Thursday, February 28, 2013

Something about power and corruption

Once more, a little collection of things I have read this week that deserve more than a Tweet, but for which I do not have time to write a full post.

So let me get this straight. President Obama is meeting with senior Congressional leaders to discuss sequestration on Friday, after the deadline has passed. Meanwhile, the Dow rallies and defense stocks, which are highly sensitive to government spending, are outperforming the market.

Is the market just conditioned to getting a last minute deal, just like what we saw during the 2011 debt ceiling impasse, or endless Eurozone summits over Greece in the same year?

What happens to equity prices if the cavalry doesn't arrive?

Ah, that would be 'crash', I believe.

-- The Supreme Court is poised to declare racism is over in America.

"There is an old disease, and that disease is cured," Bert Rein, the attorney leading the legal challenge to the Voting Rights Act—the landmark law intended to ensure all Americans can vote—told to the Supreme Court on Tuesday. "That problem is solved."

Rein represents Shelby County, Alabama, one of the jurisdictions covered by a key section of the Voting Rights Act called Section 5. Under Section 5, parts of the country with histories of discriminatory election practices have to ask for permission—or "preclearance," in legal terms—from the Justice Department before making any changes to their voting rules. But the South, where most of the covered jurisdictions are, has changed, Rein said, and the law, although once justified, is now unfair and unconstitutional. The five conservative justices on the Supreme Court seemed to agree. "The Marshall Plan was very good too," argued Justice Anthony Kennedy, "but times change."

There was also something Scalia said about the right to vote being an entitlement, and not a right. And then there's John Roberts, who has been shaping arguments against VRA since he was a pup (and Reagan was president).

Pre-clearance might just survive this challenge because of the egregiousness of Shelby, but it certainly won't last much longer. A case with enough merit for the conservatives on the Court to strike it down is all but inevitable. Democrats in state legislatures across the country would do well to begin considering what legal challenges to voting discrimination would look like in a post-Section 5 landscape. Kuffner has more.

-- Jack Lew got quietly confirmed as Treasury Secretary yesterday. A topic of somewhat under-the-radar discussion prior to his approval by the Senate were his large bonuses, one from Citigroup (which conservative media from the WSJ to assailed) and one from NYU. The bank bonus has been defended as SOP on Wall Street, as if that makes everything dandy.

I just can't be too enthusiastic about a fox of a different color pretending to guard the henhouse. Thank goodness for Elizabeth Warren. I'll bet those Republican senators who tried to block her as head of the CFPC wish now they had been unsuccessful.

"Any idea about when we're gonna arrive in the right direction?"

Update: Firedoglake has more.

-- Speaking of massive capitalist assholes, Jamie Dimon was in town yesterday to say thanks to the peasants who work for him, and some of the rich people who give him their money.

"We need a bankruptcy process that can take apart a big bank without taking down the economy. It's been done before," Dimon said in a phone interview before starting a four-city Texas bus tour. He was in Houston on Wednesday and goes to San Antonio on Thursday.

Some veterans of the financial services industry have called for dividing diversified global banks into separate commercial banking companies - those that take deposits and make loans - and investment banks that invest in companies and trade in derivatives that hedge risks. But Dimon argues against it.

"We don't speculate with depositors' money," Dimon said of JPMorgan Chase's derivatives activities.


Dimon, 56, repeatedly has said the United States needs large, diversified banking companies to help U.S. companies operate internationally with services that are efficient due to economies of scale.

"We have to compete globally," he said, citing larger, more consolidated banks in other parts of the world such as those in China. "They'd eat our lunch" if the large U.S. banks were broken into smaller companies, Dimon said. "We need global banks."

The day before yesterday, Dimon revealed his inner pig for a moment.

At JPMorgan Chase's annual investor day on Tuesday, CEO Jamie Dimon answered one analyst's question by saying, "That's why I'm richer than you." 

What do you suppose he meant by that?

-- And starring Bob Woodward as Derp Throat.

Woodward, who once upon a time went after presidents for breaking the law, finds himself in the comically hypocritical position of condemning Obama for not ignoring federal law. Woodward is shocked, shocked that a president isn't consolidating even more authority in the executive branch.

We have passed through the looking glass.

Update: Glenn Greenwald.

(H)ere is Bob Woodward, with one rant, expressing the core values of America's media class. The president is not constrained by law (contemptuously referred to as "this piece of paper"). He not only has the right but the duty to do anything - even if the law prohibits it - to project military force whenever he wants (even though the Constitution mandates as his prime duty not to Keep Us Safe but rather that he "shall take care that the laws be faithfully executed" and thus must swear as his oath "to the best of [his] ability [to] preserve, protect, and defend the Constitution of the United States"). The US must act as empire, dominating the world with superior military force if it wants to stay safe. Any reduction in military spending and deployment will endanger us all.

It's to be expected that these authoritarian and militaristic values shape political leaders and their followers. That these values also shape the "watchdog" media class, as embodied by one of their "legends", explains much about US political culture generally.

Bob Woodward fulfills an important function. Just as Tim Russert was long held up as the scary bulldog questioner who proved the existence of an adversarial TV press while the reality was that, as Harper's Lewis Lapham famously put it, he maintained "the on-air persona of an attentive and accommodating headwaiter", the decades-old Woodward lore plays a critical role in maintaining the fiction of a watchdog press corps even though he is one of the most faithful servants of the war machine and the national security and surveillance states. Every once and awhile, the mask falls, and it's a good thing when it does.

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