Lois & Clark Forums Forums General Discussion Off Topic Possible reason for Wall Street crisis

Thanks for the link. The article is really very insightful - as were many other political posts here recently.

I'm totally swamped with work (having to commute between four different places all over the city really doesn't help my time budget), but whenever I do have a little time, I enjoy reading these posts and following some of the links.

So thank you, everyone, for the interesting debate(s).

Eva

Very interesting, Alcyone. Rather unsurprisingly, I find myself disagreeing with some points the article makes, but I have to agree with several others. One thing is certain. Two years ago, when anyone mentioned the name 'Bush' in many parts of Europe, you could hear the contempt dripping from the speaker's tongue. Now, hardly anyone mentions Bush's name anymore. The anger that used to be there at the United States has also vanished. People have moved on to other things and other worries.

Perhaps the National Journal is right and the footprint that Bush leaves in history will really be a small one.

Ann

This may be right for Iraq. You're country will probably be sucessful at getting al Qaeda out of Iraq. But that won't change one thing - the USA killed Muslims. They started that war in Iraq because they were afraid of Saddam (or because they wanted to get oil). That might not be the reason why Bush or whoever else actually made the discision. But it's what people around the world think is the reason.

It's how propaganda works. It doesn't matter what reason you have to do one thing or another. It's what people think is your reason that actually matters.

Like you, I don't think that you can talk al Quaeda out of their believes. But starting wars all over the world will ultimately lead to more people becoming radical. It's not like there are only people of al Quaeda dying in this war. There might have been a lot of families in Afghanistan who hadn't even heard of September 11th. But what they know is that an US soldier came and killed their relatives. I think that this will be dangerous and will help Al Qaeda to get more support.

It would be better to show many people throughout those endangered countries that the western society is not the enemy. If al Quaeda or any other radical elements cannot win supporters, they will get weaker.

Roger, first I gotta say how amazing you are at holding your own in this discussion and how clearly you've presented all the facts in this thread. I would have lost patience by now trying to make other readers understand. What makes me sad that you've been driven to censor yourself in an attempt to get a sincere response(which has yet to be forthcoming) and I'm compelled at this juncture to point out who has shaped obama's thought process, as we all know this is the complete fact. What's great is that you can respond to my answer all you want.

The most prominent people I have seen presented that are closely associated with Obama are William Ayers and Jeriamiah Wright, two extremist outspoken US HATERS. They've postulated to no end about how much they hate this country to the point of structural damage and warping people's minds.

If John McCain were to hang out with radicals like these guys, I'd question his political stability as well.

As far as Wallstreet, we all know that Franklin Raines and Daniel Mudd, two of Obama's financial advisors for his current campaign, had been bilking Fannie Mae of government funding the whole time they were in charge of it.

Aside from the fact that he's pro abortion, anti defense(the best defense being a good offense, first strike and ALL that), pro tax and spend, I gotta wonder what sort of intellegence he has to hang out with folks like the guys mentioned above. Maybe the messiah hoped that being in his exalted presence would change these rowdy hucksters.

Please feel free to ripsaw at anything I've said if it is incorrect.

TEEEEEEEEJ

There is a huge difference between opinion and fact, TJ. I feel as if I'm banging my head against a brick wall by mentioning it, but others on this thread have been trying, in the interests of having a reasonable discussion, to leave at least some of their political slants and name-calling behind.

Obama is not anti-abortion. He is pro-choice. Maybe you think this is just a matter of semantics, but it's nothing of the kind. Someone who is pro-choice wants a pregnant woman to be able to make a free choice. Whatever that choice may be is up to her. A pro-choice individual has no agenda as to the outcome of that choice - unlike someone who is anti-abortion, who wants that outcome to exclude one option. The implication of calling someone pro-abortion is that they want a woman with an unwanted pregnancy to choose abortion, and that's so far from the truth as to be ridiculous.

(I'm not going to get into the 'anti-defence' accusation, other than to say that making the first strike sounds like being the aggressor rather than the defender, and I don't think any presidents in the past few decades, Republican or Democrat, have subscribed to that principle).

There's nothing wrong with stating an opinion, but please don't try to pretend that it's a fact.


Wendy

Is this a view that is seen outside the conservative media?

Based on what I've read, the Ayers association is not "close" (this is a stretch, the only evidence is a 200$ contribution and that they were on an eight-seven person board). This would entail a radical redefinition of "close." I linked to factcheck about this in the VP thread, so this link is different (Washington Post's factchecker). Oh and here's Politifact with some more context from when Hillary brought it up.

Moving on, I don't think Jeremiah Wright hates America, so much as is a huge critic of the government. He's very much shaped by his past and the struggles of the black community. That's my own view based on having read quite a bit on him and seen several of his sermons in their totality--I also associate with groups (though secular) where this impassioned critique is not uncommon. My view is not a fact, neither is the view that Wright "hates America." These are two interpretations.

The "fact" is, however, that Obama has since repudiated Ayer's remarks/actions and broken off with Wright. He's done it himself, stated it point-blank.

I already posted factcheck's view of the Fannie Mae and Freddie Mac mess. Of course, both left and right will "debunk" it. Both sides will want to spin it into something else to benefit their world view. I trust either side less than a source recognized as non-partisan.

By the way-- the Obama campaign said that Raines emailed McCain adiviser Carly Fiorina early last week (before it hit the fan) to correct her about the factually incorrect assertion that he was an adviser to Obama she made on TV (this was before the McCain campaign got her off the air). The Obama campaign provided a copy of the email to the media.

However, as of today, the McCain camp has remained silent on this. If they were correct in their assertion of the Raines link, wouldn't they jump to deny this?

Also, I haven't read of Daniel Mudd being an financial adviser in my trawling. Is this anywhere that isn't the conservative media? What I did find was an article from Reuters in which both Obama and McCain spoke out against golden parachutes, he would have been one of the people to benefit.

alcyone

This is one area where I will never get into an argument. This issue is far too personal for people and the odds of this type of argument making any kind of headway is pretty much zero. I do have my own opinion on this issue, and you may or may not be surprised at what it is, but I'm keeping this one to myself.

You have quite the talent of reading things into comments that aren't there. I recognize people can have different opinions on whether the invasion of Iraq was justified, but the particular point I was making here was that Bush was unfairly tarred as a liar, for manufacturing evidence as an excuse to go into Iraq. This was the beginning of the end of his presidency as he allowed Democrats to spend five months lying about him before he started fighting back. The nail was Katrina. The point made here had nothing to do with whether he was justified or not as justification isn't even part of the argument. The point was that he went in with the best information he had at the time. The point about WMD stockpiles was wrong, but it was not a lie. The justification argument can be handled separately. I would say it still was justified due to what Saddam was planning, but others will disagree with me. Fair enough.

Democrats who voted for the war resolution could have simply claimed that the incorrect intelligence fooled them as well as the president, but they couldn't leave it at that. Instead, they had to have been lied to in order to vote the way they did in order to satisfy the anger of the leftist fever swamps. So they went out to destroy the president with the help of their media allies, despite the fact that every commission convened showed the president never lied and that the intelligence presented to Democrats on the two Intelligence committees was essentially the same as the intelligence provided to the president. Senator Jay Rockefeller (D-WV), Vice Chairman of the Senate Intelligence Committee even said as much until he was pressured by his fellow Democrats to backtrack. Representative Jane Harman (D-CA), Vice Chairwoman of the House Intelligence Committee, backed up the president and lost her vice-chairmanship and was passed over for chairman when Congress switched sides in 2006 because she dared to tell the truth rather than back the party line that Bush lied, people died.

In politics, everything is fair game and is a blood sport, so I can't complain about what the Democrats did, but I can criticize the president for staying silent for so long and letting himself be tarred as a liar. He had made a promise that he would try to be more bipartisan after winning in 2004 and look where it got him.

As for Katrina, you missed the point again. I never said that Katrina didn't do damage to the country or to the region as you seem to imply. The damage was great and the loss of lives were quite significant. The economic damage was also tremendous as the economy lost over a million jobs and lost $200 billion in damages. But by unfairly tagging President Bush with all the blame essentially paralyzed the rest of his presidency, something you never want to see of the leader of the free world.

I will say one thing. While Bill Clinton was guilty of committing perjury before a grand jury, the Republican reaction was unjustified in that it took Clinton's eye off the ball. He spent much the rest of his administration defending himself against legal matters leading to contempt of court charges and disbarment, but to paralyze the President of the United States with so many dangers in the world is unwise. While Bill Clinton was worrying about lawyers, al Qaeda plotted while his administration did nothing about it.

The same thing happened with George Bush. He tried to be proactive with Katrina only to be rebuffed by the governor and the mayor, yet he was blamed for being aloof and not paying attention and for general incompetence. The press and Democrats crucified him unjustly and his administration was essentially derailed for the rest of his term.

Just as the right suffered from Clinton Derangement Syndrome in the late 90's, the left has a terrible case of Bush Derangement Syndrome right now.

As for all the arguments about supply-side economics, I'll just point to my past arguments, of which there are many pages worth. I don't need to rehash them again except to say that you're misleading people by saying they were tax cuts only for the rich. Tax cuts were always for everyone who paid taxes, and percentage of tax cuts were higher for those in the lower brackets, making the tax code more progressive. I think you object to rich people getting more of their money back, regardless of what the tax cuts do to help the lower brackets. That's fine, but it's definitely wrong to say only the rich got tax cuts. Percentage is what matters, not raw amounts. A richer person will always get more dollar-wise, but that's a no-brainer. They pay a heck of a lot more, so of course they'd get more back. To say they got tax cuts disproportionately in their favor is incorrect.

I don't defend tax cuts for the rich because I like rich people. Rich people will always do well no matter what their tax rate is. I defend tax cuts because rich people supply ALL THE JOBS. Take money from them and you have fewer jobs. It's as simple as that. 70% of all jobs are supplied by small business filing as S-Corporations, proprietorships, and partnerships, which file under personal income tax rates where most of the money goes back into the business rather than into the owners' pockets. So a lot of these "rich" aren't actually as rich as you think with their money tied up in investing in the business. So all those tax cuts for the rich are tax cuts for job producers. For that, I will always contend that is better than raising their taxes.

As for why the rich will always do better, they tend to work harder and take more risks, often working 90+ hours a week with no vacations for years to get their small businesses off the ground. As I said, 70% of all jobs are supplied by these small S-corps, not the mega-corporations. With higher risks, the rewards are higher as well. This is why the gap between rich and poor always grows, during the good times and bad. This is not to say poor people don't necessarily work hard, but a hard working person who takes no risks will never get rich. It's a necessary but not sufficient criteria. The gap grew during the Clinton Administration as well for exactly that reason. The rich don't need help, but the more money they have, the more people they can hire. You don't get jobs from poor people. This is why Europe has a chronically high unemployment rate. Chronically high taxes means chronically few jobs. Europeans would kill for our unemployment rates even during our recessions.

I will say my parents were hardly rich when they ran their little tiny grocery store of perhaps 800 square feet. With their high cash flow, they were in the higher tax brackets and would have been considered the "rich." But they never had a vacation in nine years, worked every day from 6 am until 11 pm seven days a week, and they never had much in actual earnings for themselves even in the best of times. Nobody who knew them would ever have considered them even close to being rich as they practically lived like paupers, just trying to earn enough money to send their kids to a public college (both my sister and I went to UC San Diego and paid in-state tuition) and sock a little bit away for retirement, knowing that Social Security will never be reliable. They never ate out. They never bought a new car, and they wore ten-year old clothes with patches. They lived in a townhouse of about 1200 sq. ft. in Alexandria, VA for all the time they ran the business. My mother, who's 4'9" wore my clothes that I had as a kid. These are the type of people liberals would like to tax into the ground since the left would have considered them rich, according to the tax code.

If Obama wins and he raises the taxes he promises to do, I have to say I'm glad my parents are now safely retired (my mom is 69 and my dad is 84), living on their savings, and now no longer even show up on their tax returns. If they were still in business, they probably wouldn't be for long.

Anyone wonder now why I find it offensive whenever someone says we need to tax the rich and make them pay their fair share? It's their money and what right does the government have to take so much of it and then demand more? It's their experiences and the hard work they had to go through, and the sacrifices they made for my sister and me that made me the conservative that I am today.

You are correct that some of my arguments against Bush were from the right. I am right, so naturally I'd criticize him when he starts acting like a liberal.

Not to fuel the debate between the two political extremes, but I feel that I should point out from a personal perspective that I actually make 4 times as much now than I did in the early 90s. And I am quite fully in the middle class. Truth be told, I would probably term myself poor growing up so making it into middle class has been what I feel to be an accomplishment.

Now that said, I have to admit that I am hardly an economist so I can't say to what lesser or greater extent any government or political party has had on that accomplishment. However, I am somewhat of a semi-expert on human behavior considering what I do for a living so personally I blame a lot of our econmic trouble on individuals.

Now, don't get me wrong. I certainly agree that certain decisions by both parties over the years have added to and substracted from our problems as an economy, but in the 21st century I personally feel that the "information age" has played a huge role in the market.

20 years ago when John Smith cheated on his wife, got a divorce and was forced to dump a large amount of stock in the settlement the market had time to stabilize before Bill Jones found out about the sudden drop in his favorite stock and responded with a kneejerk reaction to what he mistakenly interpreted to be insider knowledge of some impending market force.

Today, however, any market change no matter how small or inconsequential is broadcast to everyone else in the world in a matter of hours if not minutes. Individuals and brokers respond instantly to market changes and destabilize things that really weren't seriously destabilized to begin with and if they were would have stabilized themselves if left alone for a few days.

I saw an interview the other day with an economist who actually suggested that people stay away from financial news except for 1-2 times per week because of just this sort of phenomenon.

Roger, I agree entirely with you about not getting into an argument over pro-choice/anti-abortion, and I definitely don't intend to do that; the only point I was making was that calling Obama 'pro-abortion' is a loaded accusation (and not fact) because being pro-abortion isn't the same thing as being pro-choice.


Wendy

I actually understand your point. Wikipedia's page on abortion, for example, clearly states, "Pro-choice individuals often do not consider themselves 'pro-abortion'..." I can see how you would want to explain the very important difference between being "pro-abortion" in the sense that you are for abortion rights and being "pro-abortion" in the sense that you actively promote abortions as the best choice for women with unwanted pregnancies.

However, I have to say I think some of your words were a bit harsh. "Name-calling"? "So far from the truth as to be ridiculous"? "Don't try to pretend"?

Dictionary definitions of "pro-abortion":

American Heritage Dictionary: favoring or supporting legalized abortion
Dictionary.com Unabridged: pro-choice
Merriam-Webster: favoring the legalization of abortion

Nah, I get Wendy's point, the pro "choice" crowd wouldn't want to be considered baby killers or anything like that. But I stated my opinion that the chicago senator is pro abortion based on his own words that "girls who make bad choices shouldn't be punished for their mistakes." In short the man believes babies are a punishment. Whether he's pro abortion or pro "choice" is to-may-to/to-maa-to to me when I know how the man voted in the circumstance of a premie born during an abortion procedure should end up breathing its last in a trash bin rather than have a pediatrician standing by to administer aid.

It's knowing how he votes that makes obama an unacceptable candidate for me. For example. His voting against McCain's 2005 bill to audit Fannie Mae and Freddie Mac when Franklin Raines was the CEO and then choosing the same man as the financial manager for his campaign, smells like rotten tuna to me.

Roger, I was wondering if you could help me understand something. If Fannie Mae and Freddie Mac were being run/regulated/overseen by the government, how were they able to make contributions to political campaigns, say the $300000 to obama and the $700000 to chris dodd. Isn't that a tiny bit unethical?? I ask you, as so far you've provided the most factual and easiest answers to understand in this discussion so far.

Thanks!
TEEEEEEEJ

This is false.

Franklin Raines is not/has never been Obama's financial manager.

The man spoke on the phone with Obama's campaign--it's been widely documented even by the very newspaper that originally circulated the story (Washington Post).

If that's reason for worry, then that's all in a person's choice. You can criticize Obama for the phone calls all day.

But a phone call to someone does not mean he's the financial manager. That's a false statement.

Please avoid spreading false claims. It's a fraught enough election environment as it is.

alcyone

Ah yes, you are correct, Raines is his financial *advisor* , if this washington post article is correct. Sorry; advisor, not manager; terminology; my bad.

TEEEEEJ

The direct quote from the Sept 23 Post article being:

Being part of a "political circle" is not the same as being a "manager" or "advisor." It's still a false claim.

The Huslin article got explained by the Post itself here . I had already linked to it previously.



I already posted this too but *sigh*

The AP covers the email that got sent out by Raines to Fiorina correcting her assertion before it became big and her silence on it.

Terminology is important.

alcyone

This is from the Washington Post July 15 article:
Example: obama, "Frank, any more contributions coming my way?"

Raines: "Not if you let McCain pass that bill to audit my backside...."

Now I find that the FBI is looking into investigating the fraud committed at these financial institutions, and I'm thinking it's about time they got around to doing it, as our representatives on Capital Hill should have been hollering for investigations from day one. So now I only have to wonder which of our fine congressmen's bottoms are scared tight at this moment? Bet I can guess....

TEEEEEEJ

*sigh*

I know this will be equally disregarded, but I do want to state that the Post's investigation and explanation of the article quoted above is dated Sept 19.

And that the AP article is from four days ago.

I expect any possible FBI investigation will shed some light into the latest claims concerning McCain campaign manager Rick Davis' own association with Freddie Mac as well.

alcyone

Roger, I will come back later with a more comprehensive reply to your latest post. Personally I think it is a very real and very serious problem that the richest people keep getting not only richer but so much richer than most other people in their society. And that is one reason why I think it is downright wrong to give the richest people tax breaks, allowing this mega-rich clique to forge ahead even further and leave the rest of society even farther behind. Becoming so rich is like watching the rest of society through a pair of binoculars which are held the wrong way - everything around you shrinks and becomes insignificant.

For now, let me just quote something that I saw in today's USA Today:

As far as I can understand, quite a lot of today's current Wall Street mess has to do with the behaviour and risk-taking of investment banks. My impression is that these banks have made huge profits while blowing up a housing, mortgage and subprime bubble.

And 50% of the great earnings of investment banks, whose irresponsible behaviour has greatly contributed to today's crisis, has gone to the pay of those who were responsible for the reckless behaviour of these banks, its executives? That's horrendous! No bank should use more than a quite small percentage of its earnings to pay its executives, in my opinion. The way I see it, the culture of allowing mega-rich people to take huge risks so that astronomical sums of money can be channeled directly into their own pockets while leaving ordinary middle- and low-income people to contribute much of the tax money needed to clean up after this mess - that is the sort of culture that can make a few individuals unbelievably rich, while at the same time it erodes the very foundations of society.

Ann

The reason a lot of guys on Wall Street took those risks, Ann, is because they had seen a pattern of the GOVERNMENT BAILING BUSINESSES OUT. If the socialists in our government would keep their busybody noses out of our commerce, free trade would happen as it was meant to and everyone would get a chance to prosper.

As far as the rich getting tax breaks, here's an article from the Wall Street Journal showing that since 2000 the top 1% of income earners pay 35% of all federal income taxes. The top 50% of income earners pay 97% of ALL income taxes while the poor hardly pay any, less than 3-1/2 dollars out of every $100 paid in income taxes in the United States is paid by someone in the bottom 50% of wage earners.

These are income earners buy the way, people who WORK for a living, not the louts who inherited their funds from gram and granpa and have been lollygagging around on their 100 ft houseboat for the weekend(hello algore!!)

For someone from the government to just arbitrarily pop in and tell me that they deserve 22% of my hard earned cash smacks of socialism to me, which, IMO, makes it evil and wrong.

TEEEEEJ

We know who the culprits are in this financial real estate mess. If you want to see who Congress thinks is responsible, just look at the fact that Democrats in Congress have no interest at all in holding hearings to investigate what went wrong and are trying like crazy to find any Republican to blame it on and flailing. Knowing that Democrats will investigate anything if there's a shred of a chance of blaming Republicans, this is telling seeing as they know where the finger will point to. They tried to point the finger at Phil Gramm, who merely sponsored legislation to allow investment banks to participate in more traditional banking. Even Clinton's Treasury Secretary and former CEO of Goldman-Sachs, Robert Rubin, shot that down, saying that the legislation had no impact whatsoever on the current crisis.

If Congress were to ever truly investigate this, people like Christopher Dodd, Barney Frank, and John Kerry would be voted out of office very quickly.

Here's a piece from the Wall Street Journal further outlining the obstruction Democrats played in preventing oversight of Fannie Mae and Freddie Mac, where all the problems stemmed from. The detonation of Fannie Mae/Freddie Mac essentially took out collateral damage such as AIG, Lehman, Morgan Stanley, Merrill Lynch, etc. If Democrats had not stood in the way of oversight, the situation would be far different today.

The White House also put out a press release showing the timeline and actions taken to address the problems and were stymied every step of the way. After auditors pointed out fraud and potential dangers, Democrats like Barney Frank, Chuck Shumer, and Chris Dodd stood up to say that there were no problems and that Fannie Mae and Freddie Mac were not in trouble and that anyone who wanted reform legislation only wanted to discriminate against the poor and minorities by making it hard for them to get a loan.

As for Obama's culpability, he stood with Democrats in blocking efforts to reform Fannie Mae and Freddie Mac.

Here's an article from Bloomberg as well on this issue.

For those who want change, let's vote out the ones who were at fault and keep out of the White House the people who were responsible for blocking reform of Fannie Mae and Freddie Mac. It was liberalism that was at fault for distorting the markets and creating the real estate bubble, not capitalism. And who were the ones in charge? We had Janet Reno at the Clinton Justice Department who threatened companies who didn't loan to the poor or minorities under the Community Reinvestment Act, all in the name of giving people homes who couldn't afford them. We had Jim Johnson (Countrywide Mortgage scandal anyone, and Obama's head of the VP selection committee) and Franklin Raines and Jamie Gorelick who ran Fannie Mae into the ground, fraudulently inflating assets in order to maximize their bonuses. (Ann, where's your outrage at the Democrats here?) We had Barack Obama and his entire party blocking reforms that could have saved taxpayers from hundreds of billions of dollars in losses.

Explain to me why Democrats should be allowed anywhere near the economy?

As for why Fannie Mae and Freddie Mac could make campaign donations (Obama was #2 despite having been in office less than four years with over $200,000), they are corporations and were set up as such. They are Government-Sponsored Entities (GSE's), but are actual companies with a board of directors, a CEO, etc. They do have special government exemptions, which is why they're referred to as quasi-governmental agencies.