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Spengler weighs in again on the credit mess.
To bankers and politicians who insist that the world will come to an end if the US Congress does not approve the proposed US$700 billion bailout package, I wish to say: “It is not the end of the world. It is just the end of you.” Sadly, it won’t be. America’s financier caste will live to fleece another day.
There are no atheists in the trenches, and no free-marketeers in Congress after a nearly 10% fall in stock prices. A chorus of erstwhile conservative voices led by the likes of Newt Gingrich, the Republican firebrand of the 1990s, now argues that the proposed $700 billion bailout package is flawed, but it is better to enact it than to do nothing. This simply is not true.
In the event of bank failures, the government will not “do nothing”. Two of America’s largest banks, Washington Mutual of Seattle, Washington, and Wachovia Bank of Charlotte, North Carolina, were forcibly merged or taken over by regulators during the past several days, without a ripple of disruption to depositors or borrowers. …
David Warren on the rescue.
The U.S. dollar is soaring (at least in relation to the British pound), the price of oil is plummeting, stock markets are calming in the eye of the storm, the big bad banks are going down like dominoes. At first sight, what’s not to like about the failure of the U.S. House of Representatives to rubberstamp the Bush-Paulson-Pelosi-Reid financial rescue package?
Better, from a strictly Democrat point of view, Nancy Pelosi and company are squeezing every drop of partisan advantage from the process itself, by which lame-duck Republicans are trying to fix a largely Democrat-created problem that Republicans like John McCain could see coming for at least the last three years, and actually tried to do something about, over Democrat objections.
(Most readers won’t know this because they are not being told by the mainstream media: but yes, McCain began pleading with the Senate Banking Committee to act on huge irregularities discovered in the accounts of Freddie Mac and Fannie Mae, back in May 2006, two years after a Bush administration initiative to improve their regulation died in Congress. McCain’s efforts were ridiculed, then stifled by ranking Democrats, including the committee chairman, Chris Dodd, the leading recipient of financial contributions from lobbyists for the very banks McCain said were “gaming the system.” Senator Barack Obama is incidentally the second-biggest recipient of political contributions from these sources.)
Nancy Pelosi to the U.S. Senate, Monday, on the figure of $700 billion: “It is a number that is staggering, but tells us only the costs of the Bush administration’s failed economic policies: policies built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision, and no discipline in the system.”
This remark was as close to the opposite of the truth as it is humanly possible to get. Even by the standards of politicians, it was shameful. …
And David Harsanyi.
… Pelosi, the least effective Speaker in recent history, unleashes partisan tirades that peddle the tired myth that “unbridled” free markets (tell it to the more than 75,000 pages of regulations in the Federal Register) are the sole reason for our predicament.
Even she must understand that government meddling is, in part, at fault for this mess: From the Carter administration’s Community Reinvestment Act to the Clinton administration’s repeal of Glass-Steagall to George Bush’s Ownership Society, government has implicitly guaranteed loans while at the same time it has compelled lenders to hand out risky mortgages to low-income borrowers.
When the Bush administration tepidly recommended overhaul of the housing finance industry in 2003, Democrats balked. So it is with amazement we watched the very same folks — people like Congressman Barney Frank (who did not see any “possibility of serious financial losses to the Treasury” only a few years ago) and Sen. Chris Dodd (who has taken $31 million in contributions from the financial sector) — leading the mocking, cajoling and proselytizing of those who opposed the bailout. …
We are waist deep in evasions because one cannot talk sense about the cultural roots of the financial crisis without transgressing this cardinal principle of politics: Never shall be heard a discouraging word about the public.
Concerning which, a timeless political trope is: Government should budget the way households supposedly do, conforming outlays to income. But the crisis came partly because so many households decided that it would be jolly fun to budget the way government does, hitching outlays to appetites.
Beneath Americans’ perfunctory disapproval of government deficits lurks an inconvenient truth: They enjoy deficits, by which they are charged less than a dollar for a dollar’s worth of government. Conservatives participate in this, even though deficits fuel government’s growth by obscuring its cost. …
Twenty years ago we began to lose our freedom to speak. The Australian has the story.
TWENTY years ago today, Salman Rushdie published The Satanic Verses. Four years in the making and supported by a then almost unheard of advance of $850,000 from his publisher, Penguin, Rushdie had hoped the work would cement his reputation as the most important British novelist of his generation. The book certainly set the world alight, though not quite in the way it was meant to. …
Just over a year ago the I35W bridge collapsed in Minneapolis. It has been rebuilt already. Popular Mechanics has the story.
America learned about the sudden collapse of the I-35W bridge in Minneapolis in great detail when it buckled and fell last August. And with good reason: Thirteen people died. The cause of its failure remains undetermined despite faulty plates being cited as a major design flaw.
What’s been less closely watched is this story’s surprisingly happy ending—or at least its new beginning—some 13 months later. By 5 am on Sept. 18, cars and trucks had been lined up for hours on either side of the Mississippi River. When the St. Anthony Falls Bridge, with its next-gen design, officially opened this month, “it was a solid wall of traffic in both directions for over 8 minutes,” says Linda Figg, president of FIGG Engineering Group, which designed the structure based on smarter plans for modern engineering. “We heard stories of people trying to line up at midnight, to be part of the first car entourage to cross the new bridge.” …
Article in The Atlantic on Somali pirates.
Somali pirates hijacked a Ukrainian vessel carrying tanks and other military hardware in the Gulf of Aden. U.S. Navy warships have surrounded them.
This year alone, pirates have attacked 61 ships in the region. They have held 14 oil tankers, cargo vessels, and other ships with a total of over 300 crew members, and have demanded ransoms of over $1 million per ship. …
That strange hotel in North Korea gets some coverage.