing, though probably also for struggles over the internal character of the organized labor movement.

  • Harry Kershner (unverified)

    Chris L said, "You're right that he says voting for Obama isn't the answer. But he also says voting for Nader or anyone else isn't either."

    I don't subscribe to everything Reed says in his article, most obviously his attitude toward voting for Nader. However, his primary thesis is devoted to the subject of "Where Obamaism Seems to be Going", and he is really pissed off at Obama and those of his supporters who make "less evil" arguments in favor of supporting him:

    "What makes the Dems every four years 'better' is always something that the hacks and yuppies are likely to imagine getting if they win, and their disgusting moralizing about the imperative to vote for their 'lesser evil'...means 'I may get what's important for me, but you have to recognize that what you need is naïve or impractical' -- is all about bullying the rest of us into believing we have an obligation to vote for what's good for them."

    Although I also felt the sting of Reed's criticisms, it is worth repeating that he supported Nader in 2000, as many of the Nader detractors on BO have also admitted to. And it's difficult to argue that Obama's rightward lurches are less than those of Gore's or Kerry's, which is why Reed argues that each election cycle is "...moving the boundaries of thinkable liberalism that much farther to the right."

    You are misleading in your claim that, "As for differences on issues the matter to progressives being nil, you make a circular argument, since by definition in the way you argue, to disagree with you makes one 'not a progressive.'" I never have said that "to disagree with me is not to be a progressive", even if you have inferred that. I disagree with Nader, Chomsky, Zinn, etc. about some things, but I do not conclude that they therefore are not progressive. Obama's performance on those issues that fall under the rubric of corporatism and militarism, including his woeful response to the bailout, have nothing to do with progressivism, however.

    Furthermore, I disagree with your interpretation of Obama's health care plan. Like McCain's, his proposals would negatively affect health care outcomes, and your former provider, David Himmelstein, agrees with me.

    I agree with you about EFCA, and I have never said that there are NO differences between McBama, just that the differences will not help to prevent the destruction of our economy and our environment that we are witnessing, nor will it reduce the suffering that we are causing to countless people around the world through our militarism. Like the bailout, Obama's other policies at best will slow down the devolution toward chaos and pain, not stop it.

    Finally, I once again call your attention to the fact that we can chew gum and shoot moose at the same time. My support for Nader and his issues in no way makes me opposed to movement building, just as Reed's support for Nader did not signal that he was opposed to movement building in 2000.

    Those who are paying attention will realize that the events of the past week make coalition building between fair-minded conservatives and progressives much more likely. (Ron Paul is calling for voters to reject the duopoly and vote for a third party candidate.) I also attended the Jobs for Justice demonstration a few days ago, and I was disappointed in our failure to join with those to our right, who are just as pissed off as we are (I hope you're pissed off). David Sirota's analysis of uprising is cogent, and we should be ready to take advantage of it.

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    Harry, "I have never said that there are NO differences between McBama" just isn't true. You just said it. Nil mean none, no differences.

    I am pretty confident that if you were to ask David Himmelstein which plan would be worse for healthcare access in the U.S., as between Obama's and McCain's, he would say McCain's. He would also I am sure say that neither can actually solve the problems of healthcare access and the escalating costs of the health system, and that Obama's will not produce what he says it will because the history of such plans (including e.g. Oregon Health Plan) is that they cost more than projected and legislatures prove unwilling to pay the costs. I agree with his analysis, and yours. I said I favor a single payer system. Voting for Barack Obama won't get that, neither will voting for Ralph Nader.

    If you can show me (or point me to a decent starting place beyond his issues webpage which I have read and does nothing for the movement in itself) Ralph Nader running his presidential campaign in a way that is building the single-payer healthcare movement, I will be interested and more persuaded by your "chew gum" argument.

    I have never said that you are against movement building. You have said you are for it and I believe you.

    But you are inverting the point that Adolph was making and that I was pointing out: that electoral focus in his view a) does not help in the kind of movement building he seeks at this juncture, rebuilding a left-of-liberal left with a focus on structural inequality, and b) often detracts from it, especially if people are under the illusion that the electoral engagement is doing that work. Of course one can disagree with him about that, as evidently you do. He says he won't criticize either my Obama vote or (less explicitly but I think clearly enough) your Nader vote.

    Ron Paul does not fit my definition of a "fair-minded conservative." Coalition-building with conservatives cannot be categorical IMO. There are some with whom we could and can and should ally on defense of the Bill of Rights; Ron Paul I guess mostly fits that, except for his racist desire to repeal birthright citizenship and gut the 14th Amendment, which is a huge exception. Others are clearer on that case. But some of those in turn will be supporters of a big-finance exclusive orientation to addressing the financial crises, and almost all will oppose single-payer health insurance. Paul and numbers of other libertarian conservatives are anti-war -- not all of those opposing the presidential power grabs oppose the wars / occupations despite their being the route of the power grabs.

  • Harry Kershner (unverified)

    Chris: You're having trouble reading again. Here's what I said: "Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL."

    I also corrected Dave O'Dell about his misreading of the same remark. The rest of your argument is one which you've made several times to me, and I just disagree with you. For a time, you seemed to be coming around to a reasonable position on the disturbing right-wing campaign of Obama, but now you've returned to your regressive former stance. Too bad.

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    Natting nabobs of Naderism again...

    Obama is a corporatist and a militarist whose differences with McCain on most issues important to progressives are NIL.

    Seriously? The right-to-choose an abortion, right?

    Or are you one of those "progressives" who doesn't think that the right to biological self-determination doesn't matter.

  • Harry Kershner (unverified)
    <h2>What about "most issues" do you guys not understand? You're making yourselves look foolish.</h2>
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