Good News on a Friday (An Ascent From Pundit Purgatory)

It's been sneaking in again. That crushing feeling of helplessness that accompanies spending several hours a day on news blogs and political commentary sites. If you listen to the Right, we're going to hell in a handbasket. If you listen to the Left, Obama is a do-nothing, accomplish-nothing corporate puppet.

Needless to say, when no one's happy and it's sometimes difficult to disagree with the enthusiastic logic of some of those on the left, reality becomes a bit nebulous. For example, I've found myself wondering why Obama hasn't already fixed illegal immigration, gay marriage, special interest influence in politics, and solved world hunger in his first two years as president. I've wondered how the man I voted for could so quickly bow to Republicans in order to shoe-horn a half-complete health insurance reform bill through. I've wondered why he hasn't railroaded climate legislation through with his Congressional super-majority.

I'll stop there. You can see where this is headed.

The Ascent

I've been frustrated that none of the pragmatic policies I once believed in have resonated with the public and therefore compromises have been made and progress has been slow. According to those news blogs I mentioned, America hates Obama, all demographics have gone off their rocker into one fringe corner of the political spectrum or the other, crippling progressive legislation in the process.

Then I spent some time on the Huffington Post.

If one take's the country's political temperature there, then one finds many people still support the Obama administration, regularly recognizing the mountain of achievements he's already piled up. What resonated with me most of all though was the temperate, intelligent expectations these same people have regarding the slow progress of progressive legislation and the necessarily slow undoing of the political culture in Washington.

And The Good News

Shortly after rediscovering this message (which I recognized as my own more rational stance before it was blown about by the wild winds of internet political blogging), and consequently rediscovering my optimism, I also happened upon this information:

Deficits and Economic Recovery

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It's a study by a group called the Campaign for America's Future and it possesses some rather telling facts about the state of the midterm electorate. Some highlights include:

"68 percent said they would oppose making major spending cuts in Social Security and Medicare to reduce the deficit, while 28 percent said they would favor cutting those programs. That included 61 percent of Republicans and 56 percent of independents.

"Strong majorities also oppose common conservative proposals for addressing the budget deficit: 65 percent oppose raising the Social Security retirement age to 70; 65 percent oppose replacing Medicare with a private sector voucher; 62 percent oppose a 3 percent federal sales tax; 60 percent oppose raising the Medicare age from 65 to 67.

"60 percent of those surveyed responded positively to an economic message that said that “we have a budget deficit, but … we also have a massive public investment deficit” that requires us to “rebuild the infrastructure that is vital to our economy” and to the economic growth that will “generate revenues to help pay down the budget deficit.” This message tests better than any other progressive message on investment as well as more conservative messages focused on spending cuts."

In summary, this study too finds that the American public is not as irrational as the media and GOP would have us believe. A resounding majority understands that cuts to social programs in order to trim the deficit are undesirable and that public investment should be a priority before deficit reduction, therefore heading off the "strangle the beast" tactic of the Right before it finds a foothold. In other words, the Democratic message of public investment, continued support of social services, and a long-term strategy of economic development bolstered by short-term deficits is quite popular with likely voters.


Going Forward


The truth remains that Democrats will likely lose seats in the coming midterms, but I personally find peace with this now. After discovering that not only is the American public not as crazy as advertised but that the Democratic message is still a popular one, I can confidently remove my hands from my eyes knowing that progress isn't as unlikely as perceived. 


The moral of this story, if any, is that you should form your opinions for yourself. Use facts, but be sure to identify what information from what sources qualify as facts. Obama approval ratings by Rasmussen are not facts, CBO estimates are. Huffington Post editorials are not facts, and neither is anything Fox News puts on the air.


Finally, shut off the computer and walk away for a while. Perspective is a powerful thing and so is optimism. If one begets the other, then it's easy to see how a trip down the political rabbit hole can stifle both simultaneously.


Have a good Friday folks. I certainly will.

Welcome Back/The Housing Crisis

Well it was a heck of a Thanksgiving break and if you're like me, all you managed to accomplish was nothing.  Amidst more homework than ever before and an extremely uncomfortable bed at my girlfriend's mom's house, its hard to feel like we got any gains out of the too-late break.  However, there's only a couple weeks until finals so I guess we just have to get tough... To think we have two more years of this!

Anyway, down to brass tacks.  While the economy continues to make gains throughout the country with stocks rising and companies posting profits, the one area where gains are not being seen is the one that's most important to you and I: employment and the housing industry.

A recent NY Times article highlighted the unfortunate shortcomings of the current administration's program, Making Home Affordable.  The government incentives offered under the program clearly aren't pushing lenders any closer to permanent restructuring of loans and the rising unemployment continues to drag foreclosure numbers upward.

President Obama is feeling more pressure than ever to use the bully pulpit for good and Senators are looking at measures to restructure the Fed's current housing program to put more pressure on lenders for the good of delinquent borrowers.  Anti-government tea baggers heads' are spinning.

The following brief explanation sums up the article well:

From its inception early this year, the Obama administration’s program, called Making Home Affordable, has been dogged by persistent questions about whether it could diminish a swelling wave of foreclosures. Some economists argued that the plan was built for last year’s problem — exotic mortgages whose payments increased — and not for the current menace of soaring joblessness. Lawyers who defend homeowners against foreclosure maintained that mortgage companies collect lucrative fees from long-term delinquency, undercutting their incentive to lower payments to affordable levels.

Now at the end of the day, I think it's time to stop the bleeding.  The article suggests that one measure under consideration is mediated renegotiation of home loans by bankruptcy judges, putting pressure on lenders to cut their losses in lieu of financial stability.  While this will ultimately hurt the financial industry a bit, I am staunchly of the opinion that they've received quite enough of our money and this would help us by making them shoulder the burden for their deeds.

In the same breath, tighter controls need to be put in place to prevent the wild borrowing that lead people to default on their mortgages.  If we do not curtail both wild financial speculation by banks and unsafe borrowing practices by consumers, then we have learned absolutely nothing from this catastrophe.

The bottom line is this, flex muscle on lenders, relieve pressure on consumers, get money back into the economy, spur job growth.  Seems like a simple chain but as I'm sure Alex K will demonstrate, it probably isn't.

You know what to do cats and chicks.  Feel free to leave comments at the front desk.

I No Longer Know Who To Blame

Growing up we all learn to believe in certain things.  Things that become unshakable, the bringers of justice and peace in a world full of chaos and wobbly foundations.  For me, one of those things, was the Federal Reserve.

In hindsight, it was a silly assumption but as a kid growing up, is it hard to believe that the one thing I believed in was the economy?  The ubiquity of capitalism, the penetration of the dollar into our hearts and our conversations, and furthermore the body that regulates all that all seemed like pretty immovable objects to my uneducated brain.

And even in hindsight, maybe I was right to believe in their unstoppability.  The capabilities of the Fed and the apathy that most Americans graced it with did lead it to become that unflappable, unstoppable entity of capitalism.  They were powerful and, most importantly, they had full faith from the American people (or at least the standing administration).

So here we are today: I'm all growed up and after a decade of blind faith, the Fed may have put us in the mess that we're in.  My childhood hero is shattered.  But is it there fault?  Or was it Obama's?  Was it Gramm-Leach-Bliley or Goldman Sachs alone that tipped the house of cards off the table?  Was it Bush's deregulatory policy or the current administration's coddling of "too big to fail" banks?

I no longer know what to believe in but worst of all, I no longer know who to blame.  But I do know this: you guys probably do.

Feel free to leave your comments at the front desk.

Gramm-Leach-Bliley Turns 10

Happy birthday Gramm-Leach-Bliley!  You're 10 years old today!  And now, a celebration the way only MSNBC's Dylan Ratigan can throw it, with poignant commentary.

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The premise is this: back in the day, the Glass-Steagall act prevented banks from doing risky things with people's money by establishing a barrier between investment banks, "main st" or personal banks, and insurance companies.  Any money that you put into one of those institutions could not be gambled in other money markets so consumers could be sure that there money was safe.

This was so from 1933 to 1999.  It was a measure passed after the crash of the Great Depression caused by banks speculating with consumer money in investment markets.

Sounds pretty air-tight right?  This measure would keep people from dabbling in fragile derivative markets using people's pensions or mortgages, which meant that people could not lose their home because a bank's investment accounts tanked.

So what happened?  On Nov. 2nd, 1999 Congress passed Gramm-Leach-Bliley.  An act that undid that regulatory protection remove the barrier that prevented banks from participating in all three markets at the same time.  This gave banks, especially those with more capital in their vaults like Citigroup and Goldman Sachs, the opportunity to make boatloads of money by speculating with people's money and pensions!

Now how did this come to pass?  How did Congress let such an egregious measure pass the gavel and out into the financial world?  Because lobbyists from Citigroup (yes, the one's that owe us hundreds of billions of dollars in bailout money) coerced congress into passing this deregulatory measure.  The deal was made in the backrooms of the White House and Congress and now, we're paying for it.

So grab a hat everybody!  Let's celebrate the only way we can!  By wading through job applications into a crippled job market where credit is harder to come by than ever before.

Deregulation and "too big to fail" got you down?  Feel free to leave comments at the front desk.