Mojo - September 2008

American Royalty Endorses American Royalty, Citing Rednecks

| Thu Sep. 18, 2008 12:34 PM EDT

The jilted Clinton supporter Lady Lynn Forester de Rothschild recently endorsed John McCain, saying Barack Obama is elitist and unable to connect with everyday people. De Rothschild certainly knows something about elitism — the wife of British banking scion Sir Evelyn de Rothschild, she reportedly splits her time between homes in New York and London — but it's unlikely she knows all that much about everyday people. Here she is on CNN explaining her endorsement of McCain:

"The people out, you know, who are the rednecks or whoever, are bitter."

Surely the rednecks or whoever recognize this woman as one of their own. Video after the jump.

Advertise on MotherJones.com

Palin Blames Wall Street Woes on Lobbyists - The Same Ones Who Now Work for the McCain-Palin Campaign?

| Thu Sep. 18, 2008 12:15 PM EDT

In her third media interview (first two: ABC and People magazine), Sarah Palin talked Wall Street with Sean Hannity. The Fox News host wanted some answers on the current economic upheaval:

HANNITY: How connected is it, though, to Washington? You have 354 lawmakers got money from Fannie and Freddie. 354. If you look at the years from 1989 to 2008, second-top recipient was Senator Barack Obama. Should there be an investigation in terms of the relationship between the political donations and then of course the bankruptcy that ensued and the impact on the economy?
PALIN: I think that's significant, but even more significant is the role that the lobbyists play in an issue like this also. And in that cronyism — it's symptomatic of the grade of problem that we see right now in Washington and that is just that acceptance of the status quo, the politics as usual, the cronyism that has been allowed to be accepted and then it leads us to a position like we are today with so much collapse on Wall Street. That's the reform that we've got to get in there and make sure that this happens. We've got to put government and these regulatory agencies back on the side of the people.

Set aside the fact that she says nothing of substance about the economy or conditions on Wall Street. She says, "even more significant is the role that the lobbyists play in an issue like this... the cronyism that has been allowed to be accepted and then it leads us to... so much collapse on Wall Street." There's some confusing language in there but when you filter it out you get one inescapable conclusion.

Sarah Palin blames Wall Street lobbyists for a major part of the financial industry's "collapse."

If that's the case, why does she let 83 Wall Street lobbyists work for her campaign? McCain and Palin are slamming the "greed" of Wall Street and its lobbying pals on a daily basis, saying that they are hurting average Americans. Wouldn't you think McCain and Palin owe it to those average Americans to keep the lobbyists in question off the campaign payroll?

Photo by Ryan McFarland used under a Creative Commons license.

A More Generous Interpretation of the McCain-Spain Gaffe

| Thu Sep. 18, 2008 11:32 AM EDT

If you haven't heard about the McCain-Spain snafu, highlighted by Talking Points Memo overnight, here's a quick rundown. My take on the whole thing follows.

McCain did an interview with a Spanish-language radio station. He was asked about a series of Latin American troublemakers, in response to which McCain gave the standard conservative boilerplate about standing up to those that oppose liberty, freedom, etc. The interviewer then asks about Spain and President/Prime Minister Zapatero. McCain appears confused by the question or unclear on who Zapatero is and covers by providing more boilerplate about Latin America. He never embraces Spain as an ally, possibly because he doesn't know the questions are about Spain.

At this TPM post, you can hear the interview in English and evaluate for yourself.

Some in the media are already jumping on McCain. I'm more charitable. I don't think McCain can't identify Spain's correct hemisphere. I don't think McCain is uncertain about Spain's status as an ally. I don't think McCain is unaware of Spain's leader. Honestly? I think he didn't hear the interviewer, who was talking quickly and with an accent, when she transitioned to Spain. And after he missed the transition he got confused and either misheard or misunderstood the rest of what was going on.

I think this whole thing is a symptom of McCain's age.

And to be frank, I think it would work better as an attack on McCain if it was framed that way. Is any voter really going to believe that a 20+ year Senator doesn't know where Spain is? They're likely to dismiss that as the (over)zealotry of the liberal media. Questions about age and fitness are much more believable.

Federal Action Against Iranian Global Procurement Network Suggests That Deadly Iraq IED Components of US Origin

| Wed Sep. 17, 2008 6:43 PM EDT

Today, the Commerce Department Bureau of Industry and Security (BIS) announced that, in cooperation with the US attorney in Miami and other federal agencies, it had broken up an Iranian global procurement network used to illegally acquire US-origin dual use and military components. "This extensive, effective government effort has broken up a lethal international ring seeking to harm American and allied forces as well as innocent civilians by acquiring sensitive U.S. technology capable of producing improvised explosive devices (IED) similar to those being used in Iraq and Afghanistan," said Commerce Under Secretary Mario Mancuso.

A corresponding Justice Department press release today announced the unsealing of a 13-count indictment "charging eight individuals and eight corporations in connection with their participation in conspiracies to export U.S.-manufactured commodities to prohibited entities and to Iran. ... The defendants are charged with purchasing and causing the export of U.S. goods to Iran through middle countries, including the United Arab Emirates, Malaysia, England, Germany, and Singapore." None of the eight defendants reside in the U.S.

The announcements were forwarded by a Washington trade lawyer, aware of my interest in the issue. A couple months ago I reported on a curious phenomenon: why was so much US sensitive military equipment and technology ending up in Iran, the subject of extensive US sanctions? One major soft underbelly of US efforts to restrict the sale of US military equipment to Iran turns out to be the United Arab Emirates, where both the US and Iran have extensive trade ties. In my report, I cited a former Commerce Department official who noted:

"The rhetoric from Commerce…is all about national security ... US bureaucrats don't want to find their names in press for not enforcing when a US soldier is killed [in Iraq] by US technology that was exported to Iran through UAE. So, the rhetoric is very tough for UAE enforcement. On the other hand, we desperately want the oil dollars…So, mixed messages galore."

The scenario the former Commerce Department official suggested in passing was disturbing. Were some of the components in the improvised explosive devices (IEDs) blamed for killing US forces in Iraq - that the US military alleged were being supplied to Shiite militants in Iraq by Iran - in fact of American origin? Is that why the US military has repeatedly indicated it would display the evidence of the Iranian origin of some of these weapons, and then halted the full presentation?

Today's announcement by the Commerce Department raises just such questions. Stay tuned.


Dow Finishes Day Lower Than When Bush Took Office

| Wed Sep. 17, 2008 5:00 PM EDT

The Dow Jones Industrial average just closed for the day at 10609.66, about 50 points lower it was the week George W. Bush took office as president of the United States.* In seven and a half years, GOP stewardship of the economy has produced negative results in the stock market. Remember, this is the same stock market that the Bush administration (and John McCain) wanted to invest your Social Security money in. That money would have been managed, in part, by now-bankrupt Lehman Brothers and no-longer-independent Bear Sterns and Merrill Lynch.

If you invested in the stock market in 2001, betting that Republicans are better for the economy, you bet wrong. Instead, we're in the midst of what Alan Greenspan has called a "once-in-a-century" crisis. But since you're a well-informed reader of MoJo Blog (or perhaps of Kevin Drum), you already know that Democrats are better for the economy.

bushchart2.JPG

Remember, it's not just the stock market that's done poorly under Republican leadership. It's also most Americans. GOP economic policies have redistributed wealth upwards, benefiting the private-jet-and-personal-megayacht set but leaving almost everyone else, including many who would technically be considered "rich", behind. Between 2002-2006, the bottom 90 percent of Americans got 4 percent of the nation's income growth, according to figures from the Center for American Progress (PDF). (The great chart to the right is from that same report). The 15,000 richest families in America got 25 percent of the income growth, and the median household income was 0.6 percent lower in 2007 than in was in 2000. And all these figures were calculated before the turmoil of 2008 and the chaos of the past week.

Can the FDIC Weather the Financial Storm?

| Wed Sep. 17, 2008 4:01 PM EDT

The federal bailout of American Insurance Group (AIG) is like putting a finger in the dike. Next to potentially require government intervention is Washington Mutual, the nation's sixth largest bank with some $143 billion in deposits, which hangs by a thread. When—not if—it goes, the government is committed to protecting its depositors through the Federal Deposit Insurance Corporation. According to one estimate in The New York Timeson Wednesday morning, paying off Washington Mutual depositors could eat up half the FDIC's reserves, which currently stand at $45.2 billion. In August, the FDIC identified 117 banks and thrifts that could be in trouble. "A few more IndyMacs or 20 or 30 smaller collapses will wipe out [FDICs] reserves," predicts Dean Baker of the Center for Economic and Policy Research. That means the FDIC could bottom out, unless Congress steps in.

Commercial banks, already straining from the crisis, are now being encouraged by Treasury Secretary Henry Paulson, to take on crumbling Wall Street investment companies. That was the message in the Bank of America's recent takeover of Merrill Lynch. One of Washington Mutual's oft-mentioned suitors is Chase. That means that bank portfolios could become swollen with the junk bonds, lousy mortgages, and other speculative investments held by the unregulated collapsing investment banks on Wall Street. The already weakened commercial banks will find it difficult to survive with this additional load. If they fail, the FDIC's reserves are not big enough to cover the deposits of their customers.

Advertise on MotherJones.com

Sarah Palin's Yahoo Accounts Hacked

| Wed Sep. 17, 2008 2:34 PM EDT

palin-screenrab.jpgSo, you know those Yahoo accounts Sarah Palin was using to keep her official business safe from subpoenas? Turns out they're not so safe after all. Palin's Yahoo accounts (gov.palin@yahoo.com and gov.sarah@yahoo.com) were successfully hacked last night and you can see the screengrabs here. Since then, the accounts have been deleted, which could be considered destruction of evidence if a court chose to pursue it.

The evidence, at first glance, looks pretty solid that the accounts were authentic. Photos of Palin's family were pulled from e-mails, plus a "sent" e-mail to aide Amy McCorkell was confirmed by a call to McCorkell herself, reports Wired.

Who knew the GOP was so in favor of government transparency? Maybe the McCain/Palin team is a real "maverick" ticket after all.

Mission Creep Dispatch: Winslow Wheeler

| Wed Sep. 17, 2008 1:20 PM EDT

wheeler.jpgAs part of our special investigation "Mission Creep: US Military Presence Worldwide," we asked a host of military thinkers to contribute their two cents on topics relating to global Pentagon strategy. (You can access the archive here.)

The following dispatch comes from Winslow T. Wheeler, director of the Straus Military Reform Project at the Center for Defense Information in Washington, DC, and author of Wastrels of Defense: How Congress Sabotages US Security.

It's Not Just the Bases—or the Nukes

The sprawl of American bases, both wanted and unwanted by their international hosts, is an important consideration in understanding and then limiting the obnoxious overreach of the American empire. But as with nuclear proliferation, the other issue the left in American politics has latched onto, even were the matter to be solved to the complete satisfaction of the advocates (which I would strongly welcome), there would be hardly a scratch on the foreign policy and defense ills that drag America down.

Consider the following:

McCain Attacks Wall Street Greed - While 83 Wall Street Lobbyists Work for His Campaign

| Wed Sep. 17, 2008 12:25 PM EDT

In the past few days, as the economic crisis has deepened, Senator John McCain has been decrying the excesses of Wall Street. At a campaign rally in Tampa on Tuesday, he vowed that he and Alaska Governor Sarah Palin, if elected, "are going to put an end to the reckless conduct, corruption, and unbridled greed that have caused a crisis on Wall Street." He noted that the "foundation of our economy...has been put at risk by the greed and mismanagement of Wall Street and Washington."

He blasted CEOs who "seem to escape the consequences." He denounced Wall Streeters who "dreamed up investment schemes that they themselves don't even understand" and who used "derivatives, credit default swaps, and mortgage-backed securities" to try "to make their own rules." He excoriated Fannie Mae and Freddie Mac for gaming the system. And he slammed financial industry lobbyists for misguiding members of Congress. "I can promise you the days of dealing and special favors will soon be over in Washington." On Wednesday morning, after the federal government committed $85 billion to prevent the collapse of the American International Group (AIG) insurance conglomerate, McCain again assailed irresponsible corporate executives. "We need to change the way Washington and Wall Street does business," he proclaimed.

McCain has been quick with fiery, populist-tinged speeches. But one thing has been missing: any acknowledgment that McCain's own campaign has been loaded with the type of people he's been denouncing. (The McCain campaign did not respond to a request for comment; we will update the post if they do.) As Mother Jones previously reported, former Senator Phil Gramm, McCain's onetime campaign chairman, used a backroom maneuver in late 2000 to slip into law a bill that kept credit default swaps unregulated. These financial instruments greased the way to the subprime meltdown that has led to today's economic crisis. Several of McCain's most senior campaign aides have lobbied for Fannie Mae and Freddie Mac. And the Democratic National Committee, using publicly available records, has identified 177 lobbyists working for the McCain campaign as either aides, policy advisers, or fundraisers.

Of those 177 lobbyists, according to a Mother Jones review of Senate and House records, at least 83 have in recent years lobbied for the financial industry McCain now attacks. These are high-paid influence-peddlers who have been working the corridors of the nation's capital to win favors and special treatment for investment banks, securities firms, hedge funds, accounting outfits, and insurance companies. Their clients have included AIG, the newest symbol of corporate excess; Lehman Brothers, which filed for bankruptcy on Monday sending the stock market into a tailspin; Merrill Lynch, which was bought out by Bank of America this week; and Washington Mutual, the banking giant that could be the next to fall. Among these 83 lobbyists are McCain's chief political adviser, Charlie Black (JP Morgan, Washington Mutual Bank, Freddie Mac, Mortgage Bankers Association of America); McCain's national finance co-chairman, Wayne Berman (AIG, Blackstone, Credit Suisse, Fannie Mae, Freddie Mac); the campaign's congressional liaison, John Green (Carlyle Group, Citigroup, Icahn Associates, Fannie Mae); McCain's veep vetter, Arthur Culvahouse (Fannie Mae); and McCain's transition planning chief, William Timmons Sr. (Citigroup, Freddie Mac, Vanguard Group).

When cable news shows air footage of McCain railing against greedy execs and the lobbyists who rig the rules for the benefit of Wall Street dealmakers, there ought to be a crawl beneath him listing these lobbyists. (Talk about a fair and balanced presentation.) Short of that, here's the list of the McCain aides and bundlers who have worked for the high-finance greed-mongers McCain has pledged to take on. So far, it seems, none of them have been cast out of the campaign. If McCain were serious about his outrage, he might throw these money-changers out of his own temple.

What Does Deregulation Beget?

| Wed Sep. 17, 2008 12:09 PM EDT

The fact that a conservative approach to Wall Street — down with regulations! down with oversight! — has led to America's financial mess appears to be sinking in. But don't forget that deregulation has screwed up much more than Wall Street. The conservative hands-off approach has neutered nearly every science-based agency in the federal government these last eight years. That's the point of Chris Mooney's "Return of the Geeks." Check it out. No surprise, Bush Administration hacks prioritized deregulation of industry over science and oversight, to disastrous results.

Conservatives love to slam "big government." But the lack of effective regulation and oversight has led to problems in a number of areas, many of which Mother Jones has covered. Check out "The Ungreening of America: How the Bush Administration Is Rolling Back 30 Years of Environmental Progress." Also, you can read about the pernicious effects of deregulation in the areas of airline safety, food safety, the telecom industry, the FDA and food imports, mining, and nuclear garbage and nuclear safety.

Maybe it's time for regulation to make a comeback.