Great Depression; Community Reinvestment Act

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Do Republicans Want Another Depression?

Judging by reader comments on The Dallas Morning News blogs, conservatives who blocked the federal bailout (or rescue, if you prefer) of the financial industry are sharpening their talking points.

The libertarians among them say government intervention is bad. Let the banks on Wall Street fail. Let the businesses on Main Street topple after them. Let the workers who depended on their company pension plans and 401Ks go down, too. Free markets are risky and failures are how markets cleanse themselves of mistakes. We are now just shy of 80 years distant from the stock market crash of 1929 and the onset of the Great Depression. People who have personal memory of the bank panics, the home foreclosures, the Hoovervilles and soup kitchens, are fast disappearing into history. A new crop of libertarians is ripe, ready to risk another Great Depression in the name of free markets.

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Scapegoating the Financial Crisis

Other conservatives who aren't above using government to benefit their own interests are using the current crisis as an opening to attack an old bogeyman -- the poor. These people are pointing to the Community Reinvestment Act (CRA) as a root cause. According to this storyline, liberals in government wrote laws that forced lenders to make bad loans to people unlikely to be able to pay the money back. Jim Mitchell, in The Dallas Morning News Opinion blog, explains.

"Don't forget the reason CRA exists. It was a reaction to banks redlining minority and low-income neighborhoods. The law forced banks to show regulators that they attempted to provide loans and make other investment in low- and moderate-income communities."

CRA forced banks, not to make bad loans, not to make risky loans, but not to discriminate based solely on the neighborhood one lives in. Banks didn't need anyone to force them to make predatory loans. There was plenty of greed in the mortgage banking industry to do that all by itself. Government's failing is not in passing CRA. Government's failing is in not preventing predatory lending practices. Too many people were getting rich. Too many other people are now left holding the bag.

Candidate forums; Campaign lessons

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Tony Goolsby Ducks Candidate Forum

Tony Goolsby, Republican incumbent in Texas House District 102, took time out of his busy schedule to write a letter to the editor of The Dallas Morning News bad-mouthing candidate forums sponsored by the League of Women Voters. It's too bad he won't take the time to actually participate in a forum. Goolsby says, "The LWV wanted to hold their candidate forums on dates when I had scheduling conflicts." That contradicts what the League president had to say in her own letter to the editor published on September 21: "Mr. Goolsby has declined to participate, despite the league's attempts to find a mutually agreeable date." There were six or more weeks to the election. All Goolsby had to do was pick a date, any date. I'm sure the League of Women Voters would have accomodated him. So, not only did Tony Goolsby not want to answer voters' questions, he isn't straight with the voters about why.

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Selective Finger-Pointing

Mark Davis, in an op-ed column in The Dallas Morning News, draws three lessons from the Presidential campaign so far.

First, Davis has learned that attempts to change the nature of campaigning are futile. He's probably right about that one. Voters had high hopes that this year might be different. John McCain and Barack Obama promised to run honorable and issues-oriented campaigns. Then, silly season arrived early. McCain compared Obama to Paris Hilton and Britney Spears. Absurdly, McCain twisted Obama's support for a bill that would have included age-appropriate instruction for children on how to resist sexual advances into a charge that Obama wants to teach comprehensive sex education to kindergarteners. Worst of all, McCain accused Obama wanting to lose a war rather than lose an election. Obama, inevitably, responded with attack ads of his own, some clearly stretching the truth, but none as outright false as McCain's. Maybe some day we'll have two candidates who can both stick to the high road. But, I'm not holding my breath.

Second, Davis has learned that liberal bias grew to its shameful worst. That's a good one, seeing how The Dallas Morning News has given Mark Davis, a conservative wingnut who is congenitally incapable of objective analysis, a regular spot on its very valuable op-ed page real estate. Fox News, Sean Hannity, Bill O'Reilly still rule the cable television airwaves. And Rush Limbaugh still rules talk radio. Mark Davis and new columnist Trey Garrison have no regular balance on The Dallas Morning News op-ed pages. There's certainly a lot of shameful bias in election coverage, but more than their fair share of it comes from the right.

Third, Davis has learned that, due to this campaign, gender and race will be less of a barrier in future elections. I agree with Mark Davis on this one. Sadly, neither prejudice is gone yet and may still be a factor in the outcome of this election. But we're guaranteed that either an African-American or a woman will be elected President or Vice President this cycle. That, in and of itself, is a milestone on our nation's long journey towards a more perfect union.

Fannie Mae

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Selective Finger-Pointing

Republicans have pushed deregulation on industry and the financial markets for thirty years. They have extolled the benefits of free markets. Now, as the American economy stands on the brink of a collapse unlike any since before the great regulatory reforms of FDR's New Deal, John McCain and Republicans are desperately trying to evade being pinned as the party responsible. Trey Garrison reaches back to a 1999 Wall Street Journal story for exculpatory evidence.

"Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits."

The emphasis in the WSJ story is Garrison's. He latches on to the finger pointed at the Clinton administration, daringly concluding, "The problem is not too little, but too much, government regulation. As usual."

Garrison blindly ignores the second source of pressure. "[Fannie Mae] felt pressure from stock holders to maintain its phenomenal growth in profits." Garrison hides the fact that, since 1968, Fannie Mae has been a stockholder-owned private corporation. Fannie Mae was under pressure from multiple directions. From the government, eager to increase homeownership among working-class families. But also from the stockholders, greedy for dividends and capital gains. There's enough blame to go around in this disaster. There were bad bets by the government, by Fannie Mae, by Wall Street banks that bought up this junk paper, and by every individual investor who put any of his or her investments into anything associated with the risky mortgage-backed securities. Pretty much everyone shares the blame here. The saddest outcome of this disaster is if we don't learn from it. And Trey Garrison is proving to be one particularly slow learner.

McCain on the bailout

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How Is McCain Playing the Bailout?

The blogosphere is rife with speculation on the strategy behind John McCain "suspending" his campaign and going to Washington to work out the details on the proposed $700 billion bailout of financial institutions. The theories span the spectrum, from the honorable (he's putting country first to help the country find a way out of this crisis) to the politically scheming (he wants to postpone his debate with Obama until next week, bumping Sarah Palin's debate with Joe Biden into the indefinite future).

Paul Burka offers his own unique theory which is a hybrid of principle and cunning. Burka predicts that McCain, in the end, is going to vote against the deal worked out by President George Bush, Speaker Nancy Pelosi and Majority Leader Harry Reid and supported by Barack Obama. Burka thinks McCain will pitch his opposition in a way to energize his base (government should let free markets work themselves out) and peel away working class Democrats (government shouldn't bail out the fat cats after letting working stiffs lose their houses). In Burka's script, McCain plays the maverick again, standing up for free markets and workers, while Bush and Obama, arms locked, stand with the billionaire bankers on Wall Street.

I credit Paul Burka with original thinking, but I see two big problems with his theory. First, why would McCain make a big deal of going back to Washington to solve this problem if he planned all along to oppose the solution? He'll end up looking like he failed. A principled failure is still a failure.

Second, Harry Reid has already announced that there'll be no deal unless John McCain and a majority of Republicans sign on. Reid saw from the start the danger of being maneuvered into a dilemma by President Bush, where Democrats either let the country's economy collapse or provide the votes that commit $700 billion of taxpayer money to bail out Wall Street CEOs. Republicans, in the minority in Congress and not responsible for getting a bill passed, would have the luxury of standing on the sideline throwing rocks at whatever solution is hammered out between the White House and the Democrats. Reid has said he won't let that happen. Surely, Barack Obama is astute enough to avoid the trap as well.

Fact checking; Preston Hollow mountains

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As If Politics As Usual Wasn't Bad Enough

The Dallas Morning News Trailblazers blog has been posting stories on campaign fact-checking done by independent sites such as FactCheck.org, PolitiFact.com, and news media like CNN. I've noticed that, more often lately, Barack Obama is being called out for stretching the truth. John McCain continues to be a serial offender, but the Obama campaign is now joining him more and more. I've also noticed that readers tend to dismiss campaign lies as just politics as usual, excusable because everybody does it.

It's true that all candidates are selective in their choice of and presentation of the facts. But there's something new this campaign. In the past, when the press catches a candidate stretching the truth, the candidate quits telling the lie or at least shifts the wording so it's technically true again. For example, last spring, Obama said McCain didn't care if the war in Iraq went on for a hundred years. The press pointed out that what McCain actually said was that he didn't care if a peaceful American presence in Iraq lasted a hundred years. Obama changed his stump speech.

That's not happening in the McCain campaign. Sarah Palin, for example, in her first speech after McCain announced her as his running mate, bragged about having said no thanks to the bridge to nowhere. In fact, Palin was a big supporter of the bridge and even after publicity doomed the project, still kept the money. When the press pointed that out, did Palin quit telling the lie? No. She repeated it word for word, incessantly, including in her acceptance speech at the Republican National Convention. It's almost as if McCain and Palin don't care if they are caught telling bald-faced lies. That, in fact, may be exactly the case.

Jonathan Chait of The New Republic says that McCain spokesman Brian Rogers described media fact-checking this way: "We're running a campaign to win. And we're not too concerned about what the media filter tries to say about it." Chait says Republican strategist John Feehery was even more blunt: "The more The New York Times and The Washington Post go after Sarah Palin, the better off she is, because there's a bigger truth out there, and the bigger truths are: She's new, she's popular in Alaska, and she is an insurgent. [...] As long as those are out there, these little facts don't really matter."

Facts don't matter. Perversely, McCain considers it a plus for him to lie, if it's the so-called liberal elite media doing the fact-checking. It's a deliberate strategy to tell lies that the Times will report as lies, setting up an "us versus the elites" story line. That's what different this time around. Politicians may have always lied, but rarely did they do so openly, baiting the press to call them liars. This is the campaign being run by John McCain, the man who promised us an honorable campaign. That may have been the first, and biggest, lie of all.

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The Joke's On Us

By now, every blogger in Dallas has had his fun ridiculing the New York Post and its columnist Cindy Adams for her story on George W Bush's house hunting in Dallas. According to Adams, he supposedly has settled on "a town outside Dallas called Preston Hollow, one of the wealthiest areas in the oil-rich state of Texas. Houses come with horse stables, lake views, mountain views, golf club views."

Everyone seems to be having a good laugh on those ignorant New Yorkers, without anyone recognizing that lack of familiarity with Dallas says more about Dallas than it does about New York. Dallasites may like to imagine that they live in a big, important, worldly city, but, in fact, to people who actually live in big, important, worldly cities, Dallas is nothing more than a stereotype. Laugh at the New York Post if you must, Dallas, but know that the joke's on us.

Bank bailout

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Disaster Capitalism

Jim Mitchell, in The Dallas Morning News Opinion blog, says it's irrelevant whether Barack Obama or John McCain warned against the recent financial meltdown on Wall Street or even whether either has a plan to fix the mess. Mitchell says the crisis is upon us, events are moving too fast, and political talking points are mere distractions to the decisions that have to be made now.

The urgency Mitchell feels is exactly how the Bush administration wants Americans to feel about the crisis. The Bush administration, through the Treasury Department and its Secretary Henry Paulson, is rushing through a $700 billion bailout plan, pressuring Congress to act swiftly, without due consideration, without input. Taxpayers ought to be very suspicious of the Bush administration's haste. Check out this sentence buried in the administration's plan:

"Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency."

If that doesn't scare the daylights out of you, I've got a bridge to nowhere in Alaska to sell you. Taxpayers would do well to read The Shock Doctrine: The Rise of Disaster Capitalism, a 2007 book by Naomi Klein. Klein details how practitioners of Milton Freidman's free market economics have exploited (and in some cases, even created) disasters and upheavals in order to impose their radical policies on shocked societies. Chile, Russia, Iraq, even New Orleans after Katrina, all have seen wholesale imposition of economic shock therapy. The beneficiaries of this are a narrow group of the economic elite who control the companies adept at profiting from disasters (think Halliburton and Blackwater). The losers are the devastated communities left picking up the pieces of a destroyed economy and infrastructure. That section of the bailout plan quoted above is the kind of license the free marketers give themselves in order to take advantage of the chaos in a market collapse.

Congress would do well to resist being stampeded into hasty action by an administration whose primary interest may be in applying another dose of economic shock therapy, this time on the American economy itself. They were responsible for the disaster. Now they are exploiting it. It's how disaster capitalism works. Read the book.

Fear-mongering; Third party

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Fear Mongering, Bad. Green Weenies, Good

Trey Garrison, in a Points essay in The Dallas Morning News, references some fear-mongering by politicians -- Sen. John Carona's (R-Dallas) bid to outlaw pre-paid cell phones to combat drug dealers; Dallas City Council member Dwaine Caraway's bid to limit how much of a store's window space can be taken up with ads, supposedly to maximize visibility into the store from the street; and Dallas city staffers' bid to sidestep the Landmark Commission in their bid to tear down crack houses.

So far, so good. It's been said that patriotism is the last refuge of scoundrels. If so, the second last is law-and-order.

Trey Garrison, in his own blog, points readers to a second Points essay by Stanley Fish, a kind of paean to pollution. Garrison says:

"Also, be sure to check out this column from Stanley Fish about how we need to get real about our attitude toward pollution. It’s not a moral sin. It’s a fact of life. It’s the cost of people making things. And the materialist, capitalist system so many green weenies decry is what provides better efficiencies in industry and the technologies to clean up the messes we made."

Personally, I say three cheers for the "green weenies" who lobbied and pressured business and government to hold the polluters to account, to make the people making things responsible for the "cost of people making things" instead of spreading the cost to the rest of us, the people who have to breathe the air and drink the water polluted by those people. It's funny, but when the costs can't be passed off to others, the people making things get pretty innovative and find ways to reduce those costs. So, here's to the green weenies, may they ever be vigilant.

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A Third Party in 2012

Scott Burns, who criticizes financial advisors who recommend complicated investments that benefit them more than their customers, really lays into Wall Street this week. Burns declares "'Wall Street wisdom' is a new oxymoron, right up there with 'riskless investment.'"

Burns makes a few predictions. We're near a bottom. The recession won't be deep. And, most surprising, there'll be a rise of a third political party before the 2012 presidential election. Even though both major party candidates are running as the candidate of change, Burns says neither the Democrats nor the Republicans "get it." He condemns both parties for bankrupting our future. Burns is probably wrong about a third party. The future doesn't vote.

Tony Goolsby, dirty tricks

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Feigned Outrage over Fake Push-Polling

Tim Rogers, in Frontburner, alleges dirty tricks in the race for Texas House District 102, currently held by Tony Goolsby. He doesn't come right out and say it, but he implies that it's Goolsby's opponent, Carol Kent, who is running phony push-polling phone calls against Goolsby.

Personally, I find it more likely that someone in the Goolsby campaign itself, or perhaps sufficiently detached from it for plausible deniability, has been making the offensive phone calls to justify accusing Goolsby's opponent of dirty tricks. Check the reader comments to the Frontburner blog item. For example, this comment by one "Kent Can't":

"I also received a call from the company Carol Kent hired to conduct this dirty scam. I got the telemarketer to admit he was in a call center in Delhi, India. Then he told me he had no idea who Carol Kent was, but she apparently paid his company money. At least that’s what I thought he said...could hardly understand the fellow."

Does this pass the smell test? Have you ever gotten a call from a Indian telemarketer, or any telemarketer for that matter, who is willing to answer questions about his job and about who in America is paying his company for his time? The comment reads to me like someone is making up stuff to smear Carol Kent, perhaps as part of a concerted dirty tricks campaign.

Here's how it would work. First, make some offensive calls to staunch Goolsby supporters. Wait for them to tell someone in the press about it. When an obliging writer like Tim Rogers of Frontburner complies, then pile on the reader comments convicting Carol Kent of something the Goolsby campaign itself manufactured. Finally, start running your own ads criticizing Carol Kent for running a dirty tricks campaign. There. A perfect dirty trick where the victim herself gets blamed for the dirty trick you engineered. Right from the playbook perfected by Karl Rove himself, who, perhaps not coincidentally, was in Dallas August 13 to raise money for, wait for it...Tony Goolsby.

Do I have any proof of this? No. You are right to be skeptical of any such accusation against Tony Goolsby. Just as you should be skeptical of the unfounded accusations now being leveled against Carol Kent. But if you do want to start your own investigation, start by asking yourself this question. Who stands to gain from running a blatantly offensive push-polling scheme against Tony Goolsby that's bound to come to light and get all sorts of negative publicity? The supposed target, Goolsby himself, right? Certainly not Carol Kent. Follow the self-interest.

By the way, if you think Goolsby hasn't been accused before of playing dirty, check out the libel lawsuit filed against him by his opponent in the 2006 race. According to Lone Star Project:

"A 2006 cynical smear campaign and voter suppression scheme orchestrated by Republican State House Representative Tony Goolsby (HD102, Dallas), along with Dallas County Republican Party Chair Kenn George and a Dallas GOP consultant, may have backfired. Monday [Oct 15, 2007], former challenger Harriet Miller, with support from Lone Star Project, filed a lawsuit in the 192nd State District Court showing that their attack 'constitutes slander' and was committed with 'actual malice.' "

Someone has some explaining to do, to the judge at least and maybe to the voters. And it's not Carol Kent.

Wick Allison endorsement

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A Conservative for Obama

This ground-breaking election continues to surprise. Wick Allison, former publish of William F. Buckley's deeply conservative National Review and current editor-in-chief of D Magazine, just published an opinion piece titled "A Conservative for Obama." In it, he first repeats the familiar criticisms of George W. Bush's tenure as President: the deficit spending, the support for tax cuts even after the outbreak of war, the growth of government, the bellicosity abroad, the messianic mission of spreading democracy.

"This kind of conservatism, which is not conservative at all, has produced financial mismanagement, the waste of human lives, the loss of moral authority, and the wreckage of our economy that McCain now threatens to make worse."

So far, so familiar. Many conservatives have made the argument that George W Bush's failures are not failures of conservatism, but failures of a man, a man who failed to live up to conservative ideals.

Here's where Allison's argument gets interesting. He doesn't say that what's needed is a leader who will somehow just execute the same old conservative game plan better so things magically turn out different next time. No, he argues that what's needed is someone who is "skeptical of abstract theories" including, presumably, the traditional conservative game plan itself. He argues that's what needed is "a thoughtful, pragmatic, and prudent man," a "realist," someone who is "ready to test any political program against actual results." For Allison, these are the traits of a conservative. And who does Wick Allison see filling that role? None other than Barack Obama.

"Obama is almost the ideal candidate for this moment in American history. I disagree with him on many issues. But those don’t matter as much as what Obama offers, which is a deeply conservative view of the world. [...] As a cause, conservatism may be dead. But as a stance, as a way of making judgments in a complex and difficult world, I believe it is very much alive in the instincts and predispositions of a liberal named Barack Obama."

Of all the millions of words written during this Presidential campaign, Wick Allison's analysis is the single most surprising essay I've read. It rings of honesty. It recognizes the need for real change. From a conservative. Simply amazing.

Bad news keeps coming

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May I Have a Word? Compassion

Michael Landauer, in The Dallas Morning News Opinion blog, notes the recent string of bad news and posits a hypothetical worst-case scenario:

"Mom works (for now) for AIG. Dad works (for now) for EDS. Balloon payments are coming due on their leased vehicles, and their adjustable-rate mortgage just reset to a higher rate. And Junior's favorite teacher just got called to the principal's office to talk about the cutbacks at his DISD school."

Landauer asks, "What could be worse?" To which Trey Garrison quickly responds, "Bailing mom and dad out." When accused of lacking compassion, Garrison replies, "What's compassionate about treating adults like children who have to be protected from their own decisions?"

I'm a native speaker of English. For me, compassion is not an emotion that needs to be earned. It's not something to be withheld from people who fail to see misfortune coming. Compassion is a word descriptive of the person with compassion, not the person for whom compassion is felt. From American Heritage Dictionary:

"compassion - n. Deep awareness of the suffering of another coupled with the wish to relieve it."

Garrison's brand of libertarianism preaches that if tragedy befalls you, it's your own fault. For living in the path of a hurricane, or for working for a company that goes bankrupt, or for sending your kids to failing schools, or for not making enough money to be able to move to west Plano. Garrison's attitude is that everyone is on his own. Aid and comfort just begets more need for aid and comfort. That cold-hearted philosophy might or might not be good public policy (I think not), but for sure it's not compassion. Trey Garrison may or may not know the meaning of compassion, but for sure he doesn't show any.