“No Bank Bailouts”: Tea Partiers Take Contributions From Bailed Out Banks After Opposing Bank Bailouts
Tea Party-backed candidates swept into Washington in 2010 on a wave of opposition to bank bailouts. Now that they’re in Washington, however, their campaigns are drowning in campaign cash provided by the very banks that benefited from the Troubled Asset Relief Program.
The 10 freshmen Republicans on the House Financial Services Committee who have Tea Party backing have taken more than $100,000 from the political action committees affiliated with JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs — the nation’s five largest banks — Bloomberg reports:
Yet the anti-bailout fervor that drove the messaging of Republican candidates during the campaign cycle of 2009 and 2010 has dissipated, and those same lawmakers are now collecting money from the firms bailed out by President George W. Bush’s $700 billion Troubled Asset Relief Program. […]
The political action committees of those institutions have distributed $169,499 through March 31 to the campaign coffers of the 10 freshman Tea Party-backed lawmakers on the House Financial Services Committee, according to an analysis of campaign finance disclosure records.
The Tea Party hasn’t succeeded in ending “too big too fail” because they haven’t tried. Though the five biggest banks are now bigger than they were before the financial crisis, the Tea Party members haven’t proposed a single piece of legislation to limit their size. Instead, they’ve focused on repealing financial reform and blocking efforts to protect consumers from Wall Street’s predatory practices.
Multiple Democrats have proposed legislation to cap the size of large banks, while others have proposed new ways to unwind large banks without taxpayer-funded bailouts should they collapse. The efforts have drawn no support from the Tea Party. “No more bailouts,” Tea Party Express’ website proclaims. The candidates it and other Tea Party organizations backed in 2010, however, apparently no longer feel the same way.
By: Travis Waldron, Think Progress, April 30, 2012
“Blind In Both Eyes”: Marco Rubio Thinks George W. Bush “Did A Fantastic Job”
It’s strange to hear an endorsement so ringing of an unpopular ex-president who failed in so many different ways.
George W. Bush’s tenure began with a catastrophic terrorist attack. It ended with a catastrophic financial crisis. In the interim, it was consumed mostly with fighting a costly war of choice. The invasion of Iraq was launched on false premises with inadequate planning; it was poorly managed for years on end; and even America’s fallback goal of a stable democracy in the Middle East wasn’t achieved. In fact, the invasion and occupation mostly just strengthened Iran’s position. Our enemies also benefited from the prisoner abuse at Abu Ghraib and Guantanamo Bay.
On the domestic front, President Bush signed an education reform bill that liberals and conservatives now agree was a mistake; he failed to reform Social Security, and rather than finding a way to save money on Medicare he added a costly prescription drug benefit to it even as he cut taxes. It’s no wonder that the deficit exploded during his spendthrift two terms in the White House. Bush’s faith based initiatives were a bust, as were his immigration reform efforts, and he signed into law campaign finance reform legislation he’d previously deemed unconstitutional. He created the instantly dysfunctional Department of Homeland Security and illegally spied on American citizens without warrants. His dubious appointments included Alberto Gonzalez and Harriet Miers, a Supreme Court choice so bad that his own base revolted. And he left office so unpopular that his party suffered a historic defeat; even four years later its presidential candidates did their utmost to avoid saying his name in speeches and debates.
That is the record Marco Rubio deems fantastic.
As he put it:
George W. Bush, in my opinion, did a fantastic job as president over eight years, facing a set of circumstances during those eight years that are different from the circumstances that a President Romney would face.
Partisan loyalty sure does make people say ill-conceived things.
“Mass Amnesia”: Mitt Romney Bets On Forgetfulness Of The American People
I’ve said this before, but in light of Mitt Romney’s economic speech today, it bears repeating: Virtually his entire case against Obama’s economic record rests on the assumption that the American people have developed a case of mass amnesia about the depth and severity of the economic crisis the President inherited.
A few months ago, Romney liked to claim that Obama made the economy “worse.” But the good economic news forced Romney to revise that argument, and he took to claiming that, yes, okay, the economy is getting better, but only in spite of Obama’s policies, which are slowing down the natural recovery.
Today Romney upped the ante yet again, offering still another explanation for why Obama should be denied a second term, even though the economy is recovering: It’s all about freedom! From the prepared remarks:
The Obama administration’s assault on our economic freedom is the principal reason why the recovery has been so tepid — why it couldn’t meet their projections, let alone our expectations. If we don’t change course now, this assault on freedom could damage our economy and the well-being of American families for decades to come…
The proof is in this weak recovery. This administration thinks our economy is struggling because the stimulus was too small. The truth is we’re struggling because our government is too big.
Relatedly, this morning, Romney said: “The economy always comes back after a recession, of course. There’s never been one that we didn’t recover from. The problem is this one has been deeper than it needed to be and a slower recovery than it should have been, by virtue of the policies of this president.”
The common thread here is obvious, and it’s important. The pace of this recovery, according to Romney, is sluggish compared to that of previous ones — proving that Obama’s policies, or his “assault on freedom,” are the reason why. Missing from this telling, of course, is the most important reason this recovery is different from previous ones: It came after the worst financial crisis since the Great Depression.
Romney’s argument that the recovery’s pace would otherwise have been normal if not for Obama’s polices rests on a bet that the American people will forget about this, or won’t factor it into their decision this fall. Perhaps some enterprising reporter will ask Romney the obvious follow-up questions: What would you have done as president in early 2009? Is it really your contention that the economy would have recovered at a typical pace from the worst financial crisis since the 1930s if government had done nothing at all?
By: Greg Sargent, The Plum Line, The Washington Post, March 19, 2012
President Obama’s Best State Of The Union Speech
The State of the Union was upbeat and positive, and that’s saying a lot from me, a pessimist. Now I know those on the right will tell you everything that was wrong with the president’s speech; heck, former House Speaker Newt Gingrich and former Gov. Mitt Romney told America what they thought of the president’s speech before he even uttered a word!
Personally, I felt the president hit it out of the park—his best State of the Union speech and hopefully his fourth, not his last.
Starting out with thanking the U.S. military, he pointed out that for the first time in nine years we’re no longer in Iraq, and more importantly, that we’re safer and we’re more respected throughout the world. And of course, there was the huge applause when he mentioned that for the first time in over two decades, we’re no longer fearful of the wrath of Osama bin Laden.
I personally loved when the president referred to how our military operates, and how we as a nation and how the government should operate: focus on the mission at hand and do it working together. With the lowest approval rating of Congress ever and polls showing that Americans clearly want both sides of the aisle to work together to get things done, the president, I believe, was speaking to all Americans and to all of our frustrations with our government.
I also liked how the president painted a picture of what could be. He pointed out America’s values; except for one remark about the administration that preceded him, he didn’t blame former President Bush, which I found refreshing and necessary.
He was bold when he specifically stated that the banks were wrong and irresponsible in lending money to people who couldn’t afford to pay it back.
He gave facts about job loss: 4 million jobs lost before he entered office, millions more before his policies were implemented.
I found that the president was being humble when he spoke of the jobs that businesses created–not he, his administration, or Congress.
When the president spoke of American values, it didn’t have to do with church or religion; it had to do with our work ethic—from American manufacturing to GM regaining its title as the number one automaker in the world. Even the Republicans had to clap on that one.
And for a president who is constantly accused of wanting to tax America to death, he was talking about a lot of tax credits going around: tax credits for making products here in America, tax breaks for small business owners—rewarding those who keep and develop jobs here, and stopping the rewards going to companies that send their jobs overseas. (Sidenote: Eric Cantor looked angry about that–hmm…)
Then the president went on to other things America values, other things that make our nation great, and what could make us greater: education. He linked education with the ability to increase a person’s income in the future. And he made it personal when he spoke of every person in the chamber who has a teacher they liked, remembered, etc. I found myself nodding at that remark.
He reached out to Hispanics with the DREAM act, although never mentioning it by name. He touched the unions in speaking about manufacturing, teachers, and the auto industry. And he even gave a shout out to us ladies with the desire for us to earn equal pay for the jobs we do that men do. (Woo hoo!)
The bottom line is, although this speech is about governing, it is a campaign year. I felt the president reminded Americans of where we are, how far we’ve come, and where we could be headed with him at the helm. He spoke of the facts rather than the fiction Americans so often hear in the media. And if America were a ship, he showed us with his words that he is more than up to the task of being the ship’s captain for the next four years.
By: Leslie Marshall, U. S. News and World Report, January 25, 2012
The GOP Magical World Of Voodoo ‘Economists’: Repeal The 20th Century
If you came up with a bumper sticker that pulls together the platform of this year’s crop of Republican presidential candidates, it would have to be:
Repeal the 20th century. Vote GOP.
It’s not just the 21st century they want to turn the clock back on — health-care reform, global warming and the financial regulations passed in the wake of the recent financial crises and accounting scandals.
These folks are actually talking about repealing the Clean Air Act, the Clean Water Act and the Environmental Protection Agency, created in 1970s.
They’re talking about abolishing Medicare and Medicaid, which passed in the 1960s, and Social Security, created in the 1930s.
They reject as thoroughly discredited all of Keynesian economics, including the efficacy of fiscal stimulus, preferring the budget-balancing economic policies that turned the 1929 stock market crash into the Great Depression.
They also reject the efficacy of monetary stimulus to fight recession, and give the strong impression they wouldn’t mind abolishing the Federal Reserve and putting the country back on the gold standard.
They refuse to embrace Darwin’s theory of evolution, which has been widely accepted since the Scopes Trial of the 1920s.
One of them is even talking about repealing the 16th and 17th amendments to the Constitution, allowing for a federal income tax and the direct election of senators — landmarks of the Progressive Era.
What’s next — repeal of quantum physics?
Not every candidate embraces every one of these kooky ideas. But what’s striking is that when Rick Perry stands up and declares that “Keynesian policy and Keynesian theory is now done,” not one candidate is willing to speak up for the most important economic thinker of the 20th century. Or when Michele Bachmann declares that natural selection is just a theory, none of the other candidates is willing to risk the wrath of the religious right and call her on it. Leadership, it ain’t.
I realize economics isn’t a science the way biology and physics are sciences, but it’s close enough to one that there are ideas, principles and insights from experience that economists generally agree upon. Listening to the Republicans talk about the economy and economic policy, however, is like entering into an alternative reality.
Theirs is a magical world in which the gulf oil spill and the Japanese nuclear disaster never happened and there was never a problem with smog, polluted rivers or contaminated hamburger. It is a world where Enron and Worldcom did not collapse and shoddy underwriting by bankers did not bring the financial system to the brink of a meltdown. It is a world where the unemployed can always find a job if they really want one and businesses never, ever ship jobs overseas.
As politicians who are always quick to point out that it is only the private sector that creates economic growth, I found it rather comical to watch the governors at last week’s debate duke it out over who “created” the most jobs while in office. I know it must have just been an oversight, but I couldn’t help noticing that neither Mitt Romney nor Perry thought to exclude the thousands of government jobs included in their calculations — the kinds of jobs they and their fellow Republicans now view as economically illegitimate.
And how wonderfully precise they can be when it comes to job numbers. Romney is way out front when it comes to this kind of false precision. His new economic plan calculates that President Obama would “threaten” 7.3 million jobs with the ozone regulation that, in fact, the president had just canceled. By contrast, Romney claims his own plan will create 11 million jobs in his first term — not 10, not 12, but 11 million.
When you dig into such calculations, however, it turns out many are based on back-of-the-envelope extrapolations from industry data that totally ignore the dynamic quality of economic interactions.
One recent example comes from the cement industry, which now warns that new regulations limiting emissions of sulfur dioxide and nitrogen oxide could close as many as 18 of the 100 cement plants in the United States, resulting in the direct loss of 13,000 jobs.
Then again, where do you think all those customers of the 18 plants will get their cement? Do you think they might get some of it from the other 82 plants, which in turn might have to add a few workers to handle the additional volume? Or that a higher price for cement might induce somebody to build a modern plant to take advantage of the suddenly unmet demand? Or perhaps that higher prices for cement will lead some customers to use another building material produced by an industry that will have to add workers to increase its output? And what about the possibility that the regulation will encourage some innovative company to devise emissions-control equipment that will not only allow some of those plants to remain open but generate a few thousand extra jobs of its own as it exports to plants around the world.
Such possibilities are rarely, if ever, acknowledged in these “job-scare studies.” Also left out are any estimates of the benefits that might accrue in terms of longer, healthier lives. In the Republican alternative universe, it’s all costs, no benefits when it comes to government regulation. As they see it, government regulators wake up every morning with an uncontrollable urge to see how many jobs they can destroy.
If consistency is the hobgoblin of small minds, then these Republican presidential candidates are big thinkers, particularly on fiscal issues.
In the Republican alternative universe, allowing an income tax cut for rich people to expire will “devastate” the U.S. economy, while letting a payroll tax cut for working people to expire would hardly be noticed. Cutting defense spending is economic folly; cutting food stamps for poor children an economic imperative.
My favorite, though, is a proposal, backed by nearly all the candidates along with the U.S. Chamber of Commerce, to allow big corporations to bring home, at a greatly reduced tax rate, the more than $1 trillion in profits they have stashed away in foreign subsidiaries.
“Repatriation,” as it is called, was tried during the “jobless recovery” of the Bush years, with the promise that it would create 500,000 jobs over two years as corporations reinvested the cash in their U.S. operations. According to the most definitive studies of what happened, however, most of the repatriated profits weren’t used to hire workers or invest in new plants and equipment. Instead, they were used to pay down debt or buy back stock.
But fear not. In a new paper prepared for the chamber, Republican economist Douglas Holtz-Eakin argues that just because the money went to creditors and investors doesn’t mean it didn’t create jobs. After all, creditors and shareholders are people, too — people who will turn around and spend most of it, in the process increasing the overall demand for goods and services. As a result, Holtz-Eakin argues, a dollar of repatriated profit would have roughly the same impact on the economy as a dollar under the Obama stimulus plan, or in the case of $1 trillion in repatriated profit, about 3 million new jobs.
It’s a lovely economic argument, and it might even be right. But for Republican presidential candidates, it presents a little problem. You can’t argue, at one moment, that putting $1 trillion of money in the hands of households and business failed to create even a single job, and at the next moment argue that putting an extra $1 trillion in repatriated profit into their hands will magically generate jobs for millions.
It took a while, but even Richard Nixon came around to declaring himself a Keynesian. Maybe there is still hope for Perry and the gang.
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