Posts

Chris Dodd Uses Hearing to Call on Geithner to Do His Job

/in /by

Chris Dodd didn’t have many questions in yesterday’s hearing on the foreclosure crisis. But he did use the opportunity to call on Tim Geithner to convene the Financial Stability Oversight Council to prevent this crisis from blowing up the economy.

Dodd: Attorney General Miller, at the outset of my opening comments I talked about the importance of getting the, this Financial Stability [Oversight] Council that we established in the Financial Reform Bill to anticipate systemic risk and to collectively work as a body chaired by the Secretary of the Treasury, along with the FDIC and the OCC–there are ten members of that, an independent member and five others that are part of it. This seems to me like a classic example–one that we did not anticipate necessarily when we drafted the legislation, but exactly, we are in a crisis with this. Now you can argue that it’s not yet a systemic crisis that poses the kind of risk we saw in the Fall of 08, but no one can argue that we’re not in the middle of a crisis. Now the idea of this, of course, was to minimize crises so they don’t grow into a large, systemic crisis. Have you had any contact with the Secretary of Treasury? Or is there any communication going on between the Attorney Generals and this Council or the Chairman of it, the Secretary of the Treasury, or their office, to begin to talk about what the role of the federal government might be in formulating an answer to all of this?

Miller: We haven’t had any contact with the Council. We have had repeated contact with the Department of the Treasury, with Assistant Secretary Michael Barr and his staff. We’ve developed a terrific ongoing relationship with them. We talk about these issues and try and help and support each other on these issues. So we’ve had a lot of discussions with Treasury but not with that particular Council.

Dodd: Again I saw [mumble] privately with Senator Warner and others may, Senator Merkley has a similar thought. I’m going to use this forum here, obviously in a very public setting, to urge the Secretary of Treasury and others to convene that Council to begin to work with you and others, so there is a role here to examine this question in seeking broad solutions. So my hope is they’ll hear that request to pick up that obligation that we laid out in that legislation.

You know, when the Chairman of the Senate Banking Community has to use a forum like this to try to remind the Secretary of Treasury of his obligation under Dodd-Frank, it does not inspire a lot of confidence.

Mark Warner’s Chocolate Fountain Remorse

/in , /by

Once upon a time in 2006, a dirty fucking hippie blogger had an opportunity to ask aspiring presidential candidate Mark Warner a few questions. Mark Warner had just dedicated part of a speech to talking about how Iran was the biggest WMD threat. So with her questions, the dirty fucking hippie blogger asked Mark Warner how, if the NIE had said Iran was years away from having nukes whereas Pakistan and its al Qaeda favoring Generals and unstable government already had nukes, Iran could be the biggest WMD threat. Warner then listed three reasons why Iran was the biggest WMD threat: its support of Hezbollah and Hamas, its nutty president, and its aspirations for hegemony in the Middle East. “But none of those things are WMD,” the blogger said.

Matt Bai, who observed the entire exchange, would later blame the dirty fucking hippie’s questions (which, after all, proved correct on several counts and served mostly to highlight to Warner how blindly he had embraced a popular talking point) for single-handedly driving nice moderate Mark Warner from the presidential race and with him potentially the ability to succeed as a party.

The dirty fucking hippie blogger took from that exchange the following: 1) Mark Warner doesn’t have the analytic ability to understand what threatens this country 2) Matt Bai tends to spout stupid centrist ideology even when reality proves him wrong.

More than four years have passed since that exchange. In that time, Warner became a centrist Senator. As a Senator, he has been one of those who claimed no one knew the financial crisis was coming. And he was part of a group of centrist Senators that stripped the too-small stimulus bill in early 2009.

In other words, Warner continues to be unable to identify real threats to this country. It’s in that context–and specifically in the context of picking a time of almost 10% unemployment to cut the deficit–that Mark Warner chose to equate the “far left” of his own party with the TeaBaggers.

But the question will be will the super-left on my party – the MoveOn crowd in my party – and the Tea Party crowd on the other party, you know, they don’t compromise, so you know, I for one am…you know, there were too many times I bit my lip in the first year, or bit my tongue…I’m done…

[snip]

But I think an equal threat to our country’s national security is that we don’t get our balance sheet in order.

Now, Mark Warner and his friends that maintain the deficit as a bigger threat than a stagnant economy are precisely what we dirty fucking hippie bloggers point to as the problem with the last two years. Because these centrists put their own pet theories ahead of real analysis of what our country needed, the legislation they passed failed to do the job. It’s the economy, stupid, and the economy is still so shitty at least partly because deficit scolds like Mark Warner cut the already too-small stimulus package back when it could do some good.

Which is what Matt Bai fails to understand with his piece trying to refute the theory that Democrats failed because they catered to people like Mark Warner.

The theory here, embraced by a lot of the most prominent liberal bloggers and activists, is that centrist Democrats doomed the party when they blocked liberals in Congress from making good on President Obama’s promise of bold change. Specifically, they refused to adopt a more populist stance toward business and opposed greater stimulus spending and a government-run health care plan. As a result, the thinking goes, frustrated voters rejected the party for its timidity.

No, Matt, you misunderstand completely (or simply build another of your favored straw men). The problem is not that “frustrated voters rejected the party for its timidity.” Frustrated voters rejected the party because its watered down legislation didn’t do the job. And the centrists were the ones that watered down that legislation and made it ineffective.

And the biggest problem both Mark Warner and Matt Bai make is in pretending that they’re stuck in an ideology-free zone between two extremist ideologies. Leaving aside the TeaBaggers, whose ideology was very diverse up until the Koch brothers made them a wholy owned but less ideologically consistent subsidiary, this is not about a left ideology and a right ideology and the nice non-ideological centrists in between. Rather, this debate is about progressives who insist that legislation not be compromised by a blindly ideological insistence on things like deficit cutting, all because some think tanker has been paid to claim that issue, like Iran, is a greater threat than millions of Americans losing their jobs and homes. It’s about efficacy versus the flabby centrist ideology that got us into this mess.

What Bai and Warner choose not to understand is that centrism is an ideology even more stubborn than the left or right they love to attack, but an ideology that got us into the mess we’re in now, both fiscally and electorally.