Mojo - September 2008

One of the Worst-Timed Op-Eds Ever, By One of John McCain's Economic Advisers

| Mon Sep. 15, 2008 11:55 AM EDT

Both Kevin and I have noted the absurd Washington Post essay by Donald Luskin titled "A NATION OF EXAGGERATORS: Quit Doling Out That Bad-Economy Line." It was published on Sunday morning, 12 to 24 hours before news broke that the American economy is basically in shambles, making it one of the most poorly timed pieces of punditry ever.

But what Kevin and I both missed is that Luskin advises John McCain on the economy! He admits it halfway through the piece, saying, "Full disclosure: I'm an adviser to John McCain's campaign."

Get a load of the wisdom Luskin is providing McCain. This is from the piece:

Things today just aren't that bad. Sure, there are trouble spots in the economy, as the government takeover of mortgage giants Fannie Mae and Freddie Mac, and jitters about Wall Street firm Lehman Brothers, amply demonstrate. And unemployment figures are up a bit, too. None of this, however, is cause for depression -- or exaggerated Depression comparisons.

Luskin follows this with a number of arguments (bolstered by statistics, of course) that would cause anyone with a rudimentary grasp of the American economy to spit out their coffee. Like this one:

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McCain on Today's Economic Events: "The Fundamentals of Our Economy Are Strong"

| Mon Sep. 15, 2008 11:13 AM EDT

Via Steve Benen, John McCain's take on today's financial insanity:

Here's the text version of that quote:

BofA Buys Merrill; Lehman Files for Bankruptcy; AIG, WaMu Teeter

| Mon Sep. 15, 2008 12:23 AM EDT

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While you were sleeping, the landscape of the US financial system changed dramatically. CNBC is calling it, "The biggest shakeup in the history of the US financial system." The country is in a "once-in-a century" financial crisis, former Federal Reserve chairman Alan Greenspan said on ABC's "This Week" on Sunday. The New York Times reported late Sunday that Bank of America has reached a $44 billion deal to buy troubled investment firm Merrill Lynch. Another firm wasn't so lucky: Unable to find a buyer over the weekend, 158-year-old investment bank Lehman Brothers filed for bankruptcy Monday morning. Lehman's liquidation will mark the largest collapse of a Wall Street bank since Drexel Burnham Lambert folded in the wake of the junk bond scandal almost two decades ago.

The problems don't end there. "We will see other major financial firms fail," Greenspan said on "This Week." Giant insurance company American International Group (A.I.G.) asked the Federal Reserve for $40 billion, "without which the company may have only days to survive," according to the Times. Washington Mutual, too, may be in trouble, after its shares plummeted late last week and Moody's Investor Service downgraded the bank's debt to "junk" status. And in Europe, a Swiss newspaper reported that Swiss bank UBS will have to take another $5 billion in write-downs.

We'll see what happens over the course of the day on Monday, but A.I.G., at least, seems to be in serious trouble. Adam Bakhtiar, a CNBC analyst, called Sunday's events a "tidal wave of horrific news." James K. Galbraith, an economist and contributing writer for Mother Jones, wrote in an email that while he has "a pretty good record on attacking Wall Street," his "schadenfreude is very much under control at the moment":

The world will not be a better place with two free-standing investment banks—Goldman [Sachs] and Morgan [Stanley]—and a half-dozen major commercial banks, if that, running everything. Further, there is a risk that the unraveling will become disorderly and out of control from this point, as assets hit the market in fire sales and do not find takers. This will affect pension funds and greatly compound the collapse of the wealth position of the middle class.... The collapse of Wall Street will hit Main Street like Ike hit Houston.

So how do we get out of this crisis? Well, the prime mover of all of these problems is the collapse of the housing bubble in the United States. "There's no question that this is in the process of outstripping anything I've seen, and it still is not resolved and it still has a way to go," Greenspan said Sunday. "And indeed, it will continue to be a corrosive force until the price of homes in the United States stabilizes."

The collapse of Lehman and the broadening crisis will undoubtedly be topic "A" for the presidential campaigns this week. Barack Obama and John McCain want to lead this country. How do they plan to respond to Monday morning's news?

Campaign Realpolitik

| Fri Sep. 12, 2008 2:23 PM EDT

The McCain campaign has lied about the Bridge to Nowhere, Obama's tax plan, and his vice presidential pick's record on earmarks, attacked the media for not treating Sarah Palin with sufficient deference, and run a series of highly disturbing ads against Barack Obama that leave little doubt they are designed to play on racial fears and stereotypes. "Morally unfit" to be president, one commentator lambasted McCain, who had previously vowed to run an honorable campaign, and been the victim of such vicious smears himself during his unsuccessful 2000 Republican primary run against George W. Bush. If there were a referee, perhaps he could be implored to cry foul and make it stop. But, having lived through 2000 and 2004, it's also not so surprising to observers that this is the kind of campaign that McCain has chosen to run at the top of the GOP ticket. He's determined to do whatever it takes to win, and his party has used such tactics, and successfully, in the past.

So what about seeing the political campaign world as it really is, and not how candidates say they would like it to be? So suggests washingtonpost.com's political writer Chris Cillizza in this chat today:

St. Louis: Since you're so "in the know," I was wondering if you've heard from Republicans -- off the record, of course -- that they're surprised by McCain's campaign. His traditionally Republican campaign is smart -- they win -- but it also seems so out of character for the old McCain we knew in 2000. What are Republican insiders thoughts on this change?
Chris Cillizza: Hmm, was that "in the know" comment a shot at me?
If so, well played. Onto the question....
Republicans have always -- or at least for as long as the Fix memory lasts -- adopted a realpolitik approach to political campaigns.

Pre-Palin, McCain Slammed Paltry Foreign Policy Cred of Mayors and Governors

| Fri Sep. 12, 2008 12:36 PM EDT

This may be the best illustration of the cynicism of the Palin pick I've yet seen. In the primary, John McCain claimed Rudy Giuliani didn't have the foreign policy credentials to be president because he was "a mayor for a short period of time," and Mike Huckabee and Mitt Romney didn't because each of them was "a governor for a short period of time."

If John McCain ever did interviews or press conferences, he might be asked about this apparent discrepancy.

By This Logic, Any East Coast Mayor Could Be John McCain's VP

| Fri Sep. 12, 2008 12:04 PM EDT

If you've read any coverage of Sarah Palin's interview with ABC, you know that she is continuing to insist she has foreign policy credibility because you can "see" Russia from her state. Mike Tomasky takes the idea for a test run.

"Russia," as a political entity, isn't a bunch of rocks in Siberia. It's Moscow. We don't dispute that, right? Right.
So let's do a little experiment. How close is Juneau, Alaska's capital, to Moscow? It's 4,559.6 miles. Meanwhile, how close is, say, Boston, the capital of Massachusetts, to Moscow? It's 4,498.8 miles. (Distances calculated using this site.)
So there you have it. Massachusetts governor Deval Patrick is more geographically qualified to speak of matters Russian than Palin is. I wish someone would make this into a commercial. They'd never trot this argument out again.

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Obama Goes on Offense: McCain Is "Out of Touch"

| Fri Sep. 12, 2008 10:58 AM EDT

With his supporters increasingly grumbling about what feels like a campaign perpetually fighting back against John McCain's attacks, Barack Obama began an offensive assault today.

The Obama campaign is seizing on a statement by McCain Thursday night on CNN in which the Republican senator said, "It's easy for me to go to Washington and, frankly, be somewhat divorced from the day-to-day challenges people have."

In a conference call with reporters Friday morning, top Obama surrogates hammered McCain for the statement. Dick Durbin, senator from Illinois, said, "[McCain] wants to continue with George Bush have failed. If he would, you know, be in the real world of American families in New York, Illinois or Florida, he would understand that."

Rahm Emanuel, a representative from Illinois and part of the Democratic House leadership, added, "[McCain is] removed from the day-to-day challenges people have faced in their lives. And you see it manifest itself in the thing when he says, you know, I don't use a computer. I don't use e-mail. There's a whole economic revolution going on. And it fundamentally changed the economy, and fundamentally changed people's lives, and he is removed from it."

An unnamed Obama campaign official told Politico that the campaign's message is simple: "Out of touch, out of touch, out of touch."

New McCain Ad: Racist or No?

| Fri Sep. 12, 2008 10:47 AM EDT

The McCain campaign has a new 30-second spot out, hitting Obama and Biden for mistreating Sarah Palin. It's below. Near the end, Obama's face is shown with the words "HOW DISRESPECTFUL." "Disrespectful" is actually the title of the ad.

Some are questioning whether that's racist. Here's TPM's David Kurtz: "Doesn't it just drip with contempt? The sort of old-fashioned contempt that whites often held blacks in (and obviously still do)."

I'm not sure I agree. I think "how disrespectful" could be effective if paired with an image of a white politician, too, as long as that white politician's calling card was civility and positivity. Tarnishing such a reputation doesn't depend on the politician's color.

Anyway, it's not often when an ad is obviously racist or obviously sexist. Ads are almost always in a gray area, as this one is. Each viewer can decide how he or she feels.

Sarah Palin's Wasilla Emails: Did She Violate State Law?

| Thu Sep. 11, 2008 11:45 PM EDT

Sarah Palin made her bones as a self-proclaimed Republican reformer in Alaska when she turned on a Republican Party state chairman who had had been accused of wrongdoing. In 2003, that GOP leader, Randy Ruedrich, was one of three members of the Alaska Oil and Gas Conservation Commission; Palin chaired the commission and served as its ethics officer. After the news broke that Ruedrich had hosted a Republican fundraiser with several oil company executives and had sent out an email notice for a different Republican fundraising event, critics demanded he resign.

Leading the anti-Ruedrich pack was Palin. She threatened to quit the commission unless Ruedrich resolved his conflicts. "It was a very simple issue," she said at the time. "It was black and white." And after Ruedrich was forced out, Palin, acting at the behest of state investigators, examined his computer files and found emails and documents showing that Ruedrich had used his state office to conduct partisan work for the Republican Party. The records Palin unearthed became evidence in a state investigation that led to a settlement under which Ruedrich paid a $12,000 fine.

Thanks to this episode, Palin became known as a Republican willing to take on a fellow Republican who had abused his office and misused state resources. But what was not known at the time was that a year earlier, Palin had used official resources for her own partisan purposes. In doing so, Palin, now the governor of Alaska and the Republican vice presidential nominee, might have run afoul of state law and the municipal code of Wasilla.

According to emails obtained by Andrée McLeod, a self-described independent government watchdog in Alaska, and shared with Mother Jones, in 2002, when Palin was in her last year as mayor of Wasilla and running for lieutenant governor in a Republican primary, she used her official city email account for campaign purposes. In a June 11, 2002 email to Randy Ruedrich--sent from her sarah@ci.wasilla.ak.us account--Palin asked if the state Republican Party would disseminate notices for her fundraisers. "I have a heckuva' lot of notices I would love to be distributed to all the [state party] lists because I'm not networked into all the valuable distribution lists that other candidates may be networked into," she wrote. "Can you do that for me?"

Exclusive: More on the Interior Department's Sex and Oil Scandal

| Thu Sep. 11, 2008 9:00 PM EDT

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Chances are you've heard about the bacchanal known as the Minerals Management Service. The arm of the Interior Department charged with collecting some $10 billion a year in royalties from oil and gas companies, it has been caught up in scandal after scandal, including this week's revelations that top employees were in bed (and not just figuratively) with the oil officials they were supposed to regulate. In between glacially slow-to-arrive FOIA requests, I've been looking into MMS and its weird party culture off and on for more than a year. Here's a few juicy details that you won't read in the Inspector General's report.

The IG tells us about two MMS oil marketers, Stacy Leyshon and Crystel Edler, who became known among oil executives as the "MMS Chicks." Between 2002 and 2006, each received more than $2,700 in gifts on more than 60 occasions from oil companies, including meals, booze, lodging, and golf outings. Leyshon, who slept with two oil company employees, operated a sex toys side business known as "Passion Parties" (think Tupperware parties, but with dildos) and bragged that it paid more than her day job at MMS. She told the IG that nobody in the oil industry had purchased sex products from her (though three subordinates at MMS had). However, that account is contradicted by former MMS Deputy Junius Walker, a high-ranking employee who worked in Leyshon's Denver office before retiring. "She's selling that stuff to oil and gas companies," he told me last year. "I mean, that's what she was doing. She was going around, going down to the oil and gas companies, putting on presentations. . .They were having a really, really good time."