Wednesday, November 03, 2010

"More Hearings And More Pressure"

This Bloomberg article outlines what might be the best part of Tuesday's electoral results.

During the past few days I've spent some time gauging sentiment on the message boards of sites like Huffington Post and Daily Kos. It's impossible to miss posts about the bailouts, Geithner, Summers, Bernanke, the absence of perp walks, and what many see as the lack of real financial reform. On the day Bernanke was reconfirmed by a Democratic Senate back in January, I wrote:

If you're not sure about the degree of apathy and despondency on the Left, spend a few minutes poking around the message boards. The enthusiasm gap is so wide you could fit a foreclosed McMansion in it. Nature may abhor a vacuum, but Sarah Palin doesn't.

This is why Obama's decision to continue slapping the country in the face with Bernanke (and Geithner) was profoundly irresponsible. If denying a furious public some scalps and going to the wall for a failed Bush appointee amplifies the impact of broader legislative impotence and provides an opening for political extremism at the national level, it may turn out to be one of the most consequential unforced errors in recent American politics.

It turned out I was wrong about legislative impotence, but the striking indifference of Democratic voters to arguably profound legislative accomplishment only highlights the importance of Obama's apathy-inducing unforced errors. Unless he took office believing an economy in freefall would turn around quickly, Obama had to understand that by appointing and retaining symbols of failed or unpopular economic policies, his signature issue -- "change" -- would gradually become a vulnerability. If he did not it was a terrible mistake. He wound up owning the status quo sooner and to a greater degree than he should have. This was both avoidable and predictable, so he deserves no sympathy. And with his suprapolitical monetary/de facto fiscal zealot about to embark on the next round of what should only be called money printing -- the innocuous term "quantitative easing" just makes it dangerously palatable, but of course that's the point -- Obama will own those consequences as well.


Anonymous KAIMU said...


But who really "owns" the US Treasury in the end? And maybe those apathetic DEMS have a brilliant political strategy of letting the REPS take control so they have someone other than themselves to blame for failing to reverse the economy. Harry, damn it ... didn't you get the MEMO? You were suppose to lose!

11/03/2010 10:29 AM  
Anonymous Anonymous said...

I'm afraid Barry Ritholtz is going to be proved right: the GOP will work to defang the already feeble attempts at regulating the monster banks.

As I tell my friends and family, if you want to understand the crisis-- and the response-- just follow the money.

11/03/2010 10:57 AM  
Anonymous Anonymous said...

I really think that only wonkish people understand this. If 10% of Americans could identify Geithner as Treasury Secretary and Bernanke as head of the Fed, I'd be shocked. This election was about appealing to the lizard brain in people. People know that the economy sucks, but they don't understand why. They just know who's in charge at the moment, and feel that a change is necessary.

11/03/2010 2:17 PM  
Anonymous Anonymous said...

Anon: Most Americans might not know Geithner by name, but a lot more than 10% believe nothing has changed and that financial reform has been a joke.

I'd also wager that more than 10% believe the bailouts started under Obama.

11/03/2010 3:16 PM  
Anonymous Anonymous said...

Another thing -- aside from Obama's sheer strategic and tactical idiocy, don't forget that his scutboys and fanboys went out of their way to antagonize the core of their coalition. I'm one of those lefties who, apparently, needs to undergo "drug testing" for failing to buy into the 6598th round of Dem excuses and special pleading. I've decided to take them at their word: The Dems obviously don't want my vote, and so they'll never get it again. If I ever bother to vote in a national election again, it'll be for a third party.

Nader was right in 2000.
-- sglover

P.S. To Kaimu:

maybe those apathetic DEMS have a brilliant political strategy of letting the REPS take control

Maybe?!?! I'm certain that Obama's perfectly delighted with the mid-term results. Now he can do even less, hedge & trim even more, and blame it on those awful Republicans. (After all, you can always count on the GOP to reveal some serious ugliness before too long.) Obama's got a good shot at winning a second term by default. And since all he cares about is his own career, what difference does last night make?

11/03/2010 8:28 PM  
Anonymous KAIMU said...


In truth most politicians only expertise is "getting elected"!

11/04/2010 4:03 AM  
Anonymous Anonymous said...

Agree. Many seem perfectly content with the corruption. But if Obama is wrong, Bush was hell wrong for 8 years. No?

In the 90's it was vogue to require your employees to attend a zero-defect seminar. They stressed finding the "root cause" - the real problem. Our current systems (political, environmental, financial, economic, ed, infrastructure) are so broken & out of balance, but nothing will be solved until we correct our root problem. Which seems: the consolidation of the media, society's acceptance of false reporting from this media, money buying our elections resulting in corporation/lobbyiest making our laws & controlling our leadership. We are bombarded by mind-numbing "entertainment" waste and demagoguery masking as "news" or "~truthiness". Middle-America is experiencing one thing, told another by those in power, & feed demagoguery by most of the media to stir the emotions. This is a mess.

Where we are headed with billionaires/corporations controlling the shots is frightening. I thought this blog response was succinct:
"With infinite money & media on the other side, it’ll be a miracle if anyone left of Mussolini ever wins again."

Two wars & an economic recession or depression depending on where you stand, what would be wrong with Obama or our Congress appealing to our humanity: Our country needs you. Great men & women sacrificed in the past for this country. Even today our fellow citizens are giving their lives for our country in two wars and as we police the world for people and businesses. We need to repeal the Bush tax cuts and tax all income/div/compensation at the same rate. It is the moral thing to do for our country at this time. And in return I promise to fight to cleanup our financial systems, simplify our taxation system, close loopholes, __.

11/05/2010 6:46 PM  
Anonymous Anonymous said...

Video of Matt Taibbi on Eliot Spitzer's new show, discussing Matt's new book "Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America". I wish there were more voices like Matt.

The only way I know how to say it is it sounds like Obama or "insert name here" is a puppet to Wall Street. Elections don't matter? Yikes!

11/09/2010 12:29 PM  
Blogger Thomas Daulton said...

TCR, very good analysis. I realize you must be too busy to post much, but short sweet commentaries like these do a lot to counteract the overall stupidity average of the Internet these days. I hope you get the chance to discuss in detail QE2 - and particularly, other world leaders' recent outraged reactions to it.

Kaimu, very insightful comment about Dems taking a dive so the Republicans can get blamed for not fixing the economy. Even if that wasn't the conscious Dem strategy before the election, I bet you dollars to donuts that that's how the Dems will play things now. Look forward to another couple of years of the Dems whining and playing the patsy, complaining that the mean ol' Republicans are blocking all their great legislation, fiddling while the world economy burns. And then, even yet still another election, 2012, where the Dem's main strategy is to scare people about how awful it'll be if the voters hand power to the Republicans.

Man, several months before the election, we debated here about whether Democrats would "own" the wars, in the public mind. Democrats pretty much "own" everything at this point, don't they? Because we put them into office to fix certain problems, and those problems haven't been fixed. Instead, they offer excuses. So, unfair or not, the only rational conclusion a voter can make, is that those problems don't bother the Dem politicians as much as they bother the rest of us. And with that, ownership gets passed.

The Anon who doubted that 10% of Americans can identify Geithner: I think you're making a risky underestimation. At this point maybe 20-30% of the voters are Tea Party sympathizers to some degree, and Glenn Beck and his ilk have explained the debt and money-printing process to the core activists in great detail. (If only during discussions about the Gold Standard and shilling for Goldline dot Com!) Such people receive a twisted, distorted understanding of the process, which of course goes to great lengths to demonize the Fed. But believe me, the Tea Party activists are more than eager to proselytize, and pass that distorted understanding on to their less-activist friends. Maybe less than 10% can ID Geithner in a lineup, but I seriously think 40% of the country has some crude, distorted understanding of the dangers of the money-printing issue.
The big problem is, Fed policy for maybe 40 years, has been so crude, distorted, and evil that there isn't a huge difference between the truth, and the twisted narrative Glenn Beck puts forth.

11/09/2010 2:19 PM  
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