“The Brittle Grip”: Wall Street And The Financial Sector Aren’t Accustomed To Criticism
Republicans often say that the business community feels threatened by President Obama — that he’s hostile to money, hostile to business, etc. You’ve heard this before. And much of it is campaign chatter. But not all. I don’t think we can understand the dynamics of this campaign without getting that a lot of it is actually true — not the reality necessarily (in my mind not the reality at all) but the perception of it in key parts of the financial sector like Wall Street, venture capital and the dread world of private equity.
The case of Wall Street is in many ways the hardest nut to crack. President Obama took a huge political hit for massive amounts of public money that went to bailing out the major banks. By most measures, along with his predecessor, he more or less saved US and global capitalism. And yet, when you talk to people in finance, this is entirely forgotten. What you most often hear about are two or three statements from the President that are still potently remembered.
Most often it’s a late 2009 quote when he said “I did not run for office to be helping out a bunch of fat cat bankers on Wall Street. They’re still puzzled why it is that people are mad at the banks. Well, let’s see. You guys are drawing down 10, 20 million dollar bonuses after America went through the worst economic year in decades and you guys caused the problem.”
That’s not something you’d expect folks in finance to like particularly. But it did come after about a year of the President getting grief from Wall Street while simultaneously taking the political hit for bailing the same folks out with tax payer dollars.
I’ve heard similar things talking to folks in the business community in DC. And what strikes me again and again is how much it comes back to a handful of statements and anecdotes, things people remember the President saying over the last three plus years.
Some of this shouldn’t surprise us, I suppose. President Obama has pushed more regulation of business than his predecessor. (It’s certainly a change after eight years of George W. Bush; and it’s an eight years over which quite a lot has changed in the country.) He’s supported — though as yet not acted on — his call to roll back the Bush tax cuts. But Bill Clinton did all of this and more. Clinton after all is the guy whose tax hikes the Bush tax cuts in large part repealed. By most objective standards the President is actually more solicitous of the business community than most or all Democratic presidents over the last half century.
So what’s the explanation? Over recent weeks I’ve come to think that something else is in play: namely, the dramatic run up in wealth at the top of the income scale, not just over the last 35 years but particularly over the last 15 years. More or less since the beginning of the Clinton years. In a sense it’s the other side of the 99% vs 1% meme that has been the most successful legacy of the Occupy Wall Street Movement.
This is less an argument than a theory in progress. So I’d like your input. But I think the very wealthy and those who work in the most advanced and aggressive parts of finance are more defensive about their wealth than in the past — at least in terms of the political expression of it. There’s really no time in the last century in which you’d expect that a candidate running for a major political office who’d been responsible for shutting down a lot of factories wouldn’t have that come up in a major way in a campaign. Simply no way. Agree or not, it would be entirely par for the course. And yet now it’s treated as a possibly unexpected or unacceptable development.
That’s weird.
At the same time, the most important voices in the media are much, much wealthier than in earlier eras. The very wealthy are their friends and peers. Concentrated wealth simply has a stronger hold over mass communications than in the past — not necessarily in venal or corrupt terms but often simply by owning minds and mentalities. What all that amounts to is that people on Wall Street and the financial sector aren’t accustomed to a lot of criticism.
All of it goes to explaining a basic conundrum — President Obama is, when compared to Democrats over the last half century, objectively quite middle of the road. And yet the reaction from Wall Street and the halls of finance is one you’d think meant he was trying to bring capitalism to its knees. The President’s policies and tenure in office simply don’t explain the reaction. And I don’t think political spin does either. We need to look deeper into the political economy of the nation at large to understand it.
By: Josh Marshall, Editor and Publisher, Talking Points Memo, May 21, 2012
“Romney’s Tax Plan In Disgusting Perspective”: Making The Bush Tax Cuts Look Like A Gift To Poor People
In my post this morning on Cory Booker, I noted that Mitt Romney’s tax plan would save households taking in more than $1 million per year an average of at least $250,000 ever year. Let us just dwell on this number for a minute.
Earlier this month, Obama claimed the $250,000 figure. Politifact got to work on it. It turns out, says Politifact, that Obama was telling the truth, and in fact if anything could be described as using the more conservative of two ways of looking at the matter, according to an analysis by the Tax Policy Center.
You can read the Politifact description, which is thorough and clear. It comes down to this in plain language. As you know the Bush tax cuts are set to expire at the end of the year. Let’s say Romney is elected and the Bush cuts are extended, as Romney says he’ll do (and then some). If you don’t credit Romney with extending the Bush cuts–that is, if you just assume they were going to be extended anyhow–then his plan cuts the tax bill for those making more than $1 million a year by $250,000.
But if you credit President Romney with the extension of the Bush cuts, then Romney’s gift to uber-million households come to $390,000 a year. To see how insane this is, let’s add a little perspective: Let’s look at those same Bush tax cuts.
According to this report from Democratic staff in Congress on the impact of Bush cuts that was issued in 2007, households earnings $1 million or more per year received an average cut of $120,000 per year. Let’s think about this.
The Bush tax cuts “accomplished” the following: lowered the tax burden of the very rich to lowest point in 50 years; added $1.8 billion to the deficit; exploded the publicly held debt as a share of GDP; and didn’t really lead to a single net job (depending on how you measure, which will be the topic of a future post).
In other words, they were a disaster for the economy, and brutally inequitable.
And now, Romney’s plan would give the above $1 million per year households twice as much as Bush did, or three times as much. It’s really and truly sad and unbelievable that something like this is even discussed seriously by serious people. This plan makes Bush’s look like a gift to poor people. Of course Romney would say he’s cutting the lower classes’ taxes too, which he is, but that just proves how much more aggressively the Romney plan would deplete the treasury, which again we’ll dig into in detail at other points.
Voters know Bush wrecked the economy. For Romney this deserves to be and can be much a bigger pain than Bain.
By: Michael Tomasky, The Daily Beast, May 21, 2012
“Weakness Is His One Consistency”: The Romney You See Is The One You’d Get
For all of Mitt Romney’s talk of what he would do on Day One in the White House — Bomb Iran? Or was it Planned Parenthood? — there’s just as good a chance he would be tacking up two pictures on the wall. One would be of George H.W. Bush and the other of Jimmy Carter. They both became one-term presidents after they were challenged in the primaries. This is a lesson for Romney.
It is also a lesson for everyone who thinks that if Romney becomes president, he would govern from the center. This is a widely held belief, encouraged by the Romney camp itself and the supposed gaffe of Eric Fehrnstrom that the world would see a different Romney in the general election: “Everything changes. It’s almost like an Etch a Sketch. You can kind of shake it up and we start all over again.” This is not a gaffe but a feint. Romney would be able to restart nothing.
In the first place, Romney would likely have a Republican House, and maybe a Senate, too. This means he has to work with a party that has just recently punished Richard Lugar for excessive moderation and is willing, at this very moment, to bring down the country’s credit rating another notch rather than budge on the debt ceiling. To Romney, who made a fortune with the clever prestidigitation of debt, this has to make no sense, but he would go along because (1) he’d have to, and (2) he always does.
Congress, though, would be the least of President Romney’s troubles. The real threat will come from the Republican Party’s very core, which likes him little and trusts him less. The moment he shows the slightest moderate or rational tick, someone such as Rick Santorum will barrel out of the GOP’s piney woods, screaming oaths, and enter the 2016 Iowa caucuses that, you might remember, Santorum won in 2012. He must be itching for such a fight, having already called Romney “the worst Republican in the country to put up against Barack Obama.” That, folks, is not a fudge.
As luck would have it, the Supreme Court has enabled any billionaire to effectively fund a presidential campaign. Santorum’s guy was Foster Friess, who anted up $2.1 million for the Red, White and Blue Fund, but there are plenty of others. It took a herculean fundraising effort by Pat Buchanan to challenge the elder Bush in 1992 (and get 37 percent of the vote in New Hampshire), but it now takes one guy. The conservative movement is lousy with such people, rich men who play with politics as they once did with electric trains.
It’s hardly conceivable that, as president, Romney will become the Romney some think he is. The forces that shaped him in the primaries and caucuses will not go away. He has been clay in the hands of the political right, and this will not change. After Romney recently disparaged Carter’s political courage, Gerald Rafshoon, once Carter’s communications director, shot back with this via Bloomberg View: “Scour Romney’s record for a single example of real political courage — a single, solitary instance, however small, where Romney placed principle or substance above his own short-term political interests. Let me know if you find one.” Rafshoon’s phone has not been ringing.
The widespread belief that Romney would govern from the center is supposedly supported by the equally widespread belief that he is a liar. I hear this all the time: Never mind what Romney said in the primaries, he is a moderate Republican. These people point to Romney’s record as the moderate governor of liberal Massachusetts — even though he has renounced his moderation, as if it was an unaccountable episode of mental instability. The belief that he would revert is the desperate rationale of nominal Democrats who have had it with Barack Obama and want to be excused for abandoning ship. (In the business community, little distinction is made between Obama and Leon Trotsky, another community organizer . . . so to speak.)
According to what a family friend told the New York Times, Mitt and Ann Romney decided he should run for president because they both “felt it was what God wanted them to do.” Having done just that, Romney has left it to others to define what sort of candidate he would be. Nothing would change if he were president. Weakness is his one consistency.
By: Richard Cohen, Opinion Writer, The Washington Post, May 21, 2012
“Failing The Fundamental Test Of Journalism”: Watching Fox Makes You More Stupid
People who work at Fox News might like to think that they are only despised by real journalists because they are conservative and most journalists are liberal. Anyone who saw read the admiring obituaries of William F. Buckley, Jr in mainstream and liberal outlets would know that is nonsense. Journalists, both liberals and ones with no ideology in particular, are quite capable of respecting conservative pundits and reporters who deserve their respect.
But Fox does not. The reason is not because they hold a set of values that others may not share. And it is only partially because they claim to be “Fair and Balanced” when they are neither.
Rather, it is because they fail the fundamental test of journalism: are you informing your audience? According to a new study by Farleigh Dickinson University, Fox viewers are the least knowledgeable of any outlet, and they are know even less about politics and current events than people who watch no news at all.
Respondents to the survey were able to answer correctly an average of 1.8 of 4 questions about international news and 1.6 out of 5 questions about domestic affairs. “Based on these results, people who don’t watch any news at all are expected to answer correctly on average 1.22 of the questions about domestic politics, just by guessing or relying on existing basic knowledge,” said Dan Cassino the poll’s analyst.
“The study concludes that media sources have a significant impact on the number of questions that people were able to answer correctly,” wrote Cassino and his colleagues. “The largest effect is that of Fox News: all else being equal, someone who watched only Fox News would be expected to answer just 1.04 domestic questions correctly — a figure which is significantly worse than if they had reported watching no media at all. On the other hand, if they listened only to NPR, they would be expected to answer 1.51 questions correctly.”
This should come as no surprise if you follow Fox. Consider some recent history. “Fox and Friends” host Steve Doocy invented a quotation from President Obama completely out of thin air. He falsely claimed that Obama had said he and Michelle were not born with silver spoons in their mouths “unlike some people,” in reference to Mitt Romney’s privileged upbringing. In fact, Obama did not say “unlike some people” and he has been using the silver spoon line for years. Several other news outlets repeated Doocy’s assertion as fact and Doocy initially avoided correcting the record after it was revealed he was wrong. Eventually he admitted that he “seemed to misquote” Obama, instead of stating that he did, in fact, misquote him. And he did not apologize for the error.
When Fox isn’t inventing smears against Obama, it uncritically regurgitates corporate funded lies about him. Consider a segment of Sean Hannity’s show from last week. He showed a TV commercial by Americans for Prosperity, a conservative group founded and funded by the Koch brothers, that attacks President Obama’s record on investing in renewable energy. Hannity and Frank Luntz praised its effectiveness, with Luntz saying, “It was fact-based, not assertions. You see the facts come up on the screen. There’s specific numbers.”
The only problem is that the factual assertions are incorrect. The ad says, “80 percent of taxpayer dollars spent on green energy went to jobs in foreign countries.” But the article it cites as a source clearly states only that the money went to foreign firms. The bulk of American tax dollars spent on the subsidies, according to Politifact, went to American subsidiaries of the firms.
The ad goes on to offer specific examples: “$1.2 billion to a solar company that’s building a plant in Mexico. Half a billion to a car company that moved American jobs to Finland. And $39 million to build traffic lights in China. President Obama wasted $16 billion on risky investments.” I won’t bore you with all the details of how each of these claims is untrue; each has been labeled false or mostly false by Politifact or Factcheck.org and you can go to Media Matters for the full rundown.
Hannity routinely takes Republican misinformation as the Gospel truth. To choose just one particularly embarrassing example, he let Herman Cain’s spokesman Mark Block declare absurdly, that a woman named Karen Kraushaar who accused Cain of sexual harassment was the mother of a Politico reporter named Josh Kraushaar. Hannity did not challenge either the veracity of this claim nor question why this “fact” would cast doubt on Politico’s thoroughly reported revelation that Cain has been repeatedly accused of sexual harassment. In fact, Josh Kraushaar had left Politico for National Journal over a year before the story even ran, and he is not related to Karen Kraushaar. It would have been easy for Hannity to check on these facts and correct Block’s assertion, but he did not. Here is what Josh wrote about it the next day:
Anybody with Internet access would, at the very least, been able to figure out that I haven’t worked for Politico since June 2010 — and have been working at National Journal since then. I even Tweeted the fact that I wasn’t related to Karen Kraushaar earlier that evening before Hannity’s show to clear up any potential confusion.
That didn’t stop Block. When I heard what Block had said on Hannity’s show, I immediately e-mailed him informing him of his mistake. I still haven’t heard back.
This laziness, partisan hackery and lack of regard for basic accuracy is what separates Fox News from outlets that merely have opinions. And it is doing their audience a disservice. This Fairleigh Dickinson study is not the first to find that Fox News viewers are the most ill informed of any news consumers. As November 22, 2011 Think Progress had found seven studies showing Fox News’ viewers to be the worst informed of all news consumers. In a post about a report that had just come out in the International Journal of Press/Politics, by communication scholar Lauren Feldman of American University and colleagues which found that “Fox News viewing manifests a significant, negative association with global warming acceptance,” Chris Mooney cited six previous studies with similar findings.
I identified 6 separate studies showing Fox News viewers to be the most misinformed, and in a right wing direction—studies on global warming, health care, health care a second time, the Ground Zero mosque, the Iraq war, and the 2010 election.
I also asked if anyone was aware of any counterevidence, and none was forthcoming. There might very well be a survey out there showing that Fox viewers aren’t [emphasis in original] the most misinformed cable news consumers on some topic (presumably it would be a topic where Democrats have some sort of ideological blind spot), but I haven’t seen it. And I have looked.
In the last year, since Fox News fired Glenn Beck and has sought to line up behind more establishment Republican candidates such as Mitt Romney, the new conventional wisdom has been that Fox is tacking back to the center. As a purely strategic move within the Republican Party, that may be true. But, unfortunately, this has not been correlated with any improvement in the quality or independence of their journalism.
By: Ben Adler, The Nation, May 21, 2012
“It Only Takes One Simpleton”: Our Laws Are Made By Idiots
Back in 2009, Michele Bachmann told an interviewer that she was refusing to answer any questions on the census form other than how many people lived in her household. It seems this passionate advocate of the Constitution as sacred text found Article 1, Section 2 incompatible with her small-government ideology. But that’s the problem with seeing things through such narrow blinkers: when you are convinced that every question in public debate has but a single answer (“Government is bad!”), then your answers to some ordinary questions can become absurd.
So it was when the House of Representatives, a body now seemingly devoted to seeking out new ways to make itself look stupid when it isn’t pushing the country toward economic calamity, recently voted to undermine the American Community Survey, a supplement to the decennial census. The ACS gathers information on many different measures of Americans’ lives, providing valuable data that demographers, historians, and all manner of social scientists use to understand our nation and its people. Because the ACS is far larger than ordinary public opinion polls, it provides highly reliable data that are also used by government itself and by private industry. So how could something like that become politicized? How could any congressional Republican, no matter how stupid, possibly come to see it as some kind of liberal plot or wasteful boondoggle? Catherine Rampell of The New York Times explains (forgive the long excerpt; it’s a good explanation):
This survey of American households has been around in some form since 1850, either as a longer version of or a richer supplement to the basic decennial census. It tells Americans how poor we are, how rich we are, who is suffering, who is thriving, where people work, what kind of training people need to get jobs, what languages people speak, who uses food stamps, who has access to health care, and so on.
It is, more or less, the country’s primary check for determining how well the government is doing — and in fact what the government will be doing. The survey’s findings help determine how over $400 billion in government funds is distributed each year.
But last week, the Republican-led House voted to eliminate the survey altogether, on the grounds that the government should not be butting its nose into Americans’ homes. “This is a program that intrudes on people’s lives, just like the Environmental Protection Agency or the bank regulators,” said Daniel Webster, a first-term Republican congressman from Florida who sponsored the relevant legislation.
“We’re spending $70 per person to fill this out. That’s just not cost effective,” he continued, “especially since in the end this is not a scientific survey. It’s a random survey.”
In fact, the randomness of the survey is precisely what makes the survey scientific, statistical experts say.
Each year the Census Bureau polls a representative, randomized sample of about three million American households about demographics, habits, languages spoken, occupation, housing and various other categories. The resulting numbers are released without identifying individuals, and offer current demographic portraits of even the country’s tiniest communities.
It is the largest (and only) data set of its kind and is used across the federal government in formulas that determine how much funding states and communities get for things like education and public health.
I don’t for a minute think that John Boehner has been gunning for the ACS for years, or that the entire Republican caucus feels passionately about it one way or the other. But in the House today, all it takes is one simpleton of a first-term Tea Party congressman to bring this up, and the rest of them say, “Gee, I don’t want to vote for government! Because government is bad!” So they go along. All but ten House Republicans voted for Webster’s amendment, and Rand Paul has a companion bill in the Senate. What a fine display of leadership and responsible governing.
And about Webster saying the ACS “is not a scientific survey. It’s a random survey,” a bit of explanation is in order. When you say a survey is “random,” it means the respondents are selected randomly, meaning everyone in the population has an equal chance of being in the sample. That’s what makes a sample unbiased, as opposed to, say, interviewing only men or only people in California, which would be non-random surveys. Surveys have to be random, except under some very carefully defined circumstances, in order to allow you to extrapolate to a larger population. But what obviously happened is that Webster saw something about the sample being “random,” and said, “What?!? It’s just some random survey? What the hell? Let’s kill this thing!” And here’s where it’s really disheartening. From that point forward–as he wrote his bill, convinced his colleagues, and saw it passed through the House–nobody clued him in to the first thing about how surveys work in general or how this survey works in particular. Nor, obviously, did he try to find out for himself. Because who cares?
By: Paul Waldman, Contributing Editor, The American Prospect, May 20, 2012
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