Reidblog [The Reid Report blog]

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Friday, January 30, 2009
The final word on the Bush years
The final quarter of the Bush era was as bad as you thought it was ... almost...
The economy shrank at a 3.8 percent pace at the end of 2008, the worst showing in a quarter-century, as the deepening recession forced consumers and businesses to throttle back spending.

Although the initial result was better than economists expected, the figure is likely to be revised even lower in the months ahead and some believe the economy is contracting in the current quarter at an even faster pace.

The new figure, released Friday by the Commerce Department, showed the economy sinking at a much faster clip in the October-December period than the 0.5 percent decline logged in prior quarter.

Although economists expected an even worse fourth-quarter performance — a staggering 5.4 percent rate of decline — the results were still grim.

Meanwhile, things weren't as bad for some people as for others. Those who did better than the rest of us include...

Bank executives, who handed out about $18 billion in bonuses to themselves, as a reward for screwing up the mortgage market... (President Obama scolded them roundly for it today.)

Exxon Mobile, which posted earth shattering, record profits of $45.2 billion, due to Bushian sky-high oil prices through most of last year. And get this: those profits were DOWN 33%...

And last, and actually, least ... Rudy Giuliani, who's still getting people to listen to him warble, on cable TV, talk radio and on and on, despite having gotten exactly ONE electoral vote during his presidential campaign, and becoming the laughing stock, not just of New York, but of the world, with his scandal-tainted, one state strategy bid for greatness.

Other than that, it's all bad news.


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posted by JReid @ 10:52 AM  
Monday, June 23, 2008
The morning papers
Trying out a new feature for the blog, which will make morning blogging more efficient on my end, and hopefully provide a jumpstart to your morning read. Enjoy!

This morning...

The New York Times hits Barack Obama with a story about Obama advisers Tom Daschle and Jason Grumet's ethanol ties (forecast: Obama favors subsidies, wins Iowa in November. All politics is "economically local"...) On this one, I think McCain may be right about one thing: the U.S. should stop tariffing sugar ethanol out of the market. It's cheaper, produces more energy, and in Brazil at least, it's working ... Still, Obama is probably right on the politics, as this statement from the campaign makes clear:
“It does not serve our national and economic security to replace imported oil with Brazilian ethanol,” he argued.
It's the domestic production and jobs, stupid, though once he's in office, hopefully Obama will broaden his view. Sugarcane ethanol imports could not only help Brazil, it could be a lifeline for another country where sugar grows: Haiti.

Also in the Times: the Border Partrol is looking for a few good (black) men ... and George Carlin is dead at age 71.

The Washington Post follows up last night's damning "60 Minutes" piece on America's Middle East TV network, al-Hurra, one of many disastrous Bush administration attempts to "win the hearts and minds" of Muslims around the world.

Also in the Post, Obama seeks to close the Phil Gramm/Enron loophole, and while the rest of the nation squeals in pain, Houston laps up the benefits of $4.10 a gallon gas. But the story the cable chatters will probably spend most of their time on today will be yet another Obama reinvention story, this time by Dan Balz and Ann Kornblut.

The Miami Herald runs down this weekends U.S. Conference of Mayors summit, which featured two major ships passing in the night: Barack Obama on Saturday and Bill Clinton on Sunday. Clinton was mum on the election, but he did talk up the benefits of growing green.

The Boston Globe reports on John McCain's $300 million prize for whoever can build a better car battery. One question: where in the world are we getting the $300 million in a recession? And it wouldn't be a McCain plan without money for Big Bizness:
In addition, a so-called Clean Car Challenge would provide U.S. automakers with a $5,000 tax credit for every zero-carbon emissions car they develop and sell.
And there you go. Meanwhile, the Globe proffers a long puff piece by Sasha Issenberg on John McCain's war experience and how it shaped his present views. The piece skims past his contentious relations with POW/MIA groups who believed that U.S. troops remained alive in Vietnam, even skipping a notorious episode in which McCain reduced a mother of an MIA soldier to tears during televised hearings in which he lived up to his Academy nickname, "McNasty." The Globe also fails to mention the ambivalence, and even downright hostility, that some Vietnam vets continue to feel about McCain (yes, there is an anti-McCain 527.)  I doubt such information would have been left out of an article on John Kerry, and I doubt that the press will pursue the issue, given the media's reluctance to replay the Swift Boat episode from 2004 and general reverence for McCain's war service (as should be afforded any veteran.)

Last but not least, the paper reports on the Obama campaign bracing for race-based attacks during the campaign.

Meanwhile, the Los Angeles Times has a piece about the Obama campaign's careful targeting of black voters -- emphasizing the tightrope Obama has to walk between courting a needed base, and not turning off certain white voters. 

And across the pond, the Guardian reports that as the recent Mideast oil summit fails to halt rising oil prices, a leading climate scientist will go before Congress today and call for top oil executives to be put on trial. And last but not least, if you think politics is toxic in the States, try Zimbabwe.


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posted by JReid @ 8:15 AM  
Thursday, June 19, 2008
John McCain, the Enron loophole, and your gas tank
Last night, "Countdown" did an exceptional investigative piece that should be required viewing for any American who wants to know why gas prices are so high. In essence, it isn't simple supply and demand: it's speculation, or in Bushian terms, the enronization of everything. Watch:



For those who prefer to read, the Texas Lawyer Blog explains:
Who's to blame for the biggest financial catastrophe of our time? There are plenty of culprits, but one candidate for lead perp is former Sen. Phil Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade, Gramm pulled a sly legislative maneuver that greased the way to the multibillion-dollar subprime meltdown. Yet has Gramm been banished from the corridors of power? Reviled as the villain who bankrupted Middle America? Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen. John McCain's presidential campaign and advises the Republican candidate on economic matters. He's been mentioned as a possible Treasury secretary should McCain win. That's right: A guy who helped screw up the global financial system could end up in charge of US economic policy. Talk about a market failure.


The act, he declared, would ensure that neither the sec nor the Commodity Futures Trading Commission (cftc) got into the business of regulating newfangled financial products called swaps—and would thus "protect financial institutions from overregulation" and "position our financial services industries to be world leaders into the new century."

It didn't quite work out that way. For starters, the legislation contained a provision—lobbied for by Enron, a generous contributor to Gramm—that exempted energy trading from regulatory oversight, allowing Enron to run rampant, wreck the California electricity market, and cost consumers billions before it collapsed. (For Gramm, Enron was a family affair. Eight years earlier, his wife, Wendy Gramm, as cftc chairwoman, had pushed through a rule excluding Enron's energy futures contracts from government oversight. Wendy later joined the Houston-based company's board, and in the following years her Enron salary and stock income brought between $915,000 and $1.8 million into the Gramm household.)

Read the full article at Mother Jones Magazine.

Of course there are other factors contributing to high energy costs, most notably global demand (see India and China) and the weak U.S. dollar. But regulating speculation is within the direct control of Congress, and the recent slew of media coverage has finally pushed members of Congress, including Sen. Carl Levin (MI) to act, including putting a provision closing the Enron loophole into the recently passed farm bill (which is why John McCain voted against it.) That might not be enough, however. This month, former CFTC Trading and Markets Division head Michael Greenberger testified on the Hill about speculation's role in boosting energy prices, and stated that closing the Enron loophole could reduce gas prices dramatically -- perhaps by 25% overnight:
Michael Greenberger, the former head of the CFTC's Division of Trading and Markets, testified yesterday before the Senate Commerce Committee on the topic of Energy Market Manipulation. He stated that the investment banks, namely Goldman Sachs (GS) and Morgan Stanley (MS), control the price of oil and natural gas through the ICE futures market. He cited that Morgan Stanley currently owns 27% of the natural gas futures.

He stated that former Senator Phil Gramm of Texas sneaked the Enron loophole through a large piece of insignificant legislation years ago: the result was that regulations upon the futures industry were abandoned. This loophole eventually allowed the current CDO-subprime crisis, and the current energy market crisis because regulations, which once protected the market from manipulation, are no longer enforcable.

Greenberger suggested that the current attempt of closing the Enron loophole by Senator Levin through the Farm Bill, would not work - as it would leave the government with the constant burden of proof to prove manipulation was occurring. Also it would only be enforcable on domestic market manipulators and not international ones. ...


Wall Street is lobbying hard to prevent Congress from taking further action (surprise, surprise.)

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posted by JReid @ 8:03 AM  
Friday, May 16, 2008
Bush goes begging, Saudis say 'no'
Talk about appeasement. George W. Bush gave Osama bin Laden what he was demanding when he pulled U.S. troops out of Saudi Arabia after 9/11. Now, he goes with hat in hand to the Saudis, who supposedly adore him, to plead for higher oil production in order to deflate gas prices before the summertime drive pushes his approval ratings into the teens. So what do the Saudis say?

"Sorry Bushie, but it's a no."
(CBS/AP) President Bush's second stab this year at getting oil-rich Saudi Arabia to increase production and drive down the soaring gasoline prices hurting U.S. consumers appears to have again failed.

Saudi Arabian leaders made clear Friday they see no reason to increase oil production until their customers demand it, apparently rebuffing Mr. Bush, the White House said.

During Mr. Bush's second personal appeal this year to King Abdullah, Saudi officials stuck to their position that they are already meeting demand, the president's national security adviser told reporters.

"What they're saying to us is ... Saudi Arabia does not have customers that are making requests for oil that they are not able to satisfy," Stephen Hadley said on a day when oil prices topped $127 a barrel, a record high.

Maybe he could give them part of Czechoslovakia...?

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posted by JReid @ 5:54 PM  
ReidBlog: The Obama Interview
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