Outrage of the Week: Guess who paid the bill for $1.6 billion in executive bonuses?

We, the taxpayers, did! Many thanks to AP for digging out the facts.

Schadenfreude v. Apocalypse Now

By Nancy Jane Moore

Bob Herbert nailed the truth this morning:

I would like to see the self-proclaimed conservative, small government, anti-regulation, free-market zealots step up and take responsibility for wrecking the American economy and bringing about the worst financial crisis since the Depression.

Both he and I know they won't. The true believers among them are busy proposing a cut in the capital gains tax to solve the economic woes! At least they're sincere enough to allow major companies to crash rather than part from their principles.

Meanwhile the big business core -- the pragmatists who will talk against government but use it to benefit themselves -- are running around reworking the bailout, trying to get the most for their Wall Street comrades without subjecting them to too much regulation or having to fix the harm they've done to ordinary folks.

On the left, people are angry about bailing out those who caused the problem. I sympathize with this view: For years we've been lionizing the high fliers of Wall Street, who make nothing but money -- amazing amounts of money -- and it certainly gives me a certain since of schadenfreude to think of them begging for spare change among the ranks of the homeless.

But somehow I suspect that if the Wall Street crashes lead us into the depression my father and others who lived through the 1929 crash keep predicting, it won't be the bulk of big business or high fliers that will pay. It will be you and me.

When I write near-future apocalyptic science fiction, I always assume an economic meltdown not unlike this one. I am not alone -- an economic crash as well as global warming underlies Gwyneth Jones's brilliant Bold as Love series.

But recognizing the coming of a depression doesn't mean I want to live through one.

Due to 401(k) plans and other laws encouraging investment, many ordinary people have their retirement and other savings tied up in the stock market. Most of the money is in some kind of fund and the investors don't even know if it's tied up in the shaky businesses or not. A significant crash can ruin a lot of lives. And crashes on Wall Street seem to trickle down to the rest of us a whole lot faster than good times on Wall Street do.

The best fix for the situation is to put regulations back in place and improve government oversight -- in other words, undo all the destruction of our government that started in the Reagan years. I don't say go back to FDR and the New Deal; those ideas were good for the time, but now we need some fresh approaches.

Of course, that's not something even a functional Congress can do overnight, and probably not something that can be done under the failed Bush administration. And I admit that leads me to wonder why this came to crisis mode at precisely this time, when the presidential election is at its height and Congress just wants to go home.

Was it just because the Bush administration kept putting off dealing with things until they got too bad to ignore? Or was it that they hoped to rush through a plan that would simply bail out the bad guys without protecting the rest of us?

Maybe this is our October surprise. Though for now it seems to be tilting things toward Obama, so it may not be the last one.

Right now I'd like to see a short term fix that gets the overall economy breathing easier and a significant plan under what I hope is an Obama administration to fix the excesses that led to this collapse. I hope that's what we get.

Of course, it could be that total collapse will open the door to a better society. On the other hand, since I'm currently reading Naomi Klein's The Shock Doctrine, I worry that either total collapse or a badly structured bailout will just open the door to an even grimmer economy for ordinary people.

So I'm hoping for a fix I can live with. I don't really want to live in one of my apocalyptic futures.

The Train Wreck

This and this are like watching a train wreck in slow motion. O.M.G. The problem is that we're on the train. Salon sums up the situation clearly.

The debate is back on

The New York Times and others are reporting the news. Shall we recap the events?

• John McCain "suspends" his campaign and declares that he won't debate until the financial crisis is solved.
• Republicans and Democrats in Congress announce that they have a deal to pass a modified bailout plan.
• "Suspended" McCain campaign continues running ads and attacking Barack Obama via surrogates, while the news media report that McCain is putting "country first."
  
• McCain flies to Washington, DC, and arrives with much fanfare.
• Announced bailout plan crashes and burns.
  
• McCain declares victory and announces that he will (tah dah!) debate Obama as planned.
• Congressional leaders and Bush Administration go back to what they were doing before McCain intervened. A grateful nation holds its breath and prays for a real solution.
  

What was accomplished? McCain got a ton of news coverage.

The Big Bailout: David Cay Johnston pleads with journalists

Back at the dawn of time when the Internet was barely a glimmer in anyone's eye, I worked for the Detroit Free Press under Pulitzer Prize winner David Cay Johnston. He not only taught me how to write, but also which questions to ask. I have never seen a reporter who worked harder than Johnston.

Today, a letter from Johnston has been posted at Romenesko, an insiders blog for journalists. In it, Johnston pleads with his fellow reporters to do much, much more than they are now in reporting the proposed bailout.

The Administration has scared the markets and some key legislative leaders, but it has not laid out a coherent, specific and compelling need for this enormous proposal, which is the equivalent of a one-time 55 percent income tax surcharge. (Instead the money will be borrowed, so ask from whom and how this much can be raised so quickly if the credit markets are nearly seized up with fear.)...

As of now we are, as a group, behaving just as we did the last two times the administration sought to rush through a hastily thought out, ill-conceived plan. Why in the world are we being so gullible and naive? whatever happened to the core value of journalism -- check it out?

We may need this bailout, and we may need it soon. But if we don't understand exactly the why, how, who and what, then the United States may be in very deep trouble.

Socialism for the rich only

E.J. Dionne makes some interesting points on the bailout today.

Socialism, you say? We're already into that. The administration's plan amounts to socialism for the rich only.

... and...

(I)f Congress can appropriate $700 billion for Wall Street, where is the help for everyone else hurting in this economy? Isn't it strange that an administration that could not come up with a comparatively modest sum to increase the number of children with health insurance could suddenly find all this cash for the financial industry?

Here's my message to Congress: Do what you must to fix the economy, but be sensible.

The Bailout Stampede: Let's take a breath

Add my voice to the rising chorus urging both action and caution on the financial bailout. We have to do something, but allowing ourselves to be stampeded into the wrong decision will cripple the economy and this country.

Count me as one more person in agreement with Sen. Chris Dodd as quoted today by AP:

"I understand speed is important," he said. "But I am far more interested in whether or not we get this right. There is no second act to this."

Mainstream Media & the Bailout: Getting the story wrong

One of journalism's biggest problems is a tendency to get the facts right, and the story wrong. Such is the case of the coverage of the whopper of a bailout now under debate. One of the story lines being promoted by journalists is that the bailout will hamstring the next president.

McClatchy Newspapers on Friday:

The next president will take office in January with little hope of getting his pet programs enacted quickly, if at all, because of already-massive budget deficits likely to balloon even further from the hundreds of billions expected to be used to bail out Wall Street.

Time magazine today:

For at least the next year, and perhaps for years after, Treasury's spending authority will make it harder for the next President to fulfill campaign promises and pump money into new priorities.

I added the italics.

The problem with both of these passages is that they turn this into a story about the problems of a politician. The idea that it's only this poor soul's "pet programs" and his ability to "fulfill campaign promises" that is hurt is complete and utter garbage.

While it is factually true that the new president will face problems, his tussles will be tiny compared to what's going to happen to the rest of us.

This bailout -- no matter how necessary -- means that you and I won't get universal health care, at least not anytime soon. Crumbling bridges may well not be fixed because the U.S. government won't have the money. (Can anyone say "Minneapolis?") FEMA may be even less effective than it is now. Financial aid for college students could well shrink. Medical research and other scientific research could be hampered because the U.S. Treasury is strapped for cash. The list goes on and on.

There will be much less money available to provide the kind of services citizens need and should expect from their government.

By framing the story as being about presidential problems, journalists make it appear as if this is a mere political hassle for one guy who lives in the White House. Who cares if a politician has to wrestle with campaign promises?

From my vantage point, the Bailout looks a tad too much like highway robbery. It could hurt all of us for decades to come.