Much Ado About Nothing ~ Fear Of A Black Nation

Congrats to Our Great American Mainstream Media For Its Superlative Campaign Coverage!

~ Of Obama and his dangerous "radical" associations, at least ~

Bread and Circus in the 21st Century

In the More of the Same Department today, we find CNN joining the rest of the American media doing what it seems to do best ~ attempting to whip the public into a frenzy over a trumped-up newsbyte consisting of deliberately edited soundbytes devoid of context, declaring whatever it is a "crisis," then wandering off to the next manufactured media stunt ~ all the while ignoring REAL news ~

Your Demon was watching CNN last night ~ Anderson Cooper's 360, to be precise ~ and was astounded and absolutely appalled to find CNN once again giving Fox some major competition in the crusade to completely corrupt and distort American political news coverage, using airwaves owned by us, the public, to propagate pathetically shallow self-manufactured "news" coverage.

First they aired the predictably incendiary "clips" of the "controversial" Reverend Wright, taken completely out of context, and then tried to make it all Obama's problem with a purported "failure to address it earlier," ignoring the fact that Obama has addressed the issue already. Last month, most recently.

I almost fell off my chair in astonishment when Cooper read the question why he didn't off the teleprompter, albeit with a toneless and flat expression of voice and face that suggested it wasn't exactly his personal idea of a legitimate or pressing issue. The panelist to whom the question was addressed was also visibly taken aback by the profound inanity. I see that the Boston Globe and countless others have picked up the meme today.

It's distortion and noise masquerading as respectable news coverage ~ the sort of thing that Fox has foisted upon us for many years. Can we not discern the difference anymore? The clip is deliberately edited to create the most controversy, taken out of context, played over and over and over again, and what's more, that "news" purposely conflates Wright's alleged impropriety with Obama personally, seeking to make him answer for someone else's alleged "sins" against an America that admits no wrongs, no mistakes, no history, and certainly no self-examination (that would be unpatriotic in the brave new Bushworld we're now forced to inhabit!)

So Obama was basically forced by shrill media screeching, relentless and interminable, to answer for things he did not say, that there's no reason to think he believes (don't forget that he has had a vastly different life experience than has Rev. Wright) and that he correctly termed a short while ago "distractions." Obama did that, but with plainly visible sadness and discomfort. Not surprisingly. "Gotcha," cries CNN.

(Obama breaks completely with Wright: http://www.nytimes.com/2008/04/30/us/politics/30obama.html)

Reaching desperately for some reason this crap should be relevant to anything, CNN and others (including other presidential candidates) beat the tired meme that it goes to those nebulous things called "character" and "judgment." The catch-all when they can't otherwise justify gossipy, salacious, logically disconnected coverage to any other issue of legitimate interest.

Er, yeah, no less than Hillary's little white lies and John McCain's involvement with the Keating Five speaks to their "characters" and "judgment." But never mind that. It's not news, especially when a Republican is involved.

What irks me more than anything is that, here, again, the great American corporate media that has served us so well with its edifying and astute coverage of Bushco machinations, and its ability to sniff out and investigate the real outrages upon the Constitution and illegal interpretations of international law such as the Geneva Conventions (not!), never mind other candidates' "controversial preachers" (see "Presidential Preacher Wars" blog entry below), is completely blowing yet another opportunity to address and flesh out a long-standing problem in this country, and contribute some progress to healing the racial divide by devoting just a tenth of the ink and airtime they waste on trying to whip up controversy, and to foment misunderstanding and hatred for the sake of excitement and ratings ~ reality-TV style ~ and instead do something constructive with it.

Your Demon modestly suggests they could contribute more positively by helping our history-challenged and the more self-absorbed and short-attention-spanned citizens among us to understand what Reverend Wright is talking about, instead of cynically exploiting it for the all-important (but transient) daily ratings game.

I don't defend Reverend Wright's means of garnering public attention just as the first viable black candidate for the American Presidency ascends to the national spotlight (it was a selfish "dis" on Obama which may ultimately compound the difficulties Wright's flock faces), nor do I blame him for using the attention to advance his own purposes. But I've lived in more truly diverse cross-cultural communities than most Americans, and I greatly enjoy his style, his oratory, and, above all, his intelligence. Is he radical? Is he subersive? I don't think so. Quite to the contrary. He argues passionately for us all to find common cause, whatever our racial identities, our ethnic heritage, or our religions. He may not hold the precise same views of history as the average white person, but then, that's because African-Americans have lived a different history than whites. That's all he's saying. (And I can't believe this even needs to be pointed out in the year of our Lord 2008.)

See CNN's own transcript of Wright's address to Detroit chapter of the NAACP. And again, it's a matter of that all-important context. Anyone in his right mind should be able to wrap a spare brain cell around the fact that the speech was aimed at an audience of other African-Americans, and at celebrating what he legitimately says is "different, not deficient."
http://edition.cnn.com/2008/POLITICS/04/28/wright.transcript/

Otherwise, I find most of what Wright says to be true and unobjectionable (when I can find a reliable source that reports it accurately) and at the very least valid from African-Americans' points of view ~ e.g., the Tuskegee Airmen "experiments," during which American military doctors let black servicemen believe they were being treated for syphilus when in fact the doctors were just charting the progression of the disease purposely left untreated. Instead, the media chooses to hoot at Wright for not loudly declaiming the "bizarre" idea that the AIDS virus is largely left unchecked or maybe even invented by the government because AIDS is perceived to be the problem of a misbehaving minority (blacks, gays and the stupid people who sleep with them), which may or may not have originated with him. We'll never know what Wright really thinks if it's left up to the media.

Any reasonable person, Demon thinks, should be able to at least understand why black Americans so profoundly distrust American government. Never mind slavery, Jim Crow, legally sustained segregation (the Plessy v. Ferguson "separate but equal" doctrine), still unaddressed lynchings and angry white men terrorizing the black community in white robes and pointed hoods. Whose behavior is more deplorable? Or, stated another way, who had the social power to do something about it, didn't, and wants to complain now that blacks are just whiny and don't have the wherewithal to pull themselves up by their bootstraps? Er, first they have to be able to afford boots.

Oh, but Wright "praised" Farrakahn, a real radical, and an anti-semite. Doesn't that mean that Obama's commitment to Israel should be questioned?

Get a grip! Wright's attempts to make common cause with "Nation of Islam" blacks does not reflect on or impugn Barack Obama. No more than Reverend Hagee's radical views of the Catholic Church mean that John McCain believes it because Reverend Hagee must be speaking for him. Until the media starts grilling McCain and faulting him for not repudiating Hagee we can hardly be expected to take any of this garbage as anything but a hit job on Obama. I also note the complete absence of media attention to the fact that Hillary prays with a weird cult-like preacher whose main theme, according to The Nation, is "only the power elites matter." And Hillary dares to call Obama "elitist?" Why is the media not hammering on Hillary's hypocrisy? (I know ~ they'll get around to it tomorrow.) Maybe it doesn't matter because everyone already knows McCain and Hillary have no special attachments to their loopy preachers? What's the reason for the disparate treatment? I want to know, seriously. It seems creepy and weird to me that the one candidate for President who did have a genuine bond to his preacher (that he was clearly pained to break) is forced by relentless and insipid media accusations to do just that while it does not seem to be remarkable that the other candidates' preachers are patently more oppressive and hate-filled than the one just disavowed.

Worse, as to the complex, nuanced and less easily addressed (now festering) issues of race (that Wright so stridently insisted we listen to him go on about), economics and "style," for lack of a better term, on the two sides of the racial divide, CNN, joining the usual suspects in the right-wing media and blogosphere, seem to be tired of hearing that meme and want to move on ~ white America is tired of being flogged with it, it's really old news, before our time, and it doesn't generate controversy and ratings. Except for the fact that the entire country is still suffering for it, and the black community more than anyone else.

Your Demon thinks that, in the comi-tragedy that American Presidential elections have become, the very worst news here is how our corporate media "misses" so much and instead resorts to cheap shots, sensationalization and tangential manufactured "issues" to sell advertising, leaving the truth-telling, serious discussion and investigative press functions upon which the democratic process so seriously depends to wither and die.

*So what? Our ratings are through the roof!*

Welcome to the Twilight Zone.

Still Waiting For An Apology...And Waiting...And Waiting

Ill: Mark Byran

with permission

www.artofmarkbryan.com

MSM TV News Still Hasn't Properly Acknowledged Being Duped by Pentagon For-Profit Propaganda Stooges

Your Demon can't say she's surprised, but really ~ aren't they just the wee bit interested in maintaining the appearance of journalistic integrity and trustworthiness?

I've been interested in any follow-ups to the New York Times article first published a week ago (see below), but of the offenders, only ABC and CNN have attempted to address their miserable failures to not only report the news truthfully but to ask some questions in the furtherance of investigative journalism.

Not forthcoming, even from ABC and CNN. Rather, ABC buried its very brief acknowledgment in investigative reporter Brian Ross' pages, and promptly scurried to point out that the Pentagon has its own news channel. And, er, your point was, Brian? There's a hell of a difference between an ostensibly "real" television news network parading Rummy's pumped-up-on-war profits bellicose retired generals as "independent" analysts by ABC (covertly) and the Pentagon having its own network, where the average joe with two working brain cells would expect to encounter happy news about Iraq and would, heaven forfend, know enough to take it with a grain of salt.

CNN, which is behaving more and more like a subsidiary of Fox everyday with regard to election coverage (imitating the peurile gossipy salacious tone of same, I should say), also briefly acknowledged its participation in the hoodwinking of the masses.

But all the others remain conspicuously silent, Kremlin-like. They've apparently adopted the GOP-SOP: if it's bad news for us, ignore it. Americans, after all, have notoriously short attention spans and a high appetite for whatever transient fancy appears on their screens. Lay low, be quiet and it'll all be forgotten by the next newscycle.

Or maybe they got assurances from Bushco ~ a plan to head it off. Never mind it's the same old, same old ~ announce the program is being suspended, and, later, resume it when nobody's really paying attention. Worked with torture and spying, after all.

Suspension of the "Pentagon stooge" program: http://www.stripes.com/article.asp?section=104&article=61696&archive=true

Bonus tidbit on NPR: Pentagon propaganda extends even to third-graders' Weekly Readers:

http://www.npr.org/templates/story/story.php?storyId=5553746

Resumption of torture: http://www.nytimes.com/2008/04/27/washington/27intel.html

Do something: FreePress, a nonpartisan group for media reform, has an action campaign aimed at launching a Congressional investigation. Wait for the section tilted "Progaganda Pundits" to appear on the left.

http://www.freepress.net/

WarMachine 101 ~

Ill: Wizard of Whimsy
http://home.comcast.net/~wizardofwhimsy/index.html

War by and for Cabalists in the Military-Industrial Complex ~ A Nation's Worst Fears Realized

"This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence – economic, political, even spiritual – is felt in every city, every Statehouse, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society.
"In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

"We must never let the weight of this combination endanger our liberties or democratic processes. We should take nothing for granted. Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of defense with our peaceful methods and goals, so that security and liberty may prosper together."

President Dwight Eisenhower's farewell address, 1961

* * *

Bushco Oil and Terra Wars, 2002 : In return for "access" ~ to Pentagon poobahs, introductions in Iraq and classified information ~ retired Generals and lobbyists with billions of dollars in war business interests sold themselves, the American media, and us down the river in a calculated effort to convince America the war was going well ~

"A few expressed regret for participating in what they regarded as an effort to dupe the American public with propaganda dressed as independent military analysis.

"It was them saying, 'We need to stick our hands up your back and move your mouth for you,' Robert S. Bevelcqua, a retired Green Beret and former Fox news analyst, said.

" Kenneth Allard, a former NBC military analyst who has taught information warfare at National Defense University, said the campaign amounted to a sophisticated information operation. 'This was a coherent, active policy,' he said. As conditions in Iraq deteriorated [he said] he saw a yawning gap between what analysts were told in private briefings and what subsequent inquiries and books later revealed.

"Night and day,' Mr. Allard said, 'I felt we'd been hosed."

"...The Administration has demonstrated that there is a price for sustained criticism, some analysts said...' you'll lose all access."

How likely, on the face of it, would you think it'd be that George W. and "the Dick" Cheney, both of whom spent the Vietnam War either AWOL or hiding in school behind the wife's skirts, would live to be the architects of a brave new world order whereby war is fought for the most callow and self-serving purposes, largely by propaganda and a newly roaring military-industrial complex? Could a great nation and its legendary "free press" be so easily co-opted and fooled so blatantly? Almost 8 years into it, the answer is an unequivocal yes.

Though you wouldn't know it by the mainstream media silence otherwise, The New York Times on Sunday carried what is, to your Demon, a bombshell 17-page article, the result of its suit against Bushco's DOD to get information regarding Bushco's successful progaganda ploy to convince Americans that its grand and glorious war in the Middle East is going as planned, despite all the evidence on the ground to the contrary.

There's a reason for that ~ the American media who've been complicit in hyping the war even though it hasn't gone well ~ CBS, NBC, Fox and CNN as well as ABC ~ have all been hoodwinked in an elaborate ruse by Bushco to wage a disinformation campaign and distort news by deliberately planted information through Generals and lobbyists with very profitable business interests in the Middle Eastern war machine. Bushco successfully planted these a***holes as "media analysts" to keep us "on message," which was, predictably, the war, despite some setbacks, is going well.

It's a nightmare of stunning proportions, and includes the run-up to the invasion, even though Bushco knew there wasn't any good evidence for invading Iraq. Even worse, the aforementioned networks were complicit in that they didn't look very closely into the hired guns' business interests, claiming now that it was up to the hired guns to voluntarily disclose them.

One ~ General Marks, who was "working intensively on a 4.6 billion contract to provide thousands of translators to United States forces in Iraq" and was even "made president of the McNeil spin-off that won [a] huge contract in Iraq" ~ at the same time as he was serving as a paid consultant for CNN~ told the New York Times that he had "zero challenge separating myself from a business interest" and that it did not affect his commentary on the war.

"CNN said it had no idea until July 2007, when it reviewed his most recent disclosure made several months earlier, and finally made inquiries about his new job." As a result, CNN ended the relationship ~ but not, your Demon posits, before the damage was done.

Fox, of course, the only source of "fair and balanced coverage" in the nation, refused to participate or comment on the article, and promptly returned to its obsessive gossipy coverage of the radical Mormon cult in Texas and examination of Britney Spears' profound cultural significance.

Dwight Eisenhower, the Republican, is surely spinning in his grave. Your Demon is willing to bet that he's none too pleased that a pair of pansy cowards like Bush and Cheney would be responsible for such a debacle. But not, I suspect, at all surprised.
http://www.nytimes.com/2008/04/20/washington/20generals.html

Your Demon can't wait to read history's judgement of this abysmal episode of American history (seriously!) How much more evidence do we need that Bushco is a criminal enterprise, for cryin' out loud? Impeach them NOW!

Winning Ugly

Big Money in Short Sales

Quote of the Day:"Capitalism isn't pretty" but "So what?"

"It's clear somebody has to win and somebody has to lose. It's not pretty at all because people say, 'Oh my God. Look how much money these guys are making while people are losing their homes and are complaining about the cost of eggs and sugar.' But so what? We don't live in a society that is pretty all the time. That's why it's capitalism."

~ So sayeth Daniel Strachman, a former hedge fund consultant and author

Over the past 2 days, all of the news is about hedge fund manager John Paulson and the obscene amount of money he made personally last year--3.7 BILLION~ "by betting subprime mortgage securities would sour...
[...]

"He wasn't the only one with Titanic-size profits. Two other fund managers, George Soros and James Simons, who are notoriously secretive about their investments, earned $2.9 billion and $2.8 billion, respectively, according to Alpha Magazine's annual list of top hedge fund earners.

"The numbers left jaws agape across Wall Street and Washington. With his windfall from last year alone, Paulson could have bought troubled Wall Street giant Bear Stearns three times over. Or he could have matched the price Delta agreed this week to pay to merge with Northwest Airlines and still have $600 million left over.

"A few years ago, individual income reaching into the billions of dollars was unfathomable. In 2002, the first year the magazine tracked hedge fund compensation, the top 25 managers earned $2.8 billion combined.

"Paulson's feat was even more astonishing because he started 2007 managing $6 billion, not a massive pool of money by hedge fund standards. Over the course of the year, one of his funds earned a whopping 590 percent return, and another soared 353 percent, according to Alpha. By the end of December, his funds' assets were worth $28 billion.

"He amassed his winnings by 'shorting' securities linked to subprime mortgages. In a short sale, the investor borrows securities -- in this case, subprime mortgages that were widely held by banks, brokerages and other investors -- and sells them to another buyer. Later, the investor must buy those securities back and return them to the original lender. As the subprime market collapsed, the value of the securities fell, and Paulson was able to pocket the difference. The lenders were stuck with the losses.

"Several hedge fund managers, including Philip Falcone, who has been challenging the board of the New York Times Co., also profited from the mortgage crisis by betting that subprime debt securities would plunge in price. Falcone earned $1.7 billion last year. Others made fortunes by betting that the prices of commodities such as oil, sugar and corn would rise.

"Hedge funds are pools of private money, largely generated from wealthy individuals, pension funds and endowments, used for a wide range of investments. Usually 80 percent of any gains are given to such investors, while fund managers take 20 percent, plus an annual fee for their services. Alpha's list tracks the income that managers receive after paying their staff members and other expenses.

"Some Wall Street analysts who follow the industry said the gigantic compensation figures may prompt Congress to consider raising taxes on the business. Last year, several lawmakers introduced bills aimed at raising the tax rate, usually 15 percent, that fund managers pay on their gains. None of these efforts became law. "

Mr. Strachman and others claim raising taxes on hedge funds really isn't fair ~ the Captains of Churning Wall Street Markets gambled that borrowed stock, and won that money, fair and square!

http://www.washingtonpost.com/wp-dyn/content/article/2008/04/16/AR2008041602027.html

The New York Times observed yesterday that "the..unprecedented and growing affluence underscores the gaping inequality between the millions of Americans facing stagnating wages and rising home foreclosures and an agile financial elite that seems to thrive in good times and bad. Such profits may also prompt more calls for regulation of the industry.

"Even on Wall Street, where money is the ultimate measure of success, the size of the winnings makes some uneasy. 'There is nothing wrong with it — it’s not illegal,' said William H. Gross, the chief investment officer of the bond fund Pimco. 'But it’s ugly.'”

http://www.nytimes.com/2008/04/16/business/16wall.html

Your Demon can't help but note that the last time we saw such extremes in the economy it was the good old Roaring '20's ~ except that it inevitably led to a crash, and suicides as the cannibal captains of Wall Street watched their fortunes melt away, and, rather than face the world without money, leapt out of Wall Street windows to their deaths. The Great Depression followed. But that can't happen now, can it? Banks are supposed to be regulated (except if they're investment banks like Bear Stearns) ~ but no matter ~ you, the taxpayer, are indemnifying them from all their bad and risky decisions. You pay more taxes (they get more favorable rates than you), and you pay the increased costs of everything due to the tanked dollar and a moribund economy ~

If you really want an-eye-opening treat regarding the historic paralells and danger signs, over at that heretic liberal progressive website TPM Cafe there's a very lively book review and discussion going on about the ghosts of the Roaring '20's and what they might teach a new crowd of progressives about the empty activity generated by churning money markets (or nothing of very great practical use being produced, except profits of "thin noney, aka money "out of thin air"~) that led to the Crash.

For instance, an interesting comment:

"Now, the next key question is: what does that 'thin air' money get used for? If it is used to purchase physical goods and services, and to invest in the future expansion of output then things pretty much stay in balance and everyone's happy.

"Everyone, that is, except the usurers and speculators, who would rather use the 'thin air' money to create even more 'thin air' money. When you allow this to happen, the end result is always, always bad. This is the problem we have run into today. There is a fundamental mismatch: the financial system can create an unlimited amount of debt. The real economy cannot do the same for physical wealth. (see "The roots of the subprime crisis" at http://www.eurotrib.com/?op=displaystory;sid=2008/3/11/122016/316

"So, when you have a financial meltdown, it's usually because the ability to create money out of thin air was being used for private speculative gain, rather than for the public good. The solution, therefore, is relatively straightforward: you use the sovereign power of government to cancel or negate all useless 'thin air' money - in our case today, some $500 trillion of derivatives - and you use the 'full faith and credit' of the government to either reorganize that 'thin air' money or create new 'thin air' money while making sure that it is directed only into useful and productive activities. No speculation, no usury.

"Of course, it does not work out all that simple, largely because of the massive political crises that are created as the faction of usurers and speculators attempt to maintain their prerogatives. That's basically the story of the creation of the conservative movement: a bunch of rich twits who were unhappy with the New Deal restraints on their ability to get rich quick kiting 'thin air' money decided to create a movement to demand 'free trade' and 'free markets.' That's really what it all boils down to.

"The usurers and speculators will do anything to prevent this, including attacking, deprecating, and sabotaging the'full faith and credit' of the economy. The last time it got this bad, Franklin Roosevelt stuck to his guns, a bunch of usurers and speculators (including George Bush's grandfather) ended up asking retired Marine General Smedley Butler to stage a military coup and impose essentially a banker's fascist dictatorship. I am NOT making this up! See http://en.wikipedia.org/wiki/Business_Plot Fortunately, General Butler listened to the bankers very politely, then turned right around and screamed "foul" as loud as he could. Unfortunately, all the coup plotters got off without even a scolding - we would probably be better off today if at least a few of them had been shot for treason.

"So, the technical side of what to do to stop and get out of a meltdown is relatively simple. It's the politics that presents the real messy problems."

http://tpmcafe.talkingpointsmemo.com/2008/04/16/the_perils_of_deregulation/

Bushco Last Days To-Do List, Above The Law (Still)

Ill: Micah Ian Wright/Propaganda Remix

with permission

http://homepage.mac.com/leperous/PhotoAlbum1.html

Eye in the Sky

Several recent newsbits caught your Demon's attention this past week, and before we all yawn and go back to worrying about other things, I'd like to take the opportunity to reflect upon the damage wrought by Bushco on our civil liberties here at home in the name of "fighting terrorism."

This past Saturday Bushco sprang on Congress the news that it's pushing ahead with a new domestic spying program ~ a "National Operations Application" office that has to do with satellite technology.

This despite the fact that Congress thought it had determined to hold the program in abeyance. Bushco apparently got around the inconvenience posed by the recalcitrance of a co-equal Constitutional governmental body by classifying the program's funding sources and its size. Voila! It's invisible to us all!

Likewise, nobody knows what legal vetting the program has undergone (if any~given Bushco's track record so far in legal matters where civil liberties and human rights are concerned, your Demon is inclined, with good reason, to speculate that it's the same BushState version of "l'etat, c'est moi " school of imperial "make it happen" legal reasoning that also produced the infamous John Yoo-David Addington "torture is not torture until organ failure or death" memos, now disavowed, we're led to believe.)

"The Bush administration said yesterday that it plans to start using the nation's most advanced spy technology for domestic purposes soon, rebuffing challenges by House Democrats over the idea's legal authority.

"Homeland Security Secretary Michael Chertoff said his department will activate his department's new domestic satellite surveillance office in stages, starting as soon as possible with traditional scientific and homeland security activities -- such as tracking hurricane damage, monitoring climate change and creating terrain maps.

"Sophisticated overhead sensor data will be used for law enforcement once privacy and civil rights concerns are resolved, he said. The department has previously said the program will not intercept communications.

"'There is no basis to suggest that this process is in any way insufficient to protect the privacy and civil liberties of Americans,' Chertoff wrote [the Chairs] of the House Homeland Security Committee and its intelligence subcommittee, respectively, in letters released yesterday.
'I think we've fully addressed anybody's concerns' Chertoff added in remarks last week to bloggers. 'I think the way is now clear to stand it up and go warm on it.'

"His statements marked a fresh determination to operate the department's new National Applications Office as part of its counterterrorism efforts. The administration in May 2007 gave DHS authority to coordinate requests for satellite imagery, radar, electronic-signal information, chemical detection and other monitoring capabilities that have been used for decades within U.S. borders for mapping and disaster response.

"But Congress delayed launch of the new office last October. Critics cited its potential to expand the role of military assets in domestic law enforcement, to turn new or as-yet-undeveloped technologies against Americans without adequate public debate, and to divert the existing civilian and scientific focus of some satellite work to security uses.

"Democrats say Chertoff has not spelled out what federal laws govern the NAO, whose funding and size are classified. Congress barred Homeland Security from funding the office until its investigators could review the office's operating procedures and safeguards. The department submitted answers on Thursday, but some lawmakers promptly said the response was inadequate.

"'I have had a firsthand experience with the trust-me theory of law from this administration,' said Harman, citing the 2005 disclosure of the National Security Agency's domestic spying program, which included warrantless eavesdropping on calls and e-mails between people in the United States and overseas. 'I won't make the same mistake. . . . I want to see the legal underpinnings for the whole program.'

"[Congressman] Thompson called DHS's release Thursday of the office's procedures and a civil liberties impact assessment 'a good start.' But, he said, 'We still don't know whether the NAO will pass constitutional muster since no legal framework has been provided.'

"DHS officials said the demands are unwarranted. 'The legal framework that governs the National Applications Office . . . is reflected in the Constitution, the U.S. Code and all other U.S. laws,' said DHS spokeswoman Laura Keehner. She said its operations will be subject to 'robust,' structured legal scrutiny by multiple agencies."

http://www.washingtonpost.com/wp-dyn/content/article/2008/04/11/AR2008041103655.html

And if you believe that, or the fact that the spying/monitoring will be limited to innocuous civil warning sytems applications to which nobody can really object, I have a bridge for sale. See me later.

I suspect that what they're really talking about here, though the WaPo doesn't come out and say it, is domestic spying via MILITARY satellite, anytime, anywhere, and fuck quaint old-fashioned notions such as "probable cause." It's a brave new BushWorld we live in now.

I've said it before and I'll say it again ~ 911 is the best thing that ever happened to the disingenuous warmongering neocons ~ it has made their careers and provided the perfect cover to revive and relive some of this nation's sorriest historical moments since J. Edgar Hoover's most paranoid fantasies of Commie infiltration and nationwide panic. Bushco exploited a nation's legitimate fears to subvert the authority we surrendered ~ and now we can't seem to get it back. We were led to believe that internal spying could only be for our own good, and reassured us all that our civil liberties would remain inviolate and intact.

Nixonian Revival ~ Spying on Domestic "Enemies"

In 2004 Salon ran an article titled, "Outlawing Dissent," documenting the resurrection of domestic spying on peaceful anti-war dissidents, and the FBI's use of local undercover cops to infiltrate and, on some occasions, try to provoke group members into acting in a way that could have resulted in violence. The article handily recaps some history that bears remarking:

"In the early 1970s, after the exposure of COINTELPRO, a program of widespread FBI surveillance and sabotage of political dissidents, reforms were put in place to prevent the government from spying on political groups when there was no suspicion of criminal activity. But once again, protesters throughout America are being watched, often by police who are supposed to be investigating terrorism. Civil disobedience, seen during peaceful times as the honorable legacy of heroes like Gandhi and Martin Luther King Jr., is being treated as terrorism's cousin, and the government claims to be justified in infiltrating any meeting where it's even discussed. It's too early to tell if America is entering a repeat of the COINTELPRO era. But Jeffrey Fogel, legal director of the Center for Constitutional Law in Manhattan, says, 'There are certainly enough warning signs out there that we may be.'

[...]
"COINTELPRO's abuses came to light in 1971, when a group of activists calling themselves the Citizens Commission to Investigate the FBI broke into an FBI office in Media, Penn., and stole several hundred pages of files.

"In his recent history of COINTELPRO, 'There's Something Happening Here: The New Left, the Klan and FBI Counterintelligence,' David Cunningham writes, 'These files provided the first public disclosure of a range of Bureau activities against targets such as the Black Panther Party, the Venceremos Brigade, the Philadelphia Labor Committee, Students for a Democratic Society, and college students with 'revolutionary' leanings.'

"Eventually, damaging revelations about COINTELPRO led the FBI to adopt reforms designed to prevent a repeat of Hoover's excesses. Attorney General Edward Levi laid out a set of standards for FBI domestic surveillance. 'These so-called Levi Guidelines clearly laid out the criteria required for initiated investigations, establishing a standard of suspected criminal conduct, meaning activity (rather than merely ideas or writings, which had been adequate cause for targeting groups and individuals as subversive during the COINTELPRO era),' Cunningham writes. 'The guidelines also stipulated as acceptable only particular investigative techniques, making it considerably more difficult to initiate intrusive forms of surveillance.'

"The Levi guidelines didn't end all political spying -- in the 1980s, the FBI targeted the Committee in Solidarity With the People of El Salvador, or CISPES. As the ACLU reports, 'Strong evidence suggests that CISPES was targeted for investigation because of its ideological opposition to then-President Reagan's already controversial foreign policy in Latin America. The FBI persisted in an intensive six-month investigation of CISPES in which it often reported the group's activities to the Department of Justice in a prejudicial and biased manner.' Yet most civil libertarians believe that even if the rules were occasionally broken, they still worked to protect First Amendment rights.

"Contrary to the claims made by defenders of Bush administration policies, the Levi guidelines would not have impeded an investigation of al-Qaida. As Cunningham points out, cases 'with suspected ties to 'foreign powers' were not subject to this criminal standard.' Nevertheless, after Sept. 11, Attorney General John Ashcroft issued new rules gutting the Levi guidelines. Thanks to Ashcroft, FBI agents are now allowed to monitor public meetings even if they don't have any reason to suspect that there's any criminal activity being committed or planned.

"'Now, that means if there is a rally of people who are criticizing the United States and its policies and saying that the United States will someday perhaps be destroyed because of that, the FBI agent can go and listen to what's being said,' Ashcroft told CNN's Larry King in May of 2002. In other words, merely arguing that U.S. policies may result in the country's destruction justifies FBI snooping. This gives the FBI investigative license far beyond even that it enjoyed during the COINTELPRO period, let alone under the Levi Guidelines."

http://dir.salon.com/story/news/feature/2004/02/11/cointelpro/index.html

The aforementioned John Yoo took it still a giant leap further in the very-recently revealed memo in which he advised the White House that the 4th Amendment prohibition against unreasonable search and seizure doesn't apply when a brave boy President takes it into his head to conduct "domestic military operations ~ a position Mukasey has disavowed, for now. (Glenn Greenwald on John Yoo's War Crimes: http://www.salon.com/opinion/greenwald/2008/04/02/yoo/)

It's not like we weren't warned. For example, last year the ACLU called for a moratorium on the use of military spy satellites trained on our own population: http://www.aclu.org/privacy/gen/31835prs20070906.html

See also: http://www.populistamerica.com/institutionalized_spying_on_americans

Bush's War Not So Easily Stage Managed Now, Even Harder to Fight

Bushco Presents: Never Mind the Economy ~ Look Over There ~ War in Iraq! Dangerous Iranians!

Of course your Demon was paying attention to the recent Petraeus and Crocker dog and pony show of military hardware (Petraeus's chest) accompanied by smooth-talker (hardly) Ryan Crocker, Bushco's ambassador to Iraq.

I just wasn't impressed or motivated enough to comment upon it. Talk about stale. I'm not only one who thought so.

Dick Cavett, legendary talk show host, has a tart review of the performance in the NYT titled, "Memo to Petraeus and Crocker ~ More Laughs Please." Dick examines their stage presences, as well as their facility with presentations, and finds both sorely lacking: "It’s hard to imagine where you could find another pair of such sleep-inducing performers."

[...]

"Never in this breathing world have I seen a person clog up and erode his speaking — as distinct from his reading — with more 'uhs,' 'ers' and 'ums' than poor Crocker. Surely he has never seen himself talking: 'Uh, that is uh, a, uh, matter that we, er, um, uh are carefully, uh, considering.' (Not a parody, an actual Crocker sentence. And not even the worst.)

"These harsh-on-the-ear insertions, delivered in his less than melodious, hoarse-sounding tenor, are maddening. And their effect is to say that the speaker is painfully unsure of what he wants, er, um, to say.

"If Crocker’s collection of these broken shards of verbal crockery were eliminated from his testimony, everyone there would get home at least an hour earlier.

"Petraeus commits a different assault on the listener. And on the language. In addition to his own pedantic delivery, there is his turgid vocabulary. It reminds you of Copspeak, a language spoken nowhere on earth except by cops and firemen when talking to 'Eyewitness News.' Its rule: never use a short word where a longer one will do. It must be meant to convey some misguided sense of 'learnedness' and 'scholasticism' — possibly even that dread thing, 'intellectualism' — to their talk. Sorry, I mean their 'articulation.'

[...]

"I find it painful to watch this team of two straight men, straining on the potty of language. Only to deliver such . . . what? Such knobbed and lumpy artifacts of superfluous verbiage? (Sorry, now I’m doing it…)

"But I must hand it to his generalship. He did say something quite clearly and admirably and I am grateful for his frankness. He told us that our gains are largely imaginary: that our alleged 'progress' is 'fragile and reversible.' (Quite an accomplishment in our sixth year of war.) This provides, of course, a bit of pre-emptive covering of the general’s hindquarters next time that, true to Murphy’s Law, things turn sour again.

"Back to poor Crocker. His brows are knitted. And he has a perpetually alarmed expression, as if, perhaps, he feels something crawling up his leg.

"Could it be he is being overtaken by the thought that an honorable career has been besmirched by his obediently doing the dirty work of the tinpot Genghis Khan of Crawford, Texas? The one whose foolish military misadventure seems to increasingly resemble that of Gen. George Armstrong Custer at Little Bighorn?
"Not an apt comparison, I admit.
"Custer sent only 258 soldiers to their deaths."

An alert commenter adds (paraphrased), "Another reason the comparison isn't apt ~ at least Custer fought alongside his men, can't say the same for GWB."

http://cavett.blogs.nytimes.com/2008/04/11/memo-to-petraeus-crocker-more-laughs-please/?th&emc=th

Despite your modest Demon's unwillingness to appear to take issue with the highly literate and very urbane Mr. Cavett, there were several junctures in the otherwise boring drone-fest that I found very amusing, and indeed, laughed at loud upon hearing during the Petraeus/Crocker show, but none more than Crocker's plaintive response to a question posed by Sen. Obama.

"Not to sound like a broken record, but this is hard and this is complicated..."

"SEN. BARACK OBAMA (D), Illinois: I'm trying to get to an endpoint. That's what all of us have been trying to get to.

"And, see, the problem I have is, if the definition of success is so high, no traces of al-Qaida or no possibility of reconstitution, a highly effective Iraqi government, a democratic, multiethnic, multi-sectarian, functioning democracy, no Iranian influence -- at least not the kind that we don't like -- then that portends the possibility of us staying for 20 or 30 years.

"If, on the other hand, our criteria is a messy, sloppy status quo, but there's not, you know, huge outbreaks of violence, there's still corruption, but the country is struggling along, but it's not a threat to its neighbors and it's not an al-Qaida base, that seems to me an achievable goal within a measurable timeframe.

"And that, I think, is what everybody here on this committee has been trying to drive at and we haven't been able to get as clear of an answer as we would like.

"RYAN CROCKER: And that's because, Senator, it is a -- I mean, I don't like to sound like a broken record...

"SEN. BARACK OBAMA: I understand.

"RYAN CROCKER: ... but this is hard and this is complicated. I think that when Iraq gets to the point that it can carry forward its further development without a major commitment of U.S. forces, with still a lot of problems out there, but where they and we would have a fair certitude that, again, they can drive it forward themselves without significant danger of having the whole thing slip away from them again, then clearly our profile, our presence diminishes markedly."

Your Demon was also gravely amused by Sen. Biden's conclusion, after questioning Crocker, that, "I can't think of any circumstance where you fellows are likely to recommend, no matter how bad things got, where you would withdraw, but I may be mistaken. That's part of everyone's concern, at least mine."

Iran! Iran! Iran!

Another item that caught my attention was the extent to which Iran is being blamed for ~ well, everything in Iraq. The infamous Joe Lieberman and the equally infamous (Mr. Global Warming Denier) James Inhofe pursued the point with Petraeus and Crocker, and indeed, Lieberman testified for them:

"Is it fair to say that the Iranian-backed special groups in Iraq are responsible for the murder of hundreds of thousands -- excuse me -- hundreds of American soldiers and thousands of Iraqi soldiers and civilians?

"GEN. DAVID PETRAEUS: It certainly is -- I do believe that is correct. Again, some of that also is militia elements who have been subsequently trained by these individuals, but there's no question about the threat that they pose and, again, about the way that it has been revealed more fully in recent weeks.

"SEN. JOSEPH LIEBERMAN: Though we all have questions about the recent Iraqi government initiative under Prime Minister Maliki's leadership in the south in Basra, is it not possible that there's something very encouraging about that initiative, which is that it represents a decision by the Maliki government in Baghdad to not tolerate the Iranian-backed militias, essentially running wild and trying to control the south of his country?

"RYAN CROCKER: The reflection of that has been seen in the level of political unity behind the prime minister. It says -- or are more extensive than anything I've seen during my year there.

"JUDY WOODRUFF: Republican Senator James Inhofe of Oklahoma asked if Iran was trying to duplicate its influence in Lebanon, backing the Hezbollah, in Iraq.

"SEN. JAMES INHOFE (R), Oklahoma: In your opening statement, you referred to, I believe, Ahmadinejad making the statement that, if something happens, that we leave precipitously, that there would be a vacuum, and he would fill that vacuum. Do either of you want to comment on what would happen if they were to fill that vacuum?

"RYAN CROCKER: Because the general level of violence is down, we could see, I think, much more sharply defined what Iran's role is in the arming and equipping of these extremist militia groups.

"And what it tells me is that Iran is pursuing, as it were, a Lebanization strategy, using the same techniques they used in Lebanon to co-opt elements of the local Shia community, and use them as, basically, instruments of Iranian force.

"That also tells me, sir, that, in the event of a precipitous U.S. withdrawal, the Iranians would just push that much harder."

Excerpted from http://www.pbs.org/newshour/bb/military/jan-june08/hearings_04-08.html

If you're interested in this debate and all for expanding the war into Iran (I'm not) I urge you not to overlook the second page where Retired Gen. Odem, now Yale professor (who, as I recall, was practically forced to retire because Bushco can't abide anyone in the ranks who has the cajones to disagree with its insane pre-fixed war-mongering policy) and Republicon New American Century/American Enterprise Institute "military historian" Frederick Kagan go at it. Here's a taste:

"GEN. WILLIAM ODOM (Ret.), U.S. Army: The uncomfortable truth is beginning to dawn on them. The surge has sustained military instability and achieved nothing in political consolidation.

"Allowing these sheiks in the Sunni areas and other strongmen to sign up with the United States to be paid, where we protect them from Maliki's government, diffuses power, both political and military.

"The possibilities for the Shiite camp to break up have been there all along. Sadr's forces, his Mahdi Army, were standing by to see what would happen. Maliki, against the best advice of both Ambassador Crocker and Petraeus, General Petraeus, went ahead, rushed down, and got into a fight in Basra, which he lost.

"Now that is a huge political setback for Maliki, and it shows you how fractured the Shiite camp is, not to speak of the multi fractures within the Shiite-Sunni area.

"So the things are much worse now. And I don't see that they'll get any better. This was foreseeable a year, a year-and-a-half ago. And to continue to put the cozy veneer of comfortable half-truth on this is to deceive the American public and to make them think it's not the charade it is."

And finally, your Demon's choice for the most amusing testimony of the bore-fest that was the Senate hearings otherwise: Republicons switching sides & now falling all over themselves to NOT be associated with the failed "war on terra." (See PBS Online Newshour transcript).

Now my vote for biggest omission in the tragi-comedy the whole mess has become ~ the 800-lb. gorilla in the room that Petraeus and Crocker allude to in only the vaguest of terms ~ and that is the fact that there's been NO progress on the Iraqi oil-revenue sharing law that would give foreign interests (read US) a guaranteed cut of the pie, and would also be my choice for the reason we're hedging our bets by supporting (read throwing money at) anyone in Iraq who will accept it, even if they oppose the "official" government we had a hand in installing. Way to go, Bushco! No wonder the Iranians have the moral upper hand in so many Iraqis' minds.

On March 17 (last month) this report appeared in the UPI:

"Charles Ries, U.S. State Department minister for economic affairs and coordinator for economic transition in Iraq, said the proposed law isn't necessary for Iraq to produce oil 'but it would clearly be much, much better and incentivize private investment to help Iraq produce more if a bill would pass.'

"U.S. Vice President Dick Cheney is in Iraq Monday and said he's pressing Iraqi leaders to move the controversial legislation forward.Ries said Iraq has set aside $2.5 billion for Technical Support Agreements over the next two years. TSAs, being negotiated with BP, Shell, ExxonMobil, Chevron and Total, would see a transfer of technology, expertise and training to Iraq's oil sector.Further down the road, Ries said Iraq will sign production-sharing agreements to develop areas not currently producing."

http://www.upi.com/International_Security/Energy/Analysis/2008/03/17/analysis_iraq_oil_law_holdup_political/2837/

First things first: the Neocon strategy is clear to me ~ invade on a trumped-up pretext (9/11! Al Queda! 9/11! Al-Queda! They need and want democracy even if they don't know it!), persuade them to part with their oil, and then we'll think about leaving. Even more so now that we've made world-class asses of ourselves in eyes of even our allies.

And Then There's George

Ill: Wizard of Whimsy

http://home.comcast.net/~wizardofwhimsy/index.html

The Neo-Cons' Extravagant, Unbridled Resurrection of a Neo-Gilded Age

The New York Times, in the wake of an unprecedented rescue of Bear Stearns at taxpayer expense and amidst a worldwide economic meltdown, asks the question again: why do plainly incompetent robber barons take home outlandish pay packages and bonuses even while their companies post losses, and the uneveness of wealth distribution grows ever more glaring ~ the current disparity between the very rich and the very poor has reached a level not seen in this country since the late 1800's. Guess when that was? The so-called Gilded Age of very rich people who got that way by very frequently exploiting the very poor. (E.g. when women and children did piecework in sweatshops and were often trapped and died when the buildings caught fire)?

That was in the bad old days before we had unions, the eight-hour day, and things like that. Just a reminder in case you're too young or too busy to remember America's social history. Flash forward to today--we've outsourced the sweatshops along with other business, so we don't have that sort of stuff happening on our shores anymore, but we are still the buyers of those products, and we don't have a lot of jobs left in this country.

Your Demon notes it because she's long been warning of the extreme social engineering policies pursued by the man pictured above. What's occurring now in the never-ending gravy train of bailouts is the implementation of a public policy that privatizes profits and socializes losses ~ leaving you, the taxpayer, holding the bag while the robber barons churn markets and run up illusory profits while adding nothing but wave after wave of popping bubbles. For this they should be rewarded? Seriously.

Ah well ~

* * *

"It’s hard to square the conceit that chief executives are rewarded for improving companies’ performance with the fact that chiefs at 10 financial-services firms in the study made $320 million last year, even as their banks reported mortgage-related losses of $55 billion.

"Meanwhile, the average earnings of typical workers have failed to keep up with inflation in four of the past five years. According to the economists Emmanuel Saez of the University of California, Berkeley, and Thomas Piketty of the Paris School of Economics, average incomes in the highest-earning 1 percent of the United States grew 11 percent year-over-year between 2002 and 2006. Incomes in the bottom 99 percent grew by 0.9 percent annually over the period. This year looks bad, too.

"This polarization is producing a pattern of income distribution rarely seen outside Africa or Latin America, and unheard of in the United States, at least since the gilded age. In 2006, the 15,000 families in the top 0.01 percent of the income distribution — earning at least $10.7 million apiece — pocketed 3.48 percent of the nation’s total income, double their share in 1993.

"Some analysts argue that the spectacular rise in executive pay is to be expected in a marketplace in which bigger and bigger firms compete for talent. Others suggest it has more to do with the ability of chief executives to manipulate their boards to set their own pay.
In any case, the combination of inexorable income growth at the very apex of society and stagnation everywhere else can serve no public good.

"The Bush administration has focused its economic policies on cutting taxes for the very richest Americans. Taxation needs urgently to become more progressive. If the United States is to continue to embrace globalization, technological innovation and other forces that contribute to economic growth, it has to share the spoils better."

http://www.nytimes.com/2008/04/08/opinion/08tue4.html

Thanks, GOP, for taking us back to "the good old days~"

Welfare for Robber Barons & River Boat Gamblers

$50 Million Bonus for Wrecking the International Economy ~ Where Do I Apply for a Job?

Bear Stearns!

Truthout had a great rumination on the new class of welfare recipients yesterday ~ a logical outgrowth the Bushco fondness for unbridled, deregulated rapacious cannibal capitalism ~ ruin the world's biggest economy, and we'll bail you out using the "independent" Fed to do it. Whine about your stock price and we'll sweeten the pot.

But you there, little welfare mommy trying to feed your family with foodstamps ~ don't get any bright ideas from this. Welfare allotments for you are another matter entirely. You have to learn to live within your miserably inadequate budget for food, and do not whine about the astronomical prices of bread, eggs, and butter. Do not bother to complain about Medicaid spend-downs, either. A $6,000 annual deductible isn't that bad for health insurance for poor people! We can't hear you!

Two worlds under Bushco

A grocery-shopping true vignette from the real life of your Demon ~ last evening I stopped by my local Safeway to pick up some chicken while it was still on special and a few other things. Only one register was open, and in front of me was an ordinary looking mother and her small child with a shopping cart crammed full of stuff. They looked like any other people you'd see shopping in a striving-for yuppie-dom neighborhood.

Due to Safeway's unfortunate placement of its cash register computer screens, every minute detail of your shopping habits is broadcast to everyone in line behind you, including payment method. So I couldn't help but notice that it was a food stamp transaction. The time the transaction took was more than the ordinary, and as I was standing there I noticed also that for the amount of the transaction, this welfare mom must have been a heroically thrifty shopper.

She utilized coupons, spent $100, and got a shopping cart full of groceries. I have to say ~ I admire a hard shopper, a person who can pinch a penny so hard it screams (I just don't like waste!)~ and this woman was a paragon.

I saw store brands, mostly, some name brands (purchased with coupons), and some substitutions that wouldn't have occurred to me--for instance, a value-sized tub of cooking lard, but no butter or other cooking oils.

Not that I was taking inventory. These were just a few of the things I saw when not otherwise entranced by a National Enquirer cover of amateurishly pasted-together cover photos of Obama and Reverend Wright atop a lurid headline about how they're plotting to destroy the country from the inside out. ("Sorry, fellas, Bushco already beat you to it," I'm thinking.)

When I had completed my purchase and was on the way out, the welfare mom and her daughter were still standing next to their cart, Mom scrutinizing her cash register receipt to be sure there had been no mistakes.

I daresay this woman was not Ronald Reagan's demonized, vilified, and all-too-easy to hate Cadillac-driving Welfare Queen.

True story. So you might imagine how your Demon was affected when, later, she read the story about how the Bear Stearns investors and employees had succeeded in whining the price of their worthless stock from $2 to $10 when they should have been thanking their lucky stars to get $2--better than bankruptcy!

Your Demon is willing to bet no one at Bear Stearns is being forced to buy lard because they can't afford butter.

* * *

..."Long live the welfare king." This person really exists [unlike Ronald Reagan's Cadillac-driving welfare queens], his name is James E. Cayne, and taxpayers just handed him almost $50 million. Mr. Cayne got this gift when J.P. Morgan renegotiated the terms of its takeover of Bear Stearns. The buying price went up fivefold, fetching Bear Stearn's stockholders $1.2 billion instead of the $236 million in the agreement brokered by the Fed last week.

"While Bear Stearns shareholders may still have been unhappy about their losses even at the higher price (the stock had been worth more than ten times as much a year earlier), in reality this was a very generous gift from US taxpayers. As an inducement to carry through the takeover, the Fed gave J.P. Morgan up to $30 billion in guarantees, in case the bank has to make good on Bear Stearns' liabilities. In other words, J.P. Morgan is being given the opportunity to do some gambling, with the taxpayers committed to making good any losses. The money that J.P. Morgan paid for this privilege went to Bear Stearns shareholders, not the taxpayers.

"James E. Cayne did especially well as a result of the taxpayer's generosity because as the former CEO of Bear Stearns, and current chairman, he owned a great deal of the company's stock. To put the taxpayer's gift to Mr. Cayne in some context, this is approximately equal to the amount paid in TANF to 10,000 working mothers over the course of a year.

"Of course Mr. Cayne and the rest of the Bear Stearns stockholders are not the only incredibly rich people benefiting from the taxpayers' generosity these days. The Fed's actions are reining [sic] down taxpayer money all over Wall Street. When Fed Chairman Ben Bernanke rushed in to save Bear Stearns last week, he made two other important policy changes. He indicated a commitment to protecting other major investment banks and he opened the Fed's discount window to the investment banks. These are both huge taxpayer subsidies to these titans of free market capitalism.

"The story of the discount window is straightforward. The Fed is allowing investment banks, which are subject to none of the restrictions or disclosure requirements of commercial banks, to borrow at a government subsidized interest rate. Currently the discount rate is two-and-a-half percent. Those seeking to refinance mortgages, most of whom are probably better credit risks these days than the investment banks, may want to call Mr. Bernanke and ask for the same deal.

"While the subsidy involved in the below market lending is easy to see, the commitment to support the investment banks is probably the bigger subsidy to the Wall Street crew. The basic story here is that the investment banks made commitments, mostly in the form of credit default swaps, that they lack the resources to honor. These credit default swaps are essentially a form of insurance. The investment banks promise to make payments to bondholders in the event that there is a default on the bonds they hold.

"The banks were prepared to deal with an occasional default, but they don't have the resources to deal with the sort of large-scale collapse that we are now witnessing as a result of the bursting of the housing bubble. Mr. Bernanke has effectively told the banks' creditors not to worry, because the Fed will make good on these credit default swaps, even if Bear Stearns, Lehman Brothers, or Goldman Sachs can't.

"This is a very nice deal for the investment banks, because they got the fees for selling the credit default swaps, not the Fed. And they were very big fees, making the banks and the bank's executives extremely wealthy. In effect, the investment banks sold insurance that they actually were not in a position to provide. Instead the Fed is providing the insurance, but the investment banks get to keep the money they got from selling the insurance: nice work, if you can get it.

"This is yet another episode of the Conservative Nanny State, the story of the how the government intervenes in the market to redistribute income from those at the middle and bottom to those at the top. In this case, the media would have us applaud Mr. Bernanke and the Fed for keeping the financial system from freezing up and preventing the economic chaos that would follow.

"While the Fed deserves some credit for preventing worse financial distress in the face of the collapsing housing bubble, government handouts for the very richest people in the country are difficult to justify. In other areas, we usually expect to see some quid pro quo, for example, serious regulations on lending and perhaps restrictions to accomplish social goals, like a cap on executive compensation ($1 million a year should attract a much more competent crew). This is welfare as we know it now."
http://www.truthout.org/docs_2006/printer_033108A.shtml

More: In Congressional hearings, banks BLAME the Fed for coming to their rescue.

*Asian markets hadn't opened yet ~ we could have gotten more!*

Ungrateful robber barons!

http://www.mcclatchydc.com/homepage/story/32562.html