Rove “Conduit” in US Attorney Firings

I never thought that Karl Rove was the evil behind George W. Bush’s throne.  (I remain convinced that Dick Cheney was the real evil in the Bush administration.)  I’ve always thought, rather, that Rove was merely an acolyte to the evil that some in the Bush administration manifested.  Yes, Rove is/was ruthless and mendacious and would do anything to get his boss elected and to keep that boss in power, but that pales in comparison to Cheney’s résumé (Why is it, by the way, that so many politicians are named “Dick?”  But I digress).  I may have underestimated Rove’s contributions somewhat, however.

Today we learn, via the Washington Post, that Karl Rove actually had much more to do with the US Attorney firings than originally known.  I’ve suspected as much, but now there seems to be some evidence.  In other words, there has been a hint of smoke for a long time — you just knew that he was involved — but now there seems to be some fire to go along with the smoke.

Political adviser Karl Rove and other high-ranking figures in the Bush White House played a greater role than previously understood in the firing of federal prosecutors almost three years ago, according to e-mails obtained by The Washington Post, in a scandal that led to mass Justice Department resignations and an ongoing criminal probe.

The e-mails and new interviews with key participants reflect contacts among Rove, aides in the Bush political affairs office and White House lawyers about the dismissal of three of the nine U.S. attorneys fired in 2006: New Mexico’s David C. Iglesias, the focus of ire from GOP lawmakers; Missouri’s Todd Graves, who had clashed with one of Rove’s former clients; and Arkansas’s Bud Cummins, who was pushed out to make way for a Rove protege.

The documents and interviews provide new information about efforts by political aides in the Bush White House, for example, to push a former colleague as a favored candidate for one of the U.S. attorney posts. They also reflect the intensity of efforts by lawmakers and party officials in New Mexico to unseat the top prosecutor there. Rove described himself as merely passing along complaints by senators and state party officials to White House lawyers.

The only reason Rove would have been involved is if there were politics involved in the decisions surrounding the US Attorney firings.  The US Attorneys are above politics.  They have to be.  They often prosecute crimes that politicians commit, so political considerations are never supposed to be part of any decision to fire one.

AmericaBlog says that Rove led the initiative to fire David Iglesias, the US Attorney in Arizona, because he wouldn’t prosecute ACORN. 

On ACORN:

Attorney General Alberto Gonzales’s ex-chief of staff, D. Kyle Sampson, testified last week that “during the run-up to the midterm elections,” the A.G. told him Rove had “complained” that David Iglesias, the U.S. attorney in New Mexico, and two other federal prosecutors, were not doing enough to prosecute voter fraud—a top GOP priority. It was shortly after that, Sampson said, that Iglesias got added to the list of U.S. attorneys to be fired. (Iglesias told NEWSWEEK he had been repeatedly pushed by New Mexico GOP officials to prosecute workers for ACORN, an activist group that was registering voters in minority neighborhoods, but he found no cases worth bringing.)

So it seems that Rove was in the thick of it, despite saying for years that he had nothing to do with it.  I think we’re going to learn a lot more about the inner workings of the Bush administration as time goes on.  And the more we learn, the worse it works.  In any case, the other shoe hasn’t dropped yet in Rove’s and Miers’s involvement in the US Attorney firing scandal.  Is anyone taking bets (if gambling were legal) on whether we’ll see Rove and/or Miers prosecuted?

Bush Aides Still Trying to Have Government Reports Changed

It’s been noted that during the Bush years, the administration pressured scientists — among others — to change their reports to fit a political meme, rather than reality.  The examples that come to mind concern global warming and the environment.

Today, we read that former officials in the Bush administration are quietly working the leaders in the Justice Department, trying to get them to soften the torture reports.

From the Washington Post:

Former Bush administration officials are launching a behind-the-scenes lobbying campaign to urge Justice Department leaders to soften an ethics report criticizing lawyers who blessed harsh detainee interrogation tactics, according to two sources familiar with the efforts.

In recent days, attorneys for the subjects of the ethics probe have encouraged senior Bush administration appointees to write and phone Justice Department officials, said the sources, who spoke on condition of anonymity because the process is not complete.

[snip]

Authorities did not signal in the letter when or in what form the report would be released. They have shared their findings with the CIA and asked for the agency’s comments, the letter said. The biggest holdup to release has been the fact that the content of the interrogation memos had been classified, but the documents were released last month by the Justice Department. Sources said the highly anticipated report could emerge as soon as this summer.

Any disciplinary findings about the former Justice Department attorneys are likely to add fuel to calls within Congress and among left-leaning interest groups for criminal prosecutions of Bush administration officials who authorized the interrogations and for an independent congressional inquiry into the origins of the practices.

Legal experts on both sides of the political aisle have cast doubt on the likelihood of wide-scale criminal probes, but neither President Obama nor Holder has ruled out investigations of those who might have gone beyond the Justice Department’s legal advice.

The Office of Professional Responsibility, which has been conducting the investigation, itself has been a focus of criticism from defense lawyers and judges, who say it moves slowly and operates with too much secrecy. Last month Attorney General Holder transferred its longtime leader, H. Marshall Jarrett, to another senior post and replaced him with federal prosecutor Mary Patrice Brown. The report on Yoo, Bybee and Bradbury is now in her court, department sources said.

It seems to me that the former Bush administration officials who are “working the refs” in the Justice Department are up to their old tricks.  Perhaps they’re worried that they face some legal exposure in this case and are engaging in some self preservation.

I know President Obama is lukewarm on the idea of a full investigation into “enhanced interrogation” techniques (to use the Orwellian Bush administration term for the practice).  Obama wants to look forward, after all, and move on.  After all, he ended the practice in his first week in office.  I understand that.  I still think, however, that there must be an investigation — a full investigation.  There is a stain on America that needs to be eradicated.  Only then can we move forward.

More on the Torture Memos

I read Michael Gerson’s column in this morning’s Washington Post and was just aghast.  Michael Gerson was, of course, a speechwriter for George W. Bush.  It seems like he still has Bush’s back.  Either that, or he’s just delusional.

By releasing the Justice Department memos on coercive interrogations, the Obama administration has produced an unintended effect: Revealing the context and care of these decisions has made them more understandable, not less.

I had come to view harsh interrogations as a clear mistake. The war on terror is as much an ideological conflict as a military one, and the combination of Abu Ghraib and revelations about waterboarding had the practical effect of a battle lost. I worried also that these techniques might lead to a dehumanized view of the enemy — always a risk in a time of war — thus greasing a slippery slope toward abuse.

But the Justice Department memos disclose a different sort of deliberation — a government struggling with similar worries even after immense provocation; a government convinced that new attacks were imminent but still weighing the rights of captured murderers, drawing boundaries to prevent permanent injury during questioning, well aware of the laws regarding torture and determined not to violate them.

For my money, the Justice Department memos were lawyers trying to craft some kind of legal argument that torture is not, in fact, illegal.  Of course, it clearly is illegal.  We haven’t heard from Bush on all this — just Cheney, ad nauseam — but it looks to me like Bybee and Yoo were trying to make a legal judgment to cover the tails of those who were to carry out instructions that were already given.  Consider Cheney’s lack of remorse and position that Obama repudiating torture has made the nation less safe.

Gerson makes me sick with the continuation of his argument:

Historically, did America ever give such exhaustive consideration to the consequences of its actions in safeguarding the homeland? To the rights of children incinerated during the firebombing of Dresden? To the long-term mental and physical health of the elderly of Hiroshima? Even the most questionable techniques employed in the war on terror bear no comparison to methods common in past American wars.

The firebombing of children during World War II was unfortunate.  “Surgical” bombing didn’t really exist in those days, so there was a lot of collateral damage.  It’s terrible, but it’s also not a violation of international law, and it’s not a violation of the Geneva Conventions.  But that’s really not the point.  The comparison of torture to the actions of the government, trying to win a declared world war is a canard.  A fallacy.

The point is that the United States contrived a legal reason to violate international and US law.  In my opinion, that made us less safe.  We gave up any moral authority that we had, and we squandered the goodwill that the world felt toward the United States after the 9/11 attacks.

Gerson ends:

I remain ambivalent about these issues. There may be other, equally effective ways to get information from terrorists — I don’t know enough about such techniques to be certain. Elements of the interrogation program may have been mistaken. But these were not clear or obvious calls — and they deserve more than facile, retrospective judgments.

I’m not ambivalent about this.  These harsh techniques are torture.  That was a violation of our law and international law.  It wasn’t necessary, either; terrorists were already talking to their interrogators.  The Bush administration lied about the need for “enhanced interrogation techniques” just like they lied about WMD in Iraq as a pretense to start a war.  They did this in our names.  That is reprehensible.  Those responsible must answer for this.

Accountability for Torture

I’ve been digesting what our country did to detainees during the Bush administration.  To say that I am disgusted is an understatement.  It’s clear that President Bush authorized torture.  It’s clear that the Office of Legal Counsel in the Justice Department contrived some “legal” way to say that these “enhanced” interrogation methods were not torture and were, therefore, not unlawful.  That is a crock.  This was torture, pure and simple.  You can read both the ACLU memos (linked above) and the Red Cross report for yourself.

President Obama has not ruled out legal action — prosecution — against the Bush administration officials who authorized harsh interrogation methods.  He left that decision up to Attorney General Holder.

President Obama yesterday declined to rule out legal consequences for Bush administration officials who authorized the harsh interrogation techniques applied to “high-value” terrorism suspects, saying the attorney general should determine whether they broke the law.

Obama also said that if Congress is intent on investigating the enhanced interrogation practices, an independent commission might offer a better means to do so than a congressional panel, which he indicated is more likely to split along partisan lines than to produce constructive results.

I think that at the very least there should be an independent commission.  We don’t need an impotent congressional committee trying to investigate this.  Members of the committee have a short amount of time to ask (and have answered) questions.  They invariably use that to grandstand and pontificate and rarely get many useful answers.  Congressional investigations would be a waste of time, unless they are held in addition to another investigation.

What I think would do the most good is a special prosecutor.  I’m not advocating a witch hunt.  But there must be some accountability for these acts.  (I agree with the president that those who actually carried out the harsh interrogations should not be prosecuted; government attorneys gave them legal cover.)  So those who provided the legal cover — John Yoo, Jay Bybee — as well as those who authorized this — George Bush, Dick Cheney — should spend some time defending their actions.

I believe that normally what happened in a previous administration should be left to the historians.  This isn’t a normal thing, however.  Torture is not legal under American and international law.  The United States is a signatory to the Geneva Conventions, which are meant to protect both foreign combatants and American service members from inhumane treatment.  But the Bush administration threw those protections away and gravely mistreated people in the name of “keeping America safe”.

We can’t know whether these tactics actually worked.  That really doesn’t matter, though.  Call me naïve, but America is supposed to be better than that.  We’re supposed to cry foul when other countries do this kind of thing.  We’re not supposed to commit what may constitute war crimes.  And if something like that happened, those who authorized it and contrived some legal cover for it should be prosecuted. 

These are crimes that have to be addressed before we can move on.  This can’t simply be swept under the rug.  We need a special prosecutor to fully investigate this matter and we need one now.

Disturbing Scenes from the Tea Parties

Huffington Post has slide shows of the tea parties from yesterday.  I was quite disturbed by some of these images.  Here’s a small sample:

“American Taxpayers Are The Jews For Obama’s Ovens.”  I can’t even count the ways that’s offensive.  It’s probably the worst picture I’ve seen from these protests yesterday.

This one, comparing Obama to Hitler, is very nearly as bad.

“Guns tomorrow!”  Is this man advocating rebellion, like Rick Perry was?

So much for a post-racial society in the United States, at least for right now.  I know that racism exists, but that it would come out so easily and with so much vitriol really concerns me.

The Right Wing seems to have an extremist problem.  Homeland Security released a report about that a few days ago — a report that was begun under President Bush.  AmericaBlog has an excellent post on this.

I give examples below, from George Bush’s FBI and DOD, detailing the problem of far-right extremists infiltrating the US military, and trying to recruit former members of the US military. The media does all of us a disservice by not demanding the Republicans explain why they are now for us abandoning efforts to monitor a threat that George Bush himself pointed out to us.

[snip]

Department of Defense investigators estimate thousands of soldiers in the Army alone are involved in extremist or gang activity

From the Southern Poverty Law Center, 7/7/06:

Under pressure to meet wartime manpower goals, the U.S. military has relaxed standards designed to weed out racist extremists. Large numbers of potentially violent neo-Nazis, skinheads and other white supremacists are now learning the art of warfare in the armed forces.

Department of Defense investigators estimate thousands of soldiers in the Army alone are involved in extremist or gang activity. “We’ve got Aryan Nations graffiti in Baghdad,” said one investigator. “That’s a problem.”

This was George Bush’s Defense Department, Donald Rumsfeld’s DOD – they determined that thousands of extremists were at that time members of the US military. So the media needs to ask the Republicans what they are talking about. Do they think we should not keep tabs on Aryan Nation members of the US military?

FBI report: “White Supremacist Recruitment of Military Personnel since 9/11,” 7 July 2008

This is a report from George Bush’s FBI:

Although individuals with military backgrounds constitute a small percentage of white supremacist extremists, they frequently occupy leadership roles within extremist groups and their involvement has the potential to reinvigorate an extremist movement suffering from loss of leadership and in-fighting during the post- 9/11 period….

FBI reporting indicates extremist leaders have historically favored recruiting active and former military personnel for their knowledge of firearms, explosives, and tactical skills and their access to weapons and intelligence in preparation for an anticipated war against the federal government, Jews, and people of color. FBI cases also document instances of active duty military personnel having volunteered their professional resources to white supremacist causes….

A review of FBI white supremacist extremist cases from October 2001 to May 2008 identified 203 individuals with confirmed or claimed military service active in the extremist movement at some time during the reporting period….

According to FBI information, an estimated 19 veterans (approximately 9 percent of the 203) have verified or unverified service in the ongoing wars in Iraq and Afghanistan. Twelve of these have primary affiliations with the national organizations NSM (7), NA (4), and AN (1), six with skinhead groups, and one with white supremacist criminal gangs. FBI information indicates the activities engaged in by these individuals reflect those by veterans in the extremist movement generally since 9/11.

These reports are quite disturbing.  No one is saying that the Republican Party bears responsibility for these groups.  But they can’t say that the groups don’t merit watching.  They certainly do, whether they’re comprised of veterans or not.

These are scary times.  We’re involved in two wars, we’re dealing with a huge economic mess, and now we have a governor and a state senate talking about secession.  Whether you support President Obama or not, advocating the dissolution of the Union is at best counterproductive, at worst it’s criminal.  Saying that taxpayers are the Jews for Obama’s ovens and comparing Obama to Hitler is hyperbole in the worst way. 

Obama is nothing like Hitler, at least that we’ve seen thus far.  He hasn’t attacked a country.  He hasn’t rounded up millions of people and put them to death after working them nearly to death. 

I’m not ashamed to admit that I really did not like George W. Bush.  I still don’t.  I think most Democrats felt — and feel — the same way.  But you didn’t hear people on the Left talking about seceding from the Union or holding up signs saying that Bush’s foreign policy and tax policy compared favorably to sending Jews to the ovens.

Obama won the election.  Democrats won the election.  The Republicans need to be the loyal opposition, not cause more problems.  Offer real solutions, not advocate that it’s time for guns to be used because they don’t agree with the president’s tax policies.

Today’s Taxpayer Tea Parties

I haven’t talked about the tea parties going on today up to now.  For one thing, I really haven’t gotten the reason.  I get the motivation — to find something to rile up people against President Obama (talk about an Astroturf — fake grass roots — event) — but I don’t really get the aim.  (And I will leave aside the obvious jokes about tea bagging; that’s been done to death this week.  Probably best by Rachel Maddow.)  As best I can tell, it’s insanity.

The writer of an op-ed in the Los Angeles Times thinks it might be, too:

The Web is buzzing with information about how to throw an anti-Obama Taxpayer Tea Party, something organizers hope will be held today from Santa Monica to South Carolina. But no need to burn up your bandwidth reading complicated instructions. Here’s a simpler recipe:

Go to a hobby store. Buy a scale model of a U.N. One-World-Government Black Helicopter and a tube of glue. Toss the model kit. Sniff the entire tube of glue. You’re all set for the party.

I  can recall only a few outbreaks of such collective insanity as these tea parties in recent years. There was that time in the mid-1990s when a $19.95 video proving Bill Clinton was some sort of serial killer went viral. And then, a few years back, there was that chilling, televised midnight seance from the floor of the U.S. Congress aimed at reviving the long-brain-dead Terri Schiavo.

And now this. Whip out your Lipton and don your tinfoil hat and join the protest against … against … against what exactly?

The original Boston Tea Party was caffeinated by a very simple injustice: American Colonists refused to be taxed by a government that lacked any popular representation. That was remedied a few years later in a heroic struggle that stretched from Concord to Yorktown.

The original Boston Tea Party wasn’t about tea.  It was, as the writer points out, about taxation without representation (a situation, by the way, that still exists in the District of Columbia, but let’s leave that aside for now).  The colonists used tea to make a point.  And the colonists also threw boxes of loose tea, not tea bags, as today’s protestors threw.  I guess tea bags are easier to clean up.

Here’s what I don’t get: Everyone except the very rich is actually getting a tax break under Obama’s plan.  I got a tax cut; my paycheck today increased by about $20.  Not a huge sum, $400 a year, but I’ll take it.  And the tax rates affecting the very rich are still lower than when Ronald Reagan was president. 

So why are people out on the street having tea parties?

Or maybe they’ll do it for some other reason. The FreedomWorks site says the Tea Party movement began in reaction to President Obama’s corporate bailouts and ensuing yawning budget deficits. These same conservatives, however, were mum when George W. Bush erased our budget surplus and put us deep in the red by drunken spending on a pointless war in Iraq and by, yes, granting massive tax rollbacks for the loaded country clubbers who fund the GOP (and Armey’s FreedomWorks). Another bothersome detail: The bailouts were also initiated by Bush.

This is, of course, the irony (if you don’t mention the fact that Fox News basically promoted these events on their air) of this so-called tax protest.  These are the same people who didn’t say a word about their worries about the deficit.  How convenient it is for them to figure out now that deficits are bad.  I won’t lay all the blame for the deficit on Bush, but he and a compliant Congress during the first six years of his presidency deserve a large portion of the blame.

And while way too many otherwise sane Republicans are actively pandering to the tea-bag battalions, some old-fashioned conservatives are calling out the Teabaggers for their silliness. Writing in Fortune magazine, conservative policy analyst Bruce Bartlett, who has a long anti-tax history, says: “The irony of these protests is that federal revenues as a share of the gross domestic product will be lower this year than any year since 1950. … The truth is that the U.S. is a relatively low-tax country no matter how you slice the data.”

The Tea Party movement, more than anything else, is a rather garish display of a Republican right that seems to have lost not only the national elections but also any semblance of political bearings. Staying on this course, the GOP risks — in the words of one pundit — becoming “the Talk Radio Republican Party.”

Is the Right Wing so blinded by the hatred of anything Democratic that they can’t put aside some of this inane posturing and try to help the country get out of the mess it’s in?  Apparently so.  That’s what they’ve shown so far, since Obama took office.  More’s the pity, too. 

By the way, calling Obama a fascist — as some did today — is laughable.  George W. Bush (or maybe I should say Richard B. Cheney) was a good deal more fascist than Obama is.  First Obama is a socialist, then he’s a fascist.  News flash:  Obama is neither fascist nor socialist.  If you want to see what socialism is, read about Eugene Debs.

This is just more of the same from the Right.  The Republicans are bereft of leaders and ideas.  So all they can do is protest what Obama does and try to obstruct his policies.  It’s a dangerous strategy for the Republican Party both for its future, and for the country’s future as it tries to get out of the messes we’re in, most of which were left behind by a grossly ineffective administration.

The Alternative Republican Budget

The Republicans released the details of their alternative budget today.  I keep waiting for someone to stand up and say, “April Fools!”  Apparently, though, they’re serious. Rep. Paul Ryan (R-Wisc.) laid out the plan in an op-ed in today’s Wall Street Journal.

Here are some excerpts:

Under the president’s plan, spending will top $4 trillion this year alone, and consume 28.5% of our nation’s economy. His plan would mean a $1 trillion increase to the already unsustainable spending growth of our nation’s entitlement programs — including a “down payment” toward government-controlled health care and education; a $1.5 trillion tax increase to further shackle the small businesses and investors we rely on to create jobs; a massive increase in energy costs for families via cap and trade. Moreover, the Obama plan would result in an exploding deficit, a doubling of the nation’s debt in five years, and an increase of that debt to more than 82% of our nation’s GDP by the last year of the budget. This approach will ultimately debase our currency and reduce the living standards of the American people.

Instead of doubling the debt in five years, and tripling it in 10, the Republican budget curbs the explosion in spending called for by the president and his party. Our plan halts the borrow-and-spend philosophy that brought about today’s economic problems, and puts a stop to heaping ever-growing debt on future generations — and it does so by controlling spending, not by raising taxes. The greatest difference lies in the size of government our budgets achieve over time (see nearby chart).

I have to say that I love this chart.  It should win an award for fiction.  A 70-year budget projection?  Spare me.  It’s simply a straw man constructed to make the Democrats look worse than they actually are.  This, from the party who, under Bush,  halved the normal 10-year projection to five to make the deficit look better than it actually was.

- Tax Reform. Our budget does not raise taxes, and makes permanent the 2001 and 2003 tax laws. In fact, we cut taxes and reform the tax system. Individuals can choose to pay their federal taxes under the existing code, or move to a highly simplified system that fits on a post card, with few deductions and two rates. Specifically, couples pay 10% on their first $100,000 in income (singles on $50,000) and 25% above that. Capital gains and dividends are taxed at 15%, and the death tax is repealed. The proposal includes generous standard and personal exemptions such that a family of four earning $39,000 would not pay tax on that amount. In an effort to revive peoples’ lost savings, and to create an incentive for risk-taking and investment, the budget repeals the capital gains tax through 2010 for all taxpayers.

On the business side, the budget permanently cuts the uncompetitive corporate income tax rate — currently the second highest in the industrialized world — to 25%. This puts American companies in a better position to lead in the global economy, promotes jobs here at home, and strengthens worker paychecks.

The Republicans still have no new ideas.  This is a rehash of President Bush’s budget.  How is that one working out for you?

I love the way Josh Marshall puts it on TPM:

I realize that it doesn’t afford me a lot of opportunities for personal or spiritual growth. But I’m nonetheless comforted by the fact that the Republicans running things in the House GOP caucus are still as clinically insane as in years past. We see today from their House GOP ‘budget’ that their new-found allegiance to fiscal discipline has them lowering the top marginal tax rate to 25% (it’s currently 35%, with the Bush tax cuts), which for anyone who knows anything about the federal budget would pretty much inevitably lead to gargantuan federal deficits and the Treasury exploding probably some time early in the next decade. They manage to still have the deficits coming down by bunch of nonsense hokum about oil rigs and other foolery.

If that weren’t enough. This is the scoring the House Republicans have provided, tracking Democratic budget policy and theirs over the next 70 years. As you can see, predicting ideological stances over as yet unborn Democratic members of Congress, the GOP scoring appears to have us on track for the government owning about 90% of the economy in the early-mid-22nd second, which if I remember is about the time period of the invention of the warp drive. So I don’t know if they’ve figured that in too.

The Republican House Caucus is still clinically insane.  That’s a pretty apt observation.  You see why I’m waiting for someone to say, “April Fools!”  There’s nothing in their budget alternative but smoke and mirrors and a rehash of Bush tax policy.  (Andrew Sullivan can’t even find many conservative blogs that are saying seriously that this is a good plan.)

The Republicans had to put something out because President Obama challenged them to.  He did that because the Republicans keep saying no without offering anything constructive.  So the Republicans held a press conference last week and waved a brochure about their budget, the details of which we’d see this week.  Well, now we’ve seen it, and we see it for what it is: a joke.

Is This 1931?

Here’s the counterbalance to the Washington Post/ABC News poll that was released this morning.  Paul Krugman, who won a Nobel Prize for economics, says that there is no recovery in sight.  It’s not exactly cheery news.

Looking at his graph, you can see the slight uptick in 1931, then the slide continued.

According to his blog post on the New York Times website, there is no recovery coming either this year or next.

I’m detecting a trend in commentary that I find slightly ominous. Some of the economic news lately has been slightly better than expected, which was bound to happen at some point (on average, after all, half the news should be better than expected). Mostly this is in the form of things getting worse more slowly, but it wouldn’t be surprising if we see, say, an uptick in industrial production in a few months, as the inventory cycle runs its course.

If so, that doesn’t mean the worst is over. There was a pause in the plunge in early 1931, and many people started to breathe easier. They were wrong.

So far, there’s nothing pointing to a fundamental turnaround this year, or next, or for that matter as far as the eye can see.

As I said, that’s not cheery news.  It directly contradicts the optimism that some people are starting to feel again.

Another cheery post from Krugman:

So in 2007 the Pension Benefit Guarantee Corporation — which stands behind corporate pensions — switched from bonds only to lots of stocks, buying in at, natch, the peak of the market. Oops. And this is big stuff: the Bush administration may have left us all a gratuitous loss of hundreds of billions.

Why did this happen? I’m sure we’ll find some nasty stuff, but at least part of the reason was that the Bush administration, like many conservatives, was under the spell of the following pseudo-syllogism:

1. The stock market captures the essential spirit of capitalism.

2. Capitalism roolz!

3. Therefore, stocks will go up.

The most influential disseminator of this fallacy is the Wall Street Journal, which as far as I can tell has cheered on every bubble since the 1920s, always dismissing the skeptics as fools and promoting the dumbest bull-market arguments available. I don’t have time to search for it right now, but I think there was an editorial circa 2000 saying precisely that anyone who questioned the bull market of the time was anti-capitalist.

And now the cost for that attitude is falling on you and me.

Another blessing from George W. Bush.

I admit.  I was one of those people starting to feel that maybe — just maybe — there was a light at the end of this tunnel.  It looks like that isn’t the case and that Krugman — as much as I hoped that he would be wrong — is right and we’re going to have a lost decade.

Stripping AIG Executives of Their Bonuses

I’m angry at AIG.  I’m angry at the mismanagement that got them into the mess they’re in.  And I’m angry that the taxpayers have given AIG about $170 billion and now own about 80% of the company.  But that’s the reality these days.  (A bit of history — the AIG bailout was conceived and executed about a year ago.  Under President Bush.  So laying all of this on Obama is disingenuous at best.)

AIG, it has to be said, has not played a good public relations game.  They’ve had huge, lavish parties for their agents, paid bonuses and now are paying even more bonuses.  This time it’s $165 million, paid to the executives of the financial division that basically took AIG down.  And this time it’s coming on the heels of a $61.7 billion loss last quarter.  AIG isn’t in the financial position to be paying bonuses, contracted obligations or not.  By all rights, they should be in bankruptcy at the moment, where those contracts would have been voided.  But because the US Government stepped in, these guys get their bonuses.  It defies logic. 

Those executives should stand up and say that they won’t accept them, or will give them to charity, or something.  But they shouldn’t benefit financially from their failures and the taxpayers’ largesse.

That brings me to the noise going on in Congress at the moment, which I view as misguided kneejerk sputtering.

From an AP article:

Congressional Democrats vowed Tuesday to all but strip AIG executives of their $165 million in bonuses as expressions of outrage swelled in Congress over eye-catching extra income for employees of a firm that has received billions in taxpayer bailout funds.

“Recipients of these bonuses will not be able to keep all of their money,” declared Senate Majority Leader Harry Reid, in an unusually strong threat delivered on the Senate floor.

“If you don’t return it on your own we will do it for you,” said Chuck Schumer of New York.

The bonuses were paid legally, part of a program that had been disclosed in advance in filings that American International Group Inc. made with the government.

House and Senate Democrats were crafting separate bills to tax up to 100 percent of generous bonuses awarded by companies rescued by taxpayer money. Republicans said President Barack Obama’s administration should have done more to stop the bonuses.

As I said above, I share the outrage.  But crafting legislation after the fact — when the government knew about these bonuses beforehand — is punishment.  It’s deserved, but it does not sit well with me.  The government, when it agreed to bail AIG (and Citigroup and Bank of America, and GM — to name a few) should have made AIG void those contract provisions before the firm received the government money.  That they didn’t is the fault of the Bush administration.

The AIG executives need to voluntarily return the money.  They failed and they need to admit that.  But Congress can’t — and shouldn’t — do that for them.  The outrage is well placed.  The remedy strikes me as half-baked, un-American and probably unconstitutional.

Update:  Thanks to Andrew Cuomo — the Attorny General of New York — we now know who got these bonuses.  There were 73 employees who got the $165 million.  From Cuomo’s office:

• The top recipient received more than $6.4 million; 
• The top seven bonus recipients received more than $4 million each; 
•  The top ten bonus recipients received a combined $42 million; 
• 22 individuals received bonuses of $2 million or more, and combined they received more than $72 million; 
•  73 individuals received bonuses of $1 million or more; and 
• Eleven of the individuals who received “retention” bonuses of $1 million or more are no longer working at AIG, including one who received $4.6 million;

Again, these payments were all made to individuals in the subsidiary whose performance led to crushing losses and the near failure of AIG. Thus, last week, AIG made more than 73 millionaires in the unit which lost so much money that it brought the firm to its knees, forcing taxpayer bailout. Something is deeply wrong with this outcome. I hope the Committee will address it head on.

We have also now obtained the contracts under which AIG decided to make these payments. The contracts shockingly contain a provision that required most individuals’ bonuses to be 100% of their 2007 bonuses. Thus, in the Spring of last year, AIG chose to lock in bonuses for 2008 at 2007 levels despite obvious signs that 2008 performance would be disastrous in comparison to the year before. My Office has thus begun to closely examine the circumstances under which the plan was created.

Presidential Signing Statements

President Obama said today that his administration will not necessarily rely on signing statements made by President Bush.  He ordered the Executive Branch to consult with the attorney general before relying on them.

Calling into question the legitimacy of all the signing statements that former President George W. Bush used to challenge new laws, President Obama on Monday ordered executive officials to consult with Attorney General Eric H. Holder Jr. before relying on any of them to bypass a statute.

That’s good news.  When thinking about Bush’s use of signing statements, I often thought that Bush was abusing his presidential power.  Nothing new for him, and not the most egregious of his abuses, but still another abuse of power.

But Mr. Obama also signaled that he intends to use signing statements himself if Congress sends him legislation that has provisions he decides are unconstitutional. He pledged to use a modest approach when doing so, but said there was a role for the practice if used appropriately.

“In exercising my responsibility to determine whether a provision of an enrolled bill is unconstitutional, I will act with caution and restraint, based only on interpretations of the Constitution that are well-founded,” Mr. Obama wrote in a memorandum to the heads of all departments and agencies in the executive branch.

I have a question about this, because I genuinely don’t understand the legal distinctions being made here.  (And I hope I don’t sound like a rube in posing them, either.)  How does a signing statement not amount to a line-item veto if it is being used to effectively ignore a certain provision of a bill?  And if a bill is in fact unconstitutional, why sign it at all? 

All in all, I think President Obama’s restrained approach to signing statements is a good thing and should hopefully lead to less controversy.  I still wonder at the practice at all, though.  So, can someone explain that to me?