Daily Archives: May 25, 2015

Whitewater controversy

In light of what we now know about the history of banking scandals that lead up to the crash of 2009 (see my previous post The WSJ and Barron’s Apologists for the Banksters Peddle Wallison’s Fables), I thought it might be interesting to look at the Whitewater controversy again.

Excerpting from the above linked WikiPedia article is this explanation of the Whitewater real estate deal.

In spring of 1978, McDougal proposed that Clinton and Rodham join him and his wife Susan in buying 230 acres (0.93 km2) of undeveloped land along the south bank of the White River near Flippin, Arkansas, in the Ozark Mountains. The goal was to subdivide the site into lots for vacation homes,…
This period featured high interest rates in general, and by the time these lots were surveyed and thus available for sale at the end of 1979, rates had climbed to near 20 percent. Prospective buyers could no longer afford to buy vacation homes. Rather than take a loss on the venture, the four decided to hold on, building a model home and hoping for better economic conditions.

This explanation doesn’t give any hint that there is any connection between this specific deal and the type of liar loans that eventually brought down the S&L industry, and years later a repeat of such fraud nearly brought down the whole world economy. Whoever, the Wikipedia article brings up all sorts of history that had passed from my memory. It gets uglier. Nobody involved in the prosecution or the defense at the time had the benefit of the hindsight gained from 2009 and beyond. I don’t know if anyone now, besides me, is going back to see what it looks like from today’s perspective. There may be some kooky conspiracy theorists who are doing this work of which I am unaware. I don’t know if I will be joining them if I find them.

The WSJ and Barron’s Apologists for the Banksters Peddle Wallison’s Fables 3

New Economic Perspectives has the article The WSJ and Barron’s Apologists for the Banksters Peddle Wallison’s Fables by William K. Black. Remember that Black is one of the regulators who lived the history that he is reporting.

But Wallison (and the WSJ) also ignores the key act of deregulation that lies at the heart of his thesis (and is fatal to that thesis). The most important act of deregulation was the removal of our loan underwriting rule that we used to drive “liar’s” loans out of the S&L industry beginning in 1991. The rule was destroyed by Bill Clinton and Al Gore’s “Reinventing Government” assault on effective regulation. The underwriting rule was replaced with a deliberately unenforceable “guideline.” The elimination of the rule was not the product of housing goals – it was the product of Clinton and Gore’s “New Democrat” hostility to effective regulation. The elimination of the rule made it far harder for regulators to ban liar’s loans and take enforcement action against them. (The Fed had unique authority once HOEPA was passed in 1994 to ban all liar’s loans, but Alan Greenspan and Ben Bernanke’s anti-regulatory dogmas ensured that the Fed refused to ban such loans even when it knew their fraud incidence was 90 percent. Their refusal had nothing to do with affordable housing goals and everything to do with the fact that they were co-celebrants of Wallison’s anti-regulatory dogmas.)

The WSJ op ed actually spends very little time discussing Wallison’s thoroughly and repeatedly discredited thesis that Fannie and Freddie, because of government housing goals, were the demons that caused the crisis. The WSJ op ed is really devoted to providing yet another apologia for the banksters – who are the victims of an overly aggressive DOJ.

I know there is no amount of counter-evidence that I could ever point people to to convince most of them that the Faux Noise fable of Barney Frank as the culprit is a complete fable with no supporting evidence. The only thing I can hope to do with these articles is to strengthen the resolve of the people who know the truth. Someone has to be speaking truth to power, all the while that power is speaking lies to the weak.

The other value in my reading these articles and blogging about them is to remind myself and others about the severe damage that Bill Clinton and Al Gore did during their administration. The reason this is so important is that Hillary Clinton is running for President. She has a special responsibility to disown the damage that her husband did. If she fails to do so, articles like this one are needed to remind us of the damage this supposed progressive can actually do.

“I Never Wanted to Hurt Any Vietnamese”: Former Combat Medic Recalls Antiwar Resistance Within Army

Democracy Now has the article “I Never Wanted to Hurt Any Vietnamese”: Former Combat Medic Recalls Antiwar Resistance Within Army

Wayne Smith served as a combat medic in Vietnam. He joined the peace movement after he returned home. He spoke recently at the recent “Vietnam: The Power of Protest” conference in Washington, D.C.

Here is the video for which the article provides the transcript.

What drew my attention to this video was the quote:

It was also interesting for me, as a medic, who joined—and I never wanted to kill anyone, never wanted to hurt any Vietnamese. I resisted all of the attempts by the military sergeants and trainers to dehumanize the Vietnamese. They trained us to call them “gooks” and other horrible names. Obviously, I knew immediately that, had it been a war in Africa, we’d be calling them “niggers.” So it was—we resisted, and I resisted.

I experienced that Army training in 1967. I noticed and resisted the effort to dehumanize the enemy. Even an Army Chaplain had been enlisted in one of the presentations in our training of the dehumanization. I was “lucky” enough to be a little older than the average recruit, and to have already graduated from college. I was in a very strange group of trainees, many of whom were in a similar stage of life and experience as I was. I even remember one of my fellow trainees who had been in the Peace Corps. It was he who specifically raised objections to that Chaplain trying to dehumanize the people in Vietnam.

I understood why the Army needed to dehumanize the enemy. How else were they going to get normally civilized people to go out and kill fellow human beings? However, just because I could understand the reason for what they said in the “training”, I could never shake the knowledge that it wasn’t true and it wasn’t morally right.

I was also “lucky” enough to never be sent out of the country during my two years in the Army. I was never put to the ultimate test of trying to resolve the conflict between trying to survive and trying to preserve my moral beliefs.

Social activist tell CNN: ‘Whiteness gets nuance in the media and blackness doesn’t’

The Raw Story has the article Watch this activist politely destroy CNN for racism: ‘Whiteness gets nuance and blackness doesn’t’. The focus is on the following video clip:

One feature of The Raw Story article is that it provides a transcript of the interview. With my aging hearing, there are always a few words that I miss when I watch the video. For instance, I didn’t quite get the last few words in the excerpt below

McKesson slammed the media for what he called “a constant pathologizing of black bodies,” which gave the impression that “when black people assemble, it’s always criminal.”

The last few words are kind of important to the message.

Gaius Publius: Hillary, TPP, the World of Money, and the Center for American Progress

Naked Capitalism has the article Gaius Publius: Hillary, TPP, the World of Money, and the Center for American Progress. Here are a few of the shocking statements in the article. (I have left out the links that are in the excerpts in the original article. You’ll have to go to the article if you want to see them.)

  • Exxon is one of the largest owners of unmonetized methane (yet-to-be-fracked natural gas) in the country.
  • “Left-wing” support groups and think tanks like EDF (Environmental Defense Fund) and NRDC (Natural Resources Defense Council) strongly support (pdf) the “temporary” transition to natural gas as a bridge fuel.
  • By many reports both EDF and NRDC receive money in various ways, as well as advice, from the oil and gas industry and their advocates.

One of the most important — and “centrist” (code for “corporate-friendly”) — think tanks in the Democratic Party ecosystem is the Center for American Progress, or CAP. They do some good work, and their associated Web group, ThinkProgress, does excellent work. But when it comes time to put their “money” where Money’s mouth is — for example, to support cuts to Social Security and Medicare — CAP is on the anti-progressive side, and reliably so.

I was unaware of the influence of corporate money in some of these organizations. I feel played like a Tea Party member who didn’t realize that the Tea Party was invented and funded by the Koch brothers.

Whatever Happened to Antitrust?

Robert Reich has posted his article Whatever Happened to Antitrust?

He has example after example of gross violations of what you would think are the anti-trust laws. Here is just one of his examples.

Drug companies pay the makers of generic drugs to delay cheaper versions. Such “pay-for-delay” agreements are illegal in other advanced economies, but antitrust enforcement hasn’t laid a finger on them in America. They cost you and me an estimated $3.5 billion a year.

As far as I can tell from the article, the anti-trust laws have not changed. They are just not enforced anymore. Is this something we voted for? Well, yes it is when we vote to put any Republicans (and many Democrats) in office. They just don’t explicitly run on the platform of decimating our anti-trust laws.

This is an issue that must be addressed in the 2016 Presidential campaign.