Presidential Candidates At the Bailout Trough

The bloated rhetoric of the two presidential candidates is only exceeded by the nonsense they have both expressed about the financial crisis. Thanks to research by the Center for Responsive Politics the figures they collected speak volumes about how likely the bailout will work. We should know who funds their campaigns. The financial services industries have funded both candidates.

Here is the tally at the trough:

McCain received $19.6 million and Obama garnished $22.5 million.

Two of the biggest financial groups in Washington, the Financial Services Roundtable and the Mortgage Bankers Association, have been holding meetings with McCain and Obama’s economic advisers. They are working to shift their bad debt to taxpayers. The Roundtable has met in private, closed-door sessions with Obama economic advisers Ian Soloman and McCain adviser Ike Brannon. Those lurking around Obama—-economists such as Paul Volcker, Robert Rubin, Lawrence Summers, and Laura Tyson-—are as guilty of dismantling of government regulation as those advising McCain.

I say a pox on both their houses.

Bailouts Work, Sorta'

An important question to ask during these days of bailouts is to ask how things have worked out in the past. The U.S. bailout took place in 1792. William Duer tried to monopolize the market in government bonds and depress the share price of the Bank of New York. His plan went astray which caused market panic. The first Treasury Secretary Alexander Hamilton authorized banks to accept bonds as collateral for loans, which were then underwritten by the government. He also borrowed money from banks and used it to buy government bonds. The U.S. did well enough then as prices recovered and all the banks involved survived.

On the other hand, Andrew Jackson nearly brought about the collapse of the Second Bank of the United States when he refused to deposit tax revenues in it. The collapse of the bank was an important cause of the Panic of 1837 in which the next president, Martin van Buren, refused to involve the government. This event was a harbringer of the Great Depression.

Thus far, the score is 1-1.

The next disaster was in savings and loans during the 1980s and 1990s. The crisis was caused by institutions lending good money after bad, then getting slammed by rising interest rates. Fraud was also a big factor. The government set up the Resolution Trust Corporation (RTC) to regulate hundreds of failed S&Ls and try to sell their assets. The taxpayers received back about 80% on the dollar. This one was largely a success.

Then there was the issue in 2001 when the airline industry faced collapse after 9/11. Carriers faced a money crunch when a flying ban was imposed and people were afraid to fly. The government provided compensation. But once flights resumed, the airlines could not get credit. The government set up the Air Transport Stabilization Board to provide up to $10bn in loan guarantees. The government received shares in the airlines in return for guaranteeing loans to them and also charged fees for participating in the scheme. Taxpayers eventually made a profit of $300m. The weaker carriers lost out, such as United Airlines, which was forced into bankruptcy, but most of them survived. Thus, the carrier bail-out largely succeeded.

Most of the bailouts seem to work, basically 3-1 as in this scenario, but what concerns me is the frequency. If the government has to bailout companies, half of the bailouts occurring since the '80s, how vibrant can that economy be?

Judge Considers Release of International Terrorists

The Uighur (pronounced "WEE-gurz") people are Muslims inhabiting the Western region of China. Five of the Uighurs, and twelve more have been mentioned, in filing court papers asking for release. The detainees held at Guantanamo Bay may now be released into the U.S. homeland since these Chinese Muslims are no longer considered enemy combatants. U.S. District Judge Ricardo M. Urbina is considering a release. If released, it would become a landmark legal decision in the years-long battle over the rights of terrorism suspects. The men have been held for nearly seven years but they are in a bind. They can not be sent home country because Beijing considers them terrorists and they might be tortured. Previously, the government released five Uighur detainees to Albania in 2006, but no other country wants to risk offending China by accepting the others.

I have two questions: why should the problems of former enemy combatants concern me? And, how did they become former combatants in the first place?

The answer to the latter question is time. Their attorneys argue that the men have been confined for too long. The attornies say authorities could supervise them much as they monitor criminal defendants released pending trial. Yes, I suppose it is a reasonable argument that Washington D.C. is a particularly crimeless area. I wonder if the Judge might like to have the former enemy combatants next door since he was intrigued by the question of release.

How these individuals become enemy combatants is clearer. In 2001, most of the Uighurs now in Guantanamo Bay were living in camps in Afghanistan until U.S. airstrikes drove them into neighboring Pakistan. They were captured there and turned over to U.S. authorities. It is likely then that most of these people were receiving terrorist training and have been biding their time in prison in preparation. Prisons in Britain and Iraq are leading places of terrorist training and development.

The two options that are presented, release into the Homeland, or continued incarceration are the only two choices offered by attorney's on behalf of the Uighurs.

However, I see no reason why Americans should be welcoming individuals who were found in Afghani camps in 2001. Yet, a Supreme Court ruling in June gave camp dwellers the right to have their cases reviewed by federal judges under the legal doctrine of habeas corpus. U.S. District Judge Richard J. Leon has been conducting closed-door hearings. There are six Algerians who were picked up in Bosnia in late 2001. The only way to block the continued incarceration or release is evidence that the incarcerated received terrorist training. The Justice Department is expected to make the same argument for the other detainees. The government has asserted that the Uighurs were members of the East Turkistan Islamic Movement and trained at camps affiliated with the Taliban or al-Qaeda. The Bush administration designated ETIM a terrorist organization in August 2002, after the Uighurs were taken into custody.

One academic sees no other alternative than the two options proposed: "It boils down to: either you keep these people in prison at Guantanamo Bay for the rest of their lives or you release them into the United States," said Donald E. Wilkes Jr., a professor at the University of Georgia Law School and an authority on habeas corpus rights.

I see no reason why the U.S. should harbor not only the poor and the tired yearning to be free but those training at terrorist camps while providing rights of habeus corpus to them as well. If there is no reason to hold them, then release them back to China or anywhere so it is not a problem for people in the United States. They voluntarily left their own country for Afghanistan so another move, elsewhere, should not bother them now.

Sharia-Compliant Citi Seeks Taxpayer's Money

Obamics and Sharia compliant, the code of law based on the Koran, Citigroup was blocked by a Judge in the Wachovia-Wells deal. However, New York State Supreme Court Justice Charles Ramoscourt will hold a hearing to allow Citi to press for its previous agreement to buy Wachovia.

In a deal struck last Monday with the assistance of the Federal Deposit Insurance Corporation (FDIC), Citigroup had offered to take over Wachovia's banking operations for $2.2 billion.

The battle also has implications for taxpayers.

If Citigroup is successful in its takeover, taxpayers will pay more because of a FDIC offer. Citigroup has the support of industry regulators, and the FDIC stands behind its previously announced agreement with Citigroup, according to Federal Deposit Insurance Corporation Chairman Sheila Bairwhich who promised to cover any losses on Wachovia's $300 billion loan portfolio beyond the first $42 billion. The Wells offer does not ask for FDIC assistance.

Wachovia spokeswoman Christy Phillips-Brown stated the company believes its agreement with Wells Fargo is "proper, valid and ... in the best interest of shareholders, employees, and the American taxpayers," the Associated Press reported.

Seems so to me too; I'm a taxpayer.

Obama's Favorite Domestic Terrorist

The wonder of the William Ayers terrorist connection to Obama is not that Palin finally unleashed it, it lies in the fact that the mainstream media was so reluctant to report it when the data become widely available in the spring. I suppose it means less to younger people but if one was alive during those heady days of domestic terrorism the charge sticks like mud. The fact that Ayers is now a professor hardly makes his earlier activities any more respectable. There are probably more anti-American sentiments being expressed in American universities than anywhere else anyway. Both Ayers and his wife are currently college professors.

The Obama camp has tried to downplay the relationship between the terrorists and Obama but that story is sketchy. The University of Illinois at Chicago has released hundreds of documents that solidify the relationship between the two. There are more than 50,000 documents, 128 boxes, and 946 files. The University archives on the pair comes out to 70 linear feet. This is no casual connection.

Ayers was a member of the Weather Underground, a radical group that claimed responsibility for a series of bombings, including nonfatal explosions at the Pentagon and U.S. Capitol, preceding the foreign terrorism problem by many years.

Ayers was a fugitive for years with his wife, fellow radical Bernadine Dohrn, Dohrn is now a professor at Northwestern University Law School. But after surrendering in 1980, the charges against Ayers were dropped because of prosecutorial misconduct. He got off on a technicality we might say.

Moreover, Obama and Ayers both live in the same Hyde Park neighborhood. They served together on the board of a Chicago charity, and in the mid-1990s when Obama first ran for office, Ayers hosted a meet-the-candidate session for Obama at his home. They are more than casual acquaintances, Obama and Ayers share a political ideology.

For a candidate who champions his better judgement over his opponent, Ayers is a curious political supporter to have. Ayers has not denied that he set off bombs and he is on the record that U.S. Marines are terrorists. All John Kerry did was toss a few medals over the White House fence, Ayers threw bombs that exploded. This is the support that Obama has elicited.

How Obama, McCain, Bush, Congress, and the Federal Reserve Benefit Egypt

While the House of Representatives adopted a wide ranging intrusion into the nation’s beleaguered financial sector, it is instructive to see how the bailout--and why exactly are we having a bailout?--plays out in the rest of the world.

Let us take a glance at Egypt, a nation with a heavy cash-based economy and relatively nascent set of financial tools, which should, in theory, provide haven from the “credit freeze” afflicting developed markets. Nonetheless, if not passed even in Egypt a financial crisis might occur, not without reason is this period best described as “global.” For with every advance in online communication, trading, banking and asset management, the flow of capital from one state to another is eased. In fact, the problem for Egypt and other foreign markets is that when outsiders panic, they aren’t just yanking cash out of their own markets, they disinvest elsewhere also.

The odd thing of course is that Candidate A is running against Candidate B--supposedly--yet both candidates come running to vote in support with the President, I suppose I should describe him as President B, further, the bailout was supported by all three and the Treasury Secretary and Federal Reserve Chairman. It seems like just about everyone favors the bill.

But wait, did the American taxpayers? Well, no, polls last week showed that less than 3 in 10 Americans supported the bailout.

I guess they don't count in this financial lovefeast between President B, Candidate A, and Candidate B.

At one time Republicans would have viewed the bailout as an abandonement of their small-government, free-market ideology that was once the cornerstone of their party’s economic ethos. Democrats at one time would not have wanted to use the little person's money to rescue the big money Wall Street megalomaniacs who drove the economy into the current mess in the first place. No more I take it.

Oh yes, and where does the bailout leave Egypt? Left to its out devices, the Egyptian economy is weak. Because of Egypt’s high poverty rates, and record inflation, Moody’s Investor Service lowered their rating on Egypt’s foreign currency country ceilings for bonds and bank deposits from stable to negative and downgraded the government’s local currency bond rating in July.

And as the past few weeks have shown, each bank collapse or whisper of impending economic chaos in the U.S. ties up nervous American investors-—a primary source of investment in Egypt—-who pull out of emerging markets as they try to recoup losses at home.

Egypt was bracing for Eid El-Fitr, which is a Muslim holiday that marks the end of Ramadan, the Islamic holy month of fasting, and Armed Forces Day, so the American setback would be delayed in Egypt. But, once markets re-open on 7 October, Egyptians can rejoice, Candidates A, B, and President B, along with the U.S. Congress, as well as the financial tentacles of the U.S. government, will have helped them.

Only the American taxpayer will suffer from the bailout.

Note on Bergen, The Osama bin Laden I Know

I'll admit it, this was a book I did not get around to reading at first because of its style and a misunderstanding of the book's purpose. The style of the book is difficult in that it is a series of excerpts, often overlapping, of diverse sources. The players are difficult to keep track of, but they need to be introduced time after time. Thus, we are constantly being reminded of who was bin Laden's bodyguard, which player this guy is, and how they fit into the organization.

Despite its limitations, the book is a fascinating read, and excerpted by those who knew or met bin Laden personally throughout the years. Where else are you going to find detailed information such as in one visitor to bin Laden's hangout, two of bin Laden's sons were playing Nintendo while hiding out with their infamous father?

But most importantly, Bergen is one of those rare journalists who allows bin Laden to be bin Laden, without the distortions or biases built in many other sources. Although the book suffers from a lack of cogent analysis, and that has been done elsewhere by Michael Scheuer particularly, Bergen's work is valuable read in that an accurate oral history emerges from the text to reveal a bin Laden who is unremarkable in some respects, absolutely lethal, and a worthy adversary of the U.S. In addition, since he is engaged in religious war, and a typical product of Islam, the West should realize that more bin Laden's are going to follow his lead, regardless of the presence of Al-Qaeda, or the life of bin Laden.

Fury Explains How Bin Laden Got Away at Tora Bora

Afghan allies have been attributed before for allowing Osama Bin Laden to escape into the mountains of Tora Bora. In addition, a former Delta Force officer, "Dalton Fury," claims his superiors forestalled an effective plan of attack against al Qaeda. AQ has claimed the same thing for some time. Ten weeks after 9/11, and why did it take such a long time is what we should be asking, but Fury and a team of U.S. Army Delta Force soldiers joined CIA operatives and Afghan fighters under the command of a warlord named General Hazrat Ali to attack Bin Laden. The united force pursued bin Laden and an estimated 1,000 al Qaeda fighters into the Tora Bora Mountains. The U.S. strategy, says Fury, was to let Afghan allies do most of the fighting, while U.S. Special Operations Forces directed air strikes and provided support. Fury wonders whether the Afghans were really conspiring with al Qaeda. The forces heard bin Laden's radio communications and Fury noted the Afghan's demeanor. They were in awe and respected Bin Laden. Fury claims to have pushed for an attack from the Pakistan side and surprise the enemy. If does not know know whether the plan was stymied from central command or up to Clinton. Fury says that the Afghan fighters were ordered to take the lead and with the delay Bin Laden escaped. In a separate action following a bombing bin Laden seems to have been injured in the shoulder by shrapnel and then treated and hidden by local sympathizers. The general thrust of the story is in line with other evidence and if Fury is to be believed his story does seem credible.

October Order of Battle in Iraq

Graphic source: The Long War Journal

I wonder what it is about our nominees, and our journalists, who can not state the obvious. In the Vice-Presidential debate, Biden made a point that he thinks the Iraqis should provide for their own defense. Well Joe, just because the mainstream media does not cover this material, and the politicians do not want to recognize success in the field, does not make it so. Readers of this blog are kept up to date every month by the excellent field reports available. As of September 1st, Anbar Province became the eleventh of eighteen Iraqi provinces to revert to Provincial Iraqi Control (PIC). Doesn't Biden know this? Why can't the commentator call him to task for such a obvious gaffe. Even CNN, which puts much stock in fact-checking failed to correct this obvious mistake. I suppose after an election victory this would allow Obamaden to claim they are the architects of victory and withdrawal. It ain't so, Joe. The surge has been working and our military have done a stellar job in Iraq.

McCain Warned Senate About Economic Downturn Two Years Ago: Fannie Mae and Freddie Mac

McCain claims he has called for more oversight of lending institutions Fannie Mae and Freddie Mac for two years. On the Senate floor, and thus a part of the public record, he cited a federal report, saying that "Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets." He also noted a $3.8 million fine Freddie Mac had recently paid to the Federal Elections Commission over problems with disclosure of its political lobbying. He added: "If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole." McCain correctly and accurately identified the economic malady of today and warned about it some time ago.

Analysis of Only Vice-Presidential Debate

The bar was set very low since Palin has been pilloried in the mainstream media and many did not expect much from her. However, she more than held her own, no, she is not an idiot as Saturday Night Live has lampooned her or as edited clips from Katie Couric would have you believe. You may not agree with her but she took on a eminent senior Senator, more qualified to run as President than his running-mate, and she delivered the message she planned. There was no home-run tonight for the Republicans, and it was not enough to nudge any votes for McCain, but she would do fine and develop along the lines as many no-name Vice-Presidents have before her. The Veep slot is a job in training, and often training leads nowhere but down and out. If people were expecting a train wreck they were disappointed. She should be judged on the issues and her policies just like any non-outsider, non-male candidate is.

Possible Veeps Silent on Iran Killing Our Troops

Graphic source: Pajamas Media

A Humvee interior view of the passenger side door shows how a copper projectile ripped violently through the door, fragmenting the interior door armor and causing significant damage before exiting though the dashboard. This is a typical Iranian-made EFP causing U.S. casualties.

Regardless of any analysis, it is quite embarrassing to hear two people running to be second-fiddle to the Commander-in-Chief not even mention the blood and sacrifice spilled by American troops. Instead, both vice-presidential nominees hid behind the skirt of defending Israel rather than take Iran to task for supplying weapons to kill American troops. It is just despicable. Let Israel take care of their own issues, and we can remain a solid ally as needed, but for God's sake, defend our troops.

Despite abundant evidence outside the mainstream media, in the debate tonight neither candidate mentioned Iran's role in killing our people. Coalition forces have documented how Iran supplys Sunni and Shia insurgents with deadly munitions in the form of explosively formed penetrators, or EFPs.

Their blood and sacrifice is worth more than silence.

Islamist Group Urges Pakistan to Deploy Nukes

Hizb ut-Tahrir Pakistan, an international Islamist group which aims to set up a Caliphate or Khilafat, a trans-national Islamic state, has announced a campaign urging Pakistan to deploy nuclear weapons if the US continues to violate Pakistan’s territorial integrity. Previously, the group asked Pakistan to attack US bases in Bagram and Doha with nuclear weapons and suggested all of Pakistan's 160 million citizens conduct martyrdom operations. In the latest statement the group states:

Deploy nuclear weapons all over Pakistan and warn the crusaders and their allies of a stern response should they persist in their violation of Pakistan’s territorial integrity. This maneuver will not weaken Pakistan. On the contrary it will bolster the country’s ability to effectively counter regional and international threats. If a small nuclear country like North Korea’s can spurn US advances, then Pakistan, a far stronger nuclear power with the seventh largest army in the world, is in a far better position to accomplish much more.

Pakistan should detonate nuclear weapons against the Coalition.

Biden Gets $51.5 Million from Taxpayers

Funding bills is a favorite project in Washington, many people have heard now how the crucial bailout fiasco includes funding for wooden arrows. If you have not heard this, I do not make this stuff up. An earlier bill included $51.5 million and was requested by Democratic vice presidential nominee Biden. Taxpayers for Common Sense analyzed the 2,321 special-interest items called "earmarks" in the spending bill.

Senate Ignores Wishes of the People

Since the Senate is ignoring the will of the people, the most we can hope for at this point is that a sane voice against the bail out will be raised in the house.

Who Am I?

I am under 45 years old,
I love the outdoors,
I hunt,
I am a Republican reformer,
I have taken on the Republican Party establishment,
I have many children,
I have a spot on the national ticket as vice president with less than two years in the governor's office.

Who Am I?

I am Teddy Roosevelt in 1900.

Obama's Ties to Citigroup and Fannie Mae

A $100,000 state grant for a botanic garden in Chicago that then-state Senator Obama awarded in 2001 to a group headed by a onetime campaign volunteer is now under investigation by the Illinois attorney general. The money may have been misspent. State records obtained by the Chicago Sun-Times show $65,000 of the grant money went to the wife of Kenny B. Smith, the Obama 2000 congressional campaign volunteer who heads the Chicago Better Housing Association. Smith wrote another $20,000 in grant-related checks to K.D. Contractors, a construction company that his wife, Karen D. Smith, created five months after work on the garden was supposed to have begun, records show. K.D. is no longer in business.

Attorney General Lisa Madigan, a Democrat who is supporting Obama's presidential bid, is investigating "whether this charitable organization properly used its charitable assets, including the state funds it received," according to Sun-Times article.

Obama vowed to "work tirelessly" to turn the lot into an oasis; today the garden site is a mess of weeds, chunks of concrete, and garbage.

Let the Obama Campaign respond I say (Cf. http://blogs.suntimes.com/sweet/2008/07/suntimes_probe_as_state_senato.html).

In an official response the Campaign stated that Obama worked with the Chicago Better Housing Association, a non-profit that received funding from Fannie Mae, and the Citigroup Foundation.

A further tie to the discredited Fannie Mae program and the Sharia affiliated Citigroup is supposed to reassure us?

Obamics: Obama's Crooks and Cronies on Economics

Robert Rubin, former Secretary of the Treasury, later of Citigroup, Citi’s Global Islamic Banking operations were established in 1981 in London, and in 1996 Citi became the first international financial institution to set up a separately capitalized Islamic Bank: the Citi Islamic Investment Bank.

Former Secretary of Commerce William Daley, Mayor Daley's brother, Daley has been a lobbyist for the discredited Fannie Mae program that led to the economic crisis.

Former Secretary of Transportation and Secretary of Energy Federico Pena who assisted Enron. Former Enron Chairman Kenneth Lay asked Clinton to propose a power deregulation bill to forestall legislation promoting competition and consumer choice in electricity. Lay wrote the letter at Pena's urging. Internal Enron documents show Secretary Pena gave Lay key information about "key contacts from important constituents" who could pressure President Clinton.

Penny Pritzker lost her family bank to the FDIC when federal regulators cited "poor oversight by [Superior Bank's] board" when it chose to shut it down.

No wonder Obama favors the failed bailout bid.

American Professor Seeks to Silence Novel About Mohammed's Nine Year Old Bride

Denise Spellberg, an associate professor of Middle Eastern Studies at the University of Texas at Austin, is an expert on the life of Aisha and she was asked for a comment to put on the cover of a novel by Sherry Jones called The Jewel of Medina. She demurred since she was appalled by the novel.

How I would like to know, could she claim that the book was "sacred history?" Was she speaking as a detached, secular, scientific observer? She was further quoted as saying the work was "softcore pornography." Spellberg said: "I felt it my duty to warn the press of the novel's potential to provoke anger among some Muslims. London-based cleric Anjem Choudhary has called the book an insult to the Prophet's honour, and thus warrants a "death penalty" under Sharia law. Goodness, we wouldn't expect Muslims to conduct themselves properly in a diverse, secular setting now would we? Spellberg further stated: "When combined with falsification of the Islamic past, it exploits Americans who know nothing about Aisha or her seventh century world." Thank you for looking after my reading habits and noting my ignorance professor.

Moreover, Spellberg then continued into areas fields further outside her academic expertise, she teaches the history of the Middle East and Gender in Islamic History, and was quoted as stating that the novel constituted a "declaration of war" and "a national security issue."

The author Sherry Jones has called on Professor Spellberg to retract her comments.

Spellberg has published an academic study of Aisha's life called Politics, Gender and the Islamic Past: The Legacy of Aisha bint Abi Bakr; she is currently on leave.

British Kow-tow to Muslim Censorship

Graphic source: AP

As the West begins to cower before Islamic censorship, the novel Jewel of Medina may not be published in Britain. The Random House publisher of the work, Martin Rynja, had his London house firebombed which provoked the cancelling of the publisher's right to a free press. Author Sherry Jones has called on freedom loving people to protest the indefinite postponent of the work. The book fictionalizes the life of one of the prophet Mohammed’s wives, Aisha.

Despite the London action, the American publisher, Beaufort Books, will publish the book on 15 October.