Mojo - April 2010

Dazed and Confused by Karzai

| Thu Apr. 8, 2010 1:57 PM EDT

"Does the U.S. Government have any reason to believe that President Karzai is like, hiding out in the basement of the palace doing bong hits or, you know, something worse?"

This question came during Wednesday’s State Department press briefing, when spokesman P.J. Crowley was grilled about the Afghan president’s "flighty" and "erratic" behavior lately, which has included blaming ex-UN diplomat Peter Galbraith and others for orchestrating the fraud that marred last fall’s presidential election. It was in the context of Karzai’s recent remarks that Galbraith coyly suggested in a TV interview earlier this week that, according to “palace insiders,” the Afghan president "has a certain fondness for some of Afghanistan’s most profitable exports." The Karzai-as-dope-fiend meme took off from there, temporarily reducing the high-stakes tensions between the Obama and Karzai administration’s to the plot of a Harold and Kumar movie.

Sure, US officials have been dazed and confused (apologies, I couldn’t resist) by Karzai’s odd conduct, but, Crowley says, there’s no reason to believe his anti-Western-paranoia is drug-related:

He is the president of Afghanistan. He's been significantly engaged with us on a regular basis. The Secretary talked to him Friday. Ambassador Eikenberry talked to him on Friday. He was with General McChrystal and Ambassador Eikenberry over the weekend. We have no information to support the charges that Peter Galbraith has leveled.

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Fiore Cartoon: Vatican's Defense

Thu Apr. 8, 2010 1:29 PM EDT

In the face of searing critique over a major sex scandal, the Vatican has issued defenses ranging from denial (the Pope didn't know about it!) to offensive pleas (what we're going through is like anti-semitism!)

Watch satirist Mark Fiore take on the papal PR machine below:

Reagan/Bush I Appointee To GOPers: Don't Mess with Start Treaty

| Thu Apr. 8, 2010 1:11 PM EDT

President Barack Obama and Russian President Dmitri Medvedev on Thursday morning signed a new Start treaty that would cut Russian and American warheads by 30 percent—to about 1550 warheads for each side. During the signing ceremony in Prague, Obama hailed the accord as an "important milestone for nuclear security and nonproliferation." But the treaty has to be approved by two-thirds of the Senate—which means at least eight Republican senators will have to join with the 57 Democrats and the two independents who caucus with the Dems to okay this pact. And arms control advocates in Washington are concerned that Sen. Jon Kyl (R-Ariz.) might try to derail or delay ratification. Kyl hasn't yet declared a position. He may want to kill the treaty outright, but arms control advocates suspect he might block it to gain leverage in his efforts to expand missile defense and to defeat a comprehensive treaty banning all nuclear weapons testing. But former President George H.W. Bush's chief arms negotiator has a message for Kyl: don't mess with this treaty.

At a Washington press conference on Friday morning, Richard Burt, who negotiated the first Start treaty in 1991, was asked what he would say to Kyl or other Senate Republicans considering obstructing ratification of the new treaty. Burt, who was also a senior State Department official in the Reagan administration, replied in strong terms:

I can say as a former political appointee of two Republican administrations, it will be very difficult for anybody to come up with a strong set of coherent arguments against this treaty. This treaty itself does not take sweeping steps to reduce either the United States or Russian deployed arsenal.....It's a very small step toward further reductions.

Burt noted that this treaty would put the US-Russian arms control process "back on track" and "could lead to a much more profound set of agreements." He noted that in the Senate, there will be "some outliers" who will vote against it. But he added,

Anyone who would vote against [the treaty] needs to think about the consequences of the signals we would send to the rest of the world....What would be the impact on proliferation?....What would it do to US leadership...on a whole range of international order issues?"

Burt, who is now the US chair of Global Zero, an international non-profit group that calls for the phased, verified elimination of nuclear weapons, noted that he's confident that Sen. Richard Lugar (R-Ind.), the ranking GOPer on the Senate foreign affairs committee, will round up enough Republicans to ensure ratification. But Burt's remarks were a sign that if Kyl or other Republicans attempt to block the new Start treaty, they will encounter criticism from Republicans and that a campaign of obstruction against the treaty could cause a split on the right.

Alan Grayson vs. the Whigs?

| Thu Apr. 8, 2010 12:15 PM EDT

Like Disneyworld and a Tallahassee flea market, Rep. Alan Grayson (D-FL) has quite the knack for attracting nutty characters. I'm specifically talking about Grayson's campaign for re-election this fall, and the latest challenger to emerge out of the woodwork: a Ocala, Florida, resident named Steve Gerritzen who's running as the lone candidate for (drumroll) the Whig Party. Yes, those Whigs, the ones who haven't had much clout in American politics since the 1850s. Apparently, Gerritzen, fed up with Democrats and Republicans, "wants to remake the American education system in the model of that of Iceland, which emphasizes high rates of literacy, early childhood education, and taxpayer-funded collegiate studies," the Ocala Star-Banner reports.

By day, Gerritzen, 39, is an electronics assembler, and struck a populist tone in what's presumably his coming-out interview with the Star-Banner. "A lot of people are talking about a revolution, but I'm calling for a revolution through the ballot box," Gerritzen told the newspaper. "Seventy percent of the people make less than $50,000 a year, and that's who I want to represent. I care about the people because I am the people. I am the working class."

In addition to the Whig resurrection, Grayson faces a challenge from the Tea Party's Peg Dunmire, whom Grayson called one of Sarah Palin's "undead minions." So rhetorically gifted is Dunmire, Grayson said, that she deserved a spot in the Guinness Book of World Records for "Most Consecutive Cliches." Dunmire's website says she want to eliminate most payroll taxes, repeal the Sarbanes-Oxley Act of 2002 (a landmark reform of financial accounting principles), and ramp up offshore drilling off Florida's coasts.

Florida's a bizarre enough state as it is, an off-kilter peninsular republic complete with hanging chads, Katherine Harris, Elian Gonzalez, and on and on. Thanks to Grayson and his cadre of challengers, it's only getting stranger.

Citi's Fallen Gurus Repent

| Thu Apr. 8, 2010 10:28 AM EDT

Citigroup's bygone masters of the universe—Charles Prince, former CEO and chairman, and Robert Rubin, the former chair of Citi's board (and Treasury Secretary under Bill Clinton)—have come to Washington to tell us all something: They were wrong. And they're sorry.

That was among the opening highlights of Prince and Rubin's appearance today before the Financial Crisis Inquiry Commission (FCIC), the Congressionally-mandated panel investigating the root causes of the recent financial meltdown. "I can only say that I am deeply sorry that our management—starting with me—was not more prescient and that we did not foresee that lay before us," said Prince, who led Citigroup from October 2003 to November 2007, resigning on the same day Citi announced $8 to $11 billion in writedowns in the early stages of the crisis. (Prince, you'll remember, is famous for comparing the global financial markets to musical chairs: "When the music stops, in terms of liquidity, things will get complicated. But as long as the music is playing, you've got to get up and dance. We're still dancing.")

Prince and Rubin are before the FCIC today as the commission investigates Citi's role in the subprime mortgage collapse and the broader economic meltdown. The U.S. supermarket bank, for one, was a heavyweight in the market for collateralized debt obligations (CDO), a type of security backed by pools of mortgage loans with varying degrees of risk. Citi, as Prince described in his testimony, held billions in so-called "super-senior" CDOs, which Citi officials felt had little chance of turning sour. (It didn't help that the hapless credit rating agencies imprinted these products with AAA ratings, the gold standard. But that's a whole different issue.) Quite the contrary: Citi ended up losing $30 billion over six quarters on these products. Today's hearings with Prince and Rubin, as well as several hearings held yesterday with Citi officials, are an attempt to understand how such a powerful and sprawling bank could so grossly underestimate the toxicity of these CDOs.

Rubin, who said he only learned of Citi's massive positions with these CDOs in the fall of 2007, accepted his share of blame, too, for underestimating how dangerous these products could be. "Almost all of us involved in the financial system...missed the powerful combination of forces at work and the serious possibility of a massive crisis," Rubin said in his testimony. "We all bear responsibility for not recognizing this, and I deeply regret that."

Pawlenty's Health Care Flip-Flop

| Thu Apr. 8, 2010 10:20 AM EDT

Lame duck Minnesota governor Tim Pawlenty has become the latest Republican to sue the government over health reform—only months after saying he didn’t believe there were any legal objections in the bill. Newsweek’s Andrew Romano catches Pawlenty’s blatant flip-flop:

Back on Sept. 13, Pawlenty explicitly ruled out taking legal action against Obamacare. … Stephanopoulos asked a direct, unavoidable question. "So just to be clear," he said, "are you suggesting that any parts of the plan as the president has laid it out are unconstitutional?"

Pawlenty's response was equally direct: "I wouldn't go so far as to say it's a legal issue."

It’s no surprise that Pawlenty’s trying to burnish his conservative credentials in hopes of fueling his 2012 presidential aspirations, aligning himself closely with Sarah Palin and Michele Bachmann before their joint appearance in Minnesota on Wednesday. For months, Pawlenty has been trying to use health care as a wedge issue to attack his rival Mitt Romney, who’s made an even more radical reversal on the issue given his role in crafting health reform in Massachusetts. But Pawlenty’s flip-flop makes his own political motivations even more transparent—and shows just how far the opposition has moved rightward.

While national Republican legislators have gone soft on their call for full repeal of the law, there’s little sign that these state leaders are letting up on the bombast. South Carolina Attorney General Henry McMaster—who’s running for governor this year, like a number of other attorneys general heading up the lawsuits—is passing around an "almost gothic" video that touts the lawsuit in his own bid for office, as Ben Smith reports. Such efforts may cheer the conservative activists—but they also drive home the fact that the lawsuits are a pure political ploy.

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A Mine Safety Crusader's Lonely Battle

| Thu Apr. 8, 2010 10:10 AM EDT

In Anderson Cooper's CNN reports of the horror and grief following the deaths of 25 miners at Massey's Upper Big Branch mine in West Virginia, the anchor turned to Davitt McAteer to explain what was going on.  For more than 30 years, McAteer has been there through one coal mine disaster after another, pleading for reform.

The key questions in the Massey tragedy are the same as those that were asked following the deaths of 13 miners in Sago, West Virginia, in 2006. Following that incident, many questioned why the federal government would not mount an aggressive drive to enforce safety regulations in the nation's mines. Neither the Bush administration nor Congress showed any serious willingness to tackle this problem head on. All that came out of the investigations was passage of the Miner Act, which required mines to set up secure areas where trapped workers could seal themselves off with enough food and water to last 4 days, in the hope that rescuers could reach them in that time. The law also mandated a communications system that tracked the whereabouts of trapped miners. Only 8 percent of US mines have installed such a system in the 4 years since the law was passed, McAteer told me.

We're Still at War: Photo of the Day for April 8, 2010

Thu Apr. 8, 2010 8:30 AM EDT

A squad of infantryman with 1st Battalion, 28th Infantry Regiment, 1st Infantry Division, are inserted into a landing zone by a 2nd Battalion, 25th Aviation Regiment, 25th Combat Aviation Brigade, Black Hawk helicopter during an aerial reaction force operation, on March 25, 2010, near Contingency Operating Base Speicher, Iraq. Photo via the US Army by Staff Sgt. Mike Alberts.

The Oracle Rewrites History

| Wed Apr. 7, 2010 4:46 PM EDT

Alan Greenspan, the economic sage and former chair of the Federal Reserve, has been on a mission to set the record straight on the financial crisis—not least his own role in it. In March, the Brookings Institution published a detailed, 66-page paper (pdf) he authored on the crisis’ origins. Most recently, he used a three-hour hearing on Wednesday by the congressionally-chartered Financial Crisis Inquiry Commission (FCIC) to discuss how subprime mortgages and securitization fueled the meltdown. Except Greenspan hasn't been describing recent history so much as rewriting it.

Greenspan, who chaired the Fed from 1987 to 2006, has received plenty of blame and opprobrium for the central bank's role in the subprime meltdown and broader economic crisis. The Fed, critics say, failed to rein in abusive practices by subprime lenders by choosing not to flex its regulatory muscle. For a time, it let credit card companies off the hook with a 2004 ruling that overdraft fees weren’t loans, and thus not subject to fair lending law. Consumer advocates also say Greenspan’s policy of keeping interest rates low during the 2000s paved the way for the housing bubble.

But reading Greenspan's testimony before the FCIC, you'd think the Fed was the Lone Ranger of regulators, a vigilant crusader on behalf of homeowners raising red flags about toxic mortgage products and the looming housing bubble. He touted the Fed's actions under a 1994 law called the Homeownership Equity Protection Act (HOEPA) that gave the Fed the power to prohibit "unfair," "abusive," and "deceptive" mortgage lending practices. "My colleagues at the Federal Reserve were aware of their responsibilities under HOEPA," Greenspan said, "and took significant steps to ensure that its consumer protections were faithfully implemented."

Bob McDonnell's Southern Aggression

| Wed Apr. 7, 2010 1:12 PM EDT

When Republican Bob McDonnell was elected governor of Virginia last November, Times columnist David Brooks gushed about his prospects on ABC: "We've just had a guy elected Virginia governor who's probably the model for the future of the Republican Party," Brooks said. "Bob McDonnell, pretty serious guy, pragmatic, calm, kind of boring."

The lesson, as always: Don't trust everything you see on TV. With the early returns in, McDonnell has turned out to be every bit the social values crusader his masters thesis suggested. First he rescinded an existing executive order protecting state employees from discrimination on the basis of sexual orientation. Then his attorney general, Ken Cuccinelli, demanded that the state university system drop its policy of not discriminating against gays. Cuccinelli, with McDonnell's support, then led the states-rights charge against health care reform and the EPA. Now, it seems, things have reached their logical conclusion: McDonnell has put forth an executive order making April "Confederate History Month." Party time!