Democrats & Liberals Archives

People Unclear On The Situation

I heard about this article on the MSNBC’s Morning Joe program, and the disconnect it represented got me thinking, among other things about where the Republicans are. If anything, this article is about what it’s like to have power and prestige one day, to be on top of the world, and then the next to fall from grace.

There's a phenomenon called referred pain. A nerve gets pinched in your elbow, you feel it in your forearm. You get kidney stones, it feels like you're having back problems. What these former high-rollers should consider is that the unfair conditions that helped bring them wealth are the real source of the pain, and the screw-up on Wall Street just gives them the opportunity to vent and act on that anger.

There was a promise made, more or less. In the Republican's case, it was "elect us, and America will be glorious again; well defended, fiscally sound, feared and respected throughout the world" In Wall Street's case, the promise was, "Accept sacrifices and a more unequal distribution of the wealth, and we will all prosper more greatly, and the economy won't be as unstable as it was in recent memory."

These are promises that over time that both parties failed to keep. People kept hoping. People let the memory of what had come before discourage them from going back to others. People wanted things to work, and for the bargain they made to actually pay out.

It didn't. America's image has been tarnished. It's economy has been severely damaged. It's defense has been compromised, and the enemies we were promised would suffer at our feet gloat beyond our grasp. The promised prosperity eluded us, and all we got was more things to pay for and less to pay for it with. We are back where we started, thirty years ago, back looking for another plan.

But don't tell Wall Street or the Republicans this. They feel they deserve a second chance. Trouble is, they had all the second chances in the world as people waited patiently for them to get their act together. They didn't get their act together. Hence the bitter stares from everybody else.

You folks were in charge. You were given the opportunity to do practically everything and anything you wanted. People like me were willing to accommodate, capitulate, compromise. If things had continued to go well, if it didn't become gradually obvious that folks didn't actually know what they were doing, despite their claims, if the catastrophic failures of policy did not occur again and again, people might have even accepted the long term dominance of their interests.

What we had, over time, were breaking points. People found they could no longer tolerate the iniquities. How do you justify the defense strategies of those who keep losing the strategic battles they're supposed to win, the economic plans of those who keep on cratering the markets they're intended to help? At some point, reality becomes a slap in the face, and you have a choice of either backing an ideology that you know to be impractical, in hopes that someday it will pay off, or facing facts and withdrawing support of it.

The Republicans, currently, are looking for their silent majority again. Why silent? Evidently because you can't find it in a poll, whether it's one held by telephone, or one held on election day. It's easier to imagine support, to imagine that the country is center right, than to actually prove it.

Speaking of which, we've heard that statement all the time now, haven't we? The country is center-right, the Republicans tell us, despite two elections that at least place them on the other side of the median. What puzzled me, early in the morning, thinking about such statements is one simple fact: though the Republicans say that the country is center-right, the thrust of their politics has been unequivocally to the right. In fact, that's their big idea, that conservatives were not conservative enough, and should get more hardline on the issues to regain the trust of the majority of Americans.

But even if the country was center-right, we'd have to wonder why the Republicans aren't simply trying to come up with a more reliable version of the conservative/moderate compromise that existed before, a more honest accommodation of both sides. The simple answer would be, they don't want to. They want people to come back to them, their own values not compromised. Thus, a bracing torrent of aggressive political attacks since it became clear that Obama would not fold like Clinton did to the Republican's efforts to push him into doing things their way.

If the polls are any indication, their efforts have not been successful. The Republicans have long relied on what could be called a sense of peer-pressure, an overwhelming conventional wisdom that said (surprisingly enough) that the country was center-right, and that Republican proposals enjoyed the greatest support. Though this wasn't necessarily true, it was useful for intimidating Democratic Party politicians.

But how many more elections will that last for? The Republicans see that power as their birthright and are positively furious now, as they were when Clinton took office, that anybody could claim it besides themselves.

Now Wall Street is wondering, like them, why they aren't more popular, why people aren't taking their side of the story. They, too, are trying to create a populist backlash, trying to appeal to folks on how absolutely necessary they are.

The trouble is, just as with the Republicans, the dynamics of public opinion have changed. Wall Street may have thought it was protecting itself by fending off all those calls for reform that occurred after Enron and WorldCom collapsed, but it was only setting itself up for worse. Under the Bush Administration, there's been a distinct sense that Wall Street's economic policies have been poisonous to the economy most people live in. Result? When the sense finally came to full fruition, Wall Street had long ago burned away any goodwill that might have cushioned the drop in people's opinion.

The real question for most Americans is this: for what reason should we ever trust Wall Street again? We did everything they asked of us to make our economy grow, exporting our jobs, letting our wages stagnate and theirs skyrocket; we assumed all kinds of risk they once carried, let go of all kinds of benefits we once had, and settled for crappier and crappier healthcare. We were told that this was all necessary.

And then this. Here, at long last, was the breaking point. Capitalism is not dead, but the free-wheeling cowboy capitalism that's been developing is certainly pining for the fjords. That, or its days are numbered. Investment Bank is a term that no longer describes an existing set of institutions in this country. This financial crisis killed them, or scared them out of the business.

Even if you weren't one of the few evil apples in the barrel, you benefitted from a system that essentially made 40% of the money but didn't really represent a real part of the economy. Your bosses pushed this BS. Your government bailed out your brokerages, pulled your hedge funds out of the water. But you're forgetting that now, now that you're not staring death in the face, financially. Govenrment sure nice and handy to have around when its trying to help you, but when it's more or less demanding you stop being so careless, that gratitude sure dries up fast. There's a phrase for it, among the left-wing bloggers: socialize the losses, privatize the gains.

There's no such thing as a free lunch. The time has come when people want something for what they're paying to keep companies afloat, to clean up their messes. They want a system that won't require them to have to do this any time soon. Try any time in the next century, if they can help it. The idea that liberals are somehow warm to the idea of endless payouts and zombie-banks is ridiculous. We're also not warm to the idea of catastrophic economic collapses, and unlike the Republicans, we're willing to do something about both.

The Republicans cannot expect us to stick with their failed policies, whether they ask nicely or try and force it down our throats. Nor can Wall Street expect, much less demand, sympathy from an America traumatized badly by the terrible consequences of the institutional irresponsibility, and to add insult to injury, saddled with the costs of undoing the damage. You folks should be getting down on hands and knees, begging forgiveness, pledging cooperation, and actually following through on that kind of repentance. Instead, the arrogance fostered by decades of being at the top of the food chain has lead them to believe that the rest of us must accept their status quo, their favored positions, without question, without any talking back.

Unfortunately for them, the rest of us are not in the mood.

Posted by Stephen Daugherty at April 20, 2009 5:20 PM
Comments
Comment #280652

Stephen,

While in general I share your overall amazement at the sentiments of those quoted in the article, I have to wonder how an article that stated, “All the rich people I know took George Bush for granted,” says an analyst at a midtown hedge fund. “I’m a Democrat, but I agree with Rush Limbaugh on a lot of this stuff,” rails the wife of a former AIG executive.” became about the Republican Party’s problems.

I also have some empathy for those quoted in the article. These people generally were taking very personal stories and having them writ into a large social construct. I think that for the most part there was a very real, intellectual understanding of the issues on their part; however, there is also the very real, emotional feeling that they had worked really hard, and they had the rug pulled out from under them. In many ways, they feel a lot like most of us do when we look at our investments, but they are looking at their pay checks.

There is the real pain there of readjusting their expectations to what the real value of their worth is in today’s terms. That is a very difficult thing to accept. When the .com bubble burst, I know a lot of programmers that went from making $150k + stock options (ultimately worthless, but there was perceived value at the time) to $75K. They felt like they got punched in the gut. They lost houses, families. That sucked for them. Their reality was based on an overinflated market in the same way that the guys quoted here were as well.

If we can’t empathy for those that have had the wool pulled out from under them, then who can we have empathy for?

Posted by: Rob at April 20, 2009 9:41 PM
Comment #280663

We got into trouble when financial houses traded in valueless bundles of paper, and the folks at the top of those houses now want to sell us on the value of their ability to trade in valueless paper…go figure.

Stephen, you fall into the same pit I do now and then…you switch from second person to third person narrative, sometimes in the same paragraph…otherwise, a very good post.

Posted by: Marysdude at April 21, 2009 5:26 AM
Comment #280669

Rob-
I’m sure it’s tough. I’m sure that personally it must feel extraordinarily unfair. But there’s a small problem with asking everybody else to feel sorry for you at this point: Most of the people you’re asking to be sympathetic have had it far worse, not just now, but also over the long term of their experience during Wall Street’s dominance of business.

Worse than that, Wall Street has been responsible, in part, for the pressures to supress wages, to deny or eliminate benefits, to move jobs overseas, among other things. But it doesn’t get better when you realize that many folks had retirement, pension, and other kinds of investments in the stock market which have been, due to many of their promises, cut to pieces.

And then you add the whole real estate debacle to the mix.

Can you understand why people hate Wall Street at this point? It doesn’t help that Wall Street visibly pushed for years for the freedom from regulation that allowed them to make such devastating screw-ups.

If Wall Street wants sympathy, it’s got to show humility. As an overall organization, an overall sector, they’ve become a burden to the rest of us because of their actions as a sector, but they haven’t yet come to shed the sense of entitlement to the rewards they were making when they were doing good.

So many more have lost everything, have seen the economies in their areas crater, so when somebody complains about not being able to send their kids to the most expensive, exclusive schools, they’re going to be less than receptive, to say the least. When Wall Street helps Main Street become prosperous again, when finance does more than make financial butter out of financial milk, and starts helping the rest of the economy work well, then people will say “Let them have the money!”

Otherwise, all they’ll do is raise their eyebrow at the temerity of it all.

Posted by: Stephen Daugherty at April 21, 2009 7:58 AM
Comment #280672

Capitalism works best when suspicion underwrites agreements, not collusion and illusion. The goal of capitalism is to pocket other people’s money in return for services or goods offered in exchange. Tainted goods or services today are not readily visible upon receipt, ask any Madoff investor.

When everyone participating in capitalism is partnering for a share of everyone else’s money, collapse of the financial sector or economy is inevitable. At some point, some of the participants must receive goods or services worth the money they parted with, and when, in a system of deferred returns, many find the goods and services years after the investment was made, to be worthless, the house of cards tumbles down.

That is where the government has a role and responsibility to its citizens to oversee and verify that the deferred goods and services citizens invest in, have a reasonable expectation of valuable return to the investor.

AIG assumed the role which should have been exercised by government, oversight and assessment of investment instruments to insure the future value of investments. AIG executives and employees were being highly compensated for doing no more than offering appearances of future value, in real time. And the government trusted AIG.

TWO ENORMOUS and horrendous failures of the system, those were. There never should have been an AIG. There should have been hundreds of smaller AIG’s decentralizing the risk and erecting competitive barriers to group think and error prone strategies. AIG’s monolithic failure can be traced directly back to the Gramm-Leach-Bliley Act’s undoing of the Glass Steagal Act.

Now, we are faced with the largest banks hoarding cash and not making loans, in order to pay back TARP funds to remove government requirements attached to those funds. This in turn, is causing our largest banks to forego future revenues and profits from banking services, in essence, re-creating another potential big bank insolvency crisis further down the road.

The central fundamental problem here, is the size of the these financial institutions and the threat the size of their holdings pose to the American economy. Therefore, the long term solution is going to entail busting these enormous banks and financial institutions up into smaller single line of business entities. In so doing, a percentage of them at any given time in the future that may become insolvent, will pose no threat to the American economy, nor to the large investor sector, nor the tax payers who insure the depositors and investors.

We are a long way from initiating such a long term solution as yet. Congress needs to reinstate the basics of the Glass-Steagal Act, but there are few signs yet, that such an undertaking is going to be forthcoming anytime soon.

Posted by: David R. Remer at April 21, 2009 8:29 AM
Comment #280692

David,

The central fundamental problem here, is the size of the these financial institutions and the threat the size of their holdings pose to the American economy. Therefore, the long term solution is going to entail busting these enormous banks and financial institutions up into smaller single line of business entities.
Do you see any sign that the government intends to do this? No.

In fact, there is serious discussion of merging Fannie Mae and Freddie Mac! Why? The government is a vast corporate entity with a corporate culture that will be more comfortable dealing with a few, powerful, vast corporate entities rather than all the mealy little entities that would make the economy really function best.

It’s a great idea to limit the size and scope of the corporations that are the lynchpins of our economy. That’s the fundamental idea behind the founding Fathers deferring so much power to the “States respectively, or to the people”. But you’re barking up the wrong tree these days to think the government that no longer cares about limits on power will be the entity to do it.

Posted by: Lee Jamison at April 21, 2009 12:12 PM
Comment #280721

Lee Jamison-
If these banks had been smaller, less entangled with other financial institutions, it would have been easier to let them fail. Competition only works if conditions can’t take out all the players.

I don’t see politicians talking about a merger like you describe; so far the idea’s mainly been floated by a financial columnist, as far as I can tell.

As far as anti-trust goes I wouldn’t be so quick to make your odd leap of logic as to what government growth would mean to anti-trust law.

Posted by: Stephen Daugherty at April 21, 2009 1:50 PM
Comment #280722

Where’s a trust buster when you need one?

Posted by: gergle at April 21, 2009 2:08 PM
Comment #280743

Here’s a Yahoo article pointing out that the government is favoring the huge over the middling.

Posted by: Lee Jamison at April 21, 2009 4:54 PM
Comment #280757

Stephen,

You said, “If Wall Street wants sympathy, it’s got to show humility. As an overall organization, an overall sector, they’ve become a burden to the rest of us because of their actions as a sector, but they haven’t yet come to shed the sense of entitlement to the rewards they were making when they were doing good.”

I don’t disagree with much of this at all. My point was that the story that was referenced in your article spoke about Wall Street as a monolith but then illustrated the point with many personal stories. I understand the personal stories, I have empathy for the people behind them.

Having empathy for those people does not dismiss the ability to make greater points about the failings of Wall Street. I think that using their stories and feelings to discuss an organizational entity is dishonest. There is a whole stream of sociological theory that popular in the 50’s and 60’s called “Aggregate Psychology.” The notion was that you can explain the whole of an organization based on the motivation of the parts. That theory has been largely not if completely discredited by empirical research that showed that organizations operate differently than the sum of the parts.

When I read articles like the one cited here, I focus more on the individual stories than the aggregate point because while the extrapolations make for interesting “theorizing,” they make for lousy “theory.” In other words, it was not so much the thesis of the article with which I took issue, but the supporting evidence.

You also said, “Can you understand why people hate Wall Street at this point?” Absolutely, I hate it too. Like everyone in America at this point, I’ve been personally impacted by the screw-ups. However, that does not mean that I hate the people that work there.

I worked for a company that went through a merger a few years back. I loved the pre-merger company; I got laid off by the post-merger company. I hate that company, but I still love a lot of the people that work there (including my wife).

Posted by: Rob at April 21, 2009 8:17 PM
Comment #280758

Stephen,

You said, “As far as anti-trust goes I wouldn’t be so quick to make your odd leap of logic as to what government growth would mean to anti-trust law.”

I’m not sure what you meant at all by this reference. Care to expound?

Posted by: Rob at April 21, 2009 8:25 PM
Comment #280766

Rob-
What I’m more or less saying is that their expectations for how the rest of the world should react to their plight are too high, that they’re unrealistic.

Individually, I can understand these are people who thought of themselves as good people, who thought they were being compensated for their true worth, rather than their believed worth.

But what I’m afraid isn’t registering clearly enough for Wall Street as a class is the metastable nature of their position. There is a certain respect and deference that’s pretty much been lost permanently over the last few years.

I’m a firm believer in emergent phenomenon. That’s why I still favor market economics. It’s also why I favor smart regulation of it.

I don’t mind secondary markets. But when that secondary market becomes essentially a Nascar Race track for Bad loans, all going in a circle, when somebody finally crashes, you will see wrecks spinning in the air and wheels flying to who knows where. So there got to be limits, or at least disincentives for abusing secondary markets for that purpose.

That’s one example. So let me put things plainly: I’m a rules of the road capitalist, who believes that the economy is too complex to simply police itself; there’s too much room for the cheaters to hide in.

As far as the quote goes, I was responding to Lee Jamison, essentially telling him that his argument about big government liking big monopolies was not too well founded.

Posted by: Stephen Daugherty at April 21, 2009 11:53 PM
Comment #280767

Stephen,

“Individually, I can understand these are people who thought of themselves as good people, who thought they were being compensated for their true worth, rather than their believed worth.”

That’s my point entirely. When we take the words of a few and try to extrapolate that to a sociologial or political viewpoint, it is at best meaningless, and at worst heartless. It is a bit like the “Welfare Mom driving a Cadillac” construct. While it may be true in a few isolated instances, it is dishonest and misleading to create a political or sociological construct out of it.

As to the quote, it didn’t actually seem to respond to Lee’s post. His was not about monopolies, it was about favoring large institutions over smaller ones. Btw, if you read to the end, it didn’t seem to amount to much anyway. It basically said we need more time to study the progress being made, and it specifically went out of its way to state that it could not be left open indefinitely as many wanted.

Posted by: Rob at April 22, 2009 12:35 AM
Comment #280771

Rob-
His logical construct was that big government is naturally sympathetic to large trusts and monopolies, which was his attempt to blame consolidation on his favorite bogeyman.

He wasn’t making a distinction between regulators being more afraid to fail big banks whose collapse could take down our economy, and our government having a pro-consolidation outlook. Just look at all the companies that had to wait until the Bush Administration to consolidation. I mean, for heavens sake: AT&T came back as a local telecom provider!

If you want a good idea of what the difference is between the different attitude on trustbusting, just look at Microsoft. Clinton goes after him, Bush doesn’t back restrictions, Obama looks to be putting them back.

Lee was making a claim he had to back up, but didn’t back up. He doesn’t get to make wild claims without me getting to nail his claims to the floor with counterexamples

Posted by: Stephen Daugherty at April 22, 2009 7:51 AM
Comment #280787

Hey uncle SAMBO put your name at the top of his list,and the millions of towel heads started shaking their fists,and if your white you aint right and your going to hell when the chosen one obama starts to ringing his bell,and the weight of the islamist will rein down on you,coming to you curtisy of those who hate jews.

Posted by: Gracy at April 22, 2009 1:55 PM
Comment #280791

Hey uncle SAMBO put your name at the top of his list,and the millions of towel heads started shaking their fists,and if your white you aint right and your going to hell when the chosen one obama starts to ringing his bell,and the weight of the islamist will rein down on you,coming to you curtisy of those who hate jews.

Posted by: Gracy at April 22, 2009 2:37 PM
Comment #280797

Stephen,

“I mean, for heavens sake: AT&T came back as a local telecom provider!”

You are suggesting that they are a monopoly are you? There really should be no provision to prevent them from becoming a local provider as long as their position there does not constitute a monopoly, should there? Btw, the deregulation of the phone industry that allowed the consolidation to take place was signed into law in 1996 under President Clinton.

The consolidation that happened under Bush was largely set in place by the regulations that were changed in the previous administration.

Posted by: Rob at April 22, 2009 5:02 PM
Comment #280815

Rob-

You are suggesting that they are a monopoly are you? There really should be no provision to prevent them from becoming a local provider as long as their position there does not constitute a monopoly, should there? Btw, the deregulation of the phone industry that allowed the consolidation to take place was signed into law in 1996 under President Clinton.

No, I’m not suggesting that they’re a monopoly. However, I am stating as verifiable fact the following: A number of the Baby Bells merged under Bush. Southwestern Bell was one of them. It became SBC, and then subsequently, AT&T. Theirs was not the only telecom to do this.

We can also look and see the consolidations in other businesses, media, energy, and banking, all of which the Republican Congress and the Republican President were consistent in supporting.

I think we could quibble about Clinton’s role. We know him to be a centrist and a triangulator, one of a group of Democrats who charted a more rightward course for his party. It is not my object to deny that he bears responsibility for signing a number of bills that pushed deregulation, especially the financial deregulation that allowed the too-big-to-fail syndrome to occur among banks today.

But I would point out that differing motives and attendant actions took place under the umbrella of Republican leaders and Democrats, and that Democrats at the very least had folks among them who moderated the extent to which their leaders went in these directions.

I would submit that Republicans were behind these changes wholeheartedly, in a more unified manner, and when they finally gained full power, wasted no time in pushing their agenda.

Why do I submit this particular argument? Because, I think, it’s a distinction that needs to be made, and a responsibility that needs to be taken on the part of the Republicans. The object of the argument that raises examples of Democratic Party cooperation with these measures is to stagnate a changeover by essentially saying “you’ve got nowhere to go, everybody supported this.”

The trouble with that argument is that not everybody who supports something in politics supports it with the same zeal. It is totally imaginable that many Democrats (though admittedly not all) voted with Republicans because it was thought to be the politically expedient thing to do. That being the case, many of those people can be persuaded to do what is politically expedient now. Unlike some, I don’t count on the ideological purity of my fellow party members in Congress. I count on people, when the right pressure is applied, to do what is in their self-interest. My aim, and the aim of many who deal with politics in the Democratic Blogosphere is not to change the world with bright and happy rainbows, but with political pressure and activism. We’re aware of how badly many of our politicians have strayed. We’re aware of the fact that our people have acted corruptly, or at least inordinately in line with special interests.

We don’t aim to tolerate it. But we also don’t aim to let the Republicans to employ the disingenuous tactic of pointing out Democratic party foibles in that respect to get ahead, while their own are in plain view or recent memory.

Posted by: Stephen Daugherty at April 22, 2009 8:25 PM
Comment #280840

SD
There is much to be said for conservative philosophy. For example,a distrust of big government, a respect for individual rights(although they may be selective as to which rights), fiscal responsibility,etc. I have been disdainful of some of their efforts to distance themselves from the Bush regime after the fact, but lets face it. They were screwed by the Rep leadership along with the rest of us. It must hurt more because they were fooled into supporting the oligarchs that screwed everybody. That AND getting creamed at the ballot box must make them pretty depressed. I hope they snap out of it and get back to work. We need them but hopefully they will put on their thinking caps this time.
As the real weakness of liberalism is accepting change itself as a goal in and of itself, the real weakness of conservatism is to resist change even when it is the best course.
The financial troubles largely stem from the absurd run up of real estate prices. This happened when after the dot-com bust there was a great deal of capital freed up that HAD to be invested. The only thing available that was making money was real estate. This great infusion of capital created the ascending spiral,feeding on itself to create the bubble.This led to that. That led to this.
What would have happened if the country’s leadership had instead opened up the path to alternate energy production through incentives, marketing help, research and other ways the government can and has helped fledgling industries?That would have been bold. I suspect a we would be in much better shape. I know that Bushco had vested interest in an oil economy etc. but the failure was an even more basic conservative one. Bold moves, especially by government, are to be resisted. That is why, looking back, conservatives resisted things as diverse as unemployment insurance and Black civil rights. Change means a potential to make things worse,to make a mistake. The falacy,of course, is there are times when stasis,the status quo, can also make things worse but my point explains the irrational,reflexive, resistance to every BHO proposal no matter how logical. This goes beyond politics. This is also why we need conservatives as a check but should never ever let them become the dominnent political party again.Philosophically they just can’t handle it.

Posted by: bills at April 23, 2009 8:45 AM
Comment #280841

bills-
Skepticism to me is more important than distrust, and by that, I mean a more scientific kind of skepticism, where claims of all kinds are weighed on their merits. The Republicans made a mistake of being reflexively mistrustful of government, rather than merely careful in their dealings, as all Americans should be.

The real trouble is that the Republicans favored policies that allowed people to create value, profit, out of basically thin air. But this service to the quantitative side of business came at a price to the qualitative side of business, which inevitably feedback to harm the qualitative side.

Ultimately, such feedback is unavoidable. Pollution costs more to deal with after the fact than before. Global Warming certainly illustrates that. But relentless job cutting, executive overcompensation and unaccountability, deceptive accounting practices, and hypercomplex, substantively meaningless speculation trickery, have all come together to create an economy that’s more or less dysfunctional for it.

We cannot dream up more value. We have to create it. We have to create things with acceptable margins of safety and sustainability. We have to remember that pressures push wages up, and that we cannot simply expect folks who never see their wages go up, fund the enrichment of those whos salaries and compensation constantly do. At some point, something in this economy has to give, and it already has.

Posted by: Stephen Daugherty at April 23, 2009 8:55 AM
Comment #280848

“The world moves, and ideas that were once good are not always good.”

Posted by: Rodney Brown at April 23, 2009 11:41 AM
Comment #280852

SD
“The real trouble is that the Republicans favored policies that allowed people to create value, profit, out of basically thin air. “

Correct, but the straw they were using in their attempt to spin gold was the unsustainable ,artificial run-up in housing prices. That run-up could have been avoided and the capital from the dot com bubble could have been put to constructive use if we had had leadership willing to act boldly in fixing a problem we all knew we would have to face at some point. My point was that the conservative outlook simply does not favor bold action for change by definition.

Posted by: bills at April 23, 2009 1:27 PM
Comment #280890

Stephen,

You said, “No, I’m not suggesting that they’re a monopoly. However, I am stating as verifiable fact the following: A number of the Baby Bells merged under Bush. Southwestern Bell was one of them. It became SBC, and then subsequently, AT&T. Theirs was not the only telecom to do this.”

I don’t disagree; however, the implicit assumption in this statement is that the Bush administration should have prevented this. I ask you why? Because the role that the government has in regulating mergers is based on legislation that is nearly 100 years old. The intent of that legislation is to prevent monopolies. The mergers that recreated AT&T were allowed because they did not create one. The original split of AT&T in the 80’s created an environment were competition flourished, and it pervades to today. There would simply be no legal basis for preventing the mergers. Nor is there any solid evidence to suggest that it would have been the best course of action to do otherwise even if the legal authority were there to do something.

You also said, “I would submit that Republicans were behind these changes wholeheartedly, in a more unified manner, and when they finally gained full power, wasted no time in pushing their agenda.” Actually, the Republicans had to do nothng. While I agree they were behind the changes, so were most Democrats. There litterally was nothing left for the Republicans to pursue once Clinton left office.

You also said, “We don’t aim to tolerate it. But we also don’t aim to let the Republicans to employ the disingenuous tactic of pointing out Democratic party foibles in that respect to get ahead, while their own are in plain view or recent memory.” What I believe is disingenous is your constant painting of the Republicans as being responsbile for deregulation despite the evidence to the contrary. The fact was that from the 60’s on, Democrats pushed the agenda as frequently as Republican’s did and ultimtely were responsible for passing the legislation that allowed for the biggest problems to occur. That they don’t like that they did it now does not get to let them off the hook.

You also said, “The object of the argument that raises examples of Democratic Party cooperation with these measures is to stagnate a changeover by essentially saying “you’ve got nowhere to go, everybody supported this.” This is actually not my purpose in raising examples of the Democratic agenda of deregulation. My purpose in raising this argument is several:

1) I believe that the political point-scoring on the issue that you in particular are trying to make are dishonest. So I believe that your arguments deserve to be debated with facts rather than rhetoric.

2) I believe that we should recognize that deregulation as a whole has been very beneficial to the American economy. I praise the brave actions of Clinton and Carter in this regard along with those of Reagan and BushI. Without deregulation think how expensive airline travel would be today.

3) I believe that you are inproperly confusing the goals of deregulation with the desire for no regulations. Republicans and Democrats have both passed regulations over businesses in the past 30 years. Look up the history of the American with Disability Act, and you will see that BushI signed into law a bill over the strong objections of industry.

Instead, deregulation as an objective is to remove or lower entry costs into a market space and foster competition. This is a good thing. It is part of an overall strategy that includes preventing monopolies that allowed the American economy to go from a second-tier nation to a Super Power.

Finally, the argument in no seeks to prevent us from moving anywhere. However, it does mean to say think before we act. I have inferred from your posts that because deregulation was a “Republican Agenda,” and they aren’t in power any more that the Democrats are now free to fully reverse it and all will be better. I caution against believing that is the best course of action. Smart people from both parties pursued the agenda; before reflexively acting on political means, we should careful consider the law of unintended consequences.

Posted by: Rob at April 24, 2009 2:12 PM
Comment #281477

There are only two basic overriding principles of the Republican Party. The first is: Get tough or die. The second: Never give a sucker an even break.

Posted by: Stephen Hines at May 9, 2009 2:54 PM
Post a comment