Occupied Winter of Our Discontent (continued)

I have to admit that when President Obama tapped New York Attorney General Eric Schneiderman to lead a brand spanking new investigation into banksterism, my first cynical thought was "co-optation." Schneiderman would be just the latest in a long line of Democratic malcontents and holdouts to be taken on a figurative ride on Air Force One, emerging chastened, rewarded and mouthing "don't let the perfect be the enemy of the good" platitudes.

But there is reason to hope today that the pending sweetheart deal between the banks and the Obama administration may not be as sweet as the Big Five Banks had been hoping for. Schneiderman last night announced a relatively limited proposal: in exchange for a $25bn payout to victims of the robo-signing foreclosure fraud, there will be no criminal prosecution from the states which agree to the deal.  But the blanket perpetual immunity from punishment for the entire panorama of financial felonies apparently is not to be. The state agreement would not preclude the feds (read: Schneiderman and his posse of IRS and FBI agents) going after mortgage fraudsters.

Some of those skeptical that Barack Obama would ever go after the banking hand that feeds him were expressing mild shock today that there might be a Grand Perp Walk of Bank CEOs after all.  Remember, the president has stated time and again that he had no interest in punishing the banks. But then something called Occupy Wall Street came along, and made him an offer he couldn't refuse: investigate and prosecute, or we will hound you wherever you go.  Plutocracy or not, the United States still requires that presidents be voted into office. And savvy politician that he is, Obama knows which way the wind is blowing.

Sam Stein of The Huffington Post reports that banks will still be vulnerable in the following categories:

1. Criminal liability.
2. Tax liability
3. Fair lending, fair housing, or any other civil rights claim.
4. Federal Housing Finance Agency or the GSEs [Fannie Mae and Freddie Mac]
5. CFPB claims for the period after they came into existence in July 2011
6. SEC claims
7. National Credit Union Association Claims
8. FDIC claims
9. Federal Reserve Board claims
10. MERS claims

Early reports from the banking sector in the wake of Friday night's announcement and the revelation that Schneiderman's task force has already issued subpoenas show them to be borderline-panicked and indignant. Rupert Murdoch's New York Post ran a McCarthyesque red scare editorial screaming that Schneiderman was "shaking down the banks" and how dare he leave the door open to future criminal prosecution after the banksters pay up in good faith? It's the same old canard used by Timmy Geithner and Co.: if you upset the too-big-to-fail banks, the whole world will collapse. From the right-wing Post:

Besides, the prospect of future court action, should Schneiderman prevail, sure won’t help the economy.
On the other hand, demonizing financial institutions in populist fashion might help rile up the left — which, no doubt, is what Obama and Schneiderman care about most.
New York’s union cat’s-paw, the left-wing Working Families Party, is already tickled pinko — er, pink — with Schneiderman’s appointment, calling it “a big victory for the 99 percent.”
For America and New York, a world financial center, it sounds more like disaster.

Matt Taibbi of Rolling Stone is cautiously optimistic that Obama's back may finally be up against the wall on Wall Street. He says the robosigning scandal is really small potatoes compared to what really went on and what remains unpunished:

The securitization offenses were massive criminal conspiracies, identically undertaken by all of the big banks, to defraud investors in mortgage-backed securities. If you’re looking for an appropriate target for a massive federal investigation, one that would get right to the heart of the corruption of the crisis era... well, they picked the right target here. If they were to do a real clean sweep on securitization, the federal prisons would end up literally teeming with senior executives from the biggest banks. A lot of very big names would end up playing ping-pong and cards in Otisville and Englewood.

It may end up being a case of Neopopulist Obama being forced to act upon his own words as much as it pains him to do so. Taibbi adds: "One thing we do know: Obama’s decision to tap Schneiderman publicly, and dump Geithner, and whisper about a millionaire’s tax, signals a shift in its public attitude toward the Wall Street corruption issue. The administration is clearly listening to the Occupy movement. Whether it’s now acting on their complaints, or just trying to look like it’s doing something, is another question. It’s way too early to tell. But it’s certainly very interesting".

And as for Schneiderman's being co-opted, Dave Dayen of Firedoglake writes that the AG has promised to publicly disavow the task force and publicly walk away if he is in any way impeded. I think the only thing we can do for now is give him some time to put his money where his mouth is. But not too much time.

Gretchen Morgenson of the New York Times has written an excellent piece on Obama's task force for her "Fair Game" series about the nefarious banking system. The upshot: if they don't do something big very soon, what little credibility they have left will be shot.

Another glass-half-full observation: for the first time in its elite 0001% history, the World Economic Forum at Davos has heard the "inequality" word uttered. Occupiers are camped out in igloos. Severe income disparity may not be so healthy for capitalism. Greed may not be so good after all, even for the greedheads. The parasite eventually bleeds the host dry. The cancer dies right along with the victim.

The Right Stuff

By Jay - Ottawa

Following events like an American presidential election can be a test of mental endurance and a challenge to the biliary tract.  After a while, one begins to lose faith in humanity.  Anyway, that was my day, until I came across an article about another president -- until late December, one our contemporaries, but from elsewhere and now gone forever.  We still have his legacy.  I’m speaking of Václav Havel (1936-2011).  You may have seen him in the past on the News Hour (PBS), or read one of his books, or seen one of his strange plays.  As a leader enmeshed in the tough choices of managing a country, he proved politics need not be one part lies and one part venality supported by greed.  Havel was different.

A Toronto writer and translator, Paul Wilson, went to Havel’s funeral in Prague.  His full account is linked above. Here are a few quotes in case you can’t take the time to read it all, but still need a boost as we continue to push through the big muddy of 2012 American politics.

Wilson describes a poster that went up all over Prague around the time of Havel's funeral, “a shot of Havel with his back to the camera, walking toward the ocean.”  On the poster was a quotation summarizing “one of Havel’s most deeply held beliefs”:  Then this paragraph near the end of Wilson’s tribute: 

Hope is not the conviction that something will turn out well, but the certainty that something makes sense, regardless of how it turns out. 

As I said, Václav Havel was different.  It is not madness or naiveté to insist upon -- and to push a little harder for -- that difference.

Like many great Czechs before him, Havel insisted on the importance of truth, but with a difference. “Truth and love,” he was fond of saying, “must prevail over lies and hatred.” He was often ridiculed for what seemed like a Hallmark sentiment (“Why love?” people asked), but he defended the slogan by referring to one of his greatest insights: truth, by itself, is a malleable concept that depends for its truthfulness on who utters it, to whom it is said, and under what circumstances. As a playwright, Havel turned this insight into a dramatic device: in most of his plays, the main characters constantly lie to one another and to themselves, using words that, in other circumstances, would be perfectly truthful. Truth by itself is not enough: it needs a guarantor, someone to stand behind it. It must be uttered with no thought for gain, that is, in Havel’s words, with a love that seeks nothing for itself and everything for others.  

  

SOTU, Barackus?

"One place to start is serious financial reform. Look, I am not interested in punishing banks, I'm interested in protecting our economy. A strong, healthy financial market makes it possible for businesses to access credit and create new jobs. It channels the savings of families into investments that raise incomes. But that can only happen if we guard against the same recklessness that nearly brought down our entire economy". -- Barack Obama

Okay, okay -- that was from last year's STFU, pre-Occupy edition.  How he pretends that things have changed, because now the president has directed Attorney General Eric Holder to whip up a financial crimes unit to punish the banks.  As former NY Governor Eliot Spitzer told Keith Olbermann Tuesday night, there are already dozens and scores of financial crime units floating in the ozone. This may be either a lot of empty rhetoric, or it may be a way to appease/co-opt the state attorneys general who are refusing to go along with that sweetheart deal I wrote about in a previous post. Time will tell.

He also suggested a ban on Congressional insider trading, which was met by thunderous silence from the millionaire congress critters. And his much-touted big applause line: "No bailouts, no handouts, no copouts" did not evince so much as one hand clapping. 

I was disgracefully way off the mark in my prediction that Obama would utter the word "folks" two dozen times. He only used it twice -- once when he referred to millionaire folks like himself, and the other about the poor slob brand of folks on Main Street. I should have known he would never refer to Congress as folks.

Other than that, the main phrase was "built to last". I counted five times. I just couldn't get the Ford truck commercial out of my head for the whole damned speech.

And did he really say he would still work with Republicans to reform (code for cut) Medicare and Social Security?  Are you kidding me?

And to give us a preview of his bellicose chest-thumping campaign theme, he began and ended the speech with the celebration of the assassination of Osama.

All in all, a totally predictable orgy of self-celebration by the political subdivision of the criminal oligarchy.

The Sun Reigns Supreme

Monday's Supreme Court decision that it's a no-no for police to slap a GPS device on a car without a warrant may be rendered moot by an event outside the control of even the almighty United States Government. A massive explosion on the sun is now showering the earth with enough radiation to knock the entire Global Positioning System on its ass. From CNN:

The largest solar storm for seven years is expected to send a shower of radioactive solar particles racing towards Earth at almost 1,400 miles a second this week, according to NASA.The flare, caused by a huge eruption on the sun's surface on Sunday, is expected to affect GPS systems and other communications when it reaches the Earth's magnetic field on Tuesday.Solar flares are our solar system's largest explosive events and can last from minutes to hours, according to NASA, releasing up to a billion tons of matter in the process.

The National Weather Service has issued a rare major geo-magnetic solar storm warning, which sounds more ominous that it really is.  You will not experience bodily harm unless you count acute withdrawal symptoms from disruption of your cell phone service, internet, electricity and TomTom device. Will Old Sol also disrupt drone strikes from Nevada trailers?  Let's hope!

More information can be found here.

Solar Flare Photographed by NASA 1/23/12

Whitewash Delayed is SOTU Spin Denied

Thanks to pressure from activists and a few stalwart attorneys general, President Obama has been denied the chance to belch out a major whopper at tonight's State of the Union address. It would have been a moment in which a whole chorus of "You Lies!" from the gallery would have been entirely appropriate.

Obama apparently had hoped to proclaim himself the middle class champion who went after the big bad banks to get a relatively paltry $20,000 slashed from each of the loans of a relatively small number of underwater homeowners  He was planning to spin a sweetheart deal with foreclosure fraudsters at five too-big-to-exist banks into a victory for the middle class.  And that would have been a major fib, because the money would have come not from the banksters themselves, but from pension funds containing bundled mortgage securities. It would have given to the middle class by taking from the middle class. The deal would not have sent one banker to jail, nor taken one nickel from the bloated bonuses of the likes of Jamie Dimon and Brian Moynihan.

The Obama Administration had summoned the state attorneys general to Chicago on Monday to try to persuade them to leave the criminals alone and to forget about extracting justice for their constitutents. From today's New York Times:

The housing secretary, Shaun Donovan, met on Monday in Chicago with Democratic attorneys general to iron out the remaining details and to persuade holdouts to agree with any eventual deal. He later held a conference call with Republican attorneys general. But as he renewed his efforts, Democrats in Congress, advocacy groups like MoveOn.org and several crucial attorneys general said the deal might be too lenient on the banks.....

Tom Miller, the attorney general of Iowa, said Monday that an agreement with the nation’s five largest mortgage servicers — Bank of America, JPMorgan Chase, Citigroup, Wells Fargo and Ally Financial — would not be reached “anytime this week.”

In a letter to administration officials, Senator Sherrod Brown of Ohio said the settlement as reported — its details were not fully known — was too small and would allow banks to pass on the cost of the settlement to “middle-class Americans” whose pension funds hold soured mortgage securities.

In addition to disagreements over the total amount, negotiations have been held up over the question of how much latitude authorities would have in pursuing investigations into mortgage abuses before the housing bubble burst in 2007. The banks are pushing for a broad release from future claims, but several attorneys general, including prominent figures like Eric Schneiderman of New York and Martha Coakley of Massachusetts, have demanded a tougher line on the banks.

A three-pronged pushback against the Administration from activists, legislators and the attorneys general created a major disruption of negotiations. The uproar, although relatively ignored by the mainstream press (The Times story was buried in the rubble of the GOP primary trainwreck) was reminiscent of the massive protest last week against SOPA/PIPA that had craven congress critters scampering for their burrows.

Naked Capitalism's Yves Smith, who has provided some of the best coverage on the background and details of this story, thinks the collapse in negotiations Monday may spell doom for any hope the banks and Obama  had for a whitewash  going forward -- ever.  Obama apparently was counting on the party bosses of the recalcitrant AGs putting pressure on them to fall into line. That didn't happen. The AGs in question didn't bother showing up at Chicage HQ. Writes Smith:

We will hopefully get more intelligence (or maybe just better attempts at disinformation) but I read this as an indication the deal agreed between the Federal regulators and the biggest servicers somehow came unglued. Possibilities include: someone exposed a definitional/drafting flaw (the Feds thought it meant one thing and the banks thought it meant another); someone (one of the banks?) retraded the deal; the Administration has assumed it could rely on a certain minimum number of AGs to fall in line and they regarded that minimum number as essential, and the pow wow today exposed that they are below that level.

The beauty of protest movements like this is that they act like magnets for the timid and uncommitted. Fighting back against the oligarchy has become chic -- and safe. People just couldn't get onboard the anti-foreclosure settlement train fast enough:

AFL-CIO President Rich Trumka said today “We call on the administration to reject any deal that insulates banks from full responsibility.” Bob Borosage of the Campaign for America’s Future said “This is a fundamental question of justice and democracy.  The law is respected only if it is enforced.  No one who robbed a bank would be offered immunity, a modest fine and no admission of guilt – before there was an investigation into who stole the money and how much they took.” The co-chairs of the Congressional Progressive Caucus, Keith Ellison and Raul Grijalva, said “It’s past time we stand up to Wall Street and show the American people that no bank executive is above the law."

In case you missed it, here is a clip of former New York Governor Eliot Spitzer on the foreclosure fraud background and White House involvement on Sunday's Up With Chris Hayes.

Have you got your bullshit detection meter charged up for tonight's State of the Union theater of the macabre?  Are we all fired up and ready to scream?  Digby says we should take a drink every time Obama says "frankly."  I, on the other hand, am now taking bets on how many times he will utter the word "folks."  My guess is an even two dozen. I'll have paper and pen handy, keeping score. 

Human Rights Report Card Out

 Human Rights Watch, the international watchdog agency, has just issued its annual report, with the main story of course being the Arab Spring, and how the international community is (or isn't) supporting the burgeoning democratic movements in repressive countries. You can download the whole report, or browse through it, country by country.

The United States. a putative democracy and thereby expected to lead the rest of the world by example, got an unsurprising dismal review.  HRW did, however, take note of a few efforts at improvement under the Obama Administration:

In one of the few rights-protective immigration reforms in 2011, DHS (Dept of Homeland Security)  announced that it will undertake case-by-case reviews of over 300,000 pending deportation cases and cases deemed to be low-priority will be administratively closed, allowing some potential deportees to remain in the country with temporary legal status. In identifying low-priority cases DHS will weigh non-citizens’ family and community ties, military service, and whether they arrived in the US as children.

According to a piece in the New York Times last week, a pilot program testing out the new leniency policy revealed approximately one of every six undocumented workers swept up by DHS has been granted a reprieve -- but is still barred from working and driving in the United States. So I guess limbo is better than hell, although not by much.

The report also noted that draconian immigration policies in Arizona and Alabama and a few other states have been only partially enjoined by the federal courts.

And despite having our first black president, institutional racism is still alive and well in America, especially in the criminal justice system. We have the largest prison system in the world and the highest per capita incarceration rate. From the report: 

Whites and African Americans engage in drug offenses at roughly equivalent rates, and African Americans account for only about 13 percent of the US population, yet African Americans comprised about 33 percent of all drug arrests in 2009. Not surprisingly, higher arrest rates lead to higher incarceration rates. For example, 45 percent of inmates in state prisons for drug offenses in 2009 were African American; only 27 percent were white.
Persons of color comprise 77 percent of all youth serving life without parole sentences. And for the first time in the country’s history in 2011, people of Latin American origin made up the majority of federal prisoners in the US, due to the federal government’s increased focus on prosecuting unauthorized immigrants.

On a related note, there has been only the slightest improvement in humane treatment of prison populations: 

In February 2011 the DOJ issued its long-overdue proposed standards to implement the Prison Rape Elimination Act (PREA). While some standards meet the 2009 PREA Commission recommendations, several proposed standards are significantly weaker. For example, the proposed DOJ standards do not clearly require facilities to be staffed sufficiently to prevent, detect, and respond to the sexual abuse of prisoners. The standards would leave survivors of sexual assault without legal remedy because they were unable to comply with unduly strict internal grievance procedures. The proposed standards also explicitly exclude immigration detention facilities from coverage. At this writing the final PREA standards have not been issued.

And this year, three more states decided to do away with the practice of shackling pregnant prisoners, bringing the grand total to (only) 14 with such policies.

The report also takes note that more states are attempting to take away workers' collective bargaining rights, and that federal child labor laws are not regularly enforced as they pertain to migrant farm workers' children. (So Newt Gingrich is not so far out of the mainstream after all when he suggests it would be just fine if kids worked as janitors.) The United States is one of the few civilized nations that has no paid maternity leave policy, contributing to health problems in both mothers and infants.

The HIV infection rate continues to rise in this country, which HRW ascribes in part to states' bans on needle exchange programs for addicts.

 Some improvements were noted in gay rights policies: Don't Ask, Don't Tell was repealed and the government is no longer defending the Defense of Marriage Act. New York State passed the Marriage Equality Act.

And last but not least, the Obama Administration gets poor grades for its indefinite detention policies and secretive drone killings abroad, and its continuing failure to investigate and prosecute torture by the Bush Administration.

Barry Does Disney Does Newt

I am not a big believer in conspiracy theories, but I do love a string of coincidences -- or, in this case, a loosely tangled web of a week's worth of unfortunate events.

First, the timeline:

Saturday: The White House signals that it will not back SOPA and PIPA -- the twin bills meandering through Congress that would censor the internet and make it harder to do the cyber version of sneaking into a movie theater without paying.

Wednesday: a national day of protest and dissent against SOPA and PIPA. Congressional sponsors of the bills drop like flies.  Hollywood millionaire ex-Senator Chris Dodd goes ballistic and says Big Entertainment will cut off Barry's Big Entertainment money. Waaaaaah.

Thursday: Barry goes to Disney World to soothe Donald Duck's ruffled feathers  be a tourism shill and promote the theme park to rich people (not Americans). You see, the Disney people also had gone ballistic over the treason of its bought and paid for politicians running away from the anti-piracy bills that Disney helped pay for. Especially since Obama is the biggest single political recipient of Disney money. As a matter of fact, Disney donates to Democrats over Republicans two to one. WTF!!

Thursday Night: ABC (a Disney subsidiary) airs the juicy interview with the second Mrs. Ex-Newt. Newt goes ballistic. 

Where does one even start?  First, let me disabuse you of any notion that I am defending Newt Gingrich. I loathe everything about this dangerous, mean little man. He must never become president. But I find it strange that as soon as Newt started gaining on Mitt Romney in South Carolina this week, ABC/Disney suddenly has this big scoop of an interview with the former wife. (It is common knowledge that the Obama campaign would rather fight Mitt than nasty Newt any day.)  The network execs were said to be absolutely agonizing over whether they should even run it, because they have consciences and stuff.  But after about an hour, they started leaking out dribs and drabs of clips, and they ran the whole thing immediately after Thursday's debate.  Which Newt had handily won. His smackdown of CNN's odious John King was worth the price of admission. These kinds of withering smackdowns are what Obama '12 can ill-afford.

Everybody was shocked, shocked, shocked that Newt wanted an open marriage. But there is only one problem with this scenario. Not only was this no scoop, it is very old news. Of course, people actually have to be readers to realize how stale this stuff is, so I guess the point is that few people bother to read in this Age d'Information. Especially those vaunted "swing" voters.

As John H. Richardson points out in an Esquire blogpost, Marianne Gingrich spilled her guts to him more than a year ago, leading to his own lengthy real scoop of an ignored article. And ABC/Disney is taking credit for its own blockbuster of non-originality?  So now, it is serious journalism's turn to go ballistic:

Her portrayal of Gingrich (writes Richardson) was devastating, complex, nuanced, and compassionate. She held nothing back. And we continued talking after the piece was published, a conversation that continues (more on that in a moment.)

And so it's kind of funny, actually, seeing news that you broke a year and a half ago being blasted out on the Internet as some kind of world exclusive. Why, it's as if we're all amnesiacs. All last night and into today, alarmed headlines have blared across the masthead of the Drudge Report. SHOCK CLAIM: Newt moved for divorce just months after she had been diagnosed with Multiple Sclerosis.... Or: Gingrich Lacks Moral Character to Be President, Ex-Wife Says... Bitter Marianne Gingrich Unloads, Claims Newt Wanted Open Marriage... Or: Adviser: Marianne 'very bitter'...

Follow those links and you arrive at breathless stories about Marianne Gingrich's "first television appearance," which will be aired tonight on ABC. She will say that Gingrich "lacks the moral character to serve as President" because "his campaign positions on the sanctity of marriage and the importance of family values do not square with what she saw during their 18 years of marriage."

That's Disneyfication for you. It's all about the family values glitter, glitz and glamour of forcing an old coot's dirty laundry down our throats. But
back to the Disney/Barry/DNC connection.  Obama is a master at fence-straddling. I can just picture the conversation he had with his miffed Hollywood bundlers-not-lobbyists over his pretend defection from the piracy bills. (wink,nod..."It's an election year, so I can't be too obvious about helping you guys out till I'm safely back in the WH. This SOPA/PIPA thing, we just gotta kick the can down the road for a little while.... but how about I jet down to Orlando and do a giant commercial for you guys in the meantime.... and hey, how can your people help my people with the Newt problem?)

The Center for Responsive Politics has the whole scoop on the Disney Company's political heft and generous giving. It spent $3 million on lobbying Congress last year, mostly to pimp out PIPA/SOPA. (John Podesta, listed as one of the Disney lobbyists, is also the founder of Obama's favorite centrist think tank, the Center for American Progress).  Disney has "officially" given $28,800 to Obama's re-election effort this cycle, with Rick Perry coming in with sloppy seconds of only $2500. And poor Mitt got only two grand from Mickey Mouse and friends.  Newt got nada. Unless you count the free publicity Disney gave him last night.

And going back to  Obama's Cinderella photo-op: the announced purpose of his Florida visit was to make it easier for rich foreigners to come here and drop their cash, being that about half of Americans are either in or close to poverty and theme parks are beyond their means. Isn't tourism promotion one of the main functions of dictators in Banana Republics? Defined by Wikipedia, a banana republic is "a country operated as a commercial enterprise for private profit, effected by the collusion between the State and favoured monopolies, whereby the profits derived from private exploitation of public lands is private property, and the debts incurred are public responsibility". Sound familiar?

One of the main profit drivers in third world economies is tourism. The rich foreigners self-indulging and spending their currency in Disney World need never see the surrounding squalor of Florida, with its blighted neighborhoods of foreclosed homes and destitute citizens and private jails full of minority victims of the War on Drugs. But with the increased tourism the president is touting and increased profits to his political backers, the upside (we are told) is that the cute Disney "cast members" might see a nickel or two extra trickled down in their wage-slave paychecks.

No word yet on when Obama might fly back down to Disney to dedicate its new Anti-Pirates of the Caribbean ride.