Another way to restore confidence

Seven hundred billion dollars is a lot of money. It's unprecedented. It's unimaginable.

But that's how much of your money the United States Congress is about to authorize the Treasury to spend to buy up the catastrophic errors of the financial services industry. It has to be done, the lawmakers insist, so the rest of us don't have to spend the next few years living in the first half of a Frank Capra movie.

That's a Great Depression joke, if you're unfamiliar with 1930s movies.

We will leave it to others to sift through the record of the last two years, or ten years, and count up the campaign contributions from the financial services industry that went to the lawmakers who knew something of the scope of this problem and dealt with it by firmly ordering another bottle of champagne for the table.

You can look it up yourself at OpenSecrets.org, if you're interested.

But we would like to make a suggestion to lawmakers of both parties, and both presidential candidates, and the Democratic and Republican House and Senate campaign committees, and the Democratic and Republican National Committees.

Announce today that you will accept no campaign donations or contributions of any kind from the financial services industry. Not this year, not next year, not ever again.

That would go far to restore the nation's confidence that you are appropriating money and writing regulations with the best interests of the country as your only consideration.

Because, you know, that's not what we think now.

We know what you think of this suggestion.

Unprecedented. Unimaginable.

Election Day is coming. Don't send out the laundry.

Copyright 2008

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The unintended consequences of a terrible idea

The New York Times reports this morning that the draft of the bailout bill negotiated yesterday "requires the government to use its new role as owner of distressed mortgage-backed securities to make more aggressive efforts to prevent home foreclosures."

There is a catastrophe lurking in that sentence.

Now, nobody likes foreclosures.

Nobody, that is, except the people on the sidelines who have been trying to buy a house for years and have been waiting for prices to come down so they can finally afford one.

And maybe some resentful people who paid higher fees and a higher interest rate for a 30-year fixed mortgage on a little less house, while other people recklessly used adjustable-rate and interest-only mortgages to buy houses they knew they couldn't afford.

But nobody else likes foreclosures, especially not the House and Senate Democrats.

They like to help people.

They blocked efforts to restrain the size of Fannie Mae and Freddie Mac, because they wanted to help people with bad credit and no money buy houses with government-backed mortgages.

Now they want to help people by bailing out Wall Street firms that hold securities tied to those mortgages. The Democrats are as surprised as anyone to learn that some of the people with bad credit and no money aren't making their mortgage payments.

So their new plan to help people would require the government to "make more aggressive efforts to prevent home foreclosures."

Does that mean that once the government holds the mortgage, it will not foreclose on distressed homeowners who have stopped making their mortgage payments?

It had better not mean that.

Because when word gets out, everyone with one of those mortgages is going to stop making their mortgage payments.

Hey, why not?

Nothing's going to happen to them if they don't pay. They already have bad credit, and now the government will be prohibited by law from foreclosing on them.

That means the securities the government is buying with your $700 billion dollars are going to sink like stones. Right now, the Treasury Secretary assures us, the securities have some value because not all the mortgages mixed up in them are bad. So the plan is to stabilize the market and eventually sell those securities at a profit.

But if the government isn't allowed to foreclose on people who stop paying, everybody will stop paying and the problem will get bigger and bigger until it becomes impossible to reverse the policy without crashing the real estate market nationwide.

Instead of being sold to new owners on sound financial footing, the homes will be occupied by people who have effectively become squatters in government housing. On block after block after block.

What are the Democrats going to do then? Guarantee home-improvement loans?

Meanwhile, the securities the Treasury bought will be worthless. The taxpayers will lose the entire $700 billion and the government will come back to us for more.

Nobody likes foreclosures, and nobody likes declining markets. But it's just immoral, and self-defeating, and possibly insane, to pass a law that subsidizes people who got in over their heads with the tax dollars of people who didn't.

A bill that prohibits foreclosures can't be allowed to get through Congress. It shouldn't even be allowed to make it through Sunday.


Copyright 2008

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Speaker Boehner!

Do the Republicans have a pulse?

You never know.

First the GOP gained ground on the issue of domestic oil drilling, as four-dollar-a-gallon gasoline drove even hardcore environmentalists in Santa Barbara to declare, "It's just a duck."

Then last Thursday, after a day in the financial markets that one trader described as "five hundred trades from Armageddon," the Treasury Secretary and the Fed Chairman went to House Speaker Nancy Pelosi's office and told key House and Senate leaders that the stock market was just hours or days away from crashing and launching economic hard times like the country hasn't seen since the Great Depression.

Senate Democrats, Senate Republicans and House Democrats worked with the Bush administration to throw together a rescue plan that would put taxpayers on the hook for $700 billion and give the Treasury Secretary unprecedented control over how the money was spent. Pale and panicked, the lawmakers scrambled to agree on legislation before there was a market crash, a run on the banks, a collapse of the U.S. financial system and five or six other really bad things that they were told might happen.

Every day they assured financial reporters that they knew they had to get this done to prevent a catastrophic market crash.

Then a funny thing happened on the way to Armageddon.

As Barney Frank and Nancy Pelosi and Chuck Schumer proudly told reporters how they were working in a bipartisan fashion to do what was best for the country, the telephone lines at the Capitol were burning up with furious calls from constituents. Southern California Democrat Brad Sherman said calls to his office had run 300 to 2 against the plan. Pennsylvania Democrat Paul Kanjorski said the calls to his office were coming in fifty-fifty: half "no" and half "Hell, no."

One lawmaker said the public sentiment was ninety-nine percent against the bailout.

On Thursday, one week after the Treasury Secretary and the Fed Chairman had given congressional leaders the scare of their political lives, President Bush invited all parties to the White House for a showcase meeting of bipartisan negotiations to save the economy from a credit crisis and a stock market crash.

And that's when it happened. The House Republicans refused to go along with the deal.

In a week when all the players--and they're all the best in the business--were positioning themselves to be near the credit and away from the blame, House Minority Leader John Boehner outmaneuvered everybody.

There were the Democrats, working all night to bail out Wall Street's lords of luxury with the hard-earned tax dollars of teachers and nurses. There was the president, a Republican, promoting a plan for unprecedented government intervention in private markets, unprecedented federal spending, unprecedented debt, and another huge expansion of federal government power.

And there was John Boehner, with the scraggly, battered remnants of the Republican party behind him, making a stand for fiscal responsibility, free markets, and a firm foot on the brakes to stop the slippery slide into socialism.

John Boehner, attacking Wall Street greed and corruption and vowing to protect the taxpayers.

John Boehner, standing squarely on the only spot of political real estate in Washington that wasn't under attack by ninety-nine percent of the voters.

And there was Nancy Pelosi, out on a limb, checking her watch yet again because Hank Paulson told her the stock market was going to crash by now, and she certainly wouldn't have put herself in a tree for any other reason.

We're not experts on the stock market here at America Wants To Know, but we're pretty sure that no stock market crash has ever been preceded by a week and a half of dire warnings that the stock market was just about to crash.

We're also pretty sure that being on the wrong side of ninety-nine percent of the voters six weeks before an election is a new experience for the Democratic majority. They must be too young to remember the 1992 House banking scandal, when voters were enraged--enraged--that House members were permitted to overdraw their checking accounts at the House bank, without penalty.

It seems so quaint now.

Certainly no one was overdrawn by $700 billion or anything close to it.

Still, the voters were furious and very quickly the Democrats were voted out of the majority after forty straight years with the gavels in their hands.

Maybe they're not too young to remember.

They do look pale.

America Wants To Know isn't going to wake up our team of psychics and fortune tellers to look into the future tonight, but we'll venture a guess without them.

The stock market will not crash.

The Republicans will defy all predictions and laws of physics and retake the majority in the House.

The Dow Jones Industrial Average will end the year at 14,000.

Nancy Pelosi will replace Whoopi Goldberg on The View.

Whoopi Goldberg will replace Keith Olbermann on MSNBC.

Keith Olbermann will replace Cindy Sheehan on the road outside the Crawford ranch.

Be sure to tune in next week, when we predict that Sarah Palin will leave her husband and run off with the president of Pakistan, just to get some much-needed experience handling nuclear weapons.


Copyright 2008

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The hilarious point of the bailout

Members of the Senate Banking Committee told Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke at Tuesday's hearing that they've been inundated with phone calls from constituents about the proposed $700 billion financial system bailout. The voters, the senators reported nervously, are overwhelmingly against it and more than a little bit angry.

The senators really wanted the witnesses to help them explain to the voters why the bailout is good for them, and not just for the financial titans who appear to be responsible for the mess.

The answer came slowly, but if you watched the whole hearing, as we just did, the answer became clear.

"Last week it was impossible to get financing for a new car unless you had a credit score of 720 or better," one senator said.

So that's it.

The credit crisis is a lack of credit for people with middling-to-bad credit.

Secretary Paulson tried without success to explain to the senators that restrictions on executive compensation would cause the banks to refuse to participate in the program.

They'll participate if they need the bailout, the senators said repeatedly. If they don't need the bailout, the taxpayers shouldn't be bailing them out.

Secretary Paulson tried again to explain that the goal is stabilizing the system and restoring confidence.

He sounded like a man who didn't want to tell the plain truth.

It sounds like the plain truth is that the banks are adjusting to the situation pretty well, thanks, and now they'd prefer not to lend money to any more people who are likely to default on their loans.

If you're an incumbent Republican administration, this is a level of fiscal responsibility that simply cannot be tolerated.

It means fewer cars will be sold and U.S. automakers will lay off workers. It means irresponsible college students who don't pay their credit card bills won't be able to get college loans and they'll have to move back in with their furious parents. It means companies that make major appliances and sell vacations and rely on the American public's habit of buy-now-pay-maybe are going to see their business limited to customers who have good credit, or pay cash.

The Bush administration apparently believes there aren't enough of those customers to keep the economy out of recession.

So the Treasury Department is proposing a $700 trillion federal intervention to relieve the banks of the last wave of unpaid debts. That will restore "confidence" so banks will again take a chance that Americans with bad credit will pay their bills.

The banks need their "confidence" restored because the sub-prime mortgage orgy demonstrated that there are plenty of people who will happily skin a banker if given the opportunity.

"No bad behavior should be rewarded," one of the senators said.

You have to love political comedy.


Copyright 2008

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Hank Paulson's pre-emptive war

Vice President Dick Cheney went to Capitol Hill on Tuesday for a closed-door meeting with House Republicans.

It didn't go well.

The vice president tried to tell the Republican lawmakers that they had to go along with Treasury Secretary Henry Paulson's three-page legislative proposal to commit the taxpayers to buy $700 billion worth of financial instruments that no one in the financial industry will touch with a ten-foot pole.

Secretary Paulson was on Capitol Hill too, trying to tell the Senate Banking Committee that the $700 billion plan is absolutely and immediately essential to prevent a catastrophic meltdown of the United States economy that will cost Americans their jobs and the houses and their retirement savings.

That didn't go well, either.

So J.R. Ewing might have been wrong after all.

The fictional oil man from the TV series "Dallas" was once asked by an incredulous associate how he could do the things he was doing and he famously answered, "Once you give up your integrity, everything else is a piece of cake."

He might have added that it's important to get canceled in a timely manner, before it all catches up with you.

The Bush administration has been caught in too many lies to count here, but the Iraq war and the Medicare prescription drug coverage might never have happened if the administration had truthfully revealed the information it had at the time. Instead, lawmakers were treated to an edited version of the facts, and administration insiders who revealed any more than that were promptly fired or forced to resign.

Now the administration is back on Capitol Hill with another demand for unprecedented federal government expansion and executive branch authority. They're warning publicly about a deep recession, and privately about a Great Depression, if they don't get what they want. And they want it now, because they say the situation is a crisis, and there's no time for thoughtful hearings or extended public debate.

But hardly anybody believes them any more.

That's the price you pay for lying.

Maybe it's the price we're all going to pay.


Copyright 2008

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Ed O'Callaghan, ATAC Coordinator

At the end of July, a U.S. Attorney from the Southern District of New York left the Justice Department and went to work for John McCain's campaign. As an Assistant U.S. Attorney, Edward O'Callaghan had worked on prosecutions related to Iraq and the U.N.'s Oil-for-Food program, but his most recent title was "ATAC Coordinator."

ATAC stands for Anti-Terrorism Advisory Council. After the September 11th attacks, "the ATAC Coordinator positions were created in every federal district at the direction of the U.S. Department of Justice to coordinate the efforts of all local, state and federal law enforcement agencies to address the threat of terrorism," according to the biography of another attorney who held one of the ATAC Coordinator positions.

Right now, Ed O'Callaghan is in Alaska coordinating the McCain campaign's response to developments in the so-called "Troopergate" investigation.

Troopergate, from the McCain campaign's perspective, is a troublesome inquiry into whether Governor Sarah Palin abused the power of her office by firing a respected state public safety official who refused to fire a state trooper that the governor wanted dismissed.

Ed O'Callaghan has been heading up the campaign's legal strategy on Troopergate, recently declaring that the governor will not cooperate with the legislature's official investigation and that her husband will not comply with a subpoena for his testimony.

This is kind of disturbing.

If Ed O'Callaghan was conducting an investigation in New York, how would he react to key witnesses who defied subpoenas and held press conferences accusing the investigators of partisan political motives?

Not well, we suspect.

Yet there he is, a former U.S. Attorney, using all his skills to shut down, stymie or delay an investigation authorized by a bipartisan vote of the state legislature.

The really disturbing thing is that he might be perfect for the job.

What does it mean to be an ATAC Coordinator?

Maybe the position was created to make sure terror prosecutions didn't fail due to legal 'technicalities.'

Maybe an ATAC Coordinator's job is to see the big picture and make sure that the law -- due process and habeas corpus and Miranda rights -- doesn't allow terrorists to take over the streets of New York.

Maybe Ed O'Callaghan's job in Alaska is to see the big picture and make sure that the law -- due process and subpoenas and testimony under oath -- doesn't allow Barack Obama to take over the White House.

A lot of lawyers might object to fighting a U.S. presidential campaign with the damn-the-law the-ends-justify-the-means techniques the Bush administration lawyers have used against accused terrorists.

But not Ed O'Callaghan, apparently.

He's a big-picture guy.

And in the big picture, he's going to be appointed to the federal bench.

What a way to get there.


Copyright 2008

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Train wrecks

Sometimes a little bureaucracy is a good thing.

Los Angeles Times writer Steve Hymon reports today on Metrolink, the regional transit agency responsible for the worst train crash in modern California history, the September 12 head-on collision with a Union Pacific freight train that killed 25 people and injured 135 more.

Metrolink was created in 1992 when five Southern California counties were buying up freight train lines for use by commuter trains. "To keep it from becoming a large transit agency that would have to grapple with bureaucracy and labor unions," the Times reports, "Metrolink was purposely designed to keep expenses low -- its current operating budget is $159 million -- by relying on subcontractors."

Metrolink has just two hundred employees and is overseen by an 11-member board made up of people who have full-time jobs doing something else. It contracts out for almost everything, including engineers and maintenance staff.

Metrolink, the Times says, "has one of the worst fatality records of any commuter rail system in the nation."

Ron Roberts, chairman of the Metrolink board, told the Times, "It looks like we didn't have as much knowledge as we should have had."

If they'd had more knowledge, they might have had more redundancy, otherwise known as back-up. There was no one standing next to the engineer when he apparently ran through a red light and into the path of an oncoming freight train. There are reports that he may have been sending a text-message. Or he may have fallen ill.

Board chairman Roberts said he asked Metrolink's staff on Thursday what type of system is in the cab in case the engineer becomes unconscious. "They still haven't sent an answer back to me," he told the Times.

Maybe that is their answer. Nothing.

Maybe a sluggish, redundant bureaucracy with a little union feather-bedding would have saved the lives of 25 people who were just trying to get home that night. Maybe too much "efficiency" is a bad idea when safety is, or ought to be, the prime consideration.

Which brings us to the week on Wall Street.

On Thursday night, Treasury Secretary Hank Paulson and Fed Chairman Ben Bernanke went up to House Speaker Nancy Pelosi's office to meet with a select bipartisan group of congressional leaders and committee chairmen to explain the situation in the financial markets.

When the lawmakers came out of the meeting, they were ashen.

Secretary Paulson reportedly told them the United States financial system was days away from a complete collapse. He explained that the credit markets had dried up and were about to strangle the economy. He painted a picture of Americans losing their jobs, their retirement savings, and their homes. He explained the domino effect that the collapse would have around the globe.

"This is a very serious moment, very serious. It was a very sober gathering," Senate Banking Committee Chairman Chris Dodd said after the meeting. "I’ve been in the Senate for 28 years, Congress 34, there has never been a moment as serious as this one."

More serious than the 9/11 attacks, when lawmakers in the Capitol literally ran for their lives?

Secretary Paulson must have told them the markets were about to crash and plunge the country into a second Great Depression, just six weeks before voters go to the polls and decide whether to re-elect their congressman.

Here's some financial advice for you: Never play poker with Henry Paulson.

Secretary Paulson successfully silenced talk of hearings, amendments and deal-brokering that would delay new legislation needed to bail out the mortgage market. Treasury and the Fed apparently have exhausted the remedies available to them under current law. They took over Fannie Mae and Freddie Mac, forced a fire sale of Merrill Lynch and virtually nationalized AIG insurance, all to prevent the meltdown that is still imminent, or so the Treasury secretary persuaded the lawmakers.

Now the taxpayers are on the hook for as much as a trillion dollars, or who knows, maybe more.

Could anything have prevented this train wreck?

Funny you should ask.

In 1933, four years after the stock market crash that marked the start of the Great Depression, Congress passed a piece of legislation called the Glass-Steagall Act. The new law separated investment banking (issuing and selling stocks and bonds) from commercial banking (holding deposits and making loans).

Forbes Digital's Investopedia explains the reasons for the Glass-Steagall Act as follows:

Commercial banks were accused of being too speculative in the pre-Depression era, not only because they were investing their assets but also because they were buying new issues for resale to the public. Thus, banks became greedy, taking on huge risks in the hope of even bigger rewards. Banking itself became sloppy and objectives became blurred. Unsound loans were issued to companies in which the bank had invested, and clients would be encouraged to invest in those same stocks.

To prevent that kind of thing from happening again, the Glass-Steagall Act set up "a regulatory firewall" between commercial and investment bank activities and put curbs and controls on both. Banks were forced to choose whether they would become commercial or investment banks. The idea was to prevent losses in the investment banking business from bleeding the commercial banks, drying up the credit markets, and strangling the economy.

A similar firewall was built in 1956 by the Bank Holding Company Act. It separated insurance underwriting from banking. The idea was to prevent losses in the insurance business from bleeding the commercial banks, drying up the credit markets, and strangling the economy.

What a stale, old-fashioned, retro, backward, unenlightened, bureaucratic idea!

Who needs firewalls!

Do you realize how much more efficient it is to merge investment banks, commercial banks and insurance underwriters? Why, you can probably fire half the employees at each company! They're redundant!

Millions of dollars in campaign contributions rained down on Washington, and in 1999, Congress passed and the president signed the Gramm-Leach-Bliley Act, repealing Glass-Steagall and all those other stuffy bureaucratic regulations that modern people are too smart to need.

It only took nine years for the financial system to go from dull and safe to thrilling and catastrophic.

A lot of people did very well on the way to the precipice. Many collected multi-million-dollar bonuses for printing up exotic new financial instruments on the letterheads of companies that still had a fine reputation for safety, built during decades of stale, old-fashioned, retro, backward, unenlightened, bureaucratic regulation.

One of the people who did very well for himself is former senator Phil Gramm, who left the Senate in 2002 and accepted a lucrative job as vice chairman of UBS Warburg investment bank. Thanks to the legislation that bears Gramm's name, UBS was able to buy the Paine Webber brokerage firm for $12 billion in 2000.

Senator Gramm told the New York Times he believes he was hired for his "expertise and abilities, not as a reward for his work in Congress."

That's nice. Everybody should believe in something.



Copyright 2008

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The Do-Over

Something strange is going on.

Republican vice presidential candidate Governor Sarah Palin is canceling fundraisers.

Gov. Palin had been scheduled to appear at two fundraisers and a rally in California next Thursday and Friday. "The change of plans came as a shock to party insiders," the San Francisco Chronicle reports today. Local GOP officials were busy distributing 15,000 tickets for her rally in Orange County on Friday.

The fundraisers were set to raise millions for the Republican National Committee and the state party. Demand for the $1,000-a-head tickets was so strong that both events had been moved to larger venues -- the Southern California fundraiser from the Lincoln Club to the Orange County Performing Arts Center, and the Northern California event from a private home to the Santa Clara Convention Center.

The fundraisers have been postponed until after the vice presidential debate on October 2.

Governor Palin has also canceled a fundraiser scheduled for Thursday in Virginia, and the campaign says Cindy McCain will replace Palin at two fundraisers on Wednesday in Washington state and Wyoming.

Something's wrong.

Either John McCain is panicked that he can't draw an enthusiastic crowd by himself, or Sarah Palin needs much more studying-and-cramming time than the campaign wants to admit, or somebody found something in Alaska that's about to knock her off the ticket.

On Thursday, Todd Palin said he will refuse to cooperate with a subpoena for his testimony in the so-called Troopergate investigation, even though the Palins had earlier promised to cooperate fully because, they said, they had done nothing wrong and had nothing to hide.

Meanwhile, the Associated Press reported Thursday that officials in the Alaska state government are refusing to answer reporters' questions and referring them to McCain campaign aides instead. "The McCain campaign is demanding that it becomes the de facto source for answers about the operations of Alaska's government during the past 20 months," Anne Sutton reported from Juneau.

Hmmmm.

Tim Pawlenty and Mitt Romney should keep their cell phones on.


Copyright 2008

Editor's note: You might be interested in the earlier post, "The case of the governor's husband."

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The body language of Condoleezza Rice

Reuters and the Associated Press published some photos of Secretary of State Condoleezza Rice and Vice President Dick Cheney at Monday's welcoming ceremony for the president of Ghana on the South Lawn of the White House.

Now we have a question for you.

Are these people speaking to each other?



Maybe that picture gives an erroneous impression. After all, a photograph just captures one instant in time. Here are two more from the event:




We would have to guess that these people are not speaking to each other.

You can almost hear the book deals thundering down Pennsylvania Avenue.


Copyright 2008

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Tabloid update: "Sarah Palin--What She's Hiding"

Yes, the National Enquirer pays for stories, and maybe people tell them stories that are more sensational than true, and maybe America Wants To Know threw out three dollars and forty-nine cents last night at the supermarket when we bought the Enquirer with the cover story headlined "Sarah Palin: What She's Hiding," but we just couldn't stop ourselves.

We bought the Globe, too, to read the "McCain's Wife HATES Sarah Palin!" story and also "Exposed! Secret Obama Diaries."

So if you don't do your own grocery shopping, you've come to the right place.

The family portrait from Alaska is looking more and more like one of those Disneyland Haunted House pictures that turns from sedate to scary while you're looking at it.

According to the Enquirer, Sarah Palin's 17-year-old daughter Bristol "scandalized her small town as a dope-smoking underage drinker and party girl." The tabloid says Governor Palin "banished" her from the family home after learning that she was pregnant.

Meanwhile, Governor Palin's 19-year-old son Track "became an OxyContin addict involved with vandalism and theft" during 2006 and 2007 after being "really into marijuana" in 2004 and 2005.

The tabloid says Governor Palin is also trying to hide an affair she had ten years ago with her husband's business partner. The affair "came close to ruining her marriage," a "family insider" revealed.

In other news, the 18-year-old boyfriend of Governor Palin's pregnant daughter is reported to be "a pot-smoking boozer who doesn't want to get married." Levi Johnston is "privately complaining about his new life," the Enquirer says. "It was like Levi got dragged out of his house to go to Minnesota," a friend told the tabloid, referring to the father-to-be's sudden trip to the GOP convention. The tabloid says the friend described Levi's relationship with Bristol Palin as "up-and-down." (Yes, they really printed that.)

Levi's friend told the Enquirer, "Bristol fell hard for Levi, but he was more into partying with his friends." You know how it goes. "He and Bristol had a lot of problems and broke up a few times," the friend said, "and they both definitely messed around with other people when they were broken up."

All right, that's enough of Dobie Gillis Gone Wild.

Let's go over to the Globe, where we learn that Cindy McCain can't stand Sarah Palin, whom she calls "that trailer-trash redneck, Nanook of the North."

The Globe says Cindy has "told close friends she thinks Sarah is ruthless and will do anything, absolutely anything to get ahead."

Mrs. McCain is also reported to be unhappy about an embarrassing video of her 72-year-old husband "appearing to check out his sexy running mate's butt several times after announcing her as his pick for veep."

The tabloid says the video has been viewed on YouTube a quarter of a million times, but that's not true. It's been viewed more than 513,000 times.

And then Laura Bush makes a cameo appearance in the story, as "jealous Cindy" frets that John, "who is known as a womanizer," may be "tempted to stray with Sarah" just as President Bush developed an "attraction" to Secretary of State Condoleezza Rice. Laura Bush met Cindy McCain and Sarah Palin for an "ultra-private briefing" during the Republican convention, the Globe reports, and "felt the chill" between them.

"Laura came away in despair," the Globe says, quoting a "longtime Bush family friend," because her attempt to "play peacemaker" between the two women was unsuccessful.

"Cindy hates Sarah and everything she represents," a "Washington source" told the tabloid, predicting that if John McCain is elected, "America is in for one hell of a cat fight."

Over on the Democratic side, the "Obama Diary Scandal" story turns out to be about a diary kept by Obama's mother, Ann Dunham.

"The entries are shocking, scandalous, heart-wrenching and poignant" the Globe says. The tabloid quotes "an insider" who says the diaries contain "bombshell information" that "could destroy Obama's historic bid for the presidency."

Actually, there's nothing in the story about Barack Obama that hasn't been reported everywhere before. The big "bombshell" is that "the diaries are said to go into far greater detail about his Muslim background."

The Globe doesn't have any of the "greater detail."

Obama's "Muslim background" is that his father was born a Muslim, his mother's second husband was a Muslim, and he spent a few of his early grade-school years at a Muslim school in Jakarta before his mother sent him home to Hawaii to be raised by his (Caucasian, and not Muslim) grandparents.

The rest of the story is the sad tale of Ann Dunham's regrets about abandoning her son, her sad confrontation with him when he was using drugs in high school, her sad marriages and divorces, and her sad final battle with cancer.

It's enough to make you change the channel back to Dobie Gillis Gone Wild.

Did you know Sarah Palin's first child was born eight months after her wedding?


Copyright 2008

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The fabulous, fictional Chevrolet Volt

General Motors Chairman and CEO Rick Wagoner and vice chairman of product development Bob Lutz unveiled the rechargeable electric Chevrolet Volt in Detroit on Tuesday. The executives proudly described the Volt as the car that will lead GM into its second century.


GM Chairman and CEO Rick Wagoner unveils the Chevrolet Volt at GM's centennial celebration Tuesday.

They showed off the Volt's liquid-crystal instrument display and touch-screen controls for climate, information and entertainment.

They said the car has a top speed of 100 mph and the most aerodynamic design in GM history.

They said the car is due in showrooms in November, 2010.

There's just one thing.

They're still working on the battery.

"Lithium-ion batteries, which are still under development, are expected to propel the car up to 40 miles on a single charge from a home outlet," the Associated Press reported.

"If GM and its partners can develop lithium-ion batteries that are durable, powerful and safe enough for automotive use, the car will go into production at Detroit-Hamtramck in November 2010," the Detroit Free Press said.

"Company executives faced a barrage of questions about whether some of the $25 billion in low-interest loans the industry is urging Congress to fund would be used to subsidize the Volt's development and production," the Los Angeles Times noted.

Did they mention it's Bluetooth-capable?


Detroit Free Press photographer Susan Tusa tries to help out by illustrating that the Volt can always roll downhill. That's vice chairman of product development Bob Lutz getting out of the car.

Rick Wagoner and Bob Lutz are very smart guys and they are not making a mistake. But they're not making a car, either. They're making a bet that Congress will help General Motors financially if GM gives elected officials a little bit of political cover.

The car ought to be called the Vote.

You have to feel for GM's executives. The company is saddled with enormous health insurance and retirement benefit costs for its past and present workforce, locked into expensive union contracts, and strangled by idiotic government regulations, including fuel-economy standards that for years forced the production of low-selling cars for no reason other than to offset the lower fuel economy of popular models.

Then the price of oil shot up and GM was like an aircraft carrier trying to turn around in a storm drain.

Still, the battery-powered car has a few problems that you ought to know about before your hard-earned tax dollars fly off to Detroit to pay for somebody else's health insurance.

"The battery for the Volt doesn’t yet exist, at least not at a mass-market price, and building it poses formidable challenges," Jonathan Rauch reported in the July/August 2008 issue of the Atlantic Monthly. "Loading enough energy into a sufficiently small, lightweight package is hard (the battery isn’t much good unless it fits in the car); keeping it cool lest it burst into flames is harder; making it durable enough to last 10 years on bumpy roads is harder yet; manufacturing it in high volumes and at mass-market prices may be hardest of all."

"Lest it burst into flames?!"

And we thought the Corvette was an exciting car.


Copyright 2008

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Wall Street's wild weekend

If you've never tried hanging by your ankles from a chandelier during an earthquake, turn on the financial news today and experience the fun for yourself.

It appears that Lehman Brothers and Merrill Lynch are about to go extinct after Sunday's day-long meeting of government and financial titans at the New York Federal Reserve failed to get them the protection of the Endangered Species Act.

Tens of thousands of people are going to lose their jobs, and maybe their houses, which won't do anything to help the sliding real estate market that appears to have triggered all the trouble to begin with.

And it was such a nice habitat, too.

America Wants To Know has been struggling to understand how the real estate market, which historically has always had its ups and downs, could be chewing up and dragging to their deaths investment banking firms that pre-date the Great Depression.

As near as we can tell, the problem stems from a lack of information.

Mortgage debt has been put together and sliced apart and sold as if it were a corporate bond. Then the buyers and sellers of the bond-like instrument bought and sold something called a credit default swap, or CDS, which amounts to a kind of insurance against default or similar loss in value.

Now, because no one seems to know which mortgages are spliced into which financial instruments, and everybody is on the hook for payments to everybody else in cases of default, the interconnectedness of all things has Wall Street spinning like an unhinged carnival ride. On Sunday the situation was dire enough to draw the Treasury Secretary and the New York Federal Reserve president away from the NFL games to bang heads, or more likely plead on their knees, to get the top executives of the biggest banks in the United States to take action to prevent a market meltdown.

The thing is, this all appears to be based on uncertainty, not hard numbers.

It seems that no one actually knows which mortgages are underwater, or how many of them are underwater, or how far underwater they are.

How many people do you know personally who are in default on their mortgage, unable to make their payments and unable to sell their house for what they owe on it?

A lot?

A few?

Almost everybody you know? Or hardly anybody you know?

America Wants To Know suspects that Wall Street was too enthusiastic on the way up and now is too hysterical on the way down.

We're buying. Carefully, of course. We follow the advice of the Granville Guys and dollar-cost average into no-load mutual funds. We don't buy individual stocks from Wall Street brokers. Those people are crazy. You could lose your house taking their advice.


Copyright 2008

Editor's note: You might be interested in the earlier post, "Bush to Little Red Hen: 'Pay up.'"

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The case of the governor's husband

Sherlock Holmes came into the America Wants to Know offices this morning with a newspaper in one hand and a magnifying glass in the other.

"Have you seen the New York Times this morning?" he asked, his eyes sparkling.

"No."

Holmes sat down in a leather armchair and stretched his legs out in front of him. "Most interesting," he said. He folded back a page of the newspaper. "Young Mrs. Palin, a most handsome woman, is married to a man who races... snow machines."

"Yes," we said, "What about it?"

"What do you suppose he knows about state budgets?"

"State budgets?" we asked. "Why would he know anything about state budgets?"

"Precisely," Holmes said. He leaned forward and held the magnifying glass over the newspaper. "When Ms. Palin had to cut her first state budget," he read out loud in his clear, clipped manner, "she avoided the legion of frustrated legislators and mayors. Instead, she huddled with her budget director and her husband, Todd, an oil field worker who is not a state employee, and vetoed millions of dollars of legislative projects."

Holmes leaned back in the chair again and smiled.

We waited. We love to watch him think.



"Has Mrs. Palin released her family's financial records yet?" he asked.

"No, not yet."

"Most interesting."

He sat in silence for a moment. Then he stood and paced. "I expect that she will not release more than a summary of her financial records," he said. "You can see, of course, that there can be only one possible explanation for her husband to be consulted on millions of dollars in state spending."

We didn't see anything.

"Graft," he said. "The governor's husband is a conduit for payments to the governor in order to influence her decisions."

"Oh, that can't be," we said. "In this day and age? Too many people would know about it, this isn't Tammany Hall, for goodness sake."

"Isn't it?" Holmes asked. "How many Alaska lawmakers have been indicted? Several state politicians are already in prison, if I'm not mistaken, and U.S. Senator Ted Stevens is about to go on trial."

"That's completely separate," we said. "Sarah Palin cleaned up the corruption, she's not part of the corruption."

Holmes smiled as if he was trying not to.

"I can't stay," he said. "When Mrs. Palin releases her financial records, look closely for business deals that enriched Mr. Todd Palin beyond what a prudent investor might reasonably expect. Look for extraordinary luck and very fortuitous timing. Then look closely at his business associates and the business they had with the state government of Alaska." He laid the magnifying glass on the desk. "I think you'll find that Mr. Todd Palin had a very good reason to be in those budget meetings," he said. "You simply can't run a patronage system properly unless someone keeps track of the patrons."


Copyright 2008

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Obama's slump

Baseball players who get into a hitting slump have been known to try some odd things to get back on track. New York Yankees slugger Jason Giambi said he wears a gold lamé, tiger-stripe thong under his uniform.

"I only put it on when I'm desperate to get out of a big slump" he told a sportswriter.

A less superstitious way to get out of a slump is to look at video of yourself when you were hitting and see if you might have started doing something that has thrown off your swing.

America Wants To Know has noticed that Barack Obama's swing is different since he defeated Hillary Clinton for the Democratic nomination.

No doubt the candidate and his campaign managers have good, poll-tested reasons for the shift in Senator Obama's rhetoric.

But just in case anybody's interested in reviewing old tapes of Senator Obama's swing, we'd like to direct your attention to this America Wants To Know post from last February, "The Romantic appeal of Barack Obama."


Copyright 2008

Editor's note: You might be interested in the 2007 post, "Michelle Obama is good."

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Broken links to the Argus Hamilton column and tidbits puzzles

Can't find the Argus Hamilton column or tidbits puzzles with your bookmarks?

If you're having trouble reaching the ArgusHamilton.com and tidbitspuzzles.com pages, substitute ExtremeInk.com for those domain names and everything will be there.

Our web hosting company upgraded our site. You know how that goes.

We're trying to get the problem fixed, but in the meantime, these links should work:

http://www.ExtremeInk.com/argus.htm

http://www.ExtremeInk.com/tidbits/tidframe.htm

These pages can be bookmarked. Nothing has been moved, it's just some technical problem with the alternate domain names.

The sacrifice of Charlie Rangel

When you're powerful, people give you things.

America Wants to Know once worked for a man who had more money than a human being could spend in five lifetimes, yet he made his employees go to great lengths to get free merchandise from the companies with which his company did business. What, we thought, is the point of having all the money you could ever need if you're going to spend your time thinking about how not to spend money?

But it wasn't about the money. It was about the power.

Free stuff is a sign that people fear you and seek your favor.

House Ways and Means Chairman Charlie Rangel, Democrat of New York, is in a lot of trouble. He bought a vacation rental property in the Dominican Republic and the company that sold it to him didn't charge him interest on the mortgage.

He said he didn't know that, and maybe that would have been the end of the story.

But on Tuesday, Congressman Rangel's lawyer, Lanny Davis, admitted to reporters that Mr. Rangel never declared the rental income he earned from the property on his tax returns or his Congressional financial disclosure forms.

It was only $75,000 over five years, and the amount of money he owes in back taxes, when the accountants finish calculating it, will sound very trivial.

But it's not about the money.

It's about the power. It's about the abuse of power.

It's about the arrogant, clueless, self-righteous sense of entitlement that elected officials develop when they're in office too long. They begin to believe their boilerplate campaign rhetoric that they are serving the public good at great personal sacrifice.

Let's get something straight.

High public office is not a sacrifice.

It's not a sacrifice to go to work through the VIP entrance of a marble building while underlings clear the riff-raff out of your way.

It's not a sacrifice to hold the kind of position that gets your calls returned immediately, if those calls didn't get straight through in the first place.

It's not a sacrifice to be paid more than a hundred thousand dollars a year plus health insurance and a generous pension for flying back and forth to Washington to spend other people's money.

America Wants to Know is tired of hearing politicians speak of the sacrifices of public service, while they fly around the world on military jets and private corporate aircraft and then run for higher office because they also want trumpets to play when they enter the room.

Congressman Charles Rangel is the chairman of the House Ways and Means Committee, the fearsome tax-writing panel that has unrivaled power over who pays taxes and for what.

But he didn't declare all of his income and pay all the taxes that his laws required.

His laws are for other people.

If you want a reduction in your taxes, rest assured, Charlie Rangel comes to work every day vowing to make sure you don't get it. He thinks you're rich and selfish if you think your taxes are too high.

Rep. Charles Rangel should resign from the chairmanship of the House Ways and Means Committee.

Today.

And Democrats should push him if he won't jump.

That's because somebody's been dumping this stuff on Charlie Rangel into the press since mid-summer. Somebody's out to get him.

First it was the July 12 story in the New York Times that Rangel has four rent-controlled apartments in the Lenox Terrace complex in Harlem, courtesy of a major real estate developer. The congressman lives in three adjacent apartments and was using the fourth as a campaign office.

Then it was the story of his interest-free mortgage on the vacation property in the Dominican Republic.

And now it's the undeclared rental income.

The Republicans have a motive to destroy Charlie Rangel. If they can point to a corrupt Democratic leader every time a Republican is indicted in the Jack Abramoff investigation (more indictments were announced Monday), it will make their interviews on the cable news talk shows a lot easier this fall.

But regardless of who is digging up and dumping this dirt on Congressman Rangel, he must step down from the chairmanship of the Ways and Means Committee. Then, as a warning to future chairmen and tax-writers, these words should be carved into the moldings along the ceiling of the hearing room:

Sauce for the goose....


Copyright 2008

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Explaining the Seinfeld-Gates Microsoft ad

Critics are slamming the new Microsoft ad starring Jerry Seinfeld and Bill Gates, which premiered Thursday night on the National Football League's season opener.

It's "an ad about nothing," the trade publication Advertising Age said, calling the spot a "classic Crispin Porter oddity." (Crispin Porter and Bogusky is the advertising agency responsible for the ad.)

Here at America Wants to Know, we keep a collection of psychics, mediums, fortune-tellers, detectives and dowsers (to investigate Washington leaks) on the payroll for occasions just such as this. Today we convened a staff meeting.

"Will you all please look at this Microsoft commercial," we said to the group, "and explain it."

The staff huddled around the small table where Madame Lyubitshka's crystal ball rested on an old tea cup from Romania. The Gypsy woman passed her hand over the glass and the Microsoft ad came gradually into focus.


Click the arrow to watch the video on this page.


Click the picture to watch the video in a new window.

"I have to say, I'm stumped," Lieutenant Columbo said when the commercial ended.

The dowsers also came up dry.

"I saw there is cake in the kitchen," the psychic said, leaving the room.

That left the medium, Gloria Farthaway, alone at the table with Madame Lyubitshka.

"Any ideas?" the Gypsy woman asked.

"I think we should bring in an expert," Gloria said. "Does that ball get TV Land?"

Madame Lyubitshka passed her hand over the crystal fifty-four times, and a rerun of Sanford & Son appeared in the glass.

"I've seen this one, it's funny," she said.

Gloria Farthaway pulled up a chair and placed the tips of her fingers against the porcelain tea cup that held the crystal ball. "Redd Foxx!" she called out in a high, quavering voice. "Redd Foxx! We call upon your spirit! We are in need of your guidance!"

A thunderous boom of laughter filled the room. Columbo jumped. The psychic came back from the kitchen.

"What was that?" one of the dowsers asked. "Is somebody leaking?"

"No, I'm not leaking," Redd Foxx yelled out, "I had a heart attack!"

Gloria Farthaway elbowed Madame Lyubitshka out of the way and leaned in over the crystal ball. "Redd Foxx!" she called out. "Is it really you?"

The comedian turned away from the Sanford & Son set and pressed his face up against the crystal. "Let me give you a good long look at my pretty face," he said. "Nice knockers."

Gloria Farthaway leaned back again. "Mr. Foxx," she said, "we seek your comedy guidance. The great comedian Jerry Seinfeld is appearing in a commercial with the great Microsoft founder Bill Gates, and we are unworthy of them."

"Who?" Redd Foxx asked. "What?"

"We will show you," the medium said. She gestured to Madame Lyubitshka, who waved a finger over the glass and brought up the Microsoft commercial again.

Ninety seconds later, the room was silent.

"What's the problem, you don't get dick jokes?" Redd Foxx asked.

The psychic gasped.

"Mr. Foxx, please!" the medium said. "Your language!"

"What's wrong with my language?"

"Would you mind cleaning it up?"

"I did clean it up. I would have said..."

"Okay, okay, that's fine!" Gloria interrupted. "Thank you! It's fine! Please go on."

"It's a dick joke," the late comedian explained. "The big feet, the tight fit. Everybody holding up those nine-inch churros. They're saying the guy in the shoes has a big dick."

"That's it!" Lieutenant Columbo said, striding over to the table. "Mr. Foxx, sir, first may I say what a privilege it is, my wife just loves Sanford & Son, she..."

"Hey, Peter!"

The psychic gasped again.

"No, no, that's his name," the medium whispered to her.

"What are you doing here, Peter?" Redd Foxx asked.

"Well, you know how it is," the actor replied. "Everybody's gotta work."

"I know how it is," the comic agreed.

"The mystery," Columbo resumed, "is what exactly Microsoft is trying to say with this commercial."

"They're trying to say they've got the biggest dick," Redd Foxx said impatiently. "How many times do I gotta tell you?"

Columbo puffed on his cigar. "You're right," he said. "Microsoft owns ninety percent of the operating system market. That's what they're trying to say. They're letting everybody know that Apple may get the good press, but Microsoft is still the biggest."

"Now I have a question for you," Redd Foxx said. "If that's what they wanted to say, why the f*** did they name the company Microsoft?"


Copyright 2008

Editor's note: Enjoying this writer? Pick up her novel, The 37th Amendment.

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They're here! The Sarah Palin jokes from Argus Hamilton

Comedian and columnist Argus Hamilton came into the office today carrying a stack of newspapers, and he was smiling.

"Every day," he said, "I love her more."

Of course he was talking about GOP vice presidential nominee Sarah Palin, the gift that keeps on giving.

Argus has decided to maintain an ongoing online collection of the Sarah Palin jokes from his syndicated daily column. Sarah Palin joins Eliot Spitzer and the California recall election on the very exclusive list of those who have been so honored.

Bookmark http://www.ArgusHamilton.com/palin.htm for the Sarah Palin jokes, or visit http://www.ArgusHamilton.com/argus.htm for the entire daily column.

Demands for apologies and requests for personal appearances and interviews should be directed to Argus@ArgusHamilton.com.


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Hockey mom sticks it to McCain

The National Enquirer is reporting on its web site that Governor Sarah Palin quietly tried to get her 17-year-old daughter married and planned to announce the pregnancy after the wedding, but her daughter refused to go along with the plan.

Now it all makes sense.

Over the weekend, McCain aides insisted to reporters the senator was told about Bristol Palin's pregnancy before he selected Governor Palin as his running mate.

They didn't say what else he may have been told.

He may have been told that Bristol was going to marry her high-school Romeo right after the Republican convention and then Governor Palin would happily introduce the happy couple and announce the happy news of the pregnancy.

The National Enquirer says that was Sarah Palin's plan, but at some point Bristol said she wanted no part of it, sparking "a mother-daughter showdown over the failed coverup."

Politicians who seek high office typically open their campaigns with a warm story of the evening they sat down with the family to discuss whether they should run or not, because the decision affects every member of the family.

Sarah Palin didn't tell that story.

Instead, MSNBC reported today, her kids were told last weekend that they were all flying to Dayton for a celebration of their parents' wedding anniversary.

The Palin family is full of surprises.

If John Edwards had waited one more month to visit his mistress and love child, the Enquirer wouldn't have had a car available to chase him.


Copyright 2008

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