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National Republican Senatorial Committee wakes the hell up

In a move indicating that somebody in the NRSC was thinking, they've rightly reversed course on supporting newly crowned Delaware Senatorial candidate and Tea Party backed Christine O'Donnell:

In a clear sign of the grassroots pressure on Republican leaders, National Republican Senatorial Committee Chairman John Cornyn just put out a statement embracing Christine O'Donnell -- a dramatic contrast with his group's curt response last night -- and writing her a big check.

It's a remarkable reversal, and a vivid illustration that the base is in charge and has the leadership running scared.

Cornyn:

Let there be no mistake: The National Republican Senatorial Committee - and I personally as the committee's chairman - strongly stand by all of our Republican nominees, including Christine O'Donnell in Delaware.

This after Karl Rove took a stupid pill or two last night on Sean Hannity's show:

"I've met her. I wasn't frankly impressed by her abilities as a candidate," Rove said during an interview with Fox News' Sean Hannity. "One thing that O'Donnell is now going to have to answer in the general election that she didn't in the primary is her own checkered background."

"There were a lot of nutty things she has been saying that don't add up," Rove added.
"Why did she mislead voters about her college education? How come it took nearly two decades to pay her college bills so she could get her college degree? How did she make a living?"

Hannity attempted to defend O'Donnell, saying the allegations "seemed to be trumped up charges from my standpoint that the republican establishment was against her."

"Sounds like you don't support her," Hannity said.

"I'm for the Republican," Rove said. "But we were looking at eight to nine seats in the Senate. We are now looking at seven to eight in my opinion."

Republicans have the best shot they've had in a long time to make extraordinary gains in Congress here in a few weeks... but you take the NRSC's and Rove's absolute idiocy last night and you can't help but think that they're going to snatch defeat from the jaws of victory.

At one point will the Republicans learn?  What kind of idiot can't read these tea leaves?

Un-freakin-believably stupid.


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Comments (53)

"I've met her. I wasn't ... (Below threshold)
914:

"I've met her. I wasn't frankly impressed by her abilities as a candidate," Rove said during an interview with Fox News' Sean Hannity. "One thing that O'Donnell is now going to have to answer in the general election that she didn't in the primary is her own checkered background."

"There were a lot of nutty things she has been saying that don't add up," Rove added"


Where did this idiot learn to add? Barrys school of narcissism I bet.

I have something for Rove t... (Below threshold)
braininahat:

I have something for Rove to add up: I just donated to O'Donnell.

"It's a remarkable rever... (Below threshold)
JLawson:

"It's a remarkable reversal, and a vivid illustration that the base is in charge and has the leadership running scared."

It's about fucking time. Business as usual in Washington no longer cuts it - the 'give me an earmark or two and I'll bi-partisanly vote for your bloated ineffectual pig of a bill' has got to stop.

THEY are OUR employees - WE are not THEIR peons!

I am from NC and I wished w... (Below threshold)
VINNY CONCEPCION:

I am from NC and I wished we have a lady here in our state that impressive and one who shows genuing fighter heart for the principles that found this country. I sent $100 Dollars Immediately I heard those so call politicians like Karl Rove trashing this lady. I am in a very dire financial situation right now but if I can find another $100 dollars out my budget maybe cutting on food of something for the next few weeks, I will do it....IT IS GOING TO BE WORTH IT!!

Lets take our country back from this nightmare people//////

Karl Rove had his 'Jump the... (Below threshold)
zaugg:

Karl Rove had his 'Jump the Shark' moment last night. I just watched a clip of O'Donnell being intervied by George Stephanopoulos and I like what I hear. She is well spoken and defended herself well.
So she took 12 years to pay student loans, I took 8. The IRS made a mistake and they corrected it. I got a letter from our State IRS and they had completely missed my W2 that plainly attached and filled out correctly on the state form.
Idiots everywhere and especially in government.

"I've met... (Below threshold)
the Dane of your Existence:

"I've met her. I wasn't frankly impressed by her abilities as a candidate," Rove said during an interview with Fox News' Sean Hannity. "One thing that O'Donnell is now going to have to answer in the general election that she didn't in the primary is her own checkered background."

"There were a lot of nutty things she has been saying that don't add up," Rove added.
"Why did she mislead voters about her college education? How come it took nearly two decades to pay her college bills so she could get her college degree? How did she make a living?"

Shame on Rove for speaking the truth - hasn't he learned that you go on TV and lie for the Party! Seriously.

"Un-freakin-believably stupid."

Word! Somebody give Rove some "lying lessons"!

By the way, Mr Rove should ... (Below threshold)
VINNY CONCEPCION:

By the way, Mr Rove should be more concern about all the many things to count 0bama had done before he was elected POTUS. I wonder now if we were rushed to think that Mr Rove was a savvy politician....

The RNC had better damned w... (Below threshold)
GarandFan:

The RNC had better damned well wake up. Or they'll be even worth less as a political party than the Democrats will shortly find themselves.

Damned straight. I wouldn't... (Below threshold)
Clay:

Damned straight. I wouldn't say the GOP leaders have awakened, but it is safe to say that their days of ignoring the wake-up call are coming to an abrupt halt. They're either going to get with the program or tell us to go to hell directly. But, they better never try to give us the piss-poor candidates that we've seen of late. Mike Castle is a conservative? My ass.

If the NRSC and all repubs ... (Below threshold)
Hank:

If the NRSC and all repubs don't see the writing on the wall, they too are going to pay. This isn't so much about politics any longer, this is about the very future of our country.

The dems are socialists, period.
The repubs? Time to find out. And if they are truly nothing more that dem-lite, they're going to become irrelevant very very quickly.

"I've met her. I wasn't fra... (Below threshold)
DaveD:

"I've met her. I wasn't frankly impressed by her abilities as a candidate,"......

I know of a guy who came across as a fantastic candidate, great campaigner, but he sucks in office.

Let's give that new lady a shot at it and see what she can do.

Yes, people, there ... (Below threshold)
irongrampa:


Yes, people, there IS a groundswell building. It doesn't always pertain to a specific party, though. If anyone has attended any Tea Party rally, you'll find the disaffection with Washington is divided among political leanings of all kinds.

Hint--it's the AMERICAN PUBLIC,collectively, who's angry.

Seeing the NRSC reverse course this am, and endorse--complete with a 42k donation--Odonnell tells me that just maybe the light is dawning. No more business as usual.

Now we need to carry that into November.

everyone here (me included)... (Below threshold)
Jeff:

everyone here (me included) was a Rove bootlicker in 2000 and 2004 ... he had a bad night last night obviously ... If you were running for any office in the land and had a chance to get Rove as your campaign manager you would take him in a second ...

"Trumped up" charges?... (Below threshold)
Jim Addison:

"Trumped up" charges?

Did she lie about winning two counties in 2008, or not? Did she accuse the radio host who questioned her of being a RNC plant, or not?

Did she say she had more income than she disclosed for the year (just over $5000), or not? Is she paying her personal apartment rent out of campaign money, or not?


Was she demoted by ISI for running her personal PR business on their time, or not? Did she file the discrimination complaint that bears her signature, or not?

How do you "trump up" stuff like this? They are either true, or they are not true.

Still in the end she loses.... (Below threshold)
Michael:

Still in the end she loses. Delaware is a blue state...and O'Donnell is a weak candidate and all the dreaming is not going to change that.

You all know my politics he... (Below threshold)
James H:

You all know my politics here ..

But regardless of that, it behooves the GOP establishment to get behind at least some of these Tea Party candidates. If they win in November, then they can be turned into establishment politicians in short order and establishment GOP wins. If they lose in November, then establishment GOP can say it was right about those candidates' chances ... and put up candidates with impeccable establishment credentials in 2012.

How DARE this NOBODY, this ... (Below threshold)
oldpuppymax:

How DARE this NOBODY, this OUTSIDER try to break into the holy ranks of the ruling class! Who does she think she is? And who do the voters think THEY are, defeating a good member in standing of RINOs Unlimited. Rove revealed a GREAT deal about himself during his Hannity debacle, adding to that this morning on network TV. Did he have a damned BET on Castle or what? Apparently that "big tent" Rove and the rest of republican elites are always on about is NOT quite big enough for CONSERVATIVES!!! Cornyns senate outfit was literally intimidated into donating to O'Donnell. These ruling class thugs knew damned well that conservative voters across the country would tell them to go to HELL when asked for donations.

Still in the end she los... (Below threshold)
Roy:

Still in the end she loses. Delaware is a blue state...
OK, but then at least we won't have a RINO voting the exact same way while preaching about bipartisanship to the caucus.

It's a remarkable revers... (Below threshold)

It's a remarkable reversal, and a vivid illustration that the base is in charge and has the leadership running scared.

But I thought 'the base' (that is, this 'grassroots movement') was actually just 'astroturf' controlled by a few wealthy republicans...

right?

;)

Rove is like yesterday's br... (Below threshold)
Don L:

Rove is like yesterday's bread: Stale, and no one wants it but the vermin.

She doesn't think that cond... (Below threshold)
hyperbolist:

She doesn't think that condoms can prevent AIDS, and that AIDS sufferers are not victims. So either she's an evil bitch or she's a fucking moron. Unless someone spikes Delaware's water supply with about a million tonnes of stupid-flavoured Kool Aid, this bitch/moron has no hope in hell of getting elected to the federal government.

Way to send a message, scorched earth conservatives.

Still in the end she los... (Below threshold)
Clay:

Still in the end she loses.

You must have a job. Blue state or not, people everywhere are recognizing that this economy is worse and getting more so. It's the same climate that whisked Obama into the White House that causes people to consider voting for those they wouldn't normally consider.

But, I swear to all that is holy that the GOP must not win one more election until they wake up and return to the principles for which America is screaming.

everyone here (me included) was a Rove bootlicker

Well, not everyone of course. Some of us (me included) knew that Bush and Rove weren't conservatives. Not really.

[quote]Shame on Rove for sp... (Below threshold)
braininahat:

[quote]Shame on Rove for speaking the truth - hasn't he learned that you go on TV and lie for the Party! Seriously.

"Un-freakin-believably stupid."

Word! Somebody give Rove some "lying lessons"![/quote]

Nobody is asking him to lie. Nice strawman, by the way -- did you build it yourself?

It's not smart to talk that way about the likely winner -- you know, the person you're going to have to talk up now. Isn't he supposed to be some kind of strategic genius or something?

hyperbolist,I know f... (Below threshold)
DaveD:

hyperbolist,
I know from the past how you feel about Palin and now your analysis of O'Donnell. Were you (as a beta male, of course) ever in a failed relationship with a conservative alpha woman that you react so to them? I mean if O'Donnell is who you say she is she should be unelectable and pose no threat really in the long term. Of course the Dems have Al Franken so maybe you do have something to worry about.

"Why did she mislead voters... (Below threshold)
914:

"Why did she mislead voters about her college education? How come it took nearly two decades to pay her college bills so she could get her college degree? How did she make a living?"


Dear KARL-


#1. None of Your damn business.

#2. Get a life.

#3. You bet on a loser and lost BUTTHEAD.


Respectfully Yours

Christine


everyone here (me ... (Below threshold)
JSchuler:
everyone here (me included) was a Rove bootlicker in 2000 and 2004 ...
Many people questioned why Bush wasn't aggressive in engaging the far-left attacks directed at him. That was Rove.

Most of the "bootlicking" was actually satire of the magical powers Rove possessed in the eyes of the left, who saw his machinations in everything from 9/11 to Rathergate.

The right largely saw Rove as competent, but hardly infallible. Here, he clearly failed.

Karl Rove's ability to pred... (Below threshold)
SicSemperTyrannus:

Karl Rove's ability to predict races is rapidly approaching the infallible wisdom of Larry Sabato.
/s

Hahaha. "Beta male". Yes, l... (Below threshold)
hyperbolist:

Hahaha. "Beta male". Yes, liberals are pussies and Pat Tillmann was just an effeminate coward. I love the gendered half-baked psychoanalysis: that it's inherently misogynist to disparage female candidates, just like it's inherently racist to disparage Barack Obama, right? I could give a shit about her gender, Dave. Women are equally capable of being grandly idiotic, and equally capable of being strong and intelligent leaders.

Look, you can be a serious politician and believe in smaller government and minimal tax rates for rich people and, I guess, believe that fiscal austerity will somehow magically create wealth. O'Donnell, though, is not a serious politician. She's just a fucking moron.

I guess moron #1 Karl Rove ... (Below threshold)
914:

I guess moron #1 Karl Rove and jealous moron #2 above are both shellshocked by O'Donnell.


Get used to it idiots, it is only the beginning.

"Look, you can be a seri... (Below threshold)
JLawson:

"Look, you can be a serious politician and believe in smaller government and minimal tax rates for rich people and, I guess, believe that fiscal austerity will somehow magically create wealth."

I'm pretty sure at this point, Hyper, that taxing the rich and slapping out trillions in 'stimulus' hasn't done much to create wealth. I'm ready to try something different.

"She's just a fucking moron"

Yeah, that whole "Don't spend more than you take in" concept is just SO retarded...

Look, you can be a serio... (Below threshold)
Clay:

Look, you can be a serious politician and believe in smaller government and minimal tax rates for rich people and, I guess, believe that fiscal austerity will somehow magically create wealth.

Well, golly, thanks for the magnanimity, HB. However, truth be told, the above aren't the stuff of which politicians are made. It's the stuff of which statesmen are made.

BTW, in your grand opinion, from where in hell does wealth come? Personally, the more austere the government, the more opportunity for real wealth. The arrangement sucks for government employees, but I'm alright with that.

Sheesh. Are you from Canada or somewhere?

Roy - and we won't control ... (Below threshold)
Michael:

Roy - and we won't control the committes either.

Look, you can be a... (Below threshold)
JSchuler:
Look, you can be a serious politician and believe in smaller government and minimal tax rates for rich people and, I guess, believe that fiscal austerity will somehow magically create wealth.
Nobody believes fiscal austerity creates wealth, magically or otherwise. However, they do believe that fiscal austerity prevents government from destroying wealth, which government has proven very adept at doing time and time again.

Understanding the other side's argument is the first step to proving that you are not a complete idiot.

Clay, if it was as simple a... (Below threshold)
hyperbolist:

Clay, if it was as simple as 'smaller government = more money', then 'lawless shithole = Randian utopia' would follow and those Koch assholes would pick up and move to Somalia.

Prosperous middle class = strong economy. Fiscal austerity in a recession = weak middle class = shitty jobs market = double-dip recession = have fun south of the border.

Interest rates are historically low so it's obviously a good time for governments to borrow money to spend on shovel ready projects. This will objectively reduce the unemployment rate, improve your country's dilapidated infrastructure, and increase the tax base. This will all need to be done at some point so why not do it when there is a massive labour surplus and a low cost of borrowing? Is the private sector going to jump in and start benevolently re-paving roads and replacing outdated natural gas lines? No. But Sarah Palin says the Free Market Fairies are going to sprinkle magic dust on the U.S. economy and somehow reduce the size of government while lowering the unemployment rate. Magic!

JSchuler, it wasn't the gov... (Below threshold)
hyperbolist:

JSchuler, it wasn't the government that destroyed all the fucking wealth. It wasn't the government that turned Wall St. into a casino and convinced people earning $15/hour that they can afford $250,000 homes (though greater government regulation of the financial and housing sectors might have prevented it).

Yes, it was the fucking gov... (Below threshold)
Hank:

Yes, it was the fucking govt. that turned Wall St into a casino.

CRA, Freddie, Fannie and politics.

"The crisis began in the 1970s, during the Carter administration, with passage of the Community Reinvestment Act to stem bank redlining and liberalize lending in order to extend home ownership in lower-income communities. Then in the 1990s, the Department of Housing and Urban Development took a fateful step by getting the GSEs to accept subprime mortgages. With Fannie and Freddie easing credit requirements on loans they would purchase from lenders, banks could greatly increase lending to borrowers unqualified for conventional loans. In the name of extending affordable housing, this broadened the acceptability of risky loans throughout the financial system."

I could go on, but I suspect it's a waste of time.

Hyperbolist and you other l... (Below threshold)
WildWillie:

Hyperbolist and you other liberals are as usual full of shit. We have another conservative woman and the left cannot stand it. All of a sudden she is a "moron" etc. When point in fact, hyper and the other liberals are the morons. Just think of the 52% of Americans that voted for Obama. Now they are morons. ww

Hank,"CRA, Freddie... (Below threshold)
ryan a:

Hank,

"CRA, Freddie, Fannie and politics."

Ok. So are you arguing that the government should have enacted MORE regulations in order to prevent the 2008 crisis? Or are you arguing that the govt FORCED banks/lenders to make these bad loans and is therefore at fault for intervening in the market?

I'm not sure I would absolve the lenders/banks from their share of responsibility, but that's just me.

Yes, Ryan A. That is in fa... (Below threshold)
Ryan M.:

Yes, Ryan A. That is in fact EXACTLY what the government did.

In 1999, under pressure from the Clinton administration, Fannie Mae, the nation's largest home mortgage underwriter, relaxed credit requirements on the loans it would purchase from other banks and lenders, hoping that easing these restrictions would result in increased loan availability for minority and low-income buyers. Putting pressure on the GSE's (Government Sponsored Enterprise) Fannie Mae and Freddie Mac, the Clinton administration looked to increase their sub-prime portfolios, including the Department of Housing and Urban Development expressing its interest in the GSE's maintaining a 50% portion of their portfolios in loans to low and moderate-income borrowers.[10]

As noted, subprime mortgages sky-rocketed during the initial era of loosening of terms throughout the 1990's. From a low of 5% of mortgages in 1994, to 14% in 1997, to 23% in 2005, subprime mortgages continued to boom in the early 2000's. Following the 2004 initiative policy change spearheaded by a U.S. Securities and Exchange Commission (SEC) decision to allow the largest brokerage firms to borrow upwards of 30 times their capital, subprimes became an even greater investment vehicle for investment banks and institutions in the U.S. and around the world. Since 1994, the securitization rate of subprime loans has increased from approximately 32 percent to nearly 78 percent of total subprime originations.[11] This further exposed the financial community to the effects of the coming housing bubble.

I don't know, Ryan - I thin... (Below threshold)
Trust Fund Dane:

I don't know, Ryan - I think there were enough policies in place that a system of perverse incentives got established - very simplified, the banks were 'encouraged' to give loans to people who wouldn't have otherwise qualified for them, with the loans guaranteed if they went bust. Hey, when you're guaranteed not to lose, you'll put $20 on the table and spin the roulette wheel. So what if your number doesn't come up - the house covers it, so you're not out anything.

And if a lender was reluctant (because THEY could see this was a Bad Idea) they were encouraged to make the loans anyway. After all, helping the economically disadvantaged was a GOOD thing, and doing otherwise was obviously discriminatory and likely to get the bank in trouble with the Fed.

Hey, it's all good fun until the first eye gets poked out...

Get enough loans going bad, and there's not enough money to cover them. I think there were people going "Um, are you sure this is a good idea?" back as early as 2005, but Barney Frank said it was solvent, and there were other things going on that required more attention so it kind of got shoved to a back burner. (After all, it wasn't like there was a war going on or anything...)

When the loans went bust, Fannie and Freddie picked up the tab, went bust, and then enacted enough legislation to make the banks too cautious in their loans. So they went from "Have you got a pulse? You get a loan..." to "We need 125% collateral before we'll even CONSIDER giving you a loan." (Slight exaggeration, but not by much...)

The pendulum swings, we end up in a feedback loop, and the system goes nuts. Banks and lenders were at fault, but the real agent was an economic policy that virtually mandated loans to folks that'd never be able to pay on them.

Basically, when it came to ... (Below threshold)
JSchuler:

Basically, when it came to housing, the federal government did the exact opposite of what the US government was formed to do: they created a collective action problem where one did not previously exist (Obamacare does the same thing).

Sure, banks could have loaned to more worthy people, which they are prone to do on their own because they like getting their loans paid back with interest, but Freddie and Fannie were there to buy up sub-primes. Thus, banks were assured a profit if they made sub-prime loans.

This isn't much of a problem if a few banks do it, but EVERYONE looked to take advantage of it. And why shouldn't they? If they didn't, their competitors would rake in the cash, which would give them a competitive advantage in the market. Thus, banks piled on, increasing the strain on the system, and while they collectively had an interest in pulling back, the banks had an individual interest in exploiting the system as much as they could.

It's a classic prisoner's dilemma, and the conditions for it were created by government meddling.

So yes, banks and Wall Street traders are greedy. That's Ok, because it also means they are predictable. What's not Ok are representatives passing laws that assume these entities are something they are not: social welfare organizations, Hell, not even most social welfare organizations are social welfare organizations.

Rove, one of the RHINO arch... (Below threshold)

Rove, one of the RHINO architects of the mess we find ourselves in now.
Rove just sent my annual 100.00 to the nearest
"Real" Conservative, NOT the NRC.
Rove needs to keep adding the dollars up and maybe he will then start standing up for "Real" Republican principals.

"It's a classic prisoner... (Below threshold)
Trust Fund Dane:

"It's a classic prisoner's dilemma, and the conditions for it were created by government meddling.

So yes, banks and Wall Street traders are greedy. That's Ok, because it also means they are predictable. What's not Ok are representatives passing laws that assume these entities are something they are not: social welfare organizations, Hell, not even most social welfare organizations are social welfare organizations."

And PREDICTABLY greedy is fine. You can handle predictable. Want a loan? Work on making your credit score as good as possible. Pay your bills on time, save up a down payment. But as I said, and you pointed out, JSchuler, the perverse incentives caused massive problems where none were before.

All of a sudden, you didn't HAVE to have good credit. You didn't even have to have a job. In fact, I'm not even sure a pulse was needed. That left the system wide open and unpredictable...

And it fell.

Oh man, I wish I could hang... (Below threshold)
ryan a:

Oh man, I wish I could hang around and get into this one a little more...this is my favorite pet topic these days. But I have all kinds of crap that I have to work on right now. I'll check back later and see where this thread goes.

My main question for some of you on here is whether you think that the govt actually FORCED banks to make these loans. If so, what are you reading that is making these arguments.

Ryan M: I read your post. So I think you're arguing that the govt forced banks to make these loans, yes? What are the main economic or other sources that you're reading?

Jschuler:

"It's a classic prisoner's dilemma, and the conditions for it were created by government meddling."

Ok. But there's actually government intervention in the market all the time. There is no such thing as a perfectly free market, and business often takes advantage or benefit from these interventions (trade agreements, etc). I mean, it's not as if "government" and "the financial sector" are completely separate entities--in a political sense and otherwise. Wall Street and other financial interests surely lobby the government. Ultimately it seems that you're absolving the banks and lenders of their responsibility in all this. I agree that the govt has played its role...but I have my doubts about the angelic intentions of the banks/lenders.

Ok, back to work.

ryan a, it depends on the t... (Below threshold)
JSchuler:

ryan a, it depends on the type of intervention you are talking about.

Intervening to ensure that contracts are upheld is good. Intervening to make certain contracts happen is bad. And some trade agreements are actually not regulating the market at all, but regulating other governments to keep their mitts off the market.

But, I've never said that all regulation is bad. I've only commented on this case of (very bad) regulation. Or are you arguing that it's an all or nothing affair? That if I reject one regulation, I must reject it all, otherwise I should embrace whatever Washington craps out?

Wall Street and other financial interests surely lobby the government.

Indeed, they do. They, being associations of people, have the exact same first amendment rights you or I have, and thus we cannot infringe on their rights without infringing on ours. And, if the way to get ahead is to lobby Congress, they have the right and maybe even the fiduciary duty to do so. The way to prevent them from unduly influencing the system is by making it so lobbying Congress is not the way to get ahead, and that is accomplished by limiting government's freedom, not theirs.
Ultimately it seems that you're absolving the banks and lenders of their responsibility in all this.

Actually, I'm saying that their responsibility in all this does not matter. The government created an environment where a certain destructive behavior would be rewarded, and responsible behavior would be punished. So, the responsible either had to become irresponsible, or be shut out of the market. It's economic Darwinism. It wouldn't matter if we had angels in charge of the banking industry at the time. Due to the incentives government set up, devils would wind up running it.

The flaw does not lie in the financial industry, which is behaving perfectly rationally, but in government. Therefor, attempting to assign blame within the financial industry does absolutely no good. In fact, by punishing rational action, it may do a lot of harm (see: current unemployment numbers).

I agree that the govt has played its role...but I have my doubts about the angelic intentions of the banks/lenders.

I've never said their intentions were angelic, only self interested, which is exactly how I expect banks/lenders to act. When you expect them to act differently, then it is you who is engineering the next disaster.

Hyper, I think we've seen e... (Below threshold)
SCSIwuzzy:

Hyper, I think we've seen enough of you hear that someone can call you a beta-male on your own merits without resorting to stereotyping all liberals...
Although it is funny to hear the guy that concludes that all southerners are racists because a (fictional/sarc) bartender in a resort town told him so would whine he's being stereotyped so readily. And the viscous circle of beta-maledom continues...

WHAT "remarkable reversal" ... (Below threshold)
Jim Addison:

WHAT "remarkable reversal" are we talking about?

The ONLY suggestion the NRSC wouldn't support O'Donnell was an anonymous source quoted by The Hill.

How is a single report from an unnamed source a policy to "reverse" at all?

ryan a (post 38).S... (Below threshold)
Hank:

ryan a (post 38).

Sorry for not replying sooner but I logged out/off after entering my comment.
I think others have effectively answered the question in the meantime. Regards.

JSchuler,"Or are y... (Below threshold)
ryan a:

JSchuler,

"Or are you arguing that it's an all or nothing affair? That if I reject one regulation, I must reject it all, otherwise I should embrace whatever Washington craps out?"

I am by no means arguing that it's an all or nothing situation. I am trying get a sense of where you stand on this...I'm not making any assumptions about what you think, hence the reason why we're having this dialog.

"Actually, I'm saying that their responsibility in all this does not matter. The government created an environment where a certain destructive behavior would be rewarded, and responsible behavior would be punished."

Hmmm. So the bankers are just poor victims here? They need take no responsibility for the part they played in this? I think that the govt definitely played its role in this, but it's far too simplistic to simply make the government the bad guy and the bankers and lenders the poor saps who had no alternatives. I'm not buying it.

"The flaw does not lie in the financial industry, which is behaving perfectly rationally, but in government. Therefor, attempting to assign blame within the financial industry does absolutely no good."

That statement is a complete whitewashing of the situation. You've explained nothing. What do you mean the financial sector is behaving "rationally"? Do you mean they are taking all information into account and making the best possible decision? No, that's not what you're saying. You're saying the government enabled a risky situation, and the bankers went ahead and took those risks. So, unless the lenders and banks were actually coerced into these financial arrangements, they should be held responsible. Or, at the very least, we could recognize the fact that the "market" is also susceptible to coercion, corruption, and power grabs.

"I've never said their intentions were angelic, only self interested, which is exactly how I expect banks/lenders to act. When you expect them to act differently, then it is you who is engineering the next disaster."

Are you sure that we want bankers and lenders to ONLY be acting with their own interests in mind? You don't think this can EVER create any problems? The whole self interest = benefit for the common good model is nice and all, but I think there's a little more to it.

So the bankers are... (Below threshold)
JSchuler:
So the bankers are just poor victims here?
Never said they were victims. They just are.
That statement is a complete whitewashing of the situation. You've explained nothing.
The statement was not an explanation, but a conclusion. I had previously identified the factor that made the system crash, and I targeted that factor for correction in my conclusion. You may prefer to add additional regulation to fix the broken regulation, but there is no guarantee that this time things will be different.

Plus, I find it silly that we should tie an entire industry up in knots simply because some people in Congress want to play social engineer.

Do you mean they are taking all information into account and making the best possible decision? No, that's not what you're saying.

Actually, that is what I'm saying. The best possible decision any individual banker could make would be to capitalize on the sweet deal the government offered. Even if they kept their nose clean and did not respond to the incentives government provided, they'd be just as screwed now as those who took full advantage. In fact, moreso, as they wouldn't have the short-term profits in their pockets.
So, unless the lenders and banks were actually coerced into these financial arrangements, they should be held responsible.

Let me ask, what do you mean by "held responsible?" Do you mean not bailed out by the government, no such thing as "too big to fail?" If so, on that, we agree. Let the market hold them responsible. Government only reinforced the perverse incentives by doing that.

Do you mean that there should be prosecution or further regulation? On that, we disagree.

If prosecution: as nothing they did at the time was illegal, that would be an ex post facto law, which is not only unconstitutional, but threatening to freedom in general.

If regulation, then you are holding everyone responsible, regardless of their role (or lack of role) in the crisis. Also, not good. By the way, increased regulation means increased costs to comply. This is the "destruction of wealth" I referred to earlier.

Are you sure that we want bankers and lenders to ONLY be acting with their own interests in mind?

No. It would be nice if bankers were civic minded. The point is, though, our laws should not work on the assumption that they are anything else. If you want to shun those bankers from your social life, disinvite them to parties, give them mean looks as you drive past, go for it. I won't blame you. If you want to use the threat of violence to retaliate (which is what you do when you seek a solution through government), then no. That is wrong. And it also encourages bankers to spend even more money lobbying Congress, to make sure they can game the new regulations, which then sets this whole thing back into motion again.

"You may prefer to add addi... (Below threshold)
ryan a:

"You may prefer to add additional regulation to fix the broken regulation, but there is no guarantee that this time things will be different."

Don't pigeon-hole me just yet. I am not simply assuming that some massive govt regulation is the answer by any means. But I am also not assuming that the financial sector is free from certain problems either.

"Actually, that is what I'm saying. The best possible decision any individual banker could make would be to capitalize on the sweet deal the government offered."

Ok, I see what perspective you're coming from. In your view, the bankers had few options, and were basically on a sinking ship, and the best option was to at least make a short term buck or two? Hmmm. I tend to think of the bankers as part of the problem that brought the ship down, rather than the hapless chumps who paid the price of bad government intervention. I mean, it's not like these bankers are exactly DISCONNECTED from Washington. I have a hard time assuming that they did not play an active part in a lot of this.

Let me ask, what do you mean by "held responsible?" Do you mean not bailed out by the government, no such thing as "too big to fail?" If so, on that, we agree. Let the market hold them responsible. Government only reinforced the perverse incentives by doing that.

Do you mean that there should be prosecution or further regulation? On that, we disagree.

When I say held responsible I am not just making the argument that we need to regulate these people and that all will be well. And I am not arguing that the free market will just solve everything. These are the two standard answers, and at this point I am more interested in finding out who took part, what role they played, and trying to gain a better understanding of these sorts of things than assigning the usual band-aids to the problem. Seriously, we have to have something more than the standard knee-jerk assessments of this stuff.

"No. It would be nice if bankers were civic minded. The point is, though, our laws should not work on the assumption that they are anything else."

So, do you trust the market to deal with moral and political issues that crop up? How should we deal with coercion, corruption, or outright criminal behavior in the private sector? Keep in mind, I'm just asking because I'm interested--not to start some ideological firefight. Please don't assume that I'm some hard-line marxist totalitarian who thinks that the state is somehow the magical utopian solution to all problems. I don't.

Hmmm. I tend to th... (Below threshold)
JSchuler:
Hmmm. I tend to think of the bankers as part of the problem that brought the ship down, rather than the hapless chumps who paid the price of bad government intervention. I mean, it's not like these bankers are exactly DISCONNECTED from Washington. I have a hard time assuming that they did not play an active part in a lot of this.
And they may well have. The question then is, what can you do? You cannot throw them in jail for getting a law passed, and preventing them from lobbying is a gross violation of 1st Amendment rights. It's also nonsensical in a democratic system, which is based on the premise that people should have a say in how they're governed. To say "you can have a say, so long as you aren't governing yourself" turns the whole concept on its head.

That's why I advocate for restricting the powers of government. It's the only path out of this where really bad stuff doesn't start happening.

So, do you trust the market to deal with moral and political issues that crop up?

I trust markets far more than government to deal with moral and political issues. Markets at least have to speak to something objective. Government doesn't have to, as it can use its monopoly on violence to steamroll over anything.
How should we deal with coercion, corruption, or outright criminal behavior in the private sector?

Well, let's put aside criminal behavior, as by the fact that it's been labeled criminal, it's already been assumed it's punished by law.

Coercion is tough, because there is some level of social coercion that's good, and there are incidents where, regardless of outcome, someone is going to be coerced by someone else. As such, I can't give you a hard and fast rule. Instead, it depends on the effects. We know from experience that paying workers in scrip is almost a form of slavery. We know monopolies can be extremely destructive (but they also can be beneficial). So, I'm not against it.

But... coercion wasn't what the bankers were doing.

When it comes to corruption, that's easier. Remember, I said that one of the legitimate functions of governments is ensuring contracts are enforced. This requires the contracts be negotiated in good faith. Corruption is, by its nature, a breach of faith.

Now, if bankers were deliberately misleading people into taking on loans, or flat out lying, then yes, throw the book at them. We already have laws against that, so no ex post facto trigger is tripped. However, I just don't buy that. Everyone at the time (aside from the crazy people Glenn Beck dragged on his show on CNN) viewed homes as a safe investment. People saw their home values going up, and they wanted to cash in on it. If bankers were greedy, so were they. I really doubt lenders needed to lie to anyone to get the number of bad loans we did.

So, I have to say, I don't think corruption enters into the problem at hand either. But, to the extent that it did, it is the proper role of government to punish it. I just do not believe that tackling corruption within the banking industry is either necessary or sufficient to fix the problem.

JShuler,Sorry for ... (Below threshold)

JShuler,

Sorry for lagging on getting back to this one--busy week this week.

You make some good points.

I suppose right now I am skeptical of the idea that the private sector is any less flawed than government. Why" Well, first of all because half the time the same people have plenty of interests in both.

When it comes to economics, plenty of people are rightfully wary of state power and control. That guy Stalin illustrated some of the possible problems in that regard.

That said, I think a lot of people have a far too rosy picture about the powers of the free market.

As I see it, we have a serious problem when power gets concentrated in the hands of government (the state) AND/OR the private sector.

Anyway thanks for the replies.




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