"Nobody saw this coming. Anybody who did is nobody"

July 10, 2011 5:59 PM

Sheila Bair just stepped down from leading the FDIC, and has a sad, sordid story to tell . As head of the FDIC, her attempts to correct the imbalances which led to the financial crash were repeatedly ignored.

She seems to have been one of the few regulators of the financial industry who took her fiduciary responsibilities seriously. From a recent Washington Post editorial she just wrote:

Already we have heard rationalization of the subprime mortgage debacle and denigration of those of us who have advocated long-term, structural changes in the way we regulate the financial industry. Too many industry leaders, as well as some government officials, compare the crisis to a 100-year flood. “Who, us?” they say. “We didn’t do anything wrong. Nobody saw this coming.”

The truth is, some of us did see this coming. We tried to stop the excessive risk-taking that was fueling the housing bubble and turning our financial markets into gambling parlors. But we were impeded by the culture of short-termism that dominates our society. Our financial markets remain too focused on quick profits, and our political process is driven by a two-year election cycle and its relentless demands for fundraising.

I’ve had a unique vantage point during my five-year term as chairman of the Federal Deposit Insurance Corp., from the early failure of IndyMac Bankto the implementation of reforms designed to ensure that no conglomerate ever again is deemed “too big to fail.”

Now that I’m stepping down, I want to sound the alarm again. The common thread running through all the causes of our economic tumult is a pervasive and persistent insistence on favoring the short term over the long term, impulse over patience. We overvalue the quick return on investment and unduly discount the long-term consequences of that decision-making.

posted by Coventry (65 comments total)

I read this last night--it's phenomenal, and I'll bet that if she wanted to, she could tell some really really harsh stories.
posted by etaoin at 6:03 PM on July 10, 2011 [1 favorite]

I believe that since I was a kid, our culture has altered so much; I do not recall such a premium placed on profiting NOW NOW NOW, and I remember when calling somebody selfish was an insult, and acts of selfishness were a source of shame.

I must be getting old, because it's actually always been like this, right? Things haven't changed in the past few decades, we've always brazenly sought quick profits and been applauded for our greed, right? My perspective must just be a bit off due to old age.
posted by jabberjaw at 6:32 PM on July 10, 2011 [7 favorites]

Why can't someone like THIS run for president????
posted by St. Alia of the Bunnies at 6:42 PM on July 10, 2011 [22 favorites]

What time scale are we talking about? "Greed is good" is from the 80s. Phillip Morris knowingly sold dangerous products for decades. Vanderbilt, Carnegie and Rockefeller were from the 19th century.
posted by empath at 6:43 PM on July 10, 2011

Why can't someone like THIS run for president????

"Vote for me, and I guarantee you that several large American banks WILL fail during my term."

Sounds like a winning platform to me.
posted by empath at 6:44 PM on July 10, 2011 [7 favorites]

I understand that Wall Street and the nation are supposed to believe that, the next time the "too big to fail" banks get in trouble, they will not be bailed out again. But from what Bair's experience was, I find it hard to believe they won't be bailed out again.

Is there any reason to believe they won't be bailed out again?
posted by jayder at 6:44 PM on July 10, 2011 [2 favorites]

My perspective must just be a bit off due to old age.

Not always, it comes and goes in waves.

Beginning of the last century was a bad time. Old Joe Kennedy made his first fortune as a quick buck artist before getting a government job once the depression started and closing down the outrageous practices that got him rich int he first place. Glass Steagel and the depression and the war and all that brings out some good instincts in a lot of people.

Come the Greenspan era and the Wall Streeters not rich enough went back to government service again, only this time to loosen those rules because, well, what's good for Wall Street is good for America. Trust us on this one.

We will see shame return I think, but probably along with pain.

Fun fact - Paul Volcker's last salary before he left Chase Manhattan as VP and director of planning for a job as under secretary of Treasury in 1969 was about $64,000 pa. A very great deal at the time, but an insult it he minds of those followed him, even granting inflation.
posted by IndigoJones at 6:45 PM on July 10, 2011 [2 favorites]

Keep in mind, Geithener tried to give her the boot when he became the fed chair. The reason, she was literally not a "team player". I'm sure whoever they pick next won't have that problem!
posted by delmoi at 6:47 PM on July 10, 2011 [3 favorites]

The NYT article mentions another regulator who was ignored, Brooksley Born. Frontline did a show on her, The Warning. It is well worth a watch. Just as the Iraq war was started by retreaded neocons going back to the Nixon administration, our current financial system is being run by the same men who ignored these warnings as far back as the 1990's.
posted by TedW at 6:48 PM on July 10, 2011 [4 favorites]

"Vote for me, and I guarantee you that several large American banks WILL fail during my term."

Sounds like a winning platform to me.

I know you're being sarcastic, but if you could vote in a way that would guarantee the destruction of Goldman Sachs and Bank of America, would you do it?
posted by delmoi at 6:49 PM on July 10, 2011 [18 favorites]

I know you're being sarcastic, but if you could vote in a way that would guarantee the destruction of Goldman Sachs and Bank of America, would you do it?

Yeeeesssssssssss
posted by Slackermagee at 6:54 PM on July 10, 2011 [6 favorites]

Why can't someone like THIS run for president????

Even if she did, folks like you probably wouldn't vote for her. She's pro-choice.

(That's not intended as a slight against you St. Alia, just a statement of fact put out there to indicate that she's far, far too liberal to be a viable Republican candidate nowadays--on both social and financial (she argued for nationalizing CITI and several other banks) issues)
posted by Chrischris at 6:56 PM on July 10, 2011 [18 favorites]

It does seem like Obama has taken the middle ground, occupied it, constructed a futuristic techno fortress on it, to the point where people who run against him are actively competing to out-crazy each other.

Could she transfer to the democrats and challenge Obama in the primaries? I'd vote for her there too. Heck, run as an independent in a new party the: "Does not capitulate to Wall Street 100% of the time Party"

I mean doesn't viable Republican candidate mean non-viability in the national election? "I'm sorry Ma'am, it looks like you don't think that life for African Americans was better under slavery than today, you just aren't fundamentally out of touch with reality enough for modern politics."
posted by SomeOneElse at 7:19 PM on July 10, 2011 [3 favorites]

I doubt that Goldman-Sacks would fail under a Sheila Bair Presidency. There might be many pissed off investors & traders, but probably no failures.
posted by jeffburdges at 7:20 PM on July 10, 2011 [1 favorite]

Frank Rich in New York Magazine: The president’s failure to demand a reckoning from the moneyed interests who brought the economy down has cursed his first term, and could prevent a second.
posted by homunculus at 7:25 PM on July 10, 2011 [9 favorites]

> Is there any reason to believe they won't be bailed out again?

There is the Dodd-Frank bill (see p. 76), which is supposed to establish regulatory control over "systemically significant" financial institutions. But that control is unlikely to be effective. If the "Financial Stability Oversight Council" mandated by Dodd-Frank proves to have teeth, Wall Street will find a way to pack it with friendly representatives.

I don't think anything fundamental has changed to reduce the risk of another bailout-worthy crisis. For instance, it seems likely that Greece and other European countries will default. Uncertainty about related credit default swaps could easily cause a new credit crisis. And the same people who devised the recent bailouts are still running things, so a future bailout is likely to be similarly structured.
posted by Coventry at 7:29 PM on July 10, 2011

Why can't someone like THIS run for president????
posted by St. Alia of the Bunnies at 6:42 PM on 7/10
[8 favorites +] Adding... [!]


Because they would KILL her like Kennedy!
posted by Katjusa Roquette at 7:36 PM on July 10, 2011

I doubt they let presidents drive by the Texas School Book Depository in an open air limo any more.
posted by Auden at 7:55 PM on July 10, 2011

Let me see if I understand what she's saying, nothing was fixed by "financial reform", the administration knows it and actively chose to side with the banksters back then and to this day, and the next crash is coming and will be way, way worse, but we're going to bail out the same people again anyway (because they're rich, and the rich must always be protected from loss at all times regardless of circumstance), and probably we're not going change anything then either (else the rich might take a loss, can't have that). Does that about sum it up?

So. Has anyone seen a decent price on pitchforks lately?
posted by T.D. Strange at 8:16 PM on July 10, 2011 [1 favorite]

From the NYT link: She favored “market discipline” — meaning shareholders and debt holders would take losses ahead of depositors and taxpayers — over bailouts, which she abhorred.

I can see why policy makers didn't want to destroy the banks, but without a system like this "market discipline" one, what incentive do big banks have to not do stupid risky trading and investing?

I hope her resignation and the press coverage at least leads to some revisiting of the policies we've implemented.
posted by p3t3 at 8:17 PM on July 10, 2011 [1 favorite]

I understand that Wall Street and the nation are supposed to believe that, the next time the "too big to fail" banks get in trouble, they will not be bailed out again. But from what Bair's experience was, I find it hard to believe they won't be bailed out again.

I dunno what the nation is supposed to think, but Wall St. does not think but know that if the shit hit the fan again we will save their asses. So confident are they of this that many of them are applauding the whole hardline deficit cutting now stance in the face of massive unemployment b/c they want to improve bond yeilds, even though the reason the deficit's through the roof are a) the fact that the economy is in the shitter and b) the cost of the bailouts/recovery act.
posted by Diablevert at 8:30 PM on July 10, 2011 [1 favorite]

For whatever it's worth, my wife was working in government as a banking lawyer up until just a few years before everything went wrong and a) she has nothing but great things to say about Sheila Bair; and b) she (my wife) and everyone else she and I knew in financial services policy back then was constantly predicting that things would go exactly the way they did.

When they say nobody saw this coming, what they mean is that everybody saw this coming but that "they" do not want to admit it.
posted by The World Famous at 8:34 PM on July 10, 2011 [10 favorites]

Money money money money Money money money... money.
Money money money money Money money, money, money (money money money).
Money money money money:
1) money
2) money
3) money

Money money money money-Money- money money money? Money money money money money money money money!

Professor Rush Limbaugh's Slippers
Mobil-Halliburton-Bechtel-Pfizer University
Reagan-Thatcher Chair of Anglo-American Thought
posted by larry_darrell at 8:42 PM on July 10, 2011 [6 favorites]

I hope her resignation and the press coverage at least leads to some revisiting of the policies we've implemented.

I"m sure it will. They'll revisit how someone like her ever got appointed in the first place and make sure it never happens again.
posted by empath at 8:43 PM on July 10, 2011 [4 favorites]

Obama, Geithner and their ilk are quite happy with the system as it is. Huge corporate profits, banks that function like giant casinos, laws that apply to us but not them, the preposterous notion of self-regulation -- all of those things are exactly what the Obama Administration and its corporate supporters want. Persistent unemployment, stagnant wages and increasing inequality are just annoyances that the rest of us will have to deal while we keep these people in power.
posted by grounded at 9:07 PM on July 10, 2011 [8 favorites]

I thought it was interesting that all of the government officials who had the best interests of the people (not the people running the banks but the actual depositors) at heart are/were all women. Brooksley Born, Sheila Bair, and now Elizabeth Warren.

We dont know if Warren will be named to the Consumer Financial Protection Bureau as many would hope.
posted by gen at 9:43 PM on July 10, 2011 [6 favorites]

That sucks. I really liked her. She seemed like the only adult in the room. I actually had hopes she'd have a bright political future.

FMUSA.
posted by Afroblanco at 9:51 PM on July 10, 2011 [1 favorite]

"... Is there any reason to believe they won't be bailed out again?"
posted by jayder at 9:44 PM on July 10

Maybe. Part of the intransigence being demonstrated by Congressional Republicans on raising either taxes or the debt ceiling is their simple recognition that no sovereign is too big to fail, if it indefinitely tries to continue borrowing to support unrealistic spending. A country trying to borrow in excess of a trillion dollars a year to maintain government spending, while its banks retain about $300 billion of bad mortgages and non-performing loans, and where nearly 400 of those FDIC insured banks, nationwide, continue to operate with bad assets on their books in excess of their capital, isn't too big to fail. Bair and her followers at FDIC may have been doing the Lord's work on behalf of America's Main Street since late 2008, but it may not have been enough, in the end.

The world's sharp operators are staying up nights, now, re-jiggering their spreadsheets to price American default into profit plays, or at least into asset protection schemes for the very cynical. And even if a technical default is avoided between now and August 2, by political action in Washington, the magician has mistakenly shown the bunny: the full faith and credit of the American government may not be equal to the demands of a continuing worldwide banking system in short circumstances, a U.S. housing market still on the decline, various expensive foriegn military obligations, an inflationary spiral beginning with higher costs to the U.S. Treasury for borrowing even when the debt ceiling is raised, and the financial shorts who have been sitting on the sidelines for sometime, but are now, again, smelling blood.

It's a helluva way to keep from falling into global socialism, but it is one way.
posted by paulsc at 9:53 PM on July 10, 2011 [4 favorites]

"I’ve always wondered why none of A.I.G.’s counterparties didn’t have to take any haircuts. There’s no reason in the world why those swap counterparties couldn’t have taken a 10 percent haircut. There could have at least been a little pain for them.” (All of A.I.G.’s counterparties received 100 cents on the dollar after the government pumped billions into A.I.G. There was a huge outcry when it was revealed that Goldman Sachs received more than $12 billion as a counterparty to A.I.G. swaps.)

Bair continued: “They didn’t even engage in conversation about that. You know, Wall Street barely missed a beat with their bonuses.”

“Isn’t that ridiculous?” she said.
posted by mediareport at 9:57 PM on July 10, 2011 [1 favorite]

I haven't yet read the whole article, but it sounds like some revisionist history, unless I'm wrong in believing that the FDIC has regulatory power over institutions it insures.

And there was the whole WaMu debacle that hasn't had nearly enough written about it. That deal was far sleazier than any of the other shotgun weddings. Long story short, the FDIC jumped the gun in seizing the bank.
posted by wierdo at 10:06 PM on July 10, 2011 [2 favorites]

"I do not recall such a premium placed on profiting NOW NOW NOW"

at least in terms of Wall Street, some of this is a product of the 24-hour news cycle and the democratization of investing. There's a pretty unprecedented emphasis on meeting the quarterly predictions, because the news cycle is voracious for new stories, and traditional business news just doesn't HAPPEN that fast or that often. So corporations have been pushed to manage in ways that suits a quarterly profit prediction rather than a longer-term profitability/sustainability model. Plus, business news now markets to everyone with a 401(k), not just savvy businesspeople as in much of the past, and a much easier story to sell is "CorpCo met its quarterly earnings predictions today ..." rather than "CorpCo set into motion a series of production initiatives that, in fifteen years, will result in a slightly higher valuation for the company and allow it to diversify its business as a hedge against developments in the steel markets ..."

David Brooks, who isn't my favorite commentator generally, had an interesting insight about it in "On Paradise Drive" (I think it was); basically, that the longer-term most profitable stocks are almost never the short-term high-earners, because the long-term profits come from tiny things like (an example he gives) some middle manager figuring out how to shave a couple seconds off every receipt printed which, over time and across a national chain, adds up to employee manhours saved and tons of fractionally happier customers with a faster checkout process. It's the accumulation of large quantities of tiny, fractional improvements of that nature that lead to long-term profitability, he argues. But that's not interesting or sexy to report, not the way a new iPhone model is.
posted by Eyebrows McGee at 10:10 PM on July 10, 2011 [2 favorites]

delmoi wrote: I know you're being sarcastic, but if you could vote in a way that would guarantee the destruction of Goldman Sachs and Bank of America, would you do it?

I would be happier than a clam to see Goldman go down in flames, even if it cost us a hundred billion dollars to wind it up. At least the argument could be made that the other banks were just full of stupid people. The Goldmanites, on the other hand, knew all along what they were doing and made sure to fleece everyone possible, including the taxpayer as everything was blowing up.

If it weren't for them, AIG almost certainly would not have failed as spectacularly (and expensively). Hell, the European banks wouldn't be as fucked as they are/were either. They're no better than mobsters.
posted by wierdo at 10:11 PM on July 10, 2011 [1 favorite]

"I haven't yet read the whole article, but it sounds like some revisionist history, unless I'm wrong in believing that the FDIC has regulatory power over institutions it insures. ..."
posted by wierdo at 1:06 AM on July 11

The passage of Dodd-Frank beefed up FDIC regulatory powers.

For those interested in reading through a 40 page .pdf file, the FDIC has published an analysis of how its new powers under Dodd-Frank, applied to the Lehman bankruptcy, could have resulted in a 90 cents on the dollar recovery of assets, compared to the 20 cents now believed to be the best case possible in the bankruptcy proceedings.

It helps in the reading of that .pdf if you have a flair for suspension of disbelief, and enjoy fairy tales, I think.
posted by paulsc at 10:21 PM on July 10, 2011

"It does seem like Obama has taken the middle right of centre ground, occupied it, constructed a futuristic techno fortress on it, to the point where people who run against him are actively competing to out-crazy each other."
posted by arse_hat at 11:40 PM on July 10, 2011 [2 favorites]

Has anyone seen a decent price on pitchforks lately?

People keep inquiring about the price, but nobody's actually buying.
posted by vidur at 11:53 PM on July 10, 2011 [10 favorites]

.
posted by benzenedream at 12:20 AM on July 11, 2011

Well I *do* own a scythe, it cost me about $80 including taxes. I imagine a pitchfork would be around that price, assuming quality workmanship.
posted by Katjusa Roquette at 12:34 AM on July 11, 2011

Let me see if I understand what she's saying, nothing was fixed by "financial reform", the administration knows it and actively chose to side with the banksters back then and to this day, and the next crash is coming and will be way, way worse, but we're going to bail out the same people again anyway (because they're rich, and the rich must always be protected from loss at all times regardless of circumstance), and probably we're not going change anything then either (else the rich might take a loss, can't have that). Does that about sum it up?

Yep, that's about right. Also, Americans should kiss the feet of their feudal lords that they are allowed to even have a job. Benefits, pensions, salaries, all should be cut if they're "too much". The only people who don't see any of these cut are the banksters, the CEOs, and their courtiers. It's a race to the bottom. God Bless America.

And just think - within 10 years or so, we'll get to do all of this again after the next financial crisis!
posted by jhandey at 2:17 AM on July 11, 2011

The passage of Dodd-Frank beefed up FDIC regulatory powers.

Which the Republican Party, lead by such Teabagger champions of the people as $700-a-bottle wine connoisseur Rep. Paul Ryan, has been fighting desperately to make even more ineffectual.

Why is Paul Ryan's taste in wine important? Here's a long-ish excerpt from TPM's description of Ryan's dinner companions:

"The three men were spotted ordering the $700 worth of wine at Bistro Bis on Capitol Hill by an associate professor of business at Rutgers University named Susan Feinberg. After dining in the same restaurant with her husband, Feinberg confronted Ryan and his pals about the high-end wine. The exchange became contentious. Ryan professed not to know the price of the wine, and one of his buddies responded to Feinberg's chastisement by loudly saying, "Fuck her," Feinberg told TPM.

When TPM asked Ryan who he was dining with Wednesday night, he declined to identify them, saying only that they were economists, not lobbyists. But TPM has confirmed that the two other men with Ryan were Cliff Asness and John Cochrane. Both men have doctorate degrees in economics and are well-known in the conservative media world as die-hard proponents of the free market's ability to right itself without government bailouts when the crisis hit in late 2008.

Asness, who ordered the wine and who, according to Feinberg was the one who said "Fuck her," is better known as a high-profile hedge fund manager. Asness founded and runs AQR Capital, which manages an estimated $26 billion in a variety of traditional products and hedge funds, and his life story has been the subject of numerous books and articles about the rise and fall of Wall Street. He's also grabbed headlines for being one of the most voluble opponents of President Obama's economic policies.

ABC's Jake Tapper ran an illuminating piece on Asness in May of 2009, describing him as having "a name and occupation straight out of Dickens" after he wrote an angry open letter to Obama -- "Unafraid in Greenwich, Connecticut" -- in which he blasted the President's attacks on hedge fund owners refusing to go along with his administration's plans for Chrysler.

"Who came up with the title for the letter?" Tapper asked parenthetically in his piece. "Axelrod? Perhaps 'Bold and on My Yacht' was too subtle."

Cochrane, the other, more tempered dinner companion, is the AQR Capital Management Distinguished Service Professor of Finance at the University of Chicago, an apparent tip of the hat to the contributions Asness' AQR Capital Management has made to the Booth School of Business there...

...In May 2009, Asness served as a guest host on CNBC's Squawk Box and defended the $450 million in bonuses AIG executives received, arguing that President Obama and the Congress are responsible for the economic crisis and should pay the execs the bonuses themselves.

Before launching AQR Capital in 1997, Asness worked for Goldman Sachs, the most profitable securities firm in Wall Street history, as the director of quantitative research for its Asset Management Division.

By the end of 2008, the firm was at the epicenter of the global financial crisis and received a $12.9 billion government bailout ($10 billion of which it paid back the next year). Amid the crisis, Goldman Sachs was under fire for doling out billions in bonuses.

"Cliff and his team at Goldman were responsible for building quantitative models to add value in global equity, fixed income and currency markets for Goldman clients and partner," states the bio on his firm's website...."
posted by jhandey at 2:25 AM on July 11, 2011 [1 favorite]

"... By the end of 2008, the firm was at the epicenter of the global financial crisis and received a $12.9 billion government bailout ($10 billion of which it paid back the next year). ..."

In fairness, Goldman Sachs never asked for government money, they were told in no uncertain terms by Treasury to take it, along with the other top institutions to which the Treasury wanted to push out TARP money. The thought was, that if only weak institutions took TARP funds, it would quickly be a marker to the shorts which institutions were weak, and even how weak they were. And banks like Citi could have gone down quickly, on little more than market perception and a billion in negative trades by shorts, in the fragile market of the 4th quarter of 2008.

Hence, the Troubled Asset Relief Program, which bought no troubled assets at all, and relieved very little but the pressure by shorts on wobbly Citi.
posted by paulsc at 2:43 AM on July 11, 2011 [1 favorite]

People keep inquiring about the price, but nobody's actually buying.

Yet. Wait till there's another collapse where no one goes to jail and all the culprits make out like bandits.
posted by T.D. Strange at 4:09 AM on July 11, 2011

She seemed like the only adult in the room.

Nope, there's another. Elisabeth Warren is someone who strikes me as smart, compassionate, and nobody's fool. I expect her to drop out next, Obama's not going to the mat for her, AFAIK, and there's only so long that a decent person can deal with the entire Republican party, especially when they're going after you all-out and knives-drawn.

In fact, Obama's reluctance to fully back her, and his apparent use of her as a bargaining chip, has been my greatest disappointment in him. She's no radical or partisan, she doesn't come off "elitist", and if you put her in front of the cameras I think she could win a broad swath of the people to her side. She could have been a great way for Obama to reclaim the broad middle and demonstrate just how far right the Republicans are, while empowering someone decent and capable. He either didn't have the balls, or didn't want another Hillary in his spotlight, or preferred to keep bargaining instead of fighting, I don't know which.

And to +1 gen, I don't think that its a coincidence that the only two adults in this room that I see are well-educated women.
posted by tempythethird at 4:39 AM on July 11, 2011 [7 favorites]

Yes, Obama doesn't fight for his people the way Bush did. It's a weakness, and long term that type of thing isn't going to help as it's always the effective people who the Reps go after.
posted by jaduncan at 5:07 AM on July 11, 2011

p3t3 wrote: I can see why policy makers didn't want to destroy the banks, but without a system like this "market discipline" one, what incentive do big banks have to not do stupid risky trading and investing?

The 1930s solution was to regulate banks like public utilities. There's a reason why there were essentially no bank failures between the end of the Depression and sometime in the 70s.

The problem, essentially, boils down to the acolytes of Ayn Rand who run things. Rand was an utter failure as a student of history, as are those who believe in her capitalist religion. (as opposed to those who believe in the capitalist system of economics) They collectively failed to notice that her free market utopia had previously existed and did not fare well.

Basically, much stronger regulation is needed in finance. It's not only fine, but probably even a good thing to have shitheels like Goldman out there on the fringes perpetrating their bullshit. It is they and their ilk, after all, whose speculative finance helps turn technological innovation into technological revolution. However, all that bullshit needs to be kept far, far away from the place where most of us put our money.

In the immortal words of the Battlestar Galactica introduction, "all this has happened before, all this will happen again."
posted by wierdo at 5:20 AM on July 11, 2011 [5 favorites]

paulsc wrote: In fairness, Goldman Sachs never asked for government money, they were told in no uncertain terms by Treasury to take it, along with the other top institutions to which the Treasury wanted to push out TARP money.

In fairness, had the government not bailed out Goldman's counterparties, they would have been in dire need of said funds. Also, in fairness, Goldman needed Fed money so bad they couldn't wait out the week-long waiting period to become a bank holding company. I think that's strongly indicative of serious liquidity problems.

(sorry for the rapid-fire commenting, it's early and I missed a couple of comments on my first read through since last night.
posted by wierdo at 5:27 AM on July 11, 2011

In fact, Obama's reluctance to fully back her, and his apparent use of her as a bargaining chip, has been my greatest disappointment in him. She's no radical or partisan, she doesn't come off "elitist", and if you put her in front of the cameras I think she could win a broad swath of the people to her side.

This, this, a thousand times this, tempythethird! I was never an Obama supporter to begin with (and had to listen to months of my friends telling me How Fantastically Great he was, blah blah blah), but when he got elected I thought ok, let's see what happens now.

Fail.

Fail is what happened.

He had the chance to get people like Elizabeth Warren (and other Actual Grownups) running things, yet fails to back them whenever things get rough. He had the chance to grow a damn spine and tell off the Republican thugs and insurance companies (oh wait, sorry, that's redundant) who stood in the way of healthcare reform, and he screwed that up, too. Sheila Bair is just one more casualty of his halfassed ways.

If he gets elected to a second term (and I am squarely going to blame him if he doesn't, because it's not like the Republican field is all that impressive), he better go Rambo on some things or go down in history as the world's biggest promise-that-failed-to-deliver.
posted by bitter-girl.com at 6:10 AM on July 11, 2011 [5 favorites]

And to +1 gen, I don't think that its a coincidence that the only two adults in this room that I see are well-educated women.

Well if you're looking to form a economics triumvirate, then I would suggest Christina Romer, former Chairperson of the Council of Economic Advisors. She's arguably more of an economic heavyweight than even Bernanke and recently wrote an op-ed in the NYT backing selective tax increases vs. spending cuts.

I thought Romer's departure might have been a harbinger that NY/Wall St. (Geithner/Summers/Bernanke) wing of the Obama economic team was winning out vs. non-Wall St. wing.

Finally, I've followed Goolsbee even less, but since he's leaving, hopefully we'll hear his reasons and viewpoints on Obama's economic team.
posted by FJT at 6:42 AM on July 11, 2011

bitter-girl.com To be fair, I don't think we can call Obama a coward or failure. He ran and won as an incrementalist and a consensus-builder, and thats what he's doing, and by those terms he's not failing at all. He promised to do all he could to avoid out-and-out conflict, and thats what he's doing. He compromised everywhere on health care, but he did got something done in the end, and the result, as compromised as it is, is better than what we had before. I'm sure that Obama and people who support his philosophy would argue that its incrementalism or nothing in the US.

I think incrementalism and consensus-building (hah!) do work in the US, but at such a slow pace that our grandchildren will be dead before we see the things that we should rightfully see in our lifetimes, and we'll be forced to sell our souls in the process. Obama and his ways would be much more appropriate here in (relatively saner) Germany, and in some bizarre way he's politically not so far from Merkel.

Hillary Clinton was the pit-fighter we should have picked, but who knows - she may have achieved absolutely spectacular things, or she might have done worse than Obama. Obama with all his gentle ways managed to enrage the Republican nest, Clinton would have done much worse.
posted by tempythethird at 7:23 AM on July 11, 2011 [2 favorites]

bitter-girl.com wrote: This, this, a thousand times this, tempythethird! I was never an Obama supporter to begin with (and had to listen to months of my friends telling me How Fantastically Great he was, blah blah blah), but when he got elected I thought ok, let's see what happens now.

If you know of a serious contender for any federal political office (other than the two or three usual suspects in the Congress we all already know about) not in one or more lobbyist's pocket, please let me know. Until then, I'll be happy to not have schizophrenic McCain. Hillary would not have been any better on this. She and Bill have historically kept pretty much the same company politically speaking, and Bill's administration was just as full of ex-bankers as Obama's.

(I have nothing against schizophrenics, I just don't want them running my country)
posted by wierdo at 7:33 AM on July 11, 2011 [1 favorite]

or she might have done worse than Obama. Obama with all his gentle ways managed to enrage the Republican nest, Clinton would have done much worse.

On nearly every issue, Clinton has tacked to the right of Obama. She's consistently been more Hawkish, and more willing to cater to AIPAC, for instance. Nobody can really claim to know what might have happened if we're going to talk about a Clinton presidency in the subjunctive case, but I'd be willing to bet there'd be plenty--if not more--for us to complain about all the same.
posted by saulgoodman at 10:16 AM on July 11, 2011

saulgoodman You're spot on as far as foreign policy, and the sad state of affairs is such that for a Democratic woman such as Hillary to be taken seriously, she has to tack right. But I don't think we know much about her positions re: domestic policy during the Obama term. From what we know of the Clinton years, however, I would guess that she would have fought tooth-and-nail for proper healthcare, at the very least.
posted by tempythethird at 10:32 AM on July 11, 2011

True, tempythethird, but it's worth noting that Clinton's own health care plan--the plan she took the lead in developing and promoting during her husband's presidency--included many of the same industry-friendly features that have been most sharply criticized on the left in the compromise HCR that eventually made its way into law. And the plan she proposed as a candidate was essentially the same as Obama's, except it included a mandate, and in it's final form, would have expanded medicare and the federal employees health insurance program as low-cost public alternatives.

In hindsight, this last proposal, to expand medicare as a public option, seems like a damn good one, but it wasn't part of Clinton's initial campaign platform and seemed to come about more as a response to the shifting political winds on the campaign trail than from any place of deep, principled conviction. I seriously doubt any kind of Medicare expansion would have made its way into the final version of the legislation in either case, with the party that now controls the House introducing legislation proposing to scrap Medicare all together and replace it with an income regressive voucher system (and somehow actually getting much of the media to portray this act of state subversion as a reasonable, compromise proposal in the bargain). But who knows. You might be right. She might have surprised us and just been temperamentally more inclined to give Republicans a real fight.

Some politicians will fight to the bitter end for causes they don't really even care about just because they are fighters by nature and because every fight won increases their stature.
posted by saulgoodman at 11:00 AM on July 11, 2011

Well, mandate + public option would indeed be much better than what we actually got. Yes she didn't propose this during the campaign, but when campaigning politicians just say whatever their pollsters think is best during that nanosecond, had she been elected I think someone would have steered her toward this.

But you finished my point for me:

Some politicians will fight to the bitter end for causes they don't really even care about just because they are fighters by nature and because every fight won increases their stature.

I'm not saying that Hillary has particularly strong policy preferences or ethics. (Though the fact that she advocated for intervention in Libya does give me pause). Rather, she had her marital problems dragged into the spotlight by the Republicans, was the target of horrific sexist innuendo, and on and on, for years. She doesn't have Obama's high-minded nature and the arrows don't bounce off her skin. She would have fought and fought just to show the fuckers.
posted by tempythethird at 11:32 AM on July 11, 2011

As Wall St. Polices Itself, Prosecutors Use Softer Approach
posted by homunculus at 12:47 PM on July 11, 2011 [1 favorite]

Sheila Bair, meet Shirley This.
posted by Spatch at 1:37 PM on July 11, 2011

She would have fought and fought just to show the fuckers.

And that's what *I* wanted in a Democratic candidate. A Howard Dean. A Howard Dean who will FIGHT YOU. (Anyone else remember that SNL spoof of Hardball where Howard Dean tells the Republican National Committee chair he wants to fight him? In the parking garage? Yeah. Like that. I loved that sketch).

Not this consensus-building weaksauce. And not because I don't believe in consensus-building. Of course I do. It's just not how the other side plays ball, and for heaven's sake, if we want to do anything other than roll over and let them rub our tummies (or stab us in the gut when we're vulnerable, that's more like it), then we have to be willing to fight, to back our own people, to tell the other side to get bent when they need it (and they need it -- A LOT). Don't apologize for something that doesn't need an apology, don't show weakness and who CARES if we "enrage the Republican nest," tempythethird? I want my Dems to DO stuff, not sit around and wring their hands about possibly making their opponents angwy.

AND YES, I MEANT TO SPELL IT LIKE THAT.

Because that is some childish, high school shit, and it is the sort of thing I somehow managed to grow out of as an adult, yet most Dems in public office have not. Well, except the Clintons, and that's because they don't seem to give a fuck what people think of them so long as things are getting done.

On wierdo's point, namely everyone's on the take somehow, I say: yup.

Not only do I say "yup," I say it's not going to change any time soon and any legislation you put in place to stop it only moves it to a different format or arena. So cards out on the table. Make 'em disclose where they're getting money from so they can (rightfully, if needed) be criticized for steering legislation one way or another.

I seriously don't care if United Healthcare stamps my ass with a barcode tattoo if it means they improve the delivery and cost of my healthcare, and I don't care if Candidate X is on the take from United Healthcare so long as we're provided with a free press and our own means to give them a hard time when they try to steer the contract for the tattoo ink to a company owned by their brother.

So maybe I'm feeling extra-fighty today, but part of that is because of things like this, and feeling exceptionally powerless to stop them from happening, and wishing we had someone stronger on our side...
posted by bitter-girl.com at 1:45 PM on July 11, 2011

Not this consensus-building weaksauce. And not because I don't believe in consensus-building. Of course I do. It's just not how the other side plays ball, and for heaven's sake...

I'm totally on your side, the right has been mashing their finger on the button labeled "nuclear option" for decades. But on the left few think like we do. Usually when I post something along these lines even here on mefi, I get people telling me that I shouldn't be divisive and that the country isn't as divided as the politicians make us seem, etc etc. The pretty but naive Jon Stewart view of things.
posted by tempythethird at 4:08 PM on July 11, 2011 [2 favorites]

bitter-girl.com wrote: Not only do I say "yup," I say it's not going to change any time soon and any legislation you put in place to stop it only moves it to a different format or arena. So cards out on the table. Make 'em disclose where they're getting money from so they can (rightfully, if needed) be criticized for steering legislation one way or another.

I seriously don't care if United Healthcare stamps my ass with a barcode tattoo if it means they improve the delivery and cost of my healthcare, and I don't care if Candidate X is on the take from United Healthcare so long as we're provided with a free press and our own means to give them a hard time when they try to steer the contract for the tattoo ink to a company owned by their brother.

Oh, it can change, it would just require the use of the antitrust laws. And putting them back. And removing the exemption health insurance companies get from antitrust law. The problem, in my view, is primarily the concentration of wealth (and therefore power) in few hands. This leads to a situation ripe for abuse.

None of this is to say that I'm not for disclosure, mind you.
posted by wierdo at 4:44 PM on July 11, 2011

I have long nurtured a suspicion that "not a team player" means "is surrounded by idiots and should get out while the getting's good."

This isn't helping.
posted by eritain at 6:48 PM on July 11, 2011

Republican Congressmen Blame Sluggish Job Growth On Elizabeth Warren
posted by homunculus at 1:45 PM on July 14, 2011 [1 favorite]

Obama to Eliminate Warren as Consumer Head
posted by homunculus at 11:12 AM on July 16, 2011 [1 favorite]

The Right to Double Speak
posted by homunculus at 5:11 PM on July 16, 2011 [1 favorite]

homunculus wrote: Obama to Eliminate Warren as Consumer Head

I'd be disappointed if it hadn't been known all along that Warren was only there to get things set up, and not to actually run the agency for the long term. If it does turn out to be Date who gets the nod, I can take comfort in the fact that at least he wasn't one of the scum who caused the meltdown, at least through malice.
posted by wierdo at 9:29 PM on July 16, 2011

It's not Date, it's Richard Cordray: Former Ohio Attorney General to Head New Consumer Agency

Shorter Republican Party: "CFPB Delenda Est"
posted by homunculus at 2:09 PM on July 18, 2011

Elizabeth Warren: A Big Week for the New Consumer Agency
posted by homunculus at 2:11 PM on July 18, 2011