Most notably Sallie Mae, which has a history of cheating students, bribing college financial aid officers, and contributing generously Congressional campaigns.
As Matthew Yglesias notes, the college lending giant’s “compromise”, would waste $17 billion a year as compared to direct loans.
Luckily, Obama can eliminate much of the fraud, waste, and abuse, by which I mean much of the private players in the student loan market, through executive orders, as well he should.
So it’s now the law of the land in Vermont. Great news!!!!!
Hopefully, Vermonters will deal with Governor Jim Douglas at reelection time.
It looks to me like the Patent Reform Act of 2009, is an improvement, the patent troll crowd are generally negative on it, and Senator Feingold’s statement in opposition suggests that it weakens patents too much, which is a good thing.
The real question is what happens in conference.
In my dream scenario, the patenting of software algorithms, tax deductions, business plans, genes, and species would be invalidated, and a litigant could file a suit against a patent as a plaintiff without having to infringe, as is done with civil rights suits.
My guess is that vociferous international condemnation of the new Shia Sharia law, which, amongst other provisions, legalized marital rape, triggered a delay from the Afghan justice department
You know, for some time, it seems that any time someone complains that Obama’s economic team is too close to the banks, the answer is that we are seeing some sort of chess game, and it’s just that the White House is 3 steps ahead of everyone else.
I don’t buy it. I think that Larry Summers just jumped the shark into accepting bribes, as this Wall Street Journal analysis of his 2008 disclosure forms shows.
Among other things, he got $5.2 million from hedge fund D.E. Shaw for his thoroughly part time (he was a full time professor at Harvard) position, and he got $2.7 million for speaking, with his fees ranging from, “$10,000 for a Yale University speech to $135,000 for an appearance paid for by Goldman Sachs & Co.”
So we know that the market rate for his speeches is about $10K, but Wall Street investment firms were paying more than 10 times that in a year in which the Democrats were favored, and he was likely to be on the team of either Democratic nominee.
A Tiny Revolution went through his disclosure form (PDF) and came up with the following, with Merrill-Lynch being a week after the election, and Charles River Ventures being the day before:
It should be noted that the Hudson institute is a very right wing “think” tank which has consistently been dogged by accusations of racism and Islamophobia, and it’s at the same “market rate” as Yale.
I can’t see this as anything but bribe taking, with the various financial institutions paying forward to get favorable treatment.
What sort of treatment were the looking for? Well, there was probably not a specific request, a quid pro quo, if you will, but something like the White House coming up with phony entities to act as intermediaries in order to skirt Congressional limitations on executive compensation:
The Obama administration is engineering its new bailout initiatives in a way that it believes will allow firms benefiting from the programs to avoid restrictions imposed by Congress, including limits on lavish executive pay, according to government officials.
Administration officials have concluded that this approach is vital for persuading firms to participate in programs funded by the $700 billion financial rescue package.
You know, the threat of being frog marched out of their workplace in handcuffs would work better.
The administration believes it can sidestep the rules because, in many cases, it has decided not to provide federal aid directly to financial companies, the sources said. Instead, the government has set up special entities that act as middlemen, channeling the bailout funds to the firms and, via this two-step process, stripping away the requirement that the restrictions be imposed, according to officials.
Although some experts are questioning the legality of this strategy, the officials said it gives them latitude to determine whether firms should be subject to the congressional restrictions, which would require recipients to turn over ownership stakes to the government, as well as curb executive pay.
The administration has decided that the conditions should not apply in at least three of the five initiatives funded by the rescue package.
…
Enough is enough.
This is more than being too close to the financial sector, this is corruption, and it pervades Obama’s economic team.
Larry Summers, and possibly Timothy Geithner, need to spend more time with their families.
The Iowa Supreme Court rules gay marriage legal, and the Vermont house passed a same-sex marriage bill, though the governor is still talking about vetoing it, because it’s a distraction during the economic crisis.
Of course, the only way that it is a distraction is if he vetoes it, but he has to win a Republican primary with lots of bigots voting.
The idea that Vermont, which is highly dependent on tourism, would eschew this, which would give a boost to that industry, is, of course, nuts, but the Governor Jim Douglas is a ‘Phant, after all.
The down side to this is that we are going to be spending a lot more on wedding gifts.
But seriously, it stuns me how quickly the forces of reason and hope are beating back the voices of fear and bigotry.
Compared to the black civil rights movement, this is light speed.
In response to the Federal Reserve impeding attempts to get information as to the institutions that they have aided, the Senate has inserted a provision in the budget that would, “require the Fed to identify each firm it has given assistance to, how much the assistance was worth, and what the firm is doing with the money..”
Unfortunately, it appears that it won’t make it to the President’s desk, at least not according to a, “senior Democratic Senate aide,” but it would be a good thing.
Jerrold Nadler (D-NY) and Jeff Flake (R-AZ) have introduced legislation to curb the widely abused National Security Letters (NSL) and significantly increases the standards, and the opportunity for judicial review.
It still allows FBI field supervisors to issue them, but it is still an improvement.
We now have Barney Frank calling for laws giving resolution authority for systemically important firms, which means FDIC style receivership powers to, “take over and unwind the businesses of big non-bank companies”, which could apply to bank holding companies like Citi and BoA, as well as their banks, and Peter Boone and Simon Johnson (the former chief IMF economist who is calling for kicking the corrupt banking elites out) are suggesting that are suggesting that this is exactly what Geithner’s plan is.
Honestly, I do not think that the White House is sandbagging the Congress and the public over this.
As I have said before, past is prelude, and for Geithner and Summers to sign off on such a thing would run completely counter to their entire professional lives.
I hope that I am wrong, but I fear that I am not.
It looks like one Republican may actually vote for Obama’s budget.
Of course, it’s Rep. Joseph Cao (R-La.), who beat William “Dollar Bill” Jefferson in the general election after he was indicted for corruption.
Of course, the district that elected him went 74% for Barack Obama, and he is probably still hearing complaints about allow Eric Cantor to twist his arm into voting against the stimulus.
Reid is now saying that he might drop cram down provisions from the housing bill if it threatens passage of the whole package.
Basically, this means that he is going to kill it, because everyone who wants it gone now knows that they can get it dropped by whining.
Seeing as how this was the law until about 1993, the effect on interest rates are minimal, and it’s the only way to renegotiate a mortgage that has been sliced and diced until it has hundreds of owners, cramdown is the single best thing that can be done to help with the current financial meltdown.
Governor Paterson had been opposed to such taxes, suggesting that it would lead the wealthy to leave the state, but has not capitulated to progressives in the state, who were opposed to the draconian cuts in services that a “no-tax” solution would have required.
Even with this increase, 8.97% from 6.85% for income over $½ million, the top tax rate in New Jersey, is higher, and in any case, if people want to leave New York because it’s too expensive, they already have.
Nice to know that the political forces in New York State who work for the other 99% of the population can actually get meaningful change….for 3 years at least, as the tax is temporary….for now.
AIG director named to Obama tax task force.
For all I know, Martin Feldstein, who has been on the AIG board is a good person, certainly, I have come across generally favorable reviews of his works.
That being said, the atmospherics here are unbelievably stupid.
My Head Hurts.
HR 875 is a fairly innocuous bill, trying to make sure that food, both domestic and imported, is safer, but a campaign by the National Independent Consumers and Farmers Association (NIFCA), which opposes any regulation of food, and a couple of right wing conspiracy theorists, and suddenly the bill is an attempt by Monsanto to shut down every farmers market in the nation.
Well, it’s not. Go read the article for the full scoop.
They expect to see an annual savings of ¼ billion from not locking up people for years for a single joint.
It looks like we will see more of this as the downturn saps state budgets.
Hopefully, the idea of a government run option, one that can show similar efficiencies to Medicare or the VA, both of which consistently beat private insurance, will survive the conference committee.
I would offer the the caveat that one of the contributors to MSNBC’s “First Read” is Chuck Todd, who can be one of the stupidest muthf%$#ers in the White House press room,* but there is a report that the White House is “happy to have this debate out of the way” because, “sticking a finger in business’ eye wasn’t something the White House was looking forward to.”
This is about the most politically opportune time to do this, with the public attitude toward businesses being rather low, AIG is a symptom, not the trend.
I cannot for the life of me think of anyone in the White House who would even hold this opinion, except for economic adviser, and poster child for sex without partners, Lawrence Summers, who is on record saying that unions cause unemployment,† but even he isn’t stupid enough to mouth off to a reporter, or for that matter a co-worker, about this.
I’ll call bullsh%$ on this for now.
*Cases in point were his questions at the first two press conferences, would Obama veto something that doesn’t get any Republican votes in the interest of bipartisanship, and how Americans should sacrifice to address the financial meltdown (like millions of people out of work and losing their homes isn’t enough) because he does not understand the difference between a foreign war and a domestic economic downturn.
†Yeah, I know, with “Democrats” like him, who needs Republicans.
Case in point, Lincoln Chaffee, defeated for the Senate by Sheldon Whitehouse in 2006, and now Whitehouse is putting forward a bill to protect consumers from abusive credit card companies.
Among its provisions in his Consumer Credit Fairness Act:
Electing Democrats make a difference.
Kevin Drum just raised an interesting point about what Geithner has been doing so far
If, several weeks ago, you had charged a task force with figuring out how to successfully nationalize a big bank, what do you think they’d say you had to do? Three things, at least: (1) you have to figure out a widely acceptable way to value the toxic assets on bank balance sheets, (2) you have to set up a fair and consistent test for evaluating bank solvency based on those values, and (3) you need to make sure you have the legal authority to take over a huge, multinational financial conglomerate in an orderly way. Is it just a coincidence that these are precisely the things Tim Geithner has set in motion over the past month? I wonder.
It’s an interesting point, and just today, while testifying before Congress, Geithner called for the power to place large bank holding companies into government receivership, backed up by Ben Bernanke.
So Mr. Drum’s thought that recent activities of Geithner and Bernanke, and by extension President Obama being a ploy is a possibility, though but I’m inclined to agree with Yves Smith the proprietoress of Naked Capitalism, whose beat is economics, and who knows more about economics, and the major players the economic community, than either Drum or me, and she thinks that the Office of Thrift Supervision (OTS)already has the authority to place AIG in receivership, and already answers to him.
Additionally, she notes that his request for additional power does not include any request for a receivership protocol, and concludes that this request is actually an attempt to give him more power to shovel more taxpayer dollars to the financial industry.
I would also note that Geithner, and his mentor, Larry Summers, have a history that stretches back decades, and there is nothing in what they have done, or are doing now, which would indicate that they would be inclined to do this…ever!
So, while Kevin Drum has an interesting wheels within wheels theory, I am more inclined to go with Nobel Prize winning economist Joseph Stiglitz, and simply say that Geithner’s plan is robbing US taxpayers.
But that’s my gut, and my sense that past is prologue.
It looks like the financial meltdown, and the reduction in tax revenues for local and state authorities have lead to a reevaluation of incarceration policies, which have led the US to have the largest prison population of any society in history: (Gulag nation)
For nearly three decades, most U.S. states have dealt with lawbreakers in two ways: Lock more of them up for longer periods, and build more prisons to hold them. Now many governments, out of money and buried under mounting prison costs, are reversing many of those policies and practices.
Some states, like Colorado and Nevada, are closing prisons. Others, like Kansas and New Jersey, have replaced jail time with community programs or other sanctions for people who violate parole. Kentucky lawmakers passed a bill this month that enhances the credits some inmates can earn toward release.
Obviously, it’s depressing that it’s taken a fiscal crisis to interject some sanity on the entire issue of over imprisoning our population, but I’ll take what I can get.
Hopefully this can make a dent in the “prison-industrial complex.”