Associates

The McCain campaign is headed directly into the gutter. Their Vice President is acquainting audiences with William Ayers, and their latest ad basically implicates Obama in murdering the troops:



(By the way, air-raiding and bombing civilians IS why Afghanistan is going so poorly.)

Even Reverend Wright is starting to get mentioned.

McCain's campaign desperately wants to turn the page on the economy, as if everyone's pockets will be magically filled with money over the next 30 days. The country remains in a serious crisis, and McCain is out there talking about random people like William Ayers.

Now THAT'S disrespectful.

But if you want to go down this road, fine. We can discuss Phil Gramm, for instance:

Gramm was always Wall Street's man in the Senate. As chairman of the Senate Banking Committee during the Clinton administration, he consistently underfunded the Securities and Exchange Commission and kept it from stopping accounting firms from auditing corporations with which they had conflicts of interest. Gramm's piece de resistance came on Dec. 15, 2000, when he slipped into an omnibus spending bill a provision called the Commodity Futures Modernization Act (CFMA), which prohibited any governmental regulation of credit default swaps, those insurance policies covering losses on securities in the event they went belly up. As the housing bubble ballooned, the face value of those swaps rose to a tidy $62 trillion. And as the housing bubble burst, those swaps became a massive pile of worthless paper, because no government agency had required the banks to set aside money to back them up.

The CFMA also prohibited government regulation of the energy-trading market, which enabled Enron to nearly bankrupt the state of California before bankrupting itself.

The problem with this exercise, of course, is that Gramm's relationship to McCain is not comparable to the relationships that Ayers or Wright have with Obama. The idea that either Ayers or Wright would have any impact on the workings of an Obama administration is nonsensical. But Gramm and McCain do have an enduring political and economic alliance. McCain chaired Gramm's short-lived presidential campaign in 1996; Gramm is co-chair of McCain's current effort. McCain has not repudiated reports that Gramm is on the shortlist to become Treasury secretary if McCain is elected, even after Gramm labeled America "a nation of whiners."

And we can talk about Charles Keating.

The current economic crisis demands that we understand John McCain's attitudes about economic oversight and corporate influence in federal regulation. Nothing illustrates the danger of his approach more clearly than his central role in the savings and loan scandal of the late '80s and early '90s.

John McCain was accused of improperly aiding his political patron, Charles Keating, chairman of the Lincoln Savings and Loan Association. The bipartisan Senate Ethics Committee launched investigations and formally reprimanded Senator McCain for his role in the scandal -- the first such Senator to receive a major party nomination for president.

At the heart of the scandal was Keating's Lincoln Savings and Loan Association, which took advantage of deregulation in the 1980s to make risky investments with its depositors' money. McCain intervened on behalf of Charles Keating with federal regulators tasked with preventing banking fraud, and championed legislation to delay regulation of the savings and loan industry -- actions that allowed Keating to continue his fraud at an incredible cost to taxpayers.

When the savings and loan industry collapsed, Keating's failed company put taxpayers on the hook for $3.4 billion and more than 20,000 Americans lost their savings. John McCain was reprimanded by the bipartisan Senate Ethics Committee, but the ultimate cost of the crisis to American taxpayers reached more than $120 billion.

Unlike Ayers and Wright, Gramm and Keating have a DIRECT connection to the type of deregulation and free market fundamentalism that has led us to the current economic crisis. There is a through-line there that is undeniable, and you can easily see how McCain's Presidency would be guided by the same forces. Hell, Gramm could be the Treasury Secretary just given all those expansive powers.

You can see a long documentary on McCain and Keating at Keating Economics after noon ET today.

These are more serious times, but the Obama campaign can play the guilt by association game if that's where McCain wants to go.

Fundamentals

People are having fun with John McCain's economic adviser's absurd statement that McCain invented the Blackberry (that "serial liar" tag is going to stick any minute now, right?), but the Obama campaign is staying on message.

"If John McCain hadn't said that 'the fundamentals of our economy are strong' on the day of one of our nation's worst financial crises, the claim that he invented the BlackBerry would have been the most preposterous thing said all week," said Obama campaign spokesman Bill Burton.

The "fundamentals are strong" line, which is directly analogous to a line spoke by Herbert Hoover the day after the 1929 stock market crash, is really symbolic of what this election is about. Republicans have funneled cash to the moneyed class, removed oversight and regulatory restrictions, and turned Wall Street into a Wild West show. McCain was right there the entire time, and his economic guru Phil Gramm is as responsible as anyone for the mess we've gotten ourselves in. (Krugman had a great line yesterday: "Ben Bernanke and I think Hank Paulson understand that we could manage to have another Great Depression if we work at it hard enough. I think Phil Gramm might be just the guy to do it.") Failed Republican policies have brought us to the brink of financial collapse and Barack Obama knows it. He's released a strong new ad targeting the "fundamentals" line.



And his campaign events are doubling down on this attack and connecting McCain to the Republican establishment which has made a hash of things.

Yesterday, Wall Street suffered its worst losses since just after 9/11. We are in the most serious financial crisis in generations. Yet Senator McCain stood up yesterday and said that the fundamentals of the economy are strong.

A few hours later, his campaign sent him back out to clean up his remarks, and he tried to explain himself again this morning by saying that what he meant was that American workers are strong. But we know that Senator McCain meant what he said the first time, because he has said it over and over again throughout this campaign -- no fewer than 16 times, according to one independent count [...]

Make no mistake: my opponent is running for four more years of policies that will throw the economy further out of balance. His outrage at Wall Street would be more convincing if he wasn't offering them more tax cuts. His call for fiscal responsibility would be believable if he wasn't for more tax cuts for the wealthiest Americans, and more of a trillion dollar war in Iraq paid for with deficit spending and borrowing from foreign creditors like China. His newfound support for regulation bears no resemblance to his scornful attitude towards oversight and enforcement.

John McCain cannot be trusted to reestablish proper oversight of our financial markets for one simple reason: he has shown time and again that he does not believe in it.

Even his ads on other topics - like this one seeking to reassure hunters - goes right back to the economy and contrasts Obama's support for workers with McCain's.

The truth is that McCain can't get his story straight about deregulation. He's championed it for years, his economic advisers have championed it for years, and now he's trying to reinvent himself as some sort of populist. The New York Times noted the disconnect today.

On the campaign trail on Monday, Mr. McCain, the Republican presidential nominee, struck a populist tone. Speaking in Florida, he said that the economy’s underlying fundamentals remained strong but were being threatened “because of the greed by some based in Wall Street and we have got to fix it.”

But his record on the issue, and the views of those he has always cited as his most influential advisers, suggest that he has never departed in any major way from his party’s embrace of deregulation and relying more on market forces than on the government to exert discipline.

While Mr. McCain has cited the need for additional oversight when it comes to specific situations, like the mortgage problems behind the current shocks on Wall Street, he has consistently characterized himself as fundamentally a deregulator and he has no history prior to the presidential campaign of advocating steps to tighten standards on investment firms.

In fact, McCain called for more and less government regulation today in the space of an hour.

These are not the terms on which McCain wants to fight the election, but events have intervened. McCain has continued to stand with his party, deny the scope of the problem and hold to the conservative position of free-market nirvana (except when the corporations fail - then it's time to get in line at the Treasury Department soup kitchen for their handout). And now that the excrement has hit the fan, McCain is today proposing - no lie - a Beltway commission.

Republican presidential candidate John McCain on Tuesday called for a high-level commission to study the current economic crisis and claimed that a corrupt and excessive Wall Street had betrayed American workers. [...]

Appearing Tuesday on the three network morning shows, McCain said there was indeed a financial crisis and that to understand what had caused it, the nation would need a review on the order of the one led by the Sept. 11 commission. [...]

"I warned two years ago that this situation was deteriorating and unacceptable," McCain said on "Good Morning America" on ABC. "And the old-boy network and the corruption in Washington is directly involved and one of the causes of this financial crisis that we're in today. And I know how to fix it and I know how to get things done."

If there was ever a do-nothing solution to a problem, it's to convene a commission of insiders to write a paper that'll sit on a shelf unread. Obama mocked this today.

Just today, Senator McCain offered up the oldest Washington stunt in the book - you pass the buck to a commission to study the problem. But here's the thing - this isn't 9/11. We know how we got into this mess. What we need now is leadership that gets us out. I'll provide it, John McCain won't, and that's the choice for the American people in this election."

Cynics resist the idea that a Presidential election can be about issues anymore, but outside events have a way of making talk about lipstick and arugula look a bit dated. Obama's doing the right thing.

Conservatism's Wild Financial Ride

What a great day for McCain advisor Donald Luskin to tell us all that the economy is just fine and to quit our bitching! Expert timing!

In one of the most dramatic days in Wall Street’s history, Merrill Lynch agreed to sell itself on Sunday to Bank of America for roughly $50 billion to avert a deepening financial crisis, while another prominent securities firm, Lehman Brothers, filed for bankruptcy protection and hurtled toward liquidation after it failed to find a buyer.

The humbling moves, which reshape the landscape of American finance, mark the latest chapter in a tumultuous year in which once-proud financial institutions have been brought to their knees as a result of hundreds of billions of dollars in losses because of bad mortgage finance and real estate investments.

I think this has been summed up the best by a former finance minister in an NPR story this morning: "Even my 6 year-old daughter knows that you don't lend money to someone who can't pay you back."

In the end, that's what this is all about. Global investors needed a security to make them a yield, and the housing market was booming in the US, so financial institutions lent to anyone who walked in the door. They thought they could stay one step ahead of the inevitable crash, but in the end it was impossible. And because millions of people couldn't pay them back, they disintegrated.

What's different here is that Lehman was allowed to slip into bankruptcy. With Bear Stearns the government stepped in and created so much grease for the wheels of a sale that it was a bailout in function if not in name. This time, while the Fed is extending liquidity, there is no wholesale takeover or bailout in place. Enough was enough, and the American taxpayer couldn't be expected to bear yet another burden of shortsighted decision-making by the big banks. The feds had to end the moral hazard that would have resulted in bailouts for any financial services giant with a hangnail. (UPDATE: Krugman sez it's more of a bailout than it appears.)

However, anyone that thinks this represents touching bottom is crazy. AIG could go under, and a major insurer bugging out would be an even bigger hit to the economy. The big banks are all going to be on the hook for their poor decisions, sooner or later.

Here's Barack Obama's statement:

"This morning we woke up to some very serious and troubling news from Wall Street. The situation with Lehman Brothers and other financial institutions is the latest in a wave of crises that are generating enormous uncertainty about the future of our financial markets. This turmoil is a major threat to our economy and its ability to create good-paying jobs and help working Americans pay their bills, save for their future, and make their mortgage payments.

"The challenges facing our financial system today are more evidence that too many folks in Washington and on Wall Street weren’t minding the store. Eight years of policies that have shredded consumer protections, loosened oversight and regulation, and encouraged outsized bonuses to CEOs while ignoring middle-class Americans have brought us to the most serious financial crisis since the Great Depression.

"I certainly don’t fault Senator McCain for these problems, but I do fault the economic philosophy he subscribes to. It’s a philosophy we’ve had for the last eight years – one that says we should give more and more to those with the most and hope that prosperity trickles down to everyone else. It’s a philosophy that says even common-sense regulations are unnecessary and unwise, and one that says we should just stick our heads in the sand and ignore economic problems until they spiral into crises.

"Well now, instead of prosperity trickling down, the pain has trickled up – from the struggles of hardworking Americans on Main Street to the largest firms of Wall Street. This country can’t afford another four years of this failed philosophy. For years, I have consistently called for modernizing the rules of the road to suit a 21st century market – rules that would protect American investors and consumers. And I’ve called for policies that grow our economy and our middle-class together. That is the change I am calling for in this campaign, and that is the change I will bring as president," said Senator Barack Obama.

This is exactly right. It's a failure of deregulation - as sure as the Enron meltdown and the accounting scandals were failures of deregulation. Nobody was paying attention to the mass lending to those who couldn't pay it back. And it wouldn't hurt to add that deregulation's biggest champion is McCain economic adviser Phil Gramm. It's a fundamental tenet of conservatism that you allow the "free hand of the market" to reign supreme. Of course, when capitalists make bad decisions they go running to the feds for a handout like good little corporate Communists. But the end result is that other federal services gets stripped of funding. And government shrinks. And so this meltdown is a designed one.

And by the way, Obama has been saying this for at least a year and it was a key moment in his acceptance speech at the DNC. The problem is conservative theories that increase inequality and squeeze the middle class, choking off the potential for prosperity as a nation. This is also the result of an economy that consists of flipping burgers and pushing papers instead of creating and building. The green jobs program that Obama has supported fills the biggest economic hole we have, in the manufacturing sector.

McCain released a similar statement to Obama today, but he also decided it would be a good day to keep using his line that "the fundamentals of the economy are strong." It's completely unclear what he even means by that, but it wasn't lost on the Obama campaign:

“Today of all days, John McCain’s stubborn insistence that the ‘fundamentals of the economy are strong’ shows that he is disturbingly out of touch with what’s going in the lives of ordinary Americans. Even as his own ads try to convince him that the economy is in crisis, apparently his 26 years in Washington have left him incapable of understanding that the policies he supports have created an historic economic crisis,” said Obama campaign spokesman Bill Burton.

Joe Biden jumped on this as well today ("...friends, I could walk from here to Lansing, and I wouldn't run into a single person who thought our economy was doing well, unless I ran into John McCain."). And the SEIU.

This roller coaster in the financial markets was constructed by conservatism and serves the goals of conservatism. This is the connection that must be made.

...apparently, "fundamentals" means workers, in McCain's world. Why do you hate workers so much?

Ladies And Gentlemen, Please Welcome Back Phil Gramm

Please keep talking.

Former Texas Senator Phil Gramm, who stepped aside as John McCain's campaign co-chairman in July after an uproar over comments that those worried about the U.S. economy are "whiners," today revisited that sentiment.

"If you're sitting here today, you're not economically illiterate and you're not a whiner, so I'm not worried about who you're going to vote for," Gramm told supporters of McCain at a Financial Services Roundtable event in Minneapolis on the sidelines of the Republican National Convention.

Gramm, 66, stepped down as a senior adviser to McCain in July after telling the Washington Times that the U.S. is a "nation of whiners" facing a "mental recession."

Most important part of this: he was speaking to McCain supporters, essentially as a surrogate for the McCain campaign. He says he's just a supporter, but he clearly says "We went through a process of vetting all possible candidates," in referring to the process of selecting Sarah Palin. Phil Gramm is back!

I'm looking to scrounge up a few bucks to send Gramm on a nationwide speaking tour, telling as many people as he can find what whiners they are for not understanding basic economics. Anyone want to pitch in?

Leaving A Man Behind

When Phil Gramm called the United States a "nation of whiners," despite the controversy and John McCain's claim that he would now be up for Ambassador to Belarus you absolutely knew that he would be back on the campaign trail and in McCain's inner circle in a matter of weeks. This has nothing to do with McCain, it's part of the axiom that there is nothing a true conservative can do to get thrown overboard. Gramm wasn't rejected, he was expressly defended by a host of right-wing pundits ("Technically, being that we haven't exactly seen two consecutive quarters of negative growth, those half a million workers who have lost their jobs ARE whiners!"), and after a brief cooling-off period, he returned right back where he started:

But associates say the senator still dials up former Senator Phil Gramm of Texas, who forfeited his title of campaign co-chairman after a controversy over his remarks that the United States is “a nation of whiners” and is merely in “a mental recession.”

Current and former advisers say they still consider Mr. Gramm, now UBS investment bank vice chairman, a top prospect for treasury secretary in a McCain administration.

Consider the contrast between the Gramm resurrection and Wesley Clark's situation. I hate to make an equivalence between Gramm's asinine remark and Clark's perfectly acceptable and rational one, but both generated controversy, such that it is, and the reaction to that controversy from both parties reveals something profound: conservatives rally around their own, while Democrats are fearful and have no problem dropping them.

General Wesley Clark is not attending the Democratic National Convention. I was told by General Clark's personal office in Little Rock that he would not be attending.

Clark was informed by Barack Obama's people that there was no reason to come.

General Clark has been given no role of any kind at the convention.

Rubbing salt in the wound even more, the "theme" of Wednesday's Democratic convention agenda is "Securing America."

(I don't think we totally know what happened behind the scenes here, Clemons' report has shifted once or twice, but clearly the Obama team didn't exactly welcome Clark to Denver, although there's still time to make room for him.)

This is the difference between a party that stands for something and one that stands for nothing. I find the "something" Republicans stand for to be abhorrent, but Gramm certainly spoke a truth as conservatives see it, and while it appalled a lot of people, the party wasn't going to excommunicate him for it. When Clark says, correctly, that getting shot down in Vietnam is not a qualification for President per se, Democrats get nervous, so worried are they of being perceived as disrespectful of the military (but not of NATO Supreme Allied Commanders, I guess), that they tell him to take a walk.

The worst part of this is that this is a nation of second chances and short-term memories. Marv Albert still commentates for the NBA, fercryinoutloud. Democrats are always playing this game eight or nine steps ahead for no reason.

If John McCain wants Phil Gramm to be the compassionate face of conservative America, I'm all for it. But this is really about a party caring for their own. Once again, Democrats have let fear rule them.

Sunny Days For The Economy

While Bush and the Republican Party talk up how technically not horrible the economy is, Ben Bernanke spoke just like a whiner on Capitol Hill yesterday.

Warning of the risks of a further slowdown and higher inflation, Ben S. Bernanke, chairman of the Federal Reserve, offered a gloomy assessment of the economy on Tuesday as President Bush, speaking a few blocks away, urged Americans to have faith in the country’s financial foundation.

In testimony before the Senate Banking Committee, Mr. Bernanke avoided the word “recession” in characterizing the current economy, noting instead that consumer spending and exports were keeping growth “at a sluggish pace” while the housing sector “continues to weaken.”

He added that spending for personal goods had “advanced at a modest pace so far this year, generally holding up somewhat better than might have been expected given the array of forces weighing on household finances and attitudes.”

While the risks to the overall economy were still “skewed to the downside,” he said, inflation “seems likely to move temporarily higher in the near term.”

As if on cue, the consumer price index jumped up yesterday at the fastest rate in 17 years, mainly due to rising energy prices. And Bernanke didn't see any hope on that horizon, either:

In his testimony, he was especially pessimistic about any easing of energy prices, dismissing suggestions that they were being driven by speculation in futures markets. Instead, he said high energy costs reflected the markets’ recognition that demand was outstripping supplies.

“Over the past several years, the world economy has expanded at its fastest pace in decades, leading to substantial increases in the demand for oil,” Mr. Bernanke said. “On the supply side, despite sharp increases in prices, the production of oil has risen only slightly in the past few years.”

I think there's a slight amount of speculation in the markets, but we're reaching a fundamental truth about oil, that production either is peaking or has peaked, and that we need an actual plan for getting off the carbon economy instead of cries of "Drill More!" for a product whose supply is diminishing.

The economy is basically everyone's #1 or #2 issue headed into the election. This NPR/Kaiser Foundation poll looking at economic issues in Ohio and Florida shows that 89% of residents in those two states think that the economy is "not so good" or "poor." Can 89% of the people be wrong? Sure, if they're all a bunch of whiners like Phil Gramm keeps saying. Of course, well over 89% of the country didn't buy the porn films he helped produce, so maybe he's just bitter.

The big picture is that the failed conservative policies of socializing risk and privatizing profit has caught up with them. They failed to react to bubbles in the housing market and practically forgot about regulation, and homeowners were screwed. They let insurance companies discriminate against their customers and saw 47 million Americans join the ranks of the uninsured. They sought bailouts for financial institutions who made bad decisions but not the homeowners who bore the greatest impact from them. They didn't respond to rising energy demand and sought only to raise profits for their oil company pals. They ran up huge deficits, borrowed for the future from China, and stratified inequality so much that it looks like a new Gilded Age. And now, they want to elect a man as President who will gladly carry out the same policies and further privatize the economy and tear at the social safety net.

(I'm glad that the DNC is taking on McCain on Social Security, by the way. Here's the video:)



It's time for a change.

The Reverse Wes Clark

Let's be clear: John McCain's campaign had to distance himself significantly from Phil Gramm this week, even suggesting that they're no longer on speaking terms.

GERSH: Is Senator Gramm still giving advice to Senator McCain?

HOLTZ-EAKIN: No.

GERSH: No.

HOLTZ-EAKIN: At — I haven’t spoken to Senator Gramm since the comments took place, and I’m not expecting to.

This is despite the fact that among conservative movement types, Gramm's comments are being seen as largely correct. Some are saying it on technical grounds, that the country hasn't technically slipped into recession based on the outdated statistics which govern that decision, the ones that are totally disconnected to working-class Americans' lives. Others, like George Will, simply agree that Americans "are the crybabies of the western world."

Traditional media outlets have finally picked up on the fact that the Gramm comments and McCain's cluelessness on Social Security and health care led to a pathetically bad week, despite it being the week where the campaign message would be reset and more tightly focused. And hardcore conservatives are seeing McCain's "gaffes" resulting from their core beliefs, and his distancing from them as a repudiation of economic conservatism. And they don't trust him already.

Of course, Gramm helped shape McCain's policies, and on the overwhelming majority of domestic issues McCain is exactly in line with the President. But a significant segment of the conservative base sees Gramm as fundamentally correct and brave, and they see his ouster as a betrayal.

Sound familiar?

In fact both sides are having problems with their base as they lurch to the center.

UPDATE: This is howlingly funny.

Obama ran an ad calling McCain—McSame in the economy. Republican Governor Mark Sanford of South Carolina went blank trying to think up any differences between John McCain and George Bush’s economic policies when Blitzer asked him to name some. After stammering for a minute, he brought up NAFTA? Say, what? Blitzer then said they had no differences on NAFTA. Oh, and then Sanford mentioned McSame’s opposition to earmarks. That’s sure going to cut your gas prices. (rough transcript)

Blitzer: Are there any significant economic differences between what the Bush administration has put forward over these many years as opposed to John McCain’s support?

Sanford: Yea, I mean for instance take, you know, ummm, ahhh, take for instance the issue of, ahhhh..(knocks on table) I’m drawing a blank. I hate it when I do that, particularly on TV. Take for instance the contrast between NAFTA. I mean, I think the bigger issue is credibility in where one is coming from. I mean, to that position are they consistent where they come from? John McCain has consistently stood against earmarks throughout his tenure in the US Senate. Regrettably, the President has not been exactly busy with the veto pen.

Now Mark Sanford, who has impeccable conservative credentials, will be tossed under the proverbial bus. But it's John McCain making this problem by having a hard-right domestic policy that you can't tell the truth about because it's designed to be hidden.

Days Like This I Feel Good To Be Away From A Television Set

Ezra Klein writes:

The big political story of the day is that Jesse Jackson was in range of a live mic while complaining about Barack Obama to a friend.

Can that possibly be true in the nation of Washington, Lincoln, and Jefferson? In a time of war, terrorism and economic crisis? On a day when core Constitutional rights were weakened by the signing of a bill which virtually eliminates the Fourth Amendment? And even if you go with the media you have, in the midst of a week when John McCain reveals he doesn't know anything about Social Security, and his top economic adviser calls the entire country a bunch of whiners for not being able to afford food and gas...



...can the BIG POLITICAL STORY OF THE DAY possibly be a guy caught on a live mic?

Isn't everybody ashamed of themselves yet?

McCain's Horrible Week

Hey, good for Barack Obama:



If you can't see it, Obama replays Phil Gramm's "nation of whiners" comment, adds in McCain's "psychological benefits" for his energy policies comment, and concludes, "America already has one Dr. Phil." Which is one Dr. Phil too many, but he's too polite to say that.

If you haven't noticed, McCain is having a week as a candidate that makes Walter Mondale look like FDR.

This is the week that should have effectively ended John McCain's efforts to become the next president of the United States. But you wouldn't know it if you watched any of the mainstream media outlets or followed political reporting in the major newspapers.

During this past week: McCain called the most import entitlement program in the U.S. a disgrace, his top economic adviser called the American people whiners, McCain released an economic plan that no one thought was serious, he flip flopped on Iraq, joked about the deaths of Iranian citizens, and denied making comments that he clearly made -- TWICE. All this and it is not even Friday! Yet watching and reading the mainstream press you would think McCain was having a pretty decent political week, I mean at least Jesse Jackson didn't say anything about him.

Go read that whole article. But let me add to it. He emailed around a YouTube of him bashing his top economic adviser Phil Gramm and saying "He doesn't speak for me," at PRECISELY THE TIME Gramm was speaking for him at the Wall Street Journal's editorial board. He said that he didn't know the significance of the Iranian threat after spending half his campaign talking up that very threat. And then there's this, the kind of story that would utterly define any Democrat immediately as an unprincipled liar for the length of the campaign.

Asked what’s the first thing that comes to his mind when he thinks of Pittsburgh , McCain, chuckled, "the Steelers. I was a mediocre high school athlete but I loved and adored the sports but the Steelers really made a huge impression on me particularly in my early years."

And then McCain told a rather moving story about his time as a P.O.W. "When I was first interrogated and really had to give some information because of the pressures, physical pressures on me, I named the starting lineup, defensive line of the Pittsburgh Steelers as my squadron mates."

"Did you really?" asked the reporter.

"Yes," McCain said.

"In your POW camp?" asked the reporter.

"Yes," McCain said.

"Could you do it today?" asked the reporter.

"No, unfortunately," McCain said.

Here's one reason he likely couldn't do it today -- the Steelers aren't the team whose defensive line McCain named for his Vietnamese tormentors. The Green Bay Packers are. At least according to every previous time McCain has told this story.

In McCain's best-selling 1999 memoir "Faith of My Fathers," McCain writes:

"Once my condition had stabilized, my interrogators resumed their work. Demands for military information were accompanied by threats to terminate my medical treatment if I did not cooperate. Eventually, I gave them my ship’s name and squadron number, and confirmed that my target had been the power plant. Pressed for more useful information, I gave the names of the Green Bay Packers offensive line, and said they were members of my squadron. When asked to identify future targets, I simply recited the names of a number of North Vietnamese cities that had already been bombed."

In 2005, A&E ran a movie version of "Faith of My Fathers."

And McCain discussed that precise clip on CNN.

The actor playing McCain, asked to name the men in his squadron, says: "Starr; Greg; McGee; Davis ; Adderly; Brown; Ringo; Wood."

Cut back to real life. The CNN anchor asks McCain: "For those who don't know the story, were those NFL football players?"

"That was the starting lineup of the Green Bay Packers, the first Super Bowl champions, yes," McCain responded. But it's -- it was the best I could think of at the time."

The movie actually shows this act of defiance twice.

INTERROGATOR: The names of your squadron...

MCCAIN: Starr, Gregg...McGee, Davis...Adderley, Brown, Ringo, Wood.

INTERROGATOR: Ten points, McCain.

MCCAIN: Ray Nitschke, our C.O.

OK, that would actually end a Democrat's career, permanently. I remember all the jokes about Cheese Whiz and Lambert Field with John Kerry, and Al Gore inventing the Internet or being the model for Love Story. This is far worse, actually, considering it's PART OF HIS ARGUMENT AGAINST TORTURE.

Explaining why he thinks torture can result in erroneous information, McCain wrote in Newsweek in 2005, "In my experience, abuse of prisoners often produces bad intelligence because under torture a person will say anything he thinks his captors want to hear--whether it is true or false--if he believes it will relieve his suffering. I was once physically coerced to provide my enemies with the names of the members of my flight squadron, information that had little if any value to my enemies as actionable intelligence. But I did not refuse, or repeat my insistence that I was required under the Geneva Conventions to provide my captors only with my name, rank and serial number. Instead, I gave them the names of the Green Bay Packers' offensive line, knowing that providing them false information was sufficient to suspend the abuse."

I understand that the media really like BBQ, and loves to sit in the front of the plane. But if they took the rib-colored glasses off for a second, they'd see that this guy is maybe the worst Presidential candidate of my lifetime. And they'd bother to report a little truth about his evasions, lies, and missteps.

McCain's Bitter-gate

By now you may have heard that McCain's top economic adviser, former Senator Phil Gramm, thinks that all of you pathetic "hard-working people" who don't appreciate the value of concentrating money in the hands of the super-rich are just a bunch of whiners.

In an interview with the Washington Times, Phil Gramm, a former Texas senator who is now vice chairman of UBS, the giant Swiss bank, said he expects Mr. McCain to inherit a sluggish economy if he wins the presidency, weighed down above all by the conviction of many Americans that economic conditions are the worst in two or three decades and that America is in decline.

"You've heard of mental depression; this is a mental recession," he said, noting that growth has held up at about 1 percent despite all the publicity over losing jobs to India, China, illegal immigration, housing and credit problems and record oil prices. "We may have a recession; we haven't had one yet."

"We have sort of become a nation of whiners," he said. "You just hear this constant whining, complaining about a loss of competitiveness, America in decline" despite a major export boom that is the primary reason that growth continues in the economy, he said.

As S,N notes, this is the "let them eat cake" Antionette-ism that has been at the heart of the Republican Party since the Gilded Age. Their entire project is to view the federal Treasury as a bank holding the money for their wealthy contributors until they decide to dole it out to them. So they construct policies that benefit the top one-half of 1%. When you hear about The Wrecking Crew, this is their objective.

Fantastic misgovernment is not an accident; nor is it the work of a few bad individuals. It is the consequence of triumph by a particular philosophy of government, by a movement that understands the liberal state as a perversion and considers the market the ideal nexus of human society. [...] Its leaders laugh off the idea of the public interest as airy-fairy nonsense; they caution against bringing top-notch talent into government service; they declare war on public workers. [...] The ruination they have wrought has been thorough; it has been a professional job. [...] There is so much money in conservatism these days that Karl Rove rightly boasts, "We can now go to students at Harvard and say, 'There is now a secure retirement plan for Republican operatives.'" [...]

Like Bush and Reagan before him, John McCain is a self-proclaimed outsider, but should he win in November he will merely bring us more of the same: an executive branch fed by, if not actually made up of, lobbyists and other angry, righteous profiteers.

The McCain campaign, already rocked by the candidate calling the Social Security system as a concept a disgrace (and trying to backpedal furiously to little effect), has no idea what to do with this latest example of letting the economic royalist slip show. At first, and let us not forget this, they stood by the remarks.

The McCain campaign is working hard to distance itself from statements made by economic adviser Phil Gramm describing the current economic downturn as a "mental recession" and saying America had "sort of become a nation of whiners."

But in an initial statement published by Politico and then, seemingly, removed from its site, a McCain campaign aide actually stood by Gramm's remarks, saying the interview as a whole was merely meant as a preview of the Senator's economic agenda.

"Mr. Gramm was simply saying that we are laying out the economic plan this week," the piece quoted a "McCain official" as saying. "The plan is comprehensive, providing immediate near-term relief for Americans hurting today as well as longer-term solutions to get our economy back on track, secure our energy future and deliver jobs, prosperity and opportunity for the next generation. We're laying out that plan this week with an emphasis on the critical importance of job creation, and it's been a great success so far."

And Sen. Obama took McCain to task for these comments.

"One of Senator McCain’s top economic advisors may think that when people are struggling with lost jobs, stagnant wages, and the rising costs of everything from gas to groceries, it’s merely a ‘mental recession’. And Senator McCain may think it’s sufficient to offer energy proposals that he admits will have mainly ‘psychological’ benefits. But the American people know that our economic problems aren’t just in their heads. They don’t need psychological relief -- they need real relief -- and that’s what Barack Obama will provide as President," Obama spokesman Bill Burton writes.

I seem to remember a very large scandal played off of one Obama quote at a private fundraiser, about how "bitter" rural voters cling to God and guns. Gee, here we have the top economic adviser to the Republican nominee saying that any American facing the real costs of failed conservative economic policies, struggling to pay for gas or health care or food, trying to keep their job in an era of stagnant wages and rising costs, trying to keep their home in the midst of crisis, is a "whiner." The media might want to look up from their barbecue and cornbread and pay attention. This is a major Kinsley-esque gaffe, which is what happens when someone tells the truth about their objectives. McCain and his fellow travelers don't care about the economic problems of 99% of America.

Behold America's Worst Presidential Campaign

The incompetence continues. And this time, a little more attention is being paid.

So John McCain goes out on the stump yesterday and sayswe're back to "pre-surge" levels in Iraq. First of all, this kind of running in place is supposed to be a good thing. Second of all, it's not true.

Actually, Mr. Magoo, two-thirds of the surge troops are still in Iraq.

Let me walk you through this.
1. Pre-surge troops levels. That's 130,000 to 135,000 troops.

2. Bush sent 30,000 or so "surge" troops to Iraq.

3. That means at full surge we had 165,000 troops in Iraq.

4. We currently have 155,000 troops in Iraq.

5. That means we still currently have 20,000 more troops in Iraq than we had pre-surge, or 2/3 of the surge troops are still in Iraq.

So, it's a gaffe. Not a major one, but a gaffe nonetheless. And McCain compounds it by arguing over verb tenses, saying that he meant to say "we'll be drawing down" instead of "we've drawn down." I hope you forgive us when we say collectively as a nation that we're sensitive to lying about war.

The thing is, the campaign got mad about it, telling reporters on a conference call to stop nitpicking his verb tenses. And the candidate himself continued that alibi, which is just a dumb one. There's a definitive difference between finishing something and hoping to finish it. Events on the ground in Iraq have a way of screwing up those best-laid plans.

Jed Report has a video recounting of the whole thing.



It'd be one thing if this were an isolated incident, but this is a bad candidate and a bad campaign. They proved themselves to be off-message when they sent out an email with an unauthorized picture of David Petraeus in uniform, and McCain defied his advisers and staffers by admitting it was inappropriate to fundraise using that photo. They went back and forth with a dozen different explanations for how to handle the radical pastors John Hagee and Rod Parsley, until they dumped them and faced the ire of the religious right. The lobbyist problem is unbelievably difficult for the campaign, as are advisers like Foreclosure Phil Gramm, who helped create the mortgage meltdown, and the candidate's own associations with corporate benefactors like America West Airlines.

This is why the campaign is pretty universally seen as not ready for prime time, and why the numbers you have seen McCain hold, with him never over 45% or so nationally, are bound to erode.

Fall campaigns for President require massive organizations. What's more, McCain is likely to face the biggest, baddest team on the block. Barack Obama has been running the equivalent of a national campaign for almost six months now. He spends more than twice as much every 30 days as McCain has been able to raise in the same period. Obama has a campaign staff that numbers about 700 and already blankets most of the swing states. His organization ticks like a clock, has had an unwavering message and has kept a firmly fixed inner circle.

McCain, meanwhile, is still formulating his general-election pitch and struggling to build his core team. He is also trying, for the second time in as many years, to create a campaign that can win on a big scale. His previous attempt to run as the institutional candidate, with a projected nine-figure budget, failed spectacularly last July and nearly forced him out of the G.O.P. race. Though his campaign is leaner than his rival's, McCain says he is happy with the progress. "I am pleased with the way the campaign is going," he said just before Memorial Day weekend in an airplane hangar in California's Central Valley. "I think we are going pretty well." But even as he spoke, problems were sprouting all around him.

The guy cannot handle a big campaign organization. Why do we think his management style would be suitable for the whole United States?

Lobbyists In The Closet

I said earlier that McCain might have some more dirt in the corners of his campaign that avoided last week's spring cleaning. In addition to having Randy Scheunemann, the campaign's top foreign policy advisor, lobbying McCain's Senate staff for the Republic of Georgia while being paid to work on the campaign, there's the issue of Phil Gramm, McCain's top economic advisor, ALSO lobbying Congress on behalf of banking institution UBS in the middle of the housing crisis.

Republican presidential candidate Sen. John McCain’s national campaign general co-chair was being paid by a Swiss bank to lobby Congress about the U.S. mortgage crisis at the same time he was advising McCain about his economic policy, federal records show. [See sidebar.]

“Countdown with Keith Olbermann” reported Tuesday night that lobbying disclosure forms, filed by the giant Swiss bank UBS, list McCain’s campaign co-chair, former Texas Sen. Phil Gramm, as a lobbyist dealing specifically with legislation regarding the mortgage crisis as recently as Dec. 31, 2007.

Gramm joined the bank in 2002 and had registered as a lobbyist by 2004. UBS filed paperwork deregistering Gramm on April 18 of this year. Gramm continues to serve as a UBS vice chairman.

Gramm's execrable Senate record, which includes easing regulation on energy trading (which directly led to Enron), and undoing the Glass-Steagall Act (which almost directly led to the mortgage mess), ought to be enough to disqualify him from any advisory economic role. But his lobbying for the very companies seeking to stop homeowners facing foreclosure from rewriting their mortgages, which was SUCCESSFUL lobbying, by the way, is really just beyond the pale. The compromise bill worked out in the Senate is far more friendly to the terms set out by Gramm's bosses, and, significantly, John McCain.

We could add to this the fact that Joe Lieberman and Lindsay Graham are violating the ethics rules laid out by the McCain campaign, serving on the board of an organization running 527 attack ads against Barack Obama. But let that go for a second. Practically McCain's entire staff has major ties to lobbying organizations. The reformer image is virtually dead and buried.

Too Big To Let Fail

So the Treasury Secretary called for a "sweeping overhaul" of financial rules, and the cheerleaders on the business channels are predictably calling this some kind of radical change, whereas Paul Krugman sees this as rearranging deck chairs.

Anyone who has worked in a large organization — or, for that matter, reads the comic strip “Dilbert” — is familiar with the “org chart” strategy. To hide their lack of any actual ideas about what to do, managers sometimes make a big show of rearranging the boxes and lines that say who reports to whom.

You now understand the principle behind the Bush administration’s new proposal for financial reform, which will be formally announced today: it’s all about creating the appearance of responding to the current crisis, without actually doing anything substantive.

I think what we've seen is the belief in deregulation of financial markets and massive corporate consolidation in general working in tandem. This created huge financial institutions like Bear Stearns, which them became too big to allow to fail no matter how speculative they became. And so they could engage in whatever risky operations they wished, full with the knowledge that they would never experience a full washout of their assets. The result is a safety net for massive corporations only at the expense of the social safety net for individuals.

Without a vote of the Congress or a public debate, the Bush administration and the Federal Reserve have made government the guarantor of the shadow banking system – the unregulated, unhinged hedge funds and investment houses whose compulsive excesses now threaten the global economy. They say necessity is the mother of invention, but we seen only a part of the new machine, not surprisingly, the part that buttresses Wall Street. They have scrambled to put this together in an emergency, behind closed doors, without a hint of the necessary regulatory changes that must rationally accompany such guarantees. That is what the fight in the coming months will surely be about [...] The shadow banking system now must be brought out of the shadows. After all we are constantly told that finance serves the economy, and the market system is the best means to solve our social goals. It feels very uncomfortable when our servant's servant becomes our master's master as Wall Street has been permitted to become in America in recent years by contribution- hungry elected officials.

Barack Obama explicitly connected the current crisis to the bipartisan practice of deregulation. This is a culture of laissez-faire economics that has shifted risk to individuals and removed risk from corporations, and Obama's speech talked about the need to radically change that midset with actual regulation instead of putting new names on the same old ineffective regulatory agencies. Corporations for too long have, as Bob Borosage said, been given "the freedom to gamble with other peoples’ money ... protected by lavish campaign contributions and powerful lobbies." To avoid a total revolt from individuals fed up with being used as pawns in a game played by financial institutions, and to restore some balance and fairness to the macro-economy, we have to address this seriously.

One thing I do know is that John "Let's Schedule A Meeting Sometime" McCain would offer the same foot-dragging and obfuscation that has brought us to the current crisis. After all, some top campaign advisors of his lobbied for the shady lender Ameriquest, one of his top surrogates Carly Fiorina is a welfare queen whose company paid off her mortgage between 1999 and 2003, the most recent RNC chair is saying that his non-plan to deal with the mortgage crisis is incomplete, and his top economic advisor is perhaps most responsible for the crisis itself:

The general co-chairman of John McCain’s presidential campaign, former Sen. Phil Gramm (R-Texas), led the charge in 1999 to repeal a Depression-era banking regulation law that Democrat Barack Obama claimed on Thursday contributed significantly to today’s economic turmoil.

“A regulatory structure set up for banks in the 1930s needed to change because the nature of business had changed,” the Illinois senator running for president said in a New York economic speech. “But by the time [it] was repealed in 1999, the $300 million lobbying effort that drove deregulation was more about facilitating mergers than creating an efficient regulatory framework.”

Gramm’s role in the swift and dramatic recent restructuring of the nation’s investment houses and practices didn’t stop there.

A year after the Gramm-Leach-Bliley Act repealed the old regulations, Swiss Bank UBS gobbled up brokerage house Paine Weber. Two years later, Gramm settled in as a vice chairman of UBS’s new investment banking arm.

Later, he became a major player in its government affairs operation. According to federal lobbying disclosure records, Gramm lobbied Congress, the Federal Reserve and the Treasury Department about banking and mortgage issues in 2005 and 2006.

During those years, the mortgage industry pressed Congress to roll back strong state rules that sought to stem the rise of predatory tactics used by lenders and brokers to place homeowners in high-cost mortgages.

For his work, Gramm and two other lobbyists collected $750,000 in fees from UBS’s American subsidiary. In the past year, UBS has written down more than $18 billion in exposure to subprime loans and other risky securities and is considering cutting as many as 8,000 jobs.

It's so clear that lack of regulation gave the investment banks a license to steal, and that Phil Gramm and his puppet Presidential candidate, who doesn't know or care about the economy, want the theft to continue.