Video: Bailout Madness With Air America, MoJo

Always one to talk bailout madness, Mike Papantonio, co-host of Air America's lively "Ring of Fire" weekly program, invited me back recently (see the first interview here) onto his show. We talked about Mother Jones' coverage of the latest debacle surrounding the government's more than $20 trillion financial rescue—the TARP repayment process and the controversy over the government's warrant firesales.

Watch the interview below.

American Economic History

This videographic from the Economist is well worth watching.

Governor Springsteen

New Jersey Gov. Jon Corzine's Community Affairs Commissioner, Joe Doria, had to step down Friday after his house was raided as part of a massive FBI sweep of the state. Zack Roth aptly sums up the details here, but suffice to say that any tie to the corruption and money-laundering investigation is terrible news for the already beleaguered Corzine.

It is, however, further support for my argument that President Obama should ask Bruce Springsteen to run for governor of New Jersey.

More broadly, I don't understand why parties stand by deeply unpopular incumbents like Corzine and Sen. Chris Dodd (D-Conn.) when it becomes fairly clear that those incumbents are going to lose. Obviously losing the Connecticut Senate seat to the Republicans would be a disaster for Obama and the Democrats on the level of Ted Steven's loss of an otherwise-safe Alaska Senate seat for the Republicans last cycle. But the Democrats have an easy out in Connecticut: if Dodd will get out of the way, the extremely popular state attorney general, Richard Blumenthal, could run in his place. Blumenthal would win going away.

UPDATE: Maybe it's just the Democrats who have this problem: Sen. Jim Bunning (R-Ky.), perhaps the Republicans' most vulnerable incumbent, has been forced to retire because GOP officials did everything in their power to cut off his access to funds. Meanwhile, the AP reports that despite his denials, Chris Dodd knew he was getting a special deal back in 2003 when he got two home loans under Countrywide's "Friends of Angelo" program. (This according to secret testimony before the Senate Ethics Committee.) Is that really the horse you want to back, CT Dems?

The Problem With Private Health Insurance

Paul Krugman says that in a private insurance market, insurance companies will do their best to avoid taking on sick people as customers.  Alex Tabarrok disagrees:

If insurance companies do avoid covering people who are "likely to need care," this suggests that the uninsured are unhealthy.  But 60% of the uninsured are in excellent health (Table 10)....

To be sure, this doesn't mean that being uninsured is not a problem but, contra Paul, it does mean that insurance companies would be willing to cover most of the uninsured at the same rates as the insured if the uninsured could or would pay those rates.

Color me perplexed.  That first sentence doesn't compute at all, and the rest doesn't make sense either.  Sure, insurance companies are willing to cover "most" of the uninsured.  That was Krugman's point.  The problem is that they won't cover the 40% who aren't in excellent health, and those 40% account for most of our healthcare expenses. That's perfectly reasonable behavior on their part, but it's also a pretty big problem for anyone who wants a solution to more than a fraction of the problem.

Misogyny in Sports

Jaclyn Friedman has an interesting article over at the American Prospect about the overwhelming misogyny that supposedly characterizes American sports. Riffing off Pittsburgh Steelers' quarterback Ben Roethlisberger's alleged rape of a Harrah's hotel worker, Friedman writes that "sports misogyny apologists" leapt to Roethlisberger's defense:

You know the ones -- would-be or former jocks with Peter Pan disease, women desperate to be one of the guys, or who dream of being Gisele Bundchen to the next Tom Brady. They all cling to their game and their team above everything else, including evidence, compassion and logic.

It's almost undebatable that American sports culture is characterized by a whole lot of misogyny. But Friedman goes too far—or perhaps not far enough—when she suggests that it's sports celebrity, not celebrity in general, that's the problem. Rich, famous male athletes don't get treated differently than "normal" people because they're athletes. They don't get excuses made for them because they play for the Steelers or the Lakers. They get treated differently because they are rich and famous men. (Sometimes, as in the case of the University of Colorado football player rape case Friedman mentions, just fame is enough.) It's not just the world of sports celebrity that's full of misogyny and anti-feminist attitudes. Those attitudes pervade the entire celebrity culture: movies, music, fashion—even punditry.

That aside, I think Friedman is misreading the nature of fandom when she criticizes people for clinging "to their game and their team above everything else, including evidence, compassion, and logic." That's what a lot of team sports fandom is—rooting for one's team despite x. In a sport like baseball or football, you're rooting for a team that will probably have a very different lineup from one year to the next. If you get caught up in the personalities, good and bad, of the individual players, you're going to be switching teams every year. There are bad people and good people on every team. It should be okay to root for a team that has someone who did something bad on it—provided you condemn that person for the bad thing they did. Otherwise, how are you ever going to be able to pick a team to root for? Every team has a steroid user or a wife-beater or an accused rapist or a dog-fighting enthusiast at one point or another. The goal should be to get those people fired—not to get people to stop rooting for the team.

(This is different in individual sports. It would be hard to excuse rooting for, say, a golfer who beat his wife. But being a Phillies fan does not mean you support Brett Myers hitting his wife.)

The Cowboys of Kabul

In early 2002 Del and Barbara Spier filed for bankruptcy.  Their Houston-based private investigations firm, the Agency for Investigation and Protective Services, was dead.

But thanks to the war in Afghanistan, that turned out not to be a problem.  They immediately started up a brand new company, US Protection and Investigations, and got themselves a lucrative contract providing war zone security:

....By 2006, USPI claimed to employ more than 3,000 Afghan guards, along with 160 US and expat employees, and had a significant presence throughout the country, especially in Kabul, where guard shacks bearing its logo were a common sight. "It basically grew into a monster," the former Berger official says. On its website, the company described itself as "the foremost private security company working in support of Operation Enduring Freedom in Afghanistan." Its stated goal? To "help bring about change and improvement for the people of Afghanistan."

Without question, USPI's role in Afghanistan had brought about change and improvement for the Spiers. In Kabul, they took up residence in a luxurious compound that some of their employees jokingly called the "marble palace." In their bedroom, an ex-employee adds, was a safe that sometimes contained upward of $1 million cash, used to bankroll USPI's operation.

The former USPI security coordinator told me, "I remember at one point seeing boxes of cash that they were bringing in. I thought, 'Wow, that's really fucking weird.'"

Not just weird, it turned out, but completely illegal.  The whole operation was a gigantic fraud, and in 2007 it finally came to an end when USPI's office in Kabul was raided and shut down.  "Have you ever seen a dynamic entry, where people are clearing rooms out with guns locked and loaded and shoving a gun in your face?" said a former USPI supervisor.  "That's the way Blackwater did their entry into the house."

If you want to find out how the Spiers pulled it off — and how they finally got caught — Daniel Schulman has the rest of the story here.  It's worth a read.

How to Do Congressional Oversight

The Project on Government Oversight (POGO) recently published a new handbook outlining "best practices" for congressional oversight of government. It's available free to members of Congress and their staff members. If you are not a denizen of the Hill, you can buy it online.

I'll give you the bottom line for free: don't assume that everyone else knows what you know or is asking the questions you're asking. Wondering why something isn't being investigated? Bother your Congresscritter. Have a whistle to blow? Bother your Congresscritter. Better yet, let us know: a lot of the time, media attention can get the ball rolling when it wasn't before. Try scoop [at] motherjones [dot] com. We're listening.

No Sex, Please, We're Lobbyists

Here's a good indication of the obvious: in Washington, sex scandals trump institutional corruption.

Politico reports that "embattled" Senator John Ensign (R-NV), who has admitted having an affair with an employee whom the Ensign campaign paid $25,000 and who also received $96,000 fom Ensign's family (as possible hush money), remains embattled, with his chief of staff and his communications director jumping ship and with Citizens for Responsibility and Ethics in Washington filing complaints with the Senate ethics committee and the Federal Elections Commission. The newspaper reports:

“He’s trying to do a ‘Vitter,’” a senior Senate GOP aide said of Ensign. Sen. David Vitter (R-La.) managed to say virtually nothing but that he was sorry for committing a “very serious sin” after his name turned up in the phone book of the alleged “D.C. Madam” in 2007.

“He’s just trying to get beyond this,” the aide said of Ensign. “I am not sure he can, but he’s trying.”

The article makes it clear that due to the sex scandal, Ensign may not be able to hold on. And toward the end of the piece, there is this little nugget about the fellow who will take the chief of staff slot being vacated by John Lopez:

Aaron Cohen, currently a lobbyist with Jeffrey J. Kimbell and Associates, will replace Lopez. Cohen, who served previously as senior policy adviser to Ensign and former Sen. Richard Bryan (D-Nev.), currently lobbies on behalf of drug companies like Hoffman-La Roche, according to lobbying disclosure records.

Trysting with a subordinate is indeed scandalous. But a senator hiring a drug lobbyist to be his chief of staff is not cause for the blinking of an eye in the nation's capital. Not even when that senator sits on the Senate finance committee, which is in the dramatic throes of drafting major health care reform legislation of tremendous interest to Big Pharma. This is merely S.O.P. No extramarital sex is allowed--but there's nothing wrong with getting into bed with corporate mercenaries. Alas, one of these couplings affects the public interest more than the former.

You can follow David Corn's postings and media appearances via Twitter.

Ben and the Bank

Nouriel Roubini writes in the New York Times that although Ben Bernanke made some serious mistakes in the runup to last year's financial crisis, when the moment of truth arrived he acted decisively:

When a liquidity and credit crunch emerged in the summer of 2007, Mr. Bernanke engineered a U-turn in Fed policy that prevented the crisis from turning into a near depression....The federal funds rate was effectively pushed down to zero....New programs encouraged skittish institutions to resume lending....Mr. Bernanke also introduced a wide range of other programs, like those to maintain the functioning of the commercial paper market....The Fed was involved directly in the rescue of financial institutions like Bear Stearns and American International Group. It lent money to foreign central banks to ease a global shortage of dollars. The Fed even committed to purchasing up to $1.7 trillion of Treasury bonds, mortgage-backed securities and agency debt to reduce market rates.

I agree with all this.  But I'm not sure Roubini's conclusion follows:

The Fed’s creative and aggressive actions have significantly reduced the risks of a near depression. For this reason alone Mr. Bernanke deserves to be reappointed so that he can manage the Fed’s exit from its most radical economic intervention since its creation in 1913.

Hmmm.  Bernanke's background and temperament did indeed make him well suited to address this crisis once it unraveled.  However, Roubini admits that back in more normal times Bernanke's actions also played a role in helping to create this crisis in the first place.

We're now — hopefully — about to head back into more normal times.  So does it really follow that just because Bernanke turned out to be a good crisis manager, he's also the best bet to head up the Fed during the mopping up stages?  I'm not sure I see that.  Unwinding Bernanke's programs doesn't require Bernanke at the helm, and the job of re-envisioning the role of the post-collapse Fed would be better off in the hands of someone who's taken bubbles seriously all along.

It's possible, of course, that Bernanke has gotten religion on this point, but I'd rather not chance it.  Why not choose someone instead whose views on credit bubbles are clear, consistent, and long held?  Someone who correctly assessed the situation before it blew up and can be trusted to do the right thing now even if he or she has to face down the financial industry to make it happen?  I don't think reappointing Bernanke would be any kind of disaster, but I also doubt that it would be the best choice.  The Fed needs a change of direction, not more of the same.

POSTSCRIPT: But what about Bernanke's recent charm offensive?  Consider me charmed!  I applaud the idea of a Fed chairman willing to talk to the press and answer questions in fairly plain language.  It's a change for the better.  But it's still not enough to make me think Bernanke ought to be reappointed.

Baby Steps on Don't Ask Don't Tell

Jason Bellini at The Daily Beast reports that for the first time since the early '90s, the Senate will hold formal hearings on Don't Ask, Don't Tell. After failing to secure 60 votes (remember: we live in a democracy) to filibuster-proof her bill to end DADT, Kirsten Gillibrand lobbied the Senate armed services committee, which agreed to hold hearings in the fall.

I see this as a baby step, albeit one in proper direction. I know the House fight to end Don't Ask, Don't Tell, led by Pennsylvania's Patrick Murphy, has momentum: It's picking up about two sponsors a week, but still needs 54 representatives to sign on to ensure passage.

In other words, this looks like it will shape up to be a long slog. The slow pace isn't frustrating per se; some issues require considerable thought and debate. But you would think in the United States our representatives would not have to think twice about purging blatant discrimination from the United States Code.

That's the reason I find myself so frustrated with the speed at which Congress is tackling this issue. (Obviously this is tempered by the fact that we arguably have more important issues on the table—two wars going on during the worst recession in more than 50 years.) But I see it as a civil rights violation that no reasonable person could support. Why so many of our representatives can bloviate about the importance of a strong military while supporting a policy that summarily fires more than 800 able service men and women every year is even further beyond me—and reason.