Q.E.D.

If you've ever needed direct evidence of the ruling class, with the mass media as junior partner in plunder, observe the reaction to the defeat of the bailout plan in Congress. The power elite has been dealt a shocking blow by the revolt we witnessed yesterday, and that shock is fully reflected by the pundits on the morning news shows. They cannot believe that the "responsible thing" was not done. The only dissenter I've seen in the last 36 hours is Lou Dobbs (bless his soul!).

Bravo!

BAILOUT REJECTED

Sun Reportedly Expected to Rise Tomorrow Anyway

In Lockstep

It's nice to see that both the maverick and change agent are in lockstep with the Wall Street bailout. Meet the new boss...

Bailout Lies

One of the lies involved in the Wall Street bailout -- and there are many, including the claim that the credit markets are frozen -- is that the taxpayers will recoup the losses and even turn a profit. The biggest lie there is not financial but political. Even if there are gains, they will not go to the taxpayers but rather to the government. For some strange reason, this distinction is lost on virtually everyone, especially the news media.

Moving Target

The people who refuse to believe that their beloved home-ownership promotion program is largely to blame for what's going on today can't quite make up their minds about what is to blame. They "know" it has something to do with not enough regulation. But what? First they argued that the Bush regime engaged in an orgy of deregulation. They had to drop that line, however, because the last act of significant banking deregulation was signed by Bill Clinton in 1999. So they changed to "someone was asleep at the switch." Vivid metaphor, but no one has come up with an actual instance of a regulator being asleep at whatever switch he allegedly was asleep at. So now there's a new argument, voiced by Hillary Clinton this morning: the Bush regime failed to anticipate the need for a new regulatory structure in the global economy. (I won't ask why her husband also failed in that regard.)

To quote John Stossel, "Give me a break!"

Cross-posted at Liberty & Power.

Welfare State or Corporate State?

It's a grave mistake to portray the economic problems as consequences of the welfare state, as traditionally defined. Rather, this is a failure of the corporate state, or state capitalism. Not only is this the truth, it also knocks the state socialists off balance. Let the conservatives argue that the failing system was designed to help low-income people. We know better: it was designed to politically funnel money to bankers, home builders, and the real-estate profession. As usual, low-income people were mere pawns in a special-interest scheme to shift risk from big business to the taxpayers.

Cross-posted at Liberty & Power.

Who's for the Market?

Being for the free market means being for full market discipline -- nothing concentrates the mind like the threat of bankruptcy. Therefore, anyone who wants the government to weaken or remove market discipline favors something other than the free market -- the corporate state. This point must be at the root of any analysis of the financial turmoil.

McCain Has No Clue

John McCain brags that a few years ago he supported reform of Fannie Mae and Freddie Mac, changes that allegedly would have averted the problems we now witnesses. That's balderdash. He did not support converting those government-sponsored enterprises into organizations without access to government favors or an implicit guarantee of bailout. Rather he merely supported new "independent" government oversight of those privileged corporations. Here's the Congressional Research Service summary of the Federal Housing Enterprise Regulatory Reform Act of 2005:

Amends the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to establish: (1) in lieu of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development (HUD), an independent Federal Housing Enterprise Regulatory Agency which shall have authority over the Federal Home Loan Bank Finance Corporation, the Federal Home Loan Banks, the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac); and (2) the Federal Housing Enterprise Board.

Sets forth operating, administrative, and regulatory provisions of the Agency, including provisions respecting: (1) assessment authority; (2) authority to limit nonmission-related assets; (3) minimum and critical capital levels; (4) risk-based capital test; (5) capital classifications and undercapitalized enterprises; (6) enforcement actions and penalties; (7) golden parachutes; and (8) reporting.

As though "independent" oversight could have avoided the problems better than HUD oversight. The issue hasn't been lack of oversight, but intervention designed to countervail the market process in order to promote home ownership among people who couldn't otherwise have afforded it. Not coincidentally, this brought great profits to the financial, homebuilding, and real-estate industries. Nothing short of blocking Fannie's and Freddie's path to the taxpayers' wallets could have turned things around.

Yeah, a real maverick.

Stupid, Venal Government

The financial turmoil is most immediately the result of falling housing prices. Prices are falling in part because they were pushed to artificially high levels through myriad government policies aimed at controlling land use and making it easier for people with little income and no creditworthiness to get mortgages. They had to come down sometime. So now the government is committing around a trillion dollars of the taxpayers' money to bail out the lenders and investors. How is this supposed to fix things? By stopping the fall in housing prices and getting them rising again -- artificially.

Is it stupidity or venality? It could be both, couldn't it?

Government Failure

Pundits and politicians are virtually unanimous in saying today's economic turmoil is the result of a laissez-faire policy in Washington and an orgy of greed and irresponsibility on Wall Street. Laissez faire in Washington? On what planet?

The rest of this week's TGIF, "Government Failure," is at the Foundation for Economic Education website.

Constitution Day

"But whether the Constitution really be one thing, or another, this much is certain: that it has either authorized such a government as we have had, or has been powerless to prevent it. In either case, it is unfit to exist." --Lysander Spooner, "The Constitution of No Authority"

McCain for President

No, I'm not endorsing him! I'm predicting he will win. In elections I usually predict wrong. It's a hex. We're all doin' what we can.

We Will Be Fooled Again

It is appalling that Barack Obama apparently will go through this campaign without once tearing into George II's Unitary Executive Theory, under which a president may launch preventive wars unilaterally, eavesdrop and gather information on people without warrant, issue signing statements announcing he'll ignore parts of legislation he doesn't like, send detainees to foreign lands to be tortured, declare detainees "enemy combatants" and hold them in perpetuity, etc., etc., etc., -- all without check by another branch of the state. (John McCain seems to have no problem with this theory either.)

I wonder if Obama doesn't want the smorgasbord removed before he's gotten to the table. The Fuhrer Principle must be enticing to any presidential candidate.

Some peace candidate. "We won't be fooled again"? Sure we will.

The Scariest Thing I've Ever Seen

It's Sarah Palin's ABC interview here. It really is all about winning (power), isn't it?

Be afraid. Be very afraid.

Update: This link now goes to the segment of the interview in which she discusses domestic policy. It originally went to the foreign-policy segment, which I cannot find now on the ABC site.

Bailing Out Statism

The key to understanding the saga of Fannie Mae and Freddie Mac -- the newly nationalized twin government-sponsored enterprises (GSEs) that dominate home financing -- is this: They were created -- intentionally -- to distort the housing and mortgage markets. That is, government planners were not content to let voluntary exchange and spontaneous market forces configure those industries unmolested. So -- holding the taxpayers hostage -- they intervened. Make no mistake: the collapse of Fannie and Freddie is government social engineering predictably gone bad.
The rest of this week's TGIF, "Bailing Out Statism," is at the Foundation for Economic Education website.

McCain's Self-Righteous Fakery

If John McCain keeps up that self-righteous fakery about wanting to be our servant, we’re in for two rather tedious months until election day.

First of all, he also says he wants to be our leader. How can he be both our leader and our servant? We know what’s really going on here. The servant shtick is phony humility intended to soften us up. He has no intention of being our humble servant and every intention of being our know-it-all Great Leader, our commander in chief.

The rest of this week's op-ed, "McCain's Self-Righteous Fakery," is at The Future of Freedom Foundation website.

Politics Turns the World Upside Down

Didn't anti-PC conservatives once mock the sensitivity of women and people of color and ethnicity to allegedly harmless jokes? So why do they think it's good politics to feign offense at Obama's "lipstick" remark? A better question: why have the American people not barfed and sworn off Republicans and Democrats?

Priorities -- Please!

It is curious that people who obsess over a $400 million "bridge to nowhere" favor spending $10 billion a month in Iraq -- indefinitely. That bridge probably wouldn't have killed anyone.

Corporate Socialism Lives!

I hope we'll no longer hear the Bush administration accused of favoring laissez faire. We didn't need the takeovers of Freddie Mac and Fannie Mae to demonstrate the administration's devout corporatism (fascism, if we want to be blunt about it). These government-favored corporations -- which were never market institutions -- have been a disaster in many ways, and now they will cost the taxpayers $200 billion to $500 billion. Much of the mess we're in can be explained by decades of corporatist polices dressed up to look like promotions of the American Dream through home ownership. It's been a fraud top to bottom and requires nothing less that the complete removal of the state from the housing and financial industries (not to mention all others).

For anyone who needs reminding, the free market means private profits and losses.

Non Sequitur

Defenders of Sarah Palin say her maverick temperament is demonstrated by the fact that she beat an incumbent Republican in her bid to become governor of Alaska. Why isn't that just proof of her ambition for power?

Servant or Leader?

John McCain says he wants to be our servant. But he also says he is uniquely fit to lead. Which is it? We know very well which it is. Just ask who will be giving orders and who will be taking them.

Repression in St. Paul

Many bloggers have been keeping closer tabs than I on how the "authorities" treated protesters at the Republican National Convention. It appears the treatment was outrageously heavy-handed. Rad Geek's post on the subject is here. Follow the links!

Come and see the violence inherent in the system!

Don't Worry. She Supports Israel

Sarah Palin is in good hands. One of her first activities after John McCain picked her as his running mate was to begin tutoring under his neoconservative foreign-policy advisers, including Joe Lieberman. And one of her first activities in that mission was to be introduced to the chief Israel lobbying organization, AIPAC, so she could pledge her undying devotion to the state of Israel. This of course is mandatory for any "serious" national candidate. According to the Washington Post:

Lieberman, who was the 2000 Democratic vice presidential nominee but is now an independent, has helped introduce Palin to officials of the American Israel Public Affairs Committee, the leading pro-Israel lobby. In a meeting Tuesday, the day before she delivered her prime-time address at the Republican National Convention here, Palin assured the group of her strong support for Israel, of her desire to see the United States move its embassy from Tel Aviv to Jerusalem and of her opposition to Iran's aspirations to become a nuclear power, according to sources familiar with the meeting.

Next time McCain sings "Bomb, bomb, bomb, bomb-bomb Iran," he'll have someone to sing harmony.

Some Maverick

John McCain and his supporters portray him as the quintessential maverick. What was his paradigmatic act of maverickism? It was McCain-Feingold, which enacted draconian restrictions on political speech before elections. At the time, the bill was harshly opposed -- even by many Republicans -- as an "incumbent-protection act." In the floor debate on the bill, supporters complained about negative advertising by interest groups, which usually target incumbents.

This is how a maverick behaves? Memories are short in politics.

Know Thyself

Some people think that John McCain and Sarah Palin are qualified to "lead" because they know who they are. That misses the point. The relevant point is that they don't know who I am. That's why they should leave me the hell alone.

Not Too Little, Too Much

After hearing Sarah Palin's convention speech, I've decided her problem is not too little government experience, but too much.

Do These People Even Listen to Themselves?

In his convention speech tonight, Mitt Romney warned that China was acting like "Adam Smith on steroids." Is that something to be concerned about? I thought Republicans like to pretend they favor free markets. Have they stopped doing that now?

Gives Me the Willies

Is anyone bothered by those "Service" and "Country First" signs at the Republican convention? Why am I thinking of Mussolini's words: "Everything for the State; nothing outside the State; nothing against the State"?

Branding

That the word "branding" is commonly used now in media discussions of political candidates and campaigns says it all. There was a time when such concepts were avoided in public discussion. The public wasn't supposed to think that candidates were being sold like laundry detergent. But no more. It's all a sales job. Openly. It's all B.S.