Andy McCarthy (buy his book!) posts his frustrations, which I share; I feel like I am in the twilight zone, and Andy has only hit on a few of the reasons why I can't believe people with sense support Obama:
Rich, I think the problem is that "the sense that Washington is incompetent and self-interested" is more than just an impression — it's a fact. Those of us opposed to the Paulson plan but not beyond convincing that some shoring up action may be necessary are being given no reason to support this intervention and plenty of additonal reason to oppose. In a nutshell:
- Why is no one addressing the fact that Paulson — whose department has conceded that $700B may not actually be needed but is just a "very large number" they settled on, "not based on any particular data point" — will only be running Treasury for another three months? After that, this pot of gold could very well be under the control of an Obama Treasury Department, which would have the same unfettered discretion Paulson is being given to dole out perhaps hundreds of billions of dollars more than may be necessary for any legitimate shoring up of the credit markets. And, please, stop jiving us with this "profit to the taxpayers" drivel. Does anyone familar with Obama's record, the Democrats' predilections, and the nature of government honestly think the taxpayer would see a dime of any profits? Profits would become slushfunds to underwrite other obligations — which is to say this inevitably becomes a gargantuan tax increase.
- As Obama may well be inheriting this new, over-stuffed piggy bank, why is no one interested in how he doled out the last piggy banks he had control over: the Woods Fund and the Chicago Annenberg Challenge. We know the Woods Fund gave money, for example, to Jeremiah Wright's church and to Rashid Khalidi, the PLO apologist who inherited Edward Said's perch as chief of anti-Semitism at Columbia. As far as the CAC goes, here's just a sampling of what we know, courtesy of Steve Diamond:
One of the first grants awarded in 1995 was a $175,000 Implementation Grant to the Small Schools Workshop. The Workshop had been founded by Bill Ayers in 1992 and was headed up by his former SDS comrade and hardcore Maoist, Mike Klonsky. Klonsky actually visited China and met with its stalinist leaders in the early 1970s. Klonsky still heads up the Small Schools Workshop and, until it was summarily removed, hosted a blog on "social justice" and education issues on the official Barack Obama Presidential campaign website. [Over the ensuing years,] [h]undreds of thousands of dollars more would be forthcoming from the CAC for the Klonsky group.
ME: So now we want to give Obama $700 billion to play with as he sees fit?
- Americans look at those huddling to come up with a "solution" and they see photos and footage of top Democrats, prominently including Chris Dodd and Barnie Frank, the main culprits. We see Obama, who took well over $100K from the GSEs, taking a leading role in the negotiations. In short, we see that the perpetrators have been delegated to investigate the crime and design a fix. When we ask where the accountability is, we're told there is no time for that now — but of course if not now it will be never.
- How can this bailout possibly be justified without addressing the underlying causes of the distress? There is no accountability over Fannie Mae and Freddie Mac. For some reason, even though Alberto Gonzales has been gone for a year-and-a-half, Democrats demand that the investigations continue into a non-crime, the firing of a handful of U.S. attorneys, because they claim accountabilty is essential. Yet, the sky is supposedly falling on an economy in meltdown, we have just had to pay out $200B and officially take on the risk of $5 trillion in GSE debt, and yet no one seems to think it the least bit important to examined what happened at Fannie and Freddie and who is responsible for this mess. It is irresponsible for us to agree to a dime until that accounting takes place. McCain has been on the side of the angels and it would help him politically, so his failure on this is just mind-boggling.
- Now is the time not only to make the case against the GSEs and the preposterous Community Reinvestment Act but to propose solid conservative ideas that would help the economy, like tax cuts — particularly the absurdly high, uncompetitive corporate and capital gains taxes. A few days ago, the editors wrote:
Conservatives have proposed various alternatives to the Paulson plan.... Some of them consist of excellent long-term reforms that do not address the issue at hand. Take, for example, the proposal to drop the capital-gains tax rate to zero: We certainly believe that policy would promote the long-term growth potential of the United States, but it would do little to stem the current panic. It is an idea better suited to trying to pick up the pieces afterward than saving the credit markets now. The same with more drilling, or a repeal of Sarbanes-Oxley, or any otherwise sound policy proposal that does not directly and immediately address the crisis before us by injecting more capital into the system or rendering currently illiquid assets liquid again.
ME: You don't get to "pick up the pieces afterward." You have to capitalize on the moment. These are good ideas and they would help. Not cure, but help.
Can someone explain to me why, in crisis conditions, Congress managed to address children's wooden arrows, global warming, economic development in American Somoa, underground mine safety, depreciation on Indian reservations, railroad maintenance, motorsport racetrack conditions, domestic production in Puerto Rico, depreciation allowances for Hollywood, import duties on wool, excise taxes on rum, income averaging for Exxon, and on and on and on ... but somehow no time to deal with the crushing tax burdens and regulatory restrictions that are stifling economic activity, and no time to confront the public/private business model and government demands to extend credit to the non-creditworthy that actually caused this debacle?
Why should the public give these guys a further license to mutilate?
Well said, Andy.