Uncharted territory

The House has voted down the bailout bill, 228-205. A screen shot--on TPM, probably from C-span--is reproduced below:



So it looks like the Republican leadership could not--or perhaps WOULD not--deliver the votes; Democrats--unwilling to be exposed to charges that they "lost China"--had reportedly told Republican leaders that they would not bring a bailout proposal to a vote without support from 100 members of the minority party. So, did Republicans pull a fast one, or was the leadership simply unable to bring their people around?

It's worth noting that 40% of the Democrats voted against the proposal, too.

So, where do we go from here? As I write, the Dow Jones is off more than 500 points.

My suspicion is that the Dow's deep dive will push things, that there will be some more changes made to the plan to get some votes on both sides, and that a modified version of the plan will pass by the end of the week. I just hope I'm not whistling past the graveyard.

Debate Camp

ABC reports that Joe Biden is getting advice from Hillary Clinton, Diane Feinstein and Barbara Boxer for Thursday night's Vice-Presidential debate with Sarah Palin. All well and good, but wouldn't he be better off with some coaching from Tina Fey?

Let's ge the story straight

Taegan Goddard, on Political Wire, catches yet another embarrassing slip-up in the McCain campaign.

If they can't avoid these gaffes in the campaign, how would they ever handle running an actual administration?

Discovery

I pounded on doors for Barack Obama in Merrimack, NH, yesterday. (73 doors in a little over 4 hours. I still haven't recovered.) I discovered that there really are Republicans.

I feel like the Episcopal bishop who, being asked if he believed in baptism by total immersion, replied, "Believe in it? I've seen it done!"

(That is, by the way, a story that John McCain butchered earlier this year, telling it as if it were asked of a Baptist who, of course, would believe in total immersion.)

Running up on the rocks

If you're not a close reader of political blogs, you may have missed this, but a number of right-wing commentators are out after Sarah Palin. Kathleen Parker, in National Review Online, says flatly that she should go

Remember all the fuss over Palin, how she was THE story? Seems a long time ago, right?

Say what???

Did McCain really refer to Pakistan as a "failed state" when Musharraf carried out his coup? Yes, he did.

Look for pundits to pick that up in the next couple of days. It's not like Gerry Ford saying Poland was a free country in 1976--while the Iron Curtain was still firmly in place--but it's going to make some knowledgeable people question whether McCain has lost something off the old fastball.

The debate

I watched about 3 minutes of what Spiro Agnew--probably in the words of William Safire, as Agnew probably couldn't have put the phrase together--called "instant analysis and querulous criticism" after last night's debate. I shouldn't have been surprised that the couple of analysts I saw--including Pat Buchanan, for G_d's sake--differed from my take.

While watching, I thought "Obama is shredding him." But, lo, there were the pundits calling it a draw or, in Buchanan's case, a McCain victory.

I admit that I am not objective, but, Huh? What debate were they watching?

I thought McCain looked tense--some of the commentary said both candidates looked calm--as he fidgeted around while Obama answered. He was repetitive--he told us that he hadn't been elected Miss Congeniality in the Senate twice. He wandered at times.

Most important, in Barack Obama Americans--at least those who haven't made up their minds--saw a man in command of himself and the issues. He was calm, but he showed flashes of life. He might not have counterpunched McCain with fury, but he said clearly several times that McCain had misrepresented the record. He was, in a word, presidential. Given the national mood for change--which is only strengthening minute-by-minute given the financial crisis--that's what Obama has to do. If he makes more Americans comfortable with him in the Oval Office, he will win. Simple as that. And he did that last night.

Take a look at James Fallows' perceptive analysis of the debate.

The polls, by the way, agree more or less with what I've said above.

Going where the networks fear to tread

Well, MSNBC, anyway. The network has pulled this ad after Bill O'Reilly made a big thing of it on his show:

The Palin Interviews

After seeing the second part of Sarah Palin's interview with Katie Couric last night, I hope we can all agree to let the poor woman (Palin, not Couric, at least not yet) slide back into a well-deserved obscurity.

Debate!

I REALLY hope that John McCain is forced into debating Barack Obama tomorrow night. Not just because I'm hoping that Obama will come out the clear winner, not even primarily for that reason.

No, my figuring goes this way: With the two candidates rushing (sort of) to Washington for the big meeting on the bailout, and then having to get to Mississippi by tomorrow night, they won't have time to be fully prepared for the questions. AND THAT'S WHAT I WANT TO SEE. It would be good for the American people--and, frankly, good for whichever of them becomes our next President--to see them reacting to questions without being fully rehearsed.

By now it's clear that McCain is increasingly desperate to avoid a debate tomorrow night. Not only has the floated the idea of postponing it until next Thursday, and ditching the vice-presidential debate (I am shocked! shocked!), he's now said that he's confident that a deal on the bailout will be reached by Monday. This comes as AP has been reporting all morning that a compromise is almost at hand. So maybe McCain is going to Washington to throw a lever in the spokes and delay things.

I don't know about you, but I'm feeling better

Here's the joint statement that the Obama and McCain campaigns were hammering out all day yesterday:

The American people are facing a moment of economic crisis. No matter how this began, we all have a responsibility to work through it and restore confidence in our economy. The jobs, savings, and prosperity of the American people are at stake.

Now is a time to come together - Democrats and Republicans - in a spirit of cooperation for the sake of the American people. The plan that has been submitted to Congress by the Bush Administration is flawed, but the effort to protect the American economy must not fail.

This is a time to rise above politics for the good of the country. We cannot risk an economic catastrophe. Now is our chance to come together to prove that Washington is once again capable of leading this country.

There, now. Don't you feel reassured?

You can't make this stuff up

From CNN:

McCain supporter Sen. Lindsey Graham tells CNN the McCain campaign is proposing to the Presidential Debate Commission and the Obama camp that if there's no bailout deal by Friday, the first presidential debate should take the place of the VP debate, currently scheduled for next Thursday, October 2 in St. Louis.

La Guerra

A story about a dispute over the grave of Gabriel Garcia Lorca, murdered in 1936, at the outset of the Spanish Civil War, once widely considered the opening act of the anti-fascist struggle, but now almost forgotten.

Andre Malraux wrote, "It was in Spain that we learned that we could be right and yet be beaten, that might did not always conquer might."

C. Day Lewis, later Poet Laureate of Britain, opened his poem The Nabara (about a Basque armed trawler sacrificing herself to save a convoy from the fascists):

Freedom is more than a word,

more than the base coinage

Of statesmen, the tyrant's dishonoured cheque, or the dreamer's

mad

Inflated currency. She is mortal, we know, and made

In the image of simple men

who have no taste for carnage

But sooner kill and are killed than see that image betrayed.

(Apparently, John McCain told an interviewer that his favorite fictional character is Robert Jordan, hero of Hemingway's For Whom the Bell Tolls. Which is interesting, as it is widely believed that the inspiration for that character was an officer in the Abraham Lincoln Battalion, a unit most of whose members were Communists.)

Your senators explain it all to you

Confused about the bailout? Watch this:

Dragon lady?

Jeffrey Goldberg, of The Atlantic, asks, If Sarah Palin is so delicate that she can't chance questions from reporters at a photo-op, how will she fare if, in office, she has to face off against someone tough, like Spanish Prime Minister Zapatero?

Obama on the bailout

Obama's speech on the bailout, as prepared for delivery, in Tampa today:

Yesterday, the President said that Congress should pass his proposal to ease the crisis on Wall Street without significant changes or improvements.

Now, there are many to blame for causing the current crisis, starting with the speculators who gamed the system and the regulators who looked the other way. But all of us now have a stake in solving it and saving our financial institutions from collapse. Because if we don’t, the jobs and life savings of millions will be put at risk.

Given that fact, the President’s stubborn inflexibility is both unacceptable and disturbingly familiar. This is not the time for my-way-or-the-highway intransigence from anyone involved. It’s not the time for fear or panic. It’s the time for resolve, responsibility, and reasonableness.

And it is wholly unreasonable to expect that American taxpayers would or should hand this Administration or any Administration a $700 billion blank check with absolutely no oversight or conditions when a lack of oversight in Washington and on Wall Street is exactly what got us into this mess.

Now that the American people are being called upon to finance this solution, the American people have the right to certain protections and assurances from Washington.

First, the plan must include protections to ensure that taxpayer dollars are not used to further reward the bad behavior of irresponsible CEOs on Wall Street. There has been talk that some CEOs may refuse to cooperate with this plan if they have to forgo multi-million-dollar salaries. I cannot imagine a position more selfish and greedy at a time of national crisis. And I would like to speak directly to those CEOs right now: Do not make that mistake. You are stewards for workers and communities all across our country who have put their trust in you. With the enormous rewards you have reaped come responsibilities, and we expect and demand that you to live up to them. This plan cannot be a welfare program for Wall Street executives.

Second, the power to spend $700 billion of taxpayer money cannot be left to the discretion of one man, no matter who he is or which party he is from. I have great respect for Secretary Paulson, but he cannot act alone. We should set up an independent board that includes some of the most respected figures in our country, chosen by Democrats and Republicans, to provide oversight and accountability at every step of the way. I am heartened that Secretary Paulson appeared to be softening on this position in his testimony this morning.

Third, if taxpayers are being asked to underwrite hundreds of billions of dollars to solve this crisis, they must be treated like investors. The American people should share in the upside as Wall Street recovers. There are different ways to accomplish this, including putting equity into these firms instead of buying their troubled assets.

But regardless of how we structure the plan, if the government makes any kind of profit on this deal, we must give every penny back to the taxpayers who put up the money in the first place. And after the economy recovers, we should institute a Financial Stability Fee on the entire financial services industry to repay any losses to the American people and make sure we are never asked to foot the bill for Wall Street’s mistakes again. We can ask taxpayers to make an investment in the stability of our economy, but we cannot ask them to hand their money over to Wall Street without some expectation of return.

Fourth, the final plan must provide help to families who are struggling to stay in their homes. We cannot simply bailout Wall Street without helping the millions of innocent homeowners who are facing foreclosure.

There are a number of ways we can accomplish this. For example, we should consider giving the government the authority to purchase mortgages directly instead of simply mortgage-backed securities. In the past, such an approach has allowed taxpayers to profit as the housing market recovered. This is not simply a question of looking after homeowners, it’s doubtful that the economy as a whole can recover without the restoration of our housing sector, including a rebound in the home values that have suffered dramatically in recent months.

Finally, the American people need to know that we feel as great a sense of urgency about the emergency on Main Street as we do about the emergency on Wall Street. I have repeatedly called on President Bush and Senator McCain to join me in supporting an economic stimulus plan for working families – a plan that would help folks cope with rising food and gas prices, save one million jobs by rebuilding our schools and roads, help states and cities avoid painful budget cuts and tax increases, and help homeowners stay in their homes.

Let me be clear – we shouldn’t include this stimulus package into this particular legislation, but as we solve the immediate crisis on Wall Street, we should move with the same sense of urgency to help Main Street.

It is absolutely wrong to suggest that we cannot protect American taxpayers while still stabilizing our market and saving our financial system from collapse. We can and must do both.

In summary, there is no doubt negotiations over the next few days will be difficult. I will continue to keep in close touch with Secretary Paulson, Chairman Bernanke, and the leaders of Congress to ensure that we can work in a bipartisan manner to get this done as quickly as possible. Our country is being tested by a very serious crisis. We are all in this together, and we must come together as Democrats and Republicans, on Wall Street and on Main Street to solve it. And with the proper spirit of cooperation, I know we can.

While you were following the bailout debate

Georgia--the state, not the nation--prepares to execute a man who was convicted on the testimony of nine witnesses, seven of whom have recanted. There is, by the way, no forensic evidence tying Troy Davis to the crime. Oh, and three other witnesses have fingered another man--a witness against Davis at the trial--as the killer.

As if that wasn't enough, the US Supreme Court has said that it will decide by September 29th whether to accept Davis' appeal.

Nonetheless, yesterday the Georgia Supreme Court refused, by a 6-1 vote, to delay the execution. Davis is scheduled to be put to death later today.

Davis' only hope now is that the US Supreme Court will issue a stay.

And we call ourselves civilized.

Update: Less than two hours before Davis was scheduled to die, the US Supreme Court issued a stay of execution.

Note that one of the comments below comments on capital punishment as the most premeditated murder. I have long felt that the cruelest part of capital punishment is not the execution, but forcing the condemned to wait, knowing the date and hour of his death.

Quick quiz

Who said it?

Under the pressure of the financial crisis, one presidential candidate is behaving like a flustered rookie playing in a league too high. It is not Barack Obama.

Give up? None other than the Chicago Cubs' greatest fan, George Will.

Could this be a small sign that truth is making a comeback?

Report from the front lines

AP reports that more than 7.5 million people pay 50 percent of their income for housing. Thirty-eight percent of homeowners with a mortgage--that's 19 million people--pay more than 30% of their income for housing; 30% is the level at which the government believes housing becomes a burden.

And the bailout that Congress is now considering won't put more than a small dent in those numbers, at least not directly, and any beneficial effect will be many months away.

Oh, and the election is six weeks from today.

Good news?

Apparently, the administration is willing to give in on some of the Democrats points--but no word yet about that proviso that Treasury has the last word, and that word cannot be questioned.

Update: CNBC reports that there is no deal on the government taking an equity interest in companies that the taxpayers bail out. But note that doesn't say that there won't be a deal along those lines.

Also note that according to CNBC, the Democrats would create an "Emergency Oversight Board," consisting of the Fed chair (Ben Bernanke), and the chairs of the SEC and FDIC to oversee the Treasury's work. The Treasury would also be required to report weekly on assets held and assets bought and sold that week.

McCain's good idea

Talkingpointsmemo put together the video below to show how John McCain talks out of both sides of his mouth on the economic crisis--and sometimes gets called on it. However, the clip also shows McCain putting forth a good idea: That firms bailed out by the government should not be able to pay top executives more than the highest-paid government employee. (If that were seriously proposed, you'd be able to hear the howls all the way from Wall Street to Hollywood and Vine.)

How bad?

How bad would the bailout be if Congress were to roll over and pass the "clean" bill that the administration is proposing? Bloomberg reports that the Bush bill would exclude regulatory agencies from passing on Treasury's decisions about acquiring debt, and that judicial review would also be prohibited.

Can you spell "SCAM?"

Fortunately, Democrats seem to have some spine--though whether that will bend or break in the next few days (or even the next few hours) remains to be seen. Barney Frank (D.MA, and my congressman) wants oversight by the Comptroller General and the Government Accountability Office. Senate Democrats wand to add provisions that would let bankruptcy judges reform mortgages, limit the pay packages of executives at bailed-out firms and give the government equity in the companies that are unloading their debt. The last provision, in particular, is sure to elicit howls of righteous wrath from Republicans who only want to socialize losses, not the potential for gain.

As of this writing (1:40 p.m. on September 22nd), the Dow is down $250.00. The market is unlikely to rise again--and, indeed, will almost certainly fall--until an agreement is reached on the bailout between Congress and the White House. Look for the administration to push the panic button, hard, to pressure Democrats into giving way. (Such conduct would further speed market decline, but at this point, that's just what Bush and his cronies want.)

Remember how they rushed the Patriot Act through, under the seeming threat of international terrorism? And how bad a job they did? The same thing is going to happen here, because no one is prepared to say that (a) we don't need a bill this week, or even next and (b) that Congress may have to stay in session right through the election to work this thing out right.

Nice coinage

The Obama campaign in New Hampshire is working with the campaigns of Jeanne Shaheen, who's running for the Senate against John Sununu (R.NH) and Carol Shea-Porter (D.NH), incumbent congresswoman. Which leads a friend to note a possible skirttail effect.

Shoemaker, stick to thy last

Old habits die hard. Goldman Sachs and Morgan Stanley, the last two American investment banks, are turning themselves into bank holding companies, marking the end of the era in which investment banks--essentially, companies that arrange and underwrite issues of securities--and commercial banks were separate.

There was a time when bank holding companies were unlawful. There was a time when financial companies, at least, were required to concentrate on the businesses that, presumably, they knew. Then came the new era, when banks were permitted to buy insurance companies and stock brokers. (For all I know, a bank could own the newsdealer on the corner or the restaurant down the street.)

Twenty years ago, in the pages of The New York Times, I suggested that

Small companies often fail because their owners, who are knowledgable about their own businesses - how to make shoes or sell dresses - are not skilled at basic management that is common to all enterprises. Large companies have the opposite problem. Their executives know management, but all too often they have forgotten how to do business.

I think I was right then (and, indeed, the deal I was talking about--a takeover of Federated Department Stores--subsequently proved that I was), and that the idea I expressed then is still true today. Yet even in the midst of a crisis provoked by unwillingness to make corporate leaders stick to their lasts, we have not learned the lesson.

Conflict of interest

The New York Times reports today that Rick Davis, McCain's campaign manager, was paid $30,000 a month for five years (that's a total of $1.8 million) to lobby for Fannie Mae and Freddie Mac. Undoubtedly you recall that just last week the Republican sleaze machine defamed Obama by trying to tie him--falsely--to Franklin Raines, the former head of Fannie Mae. (Am I the only one to wonder if it was a mere coincidence that Raines is black?)

Meanwhile, over the weekend foreign banks appear to have lobbied successfully to be included in the bailout. To be frank, there is logic in this: if we want American securities to be purchased by overseas investors--and at this point we have little choice--we can't very well leave them out on a limb while we rescue Americans. It's worth noting, however, that the foreign bank that apparently has the biggest stake in being included in the bailout is UBS, and that former senator Phil Gramm--Mr. "Americans are whiners," architect of the worst of the deregulation that got us into this mess, friend of the Republican candidate and a likely Secretary of the Treasury in the unlikely event that there's a McCain administration--is vice-chairman of UBS' US operations and a lobbyist for the bank.

As a sage reader of Talkingpointsmemo.com asked, given that intense lobbying that will certainly surround the bailout bill and its aftermath, who's going to be left to manage McCain's campaign?

Did he REALLY say that?

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

YES HE DID! John McCain, in the Sept.-Oct. issue of Contingencies, the journal of the American Academy of Actuaries.

(That sound you hear is McCain's campaign crashing to earth.)

Talking sense to the American people

We're finally getting down to the serious issues of this Presidential campaign. A new poll reveals that more people would like to sit down and watch a football poll with Barack Obama than John McCain.

Now that we have that out of the way, we can get back to frivolous issues like war and peace, and the economy.

Friday Humor

(Don't you love the "Shot Dead at C0mmunity Outreach Fundraiser?")

Friend of the working people

(Or as he calls them, "the fundamentals.")

Viva Espana!

John McCain suggests that Spain may be an enemy nation. Asked if he would receive Spanish prime minister Zapatero, McCain replied:

Honestly, I have to analyze our relationships, situations, and priorities, but I can assure you that I will establish closer relationships with our friends, and I will stand up to those who want to harm the United States.

Did he not know of Zapatero is? Is he confusing Zapatero with Chavez, of Venezuela, or Morales, of Bolivia, who have been vociferously anti-American? Does he really bear animosity toward Zapatero--with whom the Bush administration's relations have been cool--or has he just lost it? Whatever the explanation, it does not bode well for Republican hopes of cutting into the Democratic margin among Hispanic voters.

Feeling old

Generally, I don't feel old. I figure if I can think about the future more than the past, I'm doing OK.

But sometimes....

I just saw a story that the Queen Elizabeth II has arrived in Boston for the final time; later this year she's going to Dubai, where she will be permanently docked and turned into a maritime museum. (A museum of Persian Gulf maritime history? Of the lost glories of British maritime exploits? The story is silent.)

The QEII being taken out of service? I can remember when she was launched. Indeed, I still think of her as the younger sister of the original Queen Elizabeth. When I was a stripling youth, Queen Elizabeth was the largest and most opulent passenger vessel (perhaps the largest vessel) sailing the seas. And she and her sister-ship, Queen Mary, did not wander around on cruises--they ran regular passages, winter and summer, across the North Atlantic. Indeed, in 1952, my Dad crossed from Southampton to New York on Queen Mary. He brought me back a jigsaw puzzle--a wooden jigsaw puzzle--of a painting showing the ship coming out of Southampton in earlier days.

When I was a boy, I thought that the Queens would always sail the seas, that passenger liners would cross the Atlantic forever, and that the world was, more or less, a safe and predictable place. (Or maybe it just seems that way from a distance; I recall being afraid, from time to time, of being incinerated in a nuclear blast.)

Bring back the New Deal

In the '80's and '90's some of us despaired over how Democrats might re-build a working majority. I, for one, said that the New Deal had run its course and that we had failed to devise principles, policies and programs to carry its ideas forward.

I'm here to tell you that I was wrong. At least partly.

If you have been watching or reading the news, you know that we are in a financial crisis or meltdown (a term originated to refer to what happens when a nuclear reactor goes haywire). And a large part of the blame for what has happened lies on the failure to regulate financial markets. In one instance--that of so-called credit default swaps--the government is actually forbidden to regulate, thanks to a law sponsored by John McCain's good friend and financial adviser, Phil Gramm. The statute in question was passed in late 2002, in the dead of night, as lawmakers were leaving town for the Christmas recess.

So it turns out that one of the important tasks ahead of us is to rebuild the New Deal, at least those parts of it that protected us from unbridled greed and the mass stupidity that it brings. Bring back and SEC that actually regulates the offer and sale of securities. Strengthen regulation of the banking industry. Revive an anti-trust policy that assures real competition. Create new regulatory agencies to deal with financial devices that get around the old restrictions. Put some teeth into enforcement of the tax code against abusive tax shelters.

Oh, and while we're at it, lets rebuild America's roads, bridges and railways and modernize the electrical grid and telecommunications network.

The old boys' network

"In John McCain's campaign, that's called a staff meeting."

Obama on McCain's new position(s) on the financial crisis:

Fogotten, but not gone

President Bush canceled a couple of fundraisers today, in order to deal with the economy.

This news surprised me. Is that guy STILL in office?

Our living (if sagging) Constitution

A judge in Florida has ruled a city ordinance banning "saggy" pants unconstitutional.

Oh, that wag

[Obama] talks about siding with the people just before he flew off for a fundraiser in Hollywood with Barbra Streisand and his celebrity friends. Let me tell you, my friends, there's no place I'd rather be than right here with the working men and women of Ohio.

John McCain at an airport event near Youngstown.

Ah, but does he love them enough to invite them to one of his eight houses?

Too big to fail

Bear Stearns was too big to fail. Fannie Mae and Freddie Mac were too big to fail. Now AIG is too big to fail--and apparently, the Fed is going to lend $85 billion in return for an 80% stake in the nation's largest insurer. Do I hear cries of "Socialism?" No, because it's only socialism if it's for the working class; it's justifiable intervention if it saves the hides of the rich folks.

To put the AIG rescue in perspective, it's about 9 months worth of the Bush administration's spending in Iraq. In other words, an immense amount of money.

And don't forget that by acting as midwife to Bank of America's purchase of Merrill Lynch, the Fed and Treasury have created another institution that is too big to fail.

In the short term, the rescues of Bear Stearns, Fannie and Freddie and AIG are justifiable. But in the longer view, a large part of the financial crisis we now face is attributable to a climate that has permitted--nay, encouraged--the creation of institutions that are too big to fail. Their existence threatens the financial health of the nation and undermines democracy, because they remove discretion from government policy (which is a nice way of saying that they hold the taxpayers hostage) and freedom of action from governmental agencies.

So, along with regulatory reform, the next administration should undertake to assure that there are no private or quasi-corporations that are too big to fail. And yes, that means breaking up Bank of America, and AIG (if it is not broken up as part of the rescue), and reducing the size and influence of Fannie and Freddie.

Update: As more has come out about the AIG rescue, the structure has become clearer. The government is lending up to $85 billion over two years; in return it is getting collateral for the loan (will the collateral actually be worth the amount lent? In these times, who knows?). The government is also taking 80% of the equity in AIG. The company is paying a high interest rate--8.5% over the inter-bank lending rate (that's in the credit-card interest range). Apparently, the plan is to split the company up and sell or split off the parts of its business that have value. So, in sum, the deal looks businesslike and there is some possibility--maybe a strong one--that the taxpayers will come out whole and maybe even ahead on the deal.

Pot and kettle

Despite what we said about Palin's star fading, let's be honest and admit that she's too good a target to dismiss completely.

Case in point: McCain economic surrogate Carly Fiorina, former CEO of Hewlett-Packard, says that Palin is not qualified to run a major corporation like H-P. But, apparently, Fiorina thinks Palin IS qualified to run the country.

The next phase

Sarah Palin's star is fading.

John McCain's lies are getting to be common currency and old news.

The next--and likely climactic--phase of the campaign is the economic meltdown. Here's the estimable Joe Nocera in today's Times:

How can it even be possible that we wake up on a Monday morning to discover that Lehman Brothers, a firm founded in 1850, a firm that has survived the Great Depression and every market trauma before and since, is suddenly bankrupt? That Merrill Lynch, the “Thundering Herd,” is sold to Bank of America the same weekend?

...after you get past the mind-numbing complexity of the derivatives that are at the heart of the current crisis, what’s going on is something we are all familiar with: denial.

Once again, it's the economy, stupid, and this time, we're not talking about whether you buy a second car or get a raise. Now, millions of Americans are worried about losing their homes, and fearful that if they lose their job they won't be able to find another one.

This is a phase of the debate that Obama should win going away, and I predict that he will. After all, as today's Times also notes,

In early 1995, after Republicans had taken control of Congress, Mr. McCain promoted a moratorium on federal regulations of all kinds. He was quoted as saying that excessive regulations were “destroying the American family, the American dream” and voters “want these regulations stopped.” The moratorium measure was unsuccessful.

“I’m always for less regulation,” he told The Wall Street Journal last March, “but I am aware of the view that there is a need for government oversight” in situations like the subprime lending crisis, the problem that has cascaded through Wall Street this year. He concluded, “but I am fundamentally a deregulator.”

Shades of Herbert Hoover.

Let's hope that Obama and his people do not rest on their oars and take a soft middle road, figuring that voters dissatisfied--if not downright scared--by the present situation will carry him into office. That's probably what would happen, but the present crisis--which Alan Greenspan admits is the worst in his lifetime--calls for a reversal of the anti-government, anti-regulation fervor of the past thirty years, and that's not going to be easy to bring about even with a Democratic Congress. To create real, long-term reform is going to take clear-sightedness, hard work and great political skill.

It's getting rough out there

The DSCC is running this ad in Minnesota. (Warning--this will make you tear up.)

A picture is worth....

The voice of experience?

Or Swift-Boating? We embed, you decide:

Contempt

You'd think that the McCain people would have enough respect for the American people to muzzle Palin about that bridge. But no. Today in Colorado:

Oh, and as the AP reports, she lies about Obama's tax plan, too.

Uh huh, sure

John McCain tells us that the fundamentals of the economy are strong:



And pigs can fly.

Reminds me of what Richard Armour wrote of Herbert Hoover: Hoover told Americans that "Prosperity is just around the corner." Unfortunately, people couldn't see to the corner because of the grass growing in the street.

What's the difference between Bush and McCain?

It takes two more letters to spell "McCain lies."

Hitting back

Obama ad confronts McCain directly on the lies that permeate his campaign:

Ahead of the curve

If you're reading the blogs or even the Frank Rich in The New York Times, you're seeing lots of advice--interspersed with much hand-wringing--telling Barack Obama that he needs to be tougher and that he must go right after John McCain. Even in the age of the Internet and the 24-hour cycle, however, the pundits are behind the news.

I traveled to Manchester, New Hampshire yesterday, to see Obama at a rally there. He did go after McCain in a masterful display that interspersed explanation of his programs with references to the obvious: that John McCain doesn't get it.

Obama and his people have been ahead of the rest of us for 19 months. They still are.

Here's his speech yesterday:

Drill, baby, drill?

Percentage of the world's oil reserves in US (including offshore areas) = 3

US percentage of the world's oil consumption = 25

Even Republicans should be able to do the math.

Mirabile dictu!

How blatant are McCain's lies? Even Karl Rove thinks he's gone too far:

They can't even count

Bloomberg reports that McCain's campaign has been lying about the(!) size of his crowds. To be more accurate, the sources of the crowd estimates.

It's one thing to exaggerate the size of crowds, but to tell a discernible lie about the source of the estimate is arrogant, stupid or both.

The fact is that no one has ever developed a good method for accurately computing the size of crowds in open areas. (Events like Obama's in Denver are different, because the number of seats in the stadium gives at least a basis for a reasonable estimate.) Year ago, I read--maybe from the great Teddy White--that part of the job of an advance man was to stand next to the police chief where he could say, "Pretty good crowd, chief. What d'you think, 8,000 people?" "No, not that many." "Maybe 6,000?" "Could be." And then the chief would tell the press that 6,000 people were in a crowd that might have been 4,000.

Basic values

TPM has a post with a comment from a reader. Part of it is this:

Campaigns offer a direct view into how a candidate will run a large complex organization. McCains true colors, his true moral convictions....are being demonstrated for all of us to see.

Yes. For decades we have believed that--for all of his conservative views--McCain was at least a decent, honorable man. Now we know better. Under the white-hot pressure of the campaign, his desire to be President has erased any moral convictions that he might have had. And if he gets to the Oval Office, we can expect that the pressures of being President will do the same. If, that is, he has any convictions left.

(Did McCain really have such convictions at all? Remember that in 2000, he came close to being Al Gore's running mate, and becoming a Democrat. After that, he decided that his future was in the Republican Party, and became a loyal acolyte of George W. Bush--the result of which we're seeing in Obama's commercials. For at least eight years, then, he's been as malleable as any of the politicians he decries with such self-righteousness.)

Are you scared yet?

Point of view

From an email from someone who's seen McCain up close:

I was invited to attend one of his town meeting events at the Denver Art Center. He had three giant screens in front and diagonally to the left an right of him. I was able to read his scripted speech before he said the words, and if he was interrupted he went off in non sequiturs.

Now, doesn't that make you feel good about the future of the country?

Up to the job?

Sarah Palin told Charles Gibson that she's ready for the job--presumably the job of President. Then he asked her about the Bush Doctrine and she got that moose-in-the-headlights look, sidestepped, tried to buy some time and get a hint; clearly, she did not know what the Bush Doctrine is.

OK, do you know? Is it important for her to know?

James Fallows--for a couple of decades one of the best commentators on international affairs--explains why it is:

Each of us has areas we care about, and areas we don't. If we are interested in a topic, we follow its development over the years. And because we have followed its development, we're able to talk and think about it in a "rounded" way....

Here's the most obvious example in daily life: Sports Talk radio....

Mention a name or theme -- Brett Favre, the Patriots under Belichick, Lance Armstrong's comeback, Venus and Serena -- and anyone who cares about sports can have a very sophisticated discussion about the ins and outs and myth and realities and arguments and rebuttals.

People who don't like sports can't do that. It's not so much that they can't identify the names -- they've heard of Armstrong -- but they've never bothered to follow the flow of debate.

You can see where he's going, but read the whole piece.

Two from Obama

And now, for something completely different.....two new ads from the Obama campaign.

The first take a lighthearted approach (and a not-too-subtle view of McCain as being [old and] out of touch):



The second is Barack himself. In my not-so-modest opinion, it is a GREAT political advertisement. If I were running a campaign, ads like this would be the backbone of the advertising. Take a look and let us know what you think:

More sleaze from McCain

Today's NYT has an editorial noting that

The most disheartening aspect of a scurrilous Republican ad falsely accusing Barack Obama of promoting sex education is its closing line: "I'm John McCain, and I approved this message."

Here's one that's equally reprehensible and it, too, was approved by McCain.



As TPM notes, the ad drips with the kind of contempt that whites have often shown to black Americans.

Another day, another inconsistency

Or maybe three.

In her interview with ABC's Charles Gibson, Sarah Palin said that human activity plays a role in climate change. In response to a suggestion that her words contradicted earlier statements, she said, ""Show me where I have ever said that there's absolute proof that nothing that man has ever conducted or engaged in has had any effect or no effect on climate change. I have not said that."

Well, maybe not exactly that, but she did say, ""A changing environment will affect Alaska more than any other state, because of our location. ... I'm not one, though, who would attribute it to being man-made," and "I'm not an Al Gore, doom-and-gloom environmentalist blaming the changes in our climate on human activity."

Is someone going to point out to the Governor that in this Internet age, you can't get away with contradicting yourself, especially if you try to get away with denying you said something when you did?

Every day, she digs a bigger hole.....

Bill gets on board

Clinton, that is. With Barack, and with TONE.

After a lunch with Obama yesterday, Bill said, “I predict that Sen. Obama will win and win handily.’’

Of course, regular readers will recall that TONE came to that conclusion more than a month ago, but Bill was still sulking in his tent (or was it Hillary's?) then.

The pool report of the interchange with reporters after the lunch is interesting, because it seems to indicate a certain thawing between the former and future presidents.

Well, now I'm reassured

AP:

The McCain campaign is defending Alaska Gov. Sarah Palin's much-criticized inquiry into banning books at her hometown library, saying her questions were only hypothetical.

I suppose the fact that she later tried to fire the librarian, who pushed back against the idea of banning books on some ideological basis was just a coincidence.

Consistency is the hobgoblin of little minds

ABC's Brian Ross has found a video of Sarah Palin praising then-public-safety-commissioner, Walt Monegan, just a few months before she fired him. (But NOT because he wouldn't fire her former brother-in-law from the state police!)

I guess she was for Monegan before she was against him.

Calling all Hillary supporters

So the Repubs think they can attract some of Hillary's voters, because they put Sarah Palin on the payroll, err, ticket.

This will certainly energize those who supported Hillary: When Palin was governor of Wasilla, Alaska, the town forced rape victims to pay for rape kits and tests. Wasilla was the only town in the state to charge victims. It did so until the state passed a law--which was done, according to Tony Knowles, a Democrat who was governor at the time, because of what Wasilla was doing--to outlaw the practice. Wasilla's police chief (who had been appointed by Palin after she fired his predecessor) defended charging the victims by saying, ""I just don't want to see any more burden put on the taxpayer."

Oh, yes, electing Palin would be another blow for women's equality! At least if you mean that women can be as mean-spirited, cynical, and nasty as any man. But we already knew that, right?

Good advice?

From Karl Rove, of all people?

If Mr. Obama wants to win, he needs to remember he's running against John McCain for president, not Mrs. Palin for vice president.

Now, Rove is so devious that I'm tempted to think that he really wants Obama to forget Palin and run against McCain, because he thinks that will lead to a McCain victory. Fortunately, as you read through the article, you see Rove actually making the argument that Palin's time as governor renders her more qualified than Obama.

Whew, for a moment I was worried that I'd actually agree with Rove.

Seal DNA?

We're not going to spend $3 million of your tax dollars to study the DNA of bears in Montana. I don't know if it was a paternity issue or criminal, but it was a waste of money.

Sen. John McCain

Really, Senator? Then how do you feel about half a million dollars for research on the recreational halibut industry? (Are there halibut theme-parks? Who knew that halibut needed recreation?) Or $3.2 million to study seals' DNA? or $2 million to study the mating habits of sea crabs? Those were all earmarks requested by Sarah Palin's administration for the current fiscal year. (Maybe she's changed her mind about these--yet more instances in which she was for them before she was against them.)

That's not reform we can believe in.

Before signing off this post, let me note that any or all of those requests might be good ways to spend taxpayers' money. But if John McCain wants to base his claim to the presidency on opposing earmarks, he's got to take the hit when it turns out that his allies don't have clean hands.

9/11

Once again, it is September 11th, and once again the nation will stop to take note of what happened seven years go. Like you, I can remember exactly where I was when I first heard of a plane hitting the World Trade Center, just as I can recall where I was when I heard that John F. Kennedy had been shot.

Much as the attacks on that day still affect us, it is time to let them begin to recede into history.

Look at it this way: If you were Osama bin Laden, wouldn't your heart gladden at the thought that the United States is stopping in its tracks to remember what your followers did on September 11th? Would you not rejoice in the knowledge that you have gotten so deep under America's skin?

Almost certainly, you remember what day Pearl Harbor was attacked--in part, at least, because you've heard recordings of FDR repeating the date in his "day of infamy" speech the next day. But do you remember the dates of Antietam or Gettysburg? Of Midway? Or when the flag was planted atop Mt. Suribachi, on Iwo Jima?

Perhaps it is good that we seem to remember our defeats more clearly than our victories, but there comes a time when we should move ahead.

(Note: FDR did not use the term "day of infamy." Walter Lord did, in his book about Pearl Harbor, and he was probably not the first; I haven't bothered to check this. What FDR said, was "a date that will live in infamy.")

If the shade fits....

The stakes

Andrew Sullivan:

McCain has demonstrated in the last two months that he does not have the character to be president of the United States. And that is why it is more important than ever to ensure that Barack Obama is the next president. The alternative is now unthinkable. And McCain - no one else - has proved it.

Enough!

Barack Obama at his best, on the "lipstick on a pig" "controversy" (a/k/a another Republican lie):

Uh-oh

The Bush "Justice" Department plans to deploy hundreds of poll monitors in November. This would be a good thing, if we could trust the Department to be as interested in protecting the right to vote as it is in advancing the goals of the Republican Party. Given the overwhelming evidence of the past eight years, however, such faith would be foolish.

In the bunker with Dick Cheney?

Maybe....

Colonel Harland Sanders' handwritten recipe of 11 herbs and spices was to be removed Tuesday from safekeeping at KFC's corporate offices for the first time in decades. ...Louisville-based KFC, part of the fast-food company Yum Brands Inc., hired off-duty police officers and private security guards to whisk the document away to an undisclosed location in an armored car.

Stay tuned.

Hitting back

Clearly, the Obama campaign takes no advice from TONE. Despite our counsel to avoid personality politics, it is releasing the ad below.

Before we get to that, however, check out Obama's interview with Keith Olbermann (part 2 will be broadcast tomorrow).

OK, now the ad:

Bridge of lies

Family values?

Struggling to accept that her child would be born with Down syndrome and fearful of public criticism of a governor’s pregnancy, Ms. Palin had concealed the news that she was expecting even from her parents and children until her third trimester.

Before her son was born, Ms. Palin went to extraordinary lengths to ensure that his arrival would not compromise her work. She hid the pregnancy. She traveled to Texas a month before her due date to give an important speech, delivering it even though her amniotic fluid was leaking. Three days after giving birth, she returned to work.

The New York Times

A few weeks after he was elected to the Senate at age 29 (the Constitution requires Senators to be 30, so that is as young as you can be and be elected--and then only if you will turn 30 before the first Monday in January), Joe Biden's wife and year-old daughter were killed in a traffic accident. His two sons, 2 and 3, were seriously injured. Biden considered resigning his seat in the Senate before being sworn in, but decided to serve after his mother promised to take care of the boys. Biden promised to come back to Wilmington, a 2-hour train ride, every night, which he has done for the past 29 years.

And which is the party of family values?

A dissent

A lot of Democrats and liberal blogs are pressing the Obama campaign to take the gloves off and go after McCain and Palin. And the media buzzes with liberal commentary on Palin's unfitness for high office.

The Republicans would like nothing better than to make this a campaign about personalities, and to keep Palin at center stage for as much of the next eight weeks as possible. The thing they most want to avoid is a contest on the issues. So that is where Obama and Biden need to concentrate.

This doesn't mean avoiding criticism of McCain. On Saturday, I heard Obama pointing out that McCain's message of change doesn't include changes from Bush's tax, economic, energy, etc. policies. That's the way to attack.

We in the media and the blogosphere can go out after Palin's personality, positions and phylo-thin resume. (I am planning a post on those subjects.) Obama and Biden should attack her, or McCain, only when the subject is relevant to issues that will make a real difference in voters' lives.

(Note: McCain's impetuous choice of someone so unqualified is a valid point that should be made.)

Must read

Tom Friedman on the need for national priorities.

On Wednesday, The New York Times on the Web flashed a headline that caught my eye: “U.S. to Unveil $1 Billion Aid Package to Repair Georgia.” Wow, I thought. That’s great: $1 billion to fix Georgia’s roads and schools. But as I read on, I quickly realized that I had the wrong Georgia.

Friedman goes to to explain why innovation must be our national aim.

While we still have enormous innovative energy bubbling up from the American people, it is not being supported and nurtured as needed in today’s supercompetitive world. Right now, we feel like a country in a very slow decline — in infrastructure, basic research and education — just slow enough to lull us into thinking that we have all the time and money to play around in Tbilisi, Georgia, more than Atlanta, Georgia.

Read the whole thing.

Unbelievable

It was hard enough to believe that John McCain would say once that Gov. Palin's position as commander of the Alaska National Guard qualifies as experience in foreign affairs, but he's said it again.

The most charitable way to look at this is that the Republicans are so desperate that they figure their only chance is if the American people are really, really dumb.

An old Republican slogan:

"Don't confuse me with facts!"

AP dissects some of the distortions, exaggerations and outright falsehoods heard at the Republican convention. (Why didn't we hear more about this from the media AT the convention?)

Just wondering

Does anyone know Sarah Palin's position on jacklighting?

It could shed a lot of light (no pun intended) on her character.

The new Giuliani?

The pundits--at least the liberal ones--said that Rudy Giuliani's campaign speech consisted of a noun, a verb and 911. John McCain seems to have learned something from his erstwhile rival. His campaign speeches now consist of a noun, a verb and POW.

For what it's worth

If you use gmail, Google's email, and do a spell-check, it will highlight blogspot (the host of this blog) as an unrecognized word. Blogspot is a Google site.

(By the bye: the spell-check on blogspot doesn't recognize blogspot, either.)

Obama comments on the GOP convention

The wheels of justice turn slowly

A death row inmate in Texas (where else?) is seeking a new trial on the unusual grounds that the judge and the prosecutor were having an affair during his trial. A hearing has been scheduled for September 12--two days after the inmate is scheduled to die.

"In a letter sent today to the Texas governor, 22 former judges and prosecutors, including the former chief judge of the federal Third Circuit Court of Appeal and the former attorneys general of Maryland and Tennessee, called the setting of Hood's hearing date 'inexplicable." They've also asked the governor to issue a stay.

Thanks to ABC News.

Maybe we weren't so far off

ABC collected a focus group to watch Palin's performance last nights. The independents--the people you'd think that McCain and his handlers want to swing--were not impressed.

Update: HuffPost describes two more focus groups, these of women who (mostly, it sounds like) supported Hillary Clinton. They weren't too impressed, either.

Oh, those elitists!

Vanity Fair, an alleged magazine, weighed into the political wars with a typically hard-hitting approach: it analyzed the cost of the outfit Cindy McCain wore Tuesday night.

The total? $300,000. That's right, six figures.

Wonder what she'll trot out tonight.

And they have the absolute gall to call Democrats elitist.

(The alleged magazine computes Laura Bush's togs as having cost between $3400 and $4,300, which is still more than the average person can afford to spend on a wardrobe, let alone an outfit.)

We're not alone

In suggesting that Palin's presentation last night was not as effective in the ultimate end--winning the election--as most of the media seemed to think this morning. James Fallows, of The Atlantic has a perceptive analysis.

The two dwarfs

The Republican ticket: Grumpy and Nasty.

Department of Low Expectations

Palin managed to walk out on stage without tripping over her high heels and didn't have bear grease in her hair, so the media--led by the NYT--are rapturous over her speech. In my admittedly partisan view, she delivered a series of lines written for her, rather than a seamless speech. Some of the attack lines were good, there's no question about it. But I thought they were directed in a defensive, hectoring tone that had no warmth.

Indeed, it's now clear, even before McCain's speech tonight, that the campaign is going to be Obama and Biden's warmth, optimism and hope for the future against the Republicans' defense of the status quo. I'm glad to be on the side that looks to a brighter day ahead.

Palin's speech

I'm listening to Palin's speech. It's not as good as I thought it might be (or maybe feared). Right now she's enthusing over the virtues of small town people. All very good, but there aren't many voters left who come from small towns.

Note: Her youngest daughter just took her hand, licked it and smoothed down her baby brother's hair. She's a real sweetie!

Just plain sad

We used to be able to convince ourselves that John McCain was a little bit different from other Republicans. That gets harder and harder to do with every passing day, maybe with each hour. The latest installment: In an interview with Charles Gibson, of ABC:

Gibson: Can you look the country straight in the eye and say Sarah Palin has the qualities and has enough experience to be commander in chief?

MCCAIN: Oh, absolutely. Having been the governor of our largest state, the commander of their National Guard, she was once in charge of their natural resources assets, actually, until she found out there was corruption and she quit and said it had to be fixed.

Of course, it helps to be a mayor. When I think people compare her experience, in fact, and accomplishments, I think ethics in lobbying reform in a state that was beset by the influence of special interests, cutting taxes, giving the citizens back money.

I mean, she's got an incredible resume, including a beautiful family and a wonderful, loving, caring family. So I will think that, over time, people will compare her accomplishments with that of Sen. Obama, and his are very meager.

Who said it?

The gifts that God has given to Barack Obama are as enormous as his future is unlimited. As his mentor, as his colleague, as his friend, I look forward to helping him reach to the stars and realize not just the dreams he has for himself but the dreams we all have for him and our blessed country.

Can you guess?

That's right, none other than Joe Lieberman, introducing Obama at a Jefferson-Jackson Day dinner in Connecticut in 2006. (The sanctimoniousness gave it away, didn't it?)

Thanks to Political Wire for this one.