Posted inPolitics: National

Carter and Reagan

This is the 100th anniversary of Ronald Reagan's birth, an event greeted with armies of hagiographers and one heart-felt personal book by his progressive son, Ron Reagan. It's also the 30th anniversary of Reagan's ascendancy to the presidency and the end of Jimmy Carter's one failed term in office. Carter is seen as the most successful and admirable former president, but still a personal riddle, as a new Rolling Stone article explores. As if Reagan was not one: Charismatic to the masses, friendly in person (I met him once, as part of a group of other journalists), but utterly distant and opaque beyond that to everyone except, perhaps, Nancy. Some of this sounds like Barack Obama. Maybe there's a certain sociopathic streak that comes with modern presidents. Either way, we live in Reagan's shadow, whether it's for good or bad. But we also live in Carter's.

A few years before he died, Hamilton Jordon, Carter's White House chief of staff, befriended me. He was nothing like the scheming party boy I had been taught to imagine as a young Republican. Instead, I found a man of uncommon depth, intelligence and grace, tempered by a long fight with cancer. It's not giving up any confidences to say Jordan found his boss could be as frustrating as he appeared to us on the outside. My problem with Carter, aside from the Goldwater it took years to cleanse from my system, was his Baptist preacher sanctimony. And, with the Afghanistan invasion by the Soviets and especially the Iranian embassy hostage debacle, he appeared weak and willing to preside over American decline.

But of course the story is more complicated. Ask who started the deregulation movement, appointed Paul Volcker as Fed chairman with a real mandate to break inflation, pushed the MX Missile and modernization of NATO's nuclear forces, as well as presided over building the world's most lethal ballistic missile submarine class, and you'd likely answer, "Reagan." In fact, it was Carter. Ask which president was more pragmatic, most pushed the Soviet Union on human rights, grew to genuinely hate nuclear weapons and proposed banning all ballistic missiles, and whose life-ling hero was Franklin Roosevelt, you'd probably answer, "Carter." It was, of course, Ronald Reagan. The U.S. policy (quietly) invoked to justify both Persian Gulf wars and our huge military presence there is the Carter Doctrine.

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Posted inUncategorized

The Citi gang gets away

The financial implosion that wrecked America was largely cooked up by Citigroup, not only in its kitchens of "innovation" but especially in its wide influence over the industry. Now what was once touted as the largest "financial services" company in the world is being dismantled. Among other things, it will sell its Smith Barney unit, credit-card business and consumer finance units. The Wall Street Journal observes that the final result will look much like the old Citicorp before Sandy Weill got his hands on it in 1998. Only without the integrity, market value and perhaps safety and soundness.

Unfortunately, the American taxpayers own a 7.8 percent stake in this dog (the Treasury alone gave a $45 billion infusion — 45 times the annual Amtrak budget). Maybe — who the hell knows what we're on the hook for, considering the secrecy with which the bailout has been handled. Who knows how many hundreds of billions of dollars have been thrown down the Citi-rathole by TARP and the Federal Reserve. And all for what? Did we also pay for the cheap undercoating and worthless extended warranty?

This institution that was deemed too big to fail has failed to unfreeze credit markets. Citigroup has succeeded in lavishly compensating its top executives and big-time traders, who jet away from the calamity with no consequences. In 2007, as the crisis became undeniable, then CEO Charles Prince, who had performed abysmally for shareholders, nevertheless made some $25 million. Robert Rubin, the Democrat brain trust on economics, was paid $17 million. This year, aided by "rescue" money from the taxpayers, Citi reportedly set aside $3 billion in bonuses.

Obviously the Citi never slept.

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Posted inUncategorized

To bail or not to bail?

Let’s set aside the demands of the extremists on the right, calling for more deregulation and tax cuts to address the financial crisis. It’s like trying to discuss the finer points of Plato with a small, yapping dog. Otherwise, I can understand the desire on the left and right to "punish Wall Street" by defeating the bailout plan. Unfortunately, the markets are so intertwined and inherently fragile, the first casualties are going to be on "Main Street" (a bittersweet anachronism for a nation that has mostly abandoned its main streets).

Wall Street — and increasingly overseas investors — owns Main Street.

The plan voted down yesterday was flawed but better than the original Czar Paulson contraption, which would have given the former head of Goldman Sachs unlimited access to use American treasure trying to extinguish the wildfire he and his greedy buddies started. Well, not quite — and here we get back to the unworkability of "punish Wall Street" argument. Deregulation, a casino-like attitude on Wall Street and a bubble-blowing Fed were the biggest culprits in the mess. But, so, too were the American people.

We voted in the deregulators and stood cow-like as it happened, the jobs disappearing, wages stagnating. Worse, too many of us thought we could get rich quick off real estate, like day trading before it. We bought overside houses and ran up credit-card debt we couldn’t afford. We bought SUVs to drive ever-longer distances as oil was peaking. We wanted tax cuts that gutted our schools and infrastructure. We wanted all that stuff at Wal-Mart. The casino became our ruling totem. It’s quite a remove from the generation of the Boomers’ parents that saved and waited to make purchases until it could afford them. It’s their passed-along wealth that is helping cloak the "banana republic with nukes" that we’re becoming.

So here we are. Were it not for the legacy of Franklin Roosevelt, we would already be seeing bread lines. And how many better ways could we use $700 billion…

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Posted inPolitics: National

Is the ‘nation of whiners’ also a nation of suckers?

Let’s get this straight at the outset: Phil Gramm, President-elect McCain’s chief economics adviser, did not misspeak when he said the only thing wrong now is a "mental recession" and America is a "nation of whiners." The corporate media, to the extent they are covering the story at all, are leading with McCain’s disavowal of Gramm. McCain has said the same kinds of things. He also said Social Security is "an absolute disgrace." This is what Republicans believe. Imagine if Obama had said such things?

While McCain is again showing his fundamental dishonesty, and the media are continuing to cover for him, Gramm unambiguously showed the mindset of today’s Republican Party. "Creative destruction" is their mantra, "free markets" their religion. And if you lived Gramm’s life, you might well wonder, "why are people complaining?" The former senator from Texas championed tax cuts for the wealthy, breaks for corporation and deregulation. He was repaid handsomely, most recently with his ties to the giant bank UBS.

Most Americans have paid a huge price. Median incomes have actually fallen in recent years, millions have lost their health insurance, and most average workers are losing the foundation of the middle class: secure jobs at good wages with benefits and pensions. This was partially concealed by the scam of the housing bubble, and now that’s gone. The Republican leaders, who have become wealthy from tax cuts, outsourcing, union busting and community-destroying mergers say, "stop whining."

But will they pay a price in November? I’m not convinced.

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