Analiese’s Reading 4/9
National politics edition: U.S. economy looks more like an emerging market than an established one after undue political influence from finance, Obama administration is attempting an end run around Congress on bailout rules and reporting, documenting the administration’s ties to finance, Nassim Taleb predicted the collapse and explains what needs to happen next, the possible return of Eliot Spitzer, Spector no longer supports a vote on EFCA, war demands sacrifices from dogs too, state legislatures focusing on voter “fraud” instead of real issues, Congress may fillibuster Justice nominee to protect Bush administration, and being denied health insurance for needing it.
The Quiet Coup
The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time.
Administration Seeks an Out On Bailout Rules for Firms
Administration officials have concluded that this approach is vital for persuading firms to participate in programs funded by the $700 billion financial rescue package.
The administration believes it can sidestep the rules because, in many cases, it has decided not to provide federal aid directly to financial companies, the sources said. Instead, the government has set up special entities that act as middlemen, channeling the bailout funds to the firms and, via this two-step process, stripping away the requirement that the restrictions be imposed, according to officials.
Bailout Watchdog: Treasury’s stonewalling
Elizabeth Warren, the law professor appointed as Congress’s oversight czar on bank bailouts, blasted the Treasury Department — saying new legislation might be needed to give the House and Senate more access to details of the $700 billion rescue program.
Warren, testifying before the Senate Finance Committee Tuesday morning, said keeping Congress in the loop isn’t a “priority” of Secretary Tim Geithner — and suggested a possible “next step” would be to pass legislation that would “require [Treasury] to consult” with her.
Where Wall Street Trades in Political Currency
With sweeping reforms coming, the Wall Street-Washington connection may be more important than ever, and political connections may be the new currency for deal makers.
Below is a matrix of Wall Street chiefs and private-equity bosses, as well as their personal contributions to politicians in 2007 and 2008, as recorded by the Center for Responsive Politics. The list, which gives politicians’ titles at the time, also illustrates the political action committee money given by each chief’s firm and its employees.
The Definition of Insanity
A few months ago, I did some posts and TV appearances discussing some of the problems that would inevitably occur with the appointment of Goldman Sachs lobbyist Mark Patterson as the chief of staff at the Treasury Department. As Mother Jones subsequently reported, we’ve already seen some of those problems happen.
Mr. Taleb Goes to Washington
Nassim Taleb is an unlikely choice to play the Jimmy Stewart role in a 21st-century remake of the Depression-era classic Mr. Smith Goes to Washington. But the tale of a naive do-gooder who tries to remind a corrupt political class of its obligations was re-enacted this week when Taleb attended the Wall Street Journal’s Future of Finance conference in Washington, D.C.
Was Eliot Spitzer Taken Out Because He Was Going to Bust AIG?
Eliot Spitzer is back and he’s talking. The thought of this, no doubt, brings a small shiver to the boardrooms of some of the perps walking around trying to figure out how to hide the money this week. Today Edward Liddy testified that there have been death threats made to or about executives who received bonuses, so no names will be put on the record, but these anonymous players must know that the jig is up in the land of easy-money. Isn’t what to do a no-brainer for these great Americans?
Specter Announces His Intention To Vote Against Employee Free Choice Act
Today on the Senate floor, Sen. Arlen Specter (R-PA) announced his intention to vote against cloture on the Employee Free Choice Act. Specter was the only Republican to vote for cloture when the measure was last considered in 2007. During his announcement, Specter noted his previous support for EFCA, but suggested that the current condition of the economy makes “this a particularly bad time to enact employee’s choice legislation”
Recruited to Serve and Sniff — Again
The wars in Iraq and Afghanistan aren’t just forcing thousands of soldiers and Marines to deploy for two and three tours. The sacrifice is being shared by a key, and growing, part of the U.S. military: highly trained German shepherds and Belgian Malinois. In a war with no front lines, they have become valuable at sniffing out makeshift bombs, which cause most U.S. casualties.
Around the Country, Calls for Lawmakers to Address “Real Problems, Not Imaginary Ones”
As several states enter critical phases in their legislative sessions, the debate for one of the most controversial election reforms continues to dominate headlines and legislative hearings. This year, more than 26 states introduced legislation to go above and beyond federal election law relating to voter ID, despite near consensus among voting rights advocates that it hurts the process far more than it helps. Last week, the hysteria around voter ID reached an all time high in six states, evoking public concern from advocates and citizens alike.
The Woman Who Could Nail Bush: Are the Worst of the Torture Memos Still to Come?
On March 19, the nomination of Indiana University law professor Dawn Johnsen to head the OLC was endorsed by the Judiciary Committee with every Republican voting against her and Sen. Arlen Spector (R-PA) abstaining. The nomination was to have been brought to the Senate floor for a vote on Monday and then again on Wednesday, but it has been held back. Republican leaders, it appears, are playing with the notion of making Johnsen the target of their first filibuster.
Insurers shun those taking certain meds
Trying to buy health insurance on your own and have gallstones? You’ll automatically be denied coverage. Rheumatoid arthritis? Automatic denial. Severe acne? Probably denied. Do you take metformin, a popular drug for diabetes? Denied. Use the anti-clotting drug Plavix or Seroquel, prescribed for anti-psychotic or sleep problems? Forget about it.
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