Dirty Dozen Dems Deny Fairness, Justice

Twelve Senate Democrats joined every Republican to vote down the Durbin Amendment, which would have allowed bankruptcy judges to renegotiate the terms of mortgages.

Opponents of the amendment – the financial industry! – cleverly marketed the proposed change. “Cramdown” was the framing.

I envision poor, innocent banks and other financial behemoths – many of which the government has just greatly lavished with tax dollars – being held down, in the fashion of water boarding, and forced to eat a pile of shit.

However, I prefer accuracy. Something with either the words “fairness” or “justice” would be more apt framing.

People should be given an extra opportunity to stay in their homes, especially with the amount of predatory lending and across-the-board shadiness that financial firms engaged in.

The actions of these 12 Democrats are nothing short of shameful. Pressure from the financial industry was too much. Dick Durbin, author of the amendment, is right: Wall Street owns the place. Running a campaign for the Senate is expensive. Much safer to not anger your best customers.

These dirty dozen should be mercilessly primaried, especially those from liberal or moderate states. I indicate the best possibilities with an *.

Max Baucus – MT – Though he hails from a populist Western state, he was just re-elected in ’08.

*Michael Bennet – CO – WTF? Obama won CO by 7 percentage points. Is he even trying? His ass should be grass in 2010.

Robert Byrd – WV – Is he still sentient?

Thomas Carper – DE – Okay, finance pretty much owns DE. But it’s small and liberal. Can’t be too hard to organize solid opposition in 2012.

*Byron Dorgan – ND – He’s up for re-election in 2010. BHO almost won ND. A solid candidate that speaks to the people could do well.

Tim Johnson – SD – Just re-elected in ’08.

Mary Landrieu – LA – The South. Blah!

Blanche Lincoln – AR – Ditto!

Ben Nelson – NE – Is he even a Democrat?!

Mark Pryor – AR – Another seemingly lost cause.

*Arlen Specter – PA – What a joke.

John Tester – MT – I find it hard to believe that Tester would vote “no.” He seems so decent and normal. Apparently not.

Democrat for Rick Perry

Ricky goes to school! It's about time we taught the Repubs a lesson.

Simply put, he represents the best opportunity for a Dem to claim the governor’s mansion in 2010.

Ricky is a prideful executor of mentally retarded folks and he disdains helping people in difficult economic times. He’s a bad dude, doing absolutely nothing to help regular Texans.

In this, his ninth year as governor, Ricky is weak. Republicans know it too.

Senator Hutch is challenging him in the Repub primary. She’ll be attacking from the middle: she actually supports taking the federal unemployment stimulus money and recently she’s been voting like a sane person.

KB is clearly the more formidable candidate in the general election.

And that’s exactly why Democrats, independents, and properly minded Republicans should vote for Perry.

A Democrat – whoever the hell it would be – would have a better shot against Ricky.

Fortunately, Texas has open primaries. We can do to Ricky exactly what Repubs did to Barry.

Revenge will be sweet.

Copyright Be Damned: Taleb’s Enlightened Principles

My boy Nassim Taleb – he of Black Swan fame – proposes 10 guiding principals to massively reform the US economy.

Simon Johnson, formerly the chief economist at the IMF, gives a detailed look at the powerful interests preventing the needed large-scale changes. Basically, Washington kowtows to Wall Street’s every need.

Obama needs to quickly do a good Teddy Roosevelt impression and start his own version of trust-busting. The Washington establishment still believes our current financial system is necessary for a fully functioning economy.

Au Contraire.

This one sector is holding the rest of the economy – and the country! – hostage. The process has been long in the making. For 25 years, or so, capital has been flowing increasingly into finance at the expense of the real economy and real people. With globalization and increasing international capital flows, money has been going into America’s financial sector in large amounts from abroad – creating similar structural imbalances.

Financial gimmicks and cooked books kept the scam going these past couple of years.

Lots of rich, powerful people would suffer if the system were changed. In this video, Johnson explains the resemblance of the USA’s current problem to power-structure dilemmas of the third world.

Throw the rich overboard!

Nassim Taleb’s 10 principles for a Black Swan-proof world

1. What is fragile should break early while it is still small. Nothing should ever become too big to fail. Evolution in economic life helps those with the maximum amount of hidden risks – and hence the most fragile – become the biggest.

2. No socialisation of losses and privatisation of gains. Whatever may need to be bailed out should be nationalised; whatever does not need a bail-out should be free, small and risk-bearing. We have managed to combine the worst of capitalism and socialism. In France in the 1980s, the socialists took over the banks. In the US in the 2000s, the banks took over the government. This is surreal.

3. People who were driving a school bus blindfolded (and crashed it) should never be given a new bus. The economics establishment (universities, regulators, central bankers, government officials, various organisations staffed with economists) lost its legitimacy with the failure of the system. It is irresponsible and foolish to put our trust in the ability of such experts to get us out of this mess. Instead, find the smart people whose hands are clean.

4. Do not let someone making an “incentive” bonus manage a nuclear plant – or your financial risks. Odds are he would cut every corner on safety to show “profits” while claiming to be “conservative”. Bonuses do not accommodate the hidden risks of blow-ups. It is the asymmetry of the bonus system that got us here. No incentives without disincentives: capitalism is about rewards and punishments, not just rewards.

5. Counter-balance complexity with simplicity. Complexity from globalisation and highly networked economic life needs to be countered by simplicity in financial products. The complex economy is already a form of leverage: the leverage of efficiency. Such systems survive thanks to slack and redundancy; adding debt produces wild and dangerous gyrations and leaves no room for error. Capitalism cannot avoid fads and bubbles: equity bubbles (as in 2000) have proved to be mild; debt bubbles are vicious.

6. Do not give children sticks of dynamite, even if they come with a warning . Complex derivatives need to be banned because nobody understands them and few are rational enough to know it. Citizens must be protected from themselves, from bankers selling them “hedging” products, and from gullible regulators who listen to economic theorists.

7. Only Ponzi schemes should depend on confidence. Governments should never need to “restore confidence”. Cascading rumours are a product of complex systems. Governments cannot stop the rumours. Simply, we need to be in a position to shrug off rumours, be robust in the face of them.

8. Do not give an addict more drugs if he has withdrawal pains. Using leverage to cure the problems of too much leverage is not homeopathy, it is denial. The debt crisis is not a temporary problem, it is a structural one. We need rehab.

9. Citizens should not depend on financial assets or fallible “expert” advice for their retirement. Economic life should be definancialised. We should learn not to use markets as storehouses of value: they do not harbour the certainties that normal citizens require. Citizens should experience anxiety about their own businesses (which they control), not their investments (which they do not control).

10. Make an omelette with the broken eggs. Finally, this crisis cannot be fixed with makeshift repairs, no more than a boat with a rotten hull can be fixed with ad-hoc patches. We need to rebuild the hull with new (stronger) materials; we will have to remake the system before it does so itself. Let us move voluntarily into Capitalism 2.0 by helping what needs to be broken break on its own, converting debt into equity, marginalising the economics and business school establishments, shutting down the “Nobel” in economics, banning leveraged buyouts, putting bankers where they belong, clawing back the bonuses of those who got us here, and teaching people to navigate a world with fewer certainties.

Then we will see an economic life closer to our biological environment: smaller companies, richer ecology, no leverage. A world in which entrepreneurs, not bankers, take the risks and companies are born and die every day without making the news.

In other words, a place more resistant to black swans.

The writer is a veteran trader, a distinguished professor at New York University’s Polytechnic Institute and the author of The Black Swan: The Impact of the Highly Improbable

Copyright The Financial Times Limited 2009

Two Cheers for the Congressional Black Caucus

Leaders from the group recently visited Cuba, meeting with Raul and Fidel Castro. The purpose was to begin the process of thawing long-icy relations between the U.S. and Cuba.

After Obama’s election, the future purpose of the Black Caucus was an often asked question. Do we still need it?

Hell yes.

But the conventional operating wisdom isn’t so sure. Obama has every political incentive to distance himself from the group – something he’s done since arriving in Washington as a senator in 2004.

He can’t appear to be helping black folks too much. The mere suggestion of it would bring catcalls from the right.

Apparently the Black Caucus is aware.

So, in response, they’ve gone international, advocating normalized relations with America’s closest nemesis.

Well done!

The editoral board at the WaPo, not surprisingly, isn’t pleased. They’re blowing hard about Cuba’s emerging democracy movement and how this trip undermines it.

What about all the political prisoners?

Good point. Cuba sucks when it comes to political decent. But the U.S. is only marginally better.

Over the past eight years we’ve repeatedly raped and pillaged our laws. Guantanamo. NSA wiretapping. Don Siegelman.

O, yeah, and what about all the prisoners in America?

We’ve both sinned. It’s time to make up.

My Name’s Gunnar Jacobson

And I’m running for State Rep to help those in need – the hungry, the poor, the downtrodden. It’s time for real leadership in Texas. Moneyed interests have been dominating the state for too long. Levántense!

No, I’m running for nothing.

But yesterday was the first time – ever – that I tied my own tie. I figure that’s post worthy.

50-plus Dead at Dallas News Bloodbath

A 1938 DMN cover page.

Preliminary reports indicate the high likelihood of suicide.

But, really, the death can be dated years back. The buyouts and layoffs of the past few years are only part of the equation.

When was the last time the DMN actually took on the powers that be in Dallas or Texas? Well, there was . . .

They probably have. But most of the big items they run are tearjerker pieces: so and so fell through the cracks. Their lives are so hard. Let’s feel bad.

More than anything, the paper is a booster for the status quo – the moneyed interests of the city and state, including developers, sports team owners, bankers, and oil boys.

Real news goes unreported – or is relegated to small blurbs on the second page of the Metro section.

The increasing vibrancy of the city – thanks mostly to the influx of Latin and Asian immigrants – and, in general, community-level happenings are not sufficiently reflected in the paper.

In-depth projects of a controversial nature are regularly held up, watered down, or simply just not run.

And, to be honest, has the oldest news organization in Texas ever really done the bidding of the people?

However, in closing, I will give credit where it is do. The Dallas Morning News sure did stoke the fire of right-wing extremism in the 1960s. Thanks DMN, you were an accessory to the ugliest patch of recent American history.

But now you’ve killed yourself.

I think Dallas and Texas will be better off.

Republican Power Play Reaches Texas House

The long-standing wet dream of Texas Republicans hit the House Elections Committee today.

For the third session in a row, Republicans are offering to save the sanctity of Texas elections from voter impersonators (pssst – illegals! Mexicans!). With “significant evidence of voter fraud,” according to chairman Todd Smith (R), Republicans would have voters bring additional identification to the polls – 3 pieces, in some circumstances.

In this video, when talking about the supposed fraud, Mr. Smith sure does stumble. The centerpiece of his argument is a story without specifics!

Apparently, there has been “a substantial loss of faith by people of this state and across the country in their electoral process,” Mr. Smith said.

I couldn’t agree more.

And Texas Republicans have been a huge cause of the loss of faith!

Of course, there’s he whose name shall not be spoken. Others come to mind as well: the outlandish shenanigans of Tom Delay, especially the illegal re-drawing of U.S. congressional districts that he orchestrated; Tom Craddick’s reign of terror, which Delay ushered in to power; and Phil Gramm’s give aways to the country’s captains of finance.  These individuals and their shameful actions are the reason people have lost faith in their government.

Mr. Smith, you are the problem.

Instead of making voting more difficult, and excluding greater numbers of citizens, I’d open up the process. Same-day voter registration would be nice. (Feasibility is another question.)

If I were Mr. Smith, or any politician nationwide, I’d be sure to not kick the masses while they’re down.

To increase the government’s role as an advocate for the for well-to-do, the  already super-entrenched power, seems like a firey recipe.

One that might blow up in your face. And sooner than you think!

Public Testimony of Voter ID Bill:

Anyone Can Testify (Or just sign in as opposed to the bill)

Tuesday, April 7th – Tomorrow

1:15 pm (But it’s a good idea to get there early to sign up. As early at 10 am)

John H. Reagan Building – Room 120
105 W. 15th Street
Austin, TX 78701