Mojo - March 2010

Corker Shills for Payday Lenders

| Wed Mar. 10, 2010 6:16 AM PST

Sen. Bob Corker (R-Tenn.), the top GOP negotiator in the Senate's arduous financial-reform talks, is doing the dirty work for one of the dirtiest of financial industries: payday lending. Corker, the New York Times reports today, is pushing hard to throw a loophole in Senate banking committee's bill for the payday lending industry—essentially a form of loan sharking—to blunt any new oversight. The move sets up a potential showdown with Sen. Chris Dodd (D-Conn.), banking committee chair and leader of the financial-reform talks, whose November draft of legislation empowered a new, independent consumer-protection agency to crack down on payday lenders, among other non-banking institutions.

According to the Times, while a consumer agency tentatively agreed to by Dodd and Corker might be able to write new regulations for payday lenders, it would have to consult with other regulators to enforce those rules. Consumer advocates have repeatedly said gutting a consumer agency's rule-enforcement power would kneecap the new agency and limit its usefulness. And if the Senate goes lightly on the payday lending industry, it's likely to set up a battle between the House—whose bill last winter called for new oversight of the industry—and the Senate when the two try to merge their bill.

Corker's support for the payday lending industry is no surprise given the power the industry wields in his home state. The main trade group for payday lenders, the Community Financial Services Association, was founded in Tennessee in 1999, and has donated $1,000 to Corker. Corker has also received thousands more in donations from other heavy-hitters in the payday lending business, like $6,500 from the founders of Advance America, a leading payday lender. And overall, the industry's lobbying efforts almost tripled between 2005 and 2008 to maintain lax regulation of their industry, while at the same time business is booming for payday lenders. Especially with all those unemployed workers to prey on.

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Blackwater's South Park Debut

| Wed Mar. 10, 2010 5:31 AM PST

It wasn't a matter of if this would happen, but when. In a promo for the upcoming season of South Park, Eric Cartman strolls into an armory: "Yes, I would like 500-AK-47s please," he says to an official sitting behind a desk.

"500 AK-47s?" the official responds. "OK, but you're going to have to sign for those."

"Not a problem," Cartman says.

Apparently, this was more or less the scene that took place in a weapons depot outside of Kabul in September 2008 when some Blackwater wisenheimer signed for 211 AKs he was unauthorized to have using the alias Eric Cartman.

"It makes perfect sense. It's the name I would use," South Park co-creator Trey Parker told the Huffington Post a couple weeks ago. "Our first reaction to any story is 'How do we put this into the show?' and the second reaction is 'Did Cartman do that?'"

Tune in March 17 for the season 14 premier to see if Cartman makes Blackwater respect his authoritah.

(H/T Danger Room, Attackerman)

We're Still at War: Photo of the Day for March 10, 2010

Wed Mar. 10, 2010 3:00 AM PST

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Marines of Combined Anti-Armor Team, Battalion Landing Team 1st Battalion, 9th Marine Regiment, 24th Marine Expeditionary Unit send live rounds down range during an live-fire machine gun range in the mountainous terrain of Djibouti, Africa, on March 8. Photo via the US Marines Corps by Lance Cpl. David J. Beall.

"The Country Is Gonna Go to the Bow-wows" Warns Debt Commission Chair Alan Simpson

| Tue Mar. 9, 2010 8:51 PM PST

For more than a year, there have been signs that all our economic woes--the costs of the financial meltdown, and the bank bailout and stimulus spending that followed--would eventually be placed square on the backs of our so-called old-age entitlements: Social Security and Medicare. And lo, it is coming to pass, via President Obama’s euphemistically named National Commission on Fiscal Responsibility and Reform, commonly called the Deficit Commission or the Debt Panel.

Despite the names, no one is even trying very hard to pretend that the commission has any purpose other than cutting Social Security, Medicare, and probably Medicaid as well. That was clear from the get-go, based on Obama’s choice of Alan Simpson to co-chair the commission. The former Republican senator from Wyoming has already described his mission as “saving” the United States from “insolvency” by hacking away at entitlements. And if we want any more proof, we need only look at Simpson’s background, as detailed by Saul Friedman in his latest “Gray Matters” column:

This time President Obama, in his obsessive reaching across the political aisle, may have gone a stretch too far. For the Republican he picked to co-chair the so-called deficit reduction commission, former Sen. Alan Simpson, has been a harsh critic of Social Security and Medicare. And he sought to destroy their most powerful defenders, especially AARP.

That was 15 years ago, but as recently as 2005, Simpson, a conservative from Wyoming who left the Senate in 1997, supported attempts by President George Bush to privatize Social Security by turning part of the pension and insurance program into millions of individual investment accounts, which by now would have lost 20 percent of their value. Bush’s plan failed, largely because of the opposition of AARP and other advocates that Simpson sought to discredit.

Even now, Simpson, who should know better, conflates or deliberately confuses Social Security’s long term fiscal problems, which are minor, with its supposed contribution to the federal deficit, which is almost nil.

In an interview with the NewsHour after his appointment, Simpson said of Social Security, “You have two choices…you either raise the payroll tax or decrease the benefits or start affluence testing. The rest of it is B.S. And if the people are really ingesting B.S. all day long, their grandchildren will be picking grit with the chickens. This country is gonna go to the bow-wows unless we deal with entitlements, Social Security and Medicare.”

Wal-Mart's Black Barbie Sale

| Tue Mar. 9, 2010 4:03 PM PST

[UPDATE: We've followed up on this story here: "Barbiegate: What We Learned"]

Never let it be said that Wal-Mart doesn't know how to pander for a fast buck. The megachain acknowledged today that it's selling ethnic Barbie dolls for about half of what it charges for Caucasian Barbies.

The store was forced into the admission after a Louisiana-based shopper posted a photo, seen here, of the diverse dolls—and their respective pricetags—side by side in a Wal-Mart. As the good-humored Latino-interest blog Guanabee put it: "The same exact doll, in Caucasian, commands almost double the price! Who says Barbie dolls don’t supply young girls with a realistic portrayal of womanhood?"

(Interestingly, ABC News reported that the dolls were "black," while Guanabee called them "brown." Ambiguity abounds—except for Wal-Mart's contention that whatever they are, they're worth less than white ballerinas.)

For its part, the chain said it was selling the darker-skinned Ballerina Theresa Barbie dolls on the cheap because it needs to "clear shelf space for its new spring inventory." Which must make Theresa feel oh, so special.

No word yet from Wal-Mart, though, on when your kids will be able to find Burka Barbie on your local shelves.

[UPDATE: We've followed up on this story here: "Barbiegate: What We Learned"]

Petraeus' Presidential Fetish

| Tue Mar. 9, 2010 2:19 PM PST

For a guy who doesn't want the job, Gen. David Petraeus sure talks about the presidency a lot. So says the Associated Press in its dispatch today.  The AP followed the head of US Central Command—who's credited with writing the book on counterinsurgency, turning Iraq around, keeping Afghanistan close, and generally making patriotism sexy again—as he participated in Q&A's around the country. And every time he was asked a question that bordered remotely on politics, he steered it into a denial that he's trained his sights on the White House:

Part of his stock reply to the politics question—even when it's not asked—is to cite lyrics from a Lorrie Morgan country-western song about rejecting an unwanted suitor: "What part of 'no' don't you understand?"

Then he chuckles as if to suggest he's a bit embarrassed by the fuss—fuss sometimes of his own making.

Is he keeping his options open?

By a long stretch, this isn't the first time "Petraeus" and "presidency" have been joined in the same sentence; two and a half years ago, MoJo's own DC-based Dan Schulman reported in great detail on the general's electoral potential. Even Bob Dole weighed in last year to give the noncandidate his endorsement for commander in chief. And no grassroots candidacy is truly complete without the occasional Astroturf blog of support.

But on further review (and ignoring the obvious concerns about militarism in electoral politics), a Petraeus candidacy might be healthy for the GOP—and for the country. He publicly supported the Obama administration's now-stalled plan to shutter Guantanamo Bay's detention facility and end torture. He holds a doctorate from Princeton and has surrounded himself with intellectuals, left and right, in and out of uniform, who embrace out-of-the-box thinking—no small feat in the military's often stultifying bureaucracy.

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Obama's Speeches May Be "Fiery," But His Health Care Reform Is Still Lukewarm

| Tue Mar. 9, 2010 12:48 PM PST

Some news outlets have described Obama’s speech at a health care rally in Pennsylvania yesterday as "angry" or "fiery." As satisfying as it is to hear Obama say something nasty about the insurance companies, the details of his supposed "vilification" of these bloodsucking middlemen are well in line with the tepid outlines of the Democrats’ current health care reform plans. As described by the Christian Science Monitor:

President Obama charged that insurance companies have made a calculation that they can deny coverage for preexisting conditions, drop coverage when people need it most, and make big profits "as long as they can get away with it."

It was widely known from the start of the so-called health care debate that a baseline goal would be to stop insurance companies from denying people coverage because of pre-existing conditions, or knocking people off the rolls when they got sick. (The public option, as everyone should by now have realized, was never much more than a bargaining chip.) And that’s just what’s likely to happen. The insurance companies might have to endure a few insults along the way, but in the end they will get the deal they've always been promised: They'll make a few concessions in return for a boatload of new, government-mandated customers.

It was also well understood that any health care reform must genuflect before the alter of the free market. That has been a given since Reagan took office in 1981 and the conservative Heritage Foundation came up with its health care reform plan--which quite resembles the one now being promoted by Obama and many other Democrats.  

The Heritage plan is based on the Federal Employee Health Benefits program (FEHB). (See Stephanie Mencimer's earlier piece on the subject, as well as mine.) It supports a vending machine type "exchange" to sell private insurance across the country to one and all, thereby achieving a supposed twofer: affordable universal health care and preservation of the free market. The problem, of course, is that there is no free market when it comes to health insurance, and the FEHB is becoming more expensive by the day. So the exchanges will do nothing but bring mediocre and criminally overpriced insurance to a slightly larger pool of people.

And if we are to believe the latest tracking poll from the Kaiser Family Foundation, this is pretty much what Americans seem to want--a timid, lukewarm reform that addresses some of the worst abuses of the health care system without rendering any fundamental change. 

GOP: Aim Low on Wall St. Reform

| Tue Mar. 9, 2010 12:41 PM PST

That's the message coming from the GOP's lead negotiator in the Senate on a new Wall Street crackdown. Today Sen. Bob Corker (R-Tenn.), on CNBC to talk about the state of play in the Senate banking committee's financial-reform negotiations, said no one should get their hopes up for a bill that tackles all parts of the financial-reform equation. "I don't think we oughta try to pass legislation that solves every problem in the world," Corker said. "I think when we do that we end up with things like [what] is happening right now with health care reform." The junior senator from Tennessee added that a "middle of the road"—not too far to the left or the right—and "very solid" bill was the best outcome for the Senate banking committee, which has been embroiled in financial-reform talks for months now. (Below is the CNBC video, with more after it.)

On the one hand, Corker makes a fair point. Politics is compromise, and if the Democrats and Republicans on the banking committee try to inject their own ideologies into financial reform, we'll still be waiting for the banking committee to release a bill in November. That said, a crisis, to borrow the well-worn adage, is a terrible thing to waste, and the financial crisis of 2008 and 2009 offered a once-in-a-generation opportunity for lawmakers to put aside partisan differences and pass a comprehensive, historic bill. That bill would do away with the government's implicit bailout guarantee, protect consumers, shed some light on the derivatives industry, and try to end what Simon Johnson, former IMF chief economist, has called the "doom cycle."

That window of opportunity, however, looks to have passed. Odds are, if and when the dust settles and a financial-reform bill lands on President Obama's desk, that legislation will do far less than originally anticipated and possibly represent a victory for the financial services community. Sen. Corker's comments today are further confirmation (if you needed more) that any chances of a major overhaul have disappeared.

Corn on MSNBC: Wanna Bet?

Tue Mar. 9, 2010 11:18 AM PST

David Corn, Mother Jones' Washington Bureau Chief, was on MSNBC on Tuesday to talk about Karl Rove's new book, in which Rove claims that the Bush administration didn't mislead Americans in the run-up to the Iraq war. David says Rove is spinning, but Brad Blakeman, a former Bush administration official, disagrees—and adds that Bush launched the war because Saddam Hussein wouldn't allow international weapons inspectors into Iraq. David interrupts to say that's not at all true. Blakeman insists it is. Then David suggests he and Blakeman make a $1000 bet on that point. Watch what happens:

DoD Enters Consumer Agency Fray

| Tue Mar. 9, 2010 11:01 AM PST

You know the fight for financial reform has truly hit a fever pitch when the Defense Department, the monolith of the US government, has entered the ring. Not to be outdone by auto-industry lobbyists, the Pentagon has begun to lobby the Senate banking committee to convince them, including chairman Sen. Chris Dodd (D-Conn.), that any new consumer-protection agency should oversee auto dealers as well as banks and non-banking companies like subprime mortgage lenders, Politico reports. The DoD insists that any new consumer agency regulate dealers due to numerous reports of car salesmen preying on members of the military—a tactic Mother Jones' own Stephanie Mencimer reported in detail on last summer. And because the House's version of financial-reform exempted auto dealers from a consumer agency's oversight, the DoD is pushing hard to make sure the Senate doesn't include the same loophole.

The Pentagon's push came most notably in a February 26 letter from Clifford Stanley, an undersecretary of defense, citing auto dealers' "unscrupulous" practices toward members of the military. A consumer advocate added, "Predatory lending affects our military preparedness...It explains that this is not just some liberal position." A spokesman from the National Automotive Dealers Association told Politico that the practices decried by the DoD are already outlawed, and that a new consumer agency would only increase bureaucratic bloat in Washington. "Creating new regulatory mandates on top of existing federal and state statutes will likely drive up costs, limit vehicle financing options and, for many consumers including service members, effectively eliminate their ability to obtain financing to meet their vehicle need," the spokesman said.

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