I'm just sayin': Change we can believe in

"[I]f we are all complicit in the damage, then we all share responsibility in the solutions; that is, we are united, or can be united, in taking a stand, in revolt." -- John Gibler in Mexico Unconquered: Chronicles of Power and Revolt, his thorough and readable history of our troubled southern neighbor.

quote unquote: You're outta here!

“I never felt that anxious any other time during my presidency, curiously enough.” -- George W. Bush, remembering the pitch he threw out at the 2001 World Series (in response to a question from People magazine about the moments of the last eight years he has revisited most).

The Economic Stimulus: Devil's in the details

Investment, investment, investment has got to be the central focus: energy, roads, bridges, waterways, housing. Job creation is Job One. -- Sen. Kent Conrad, chairman of the Senate budget committee.

Comes as a relief to see some pushback from Congressional Democrats on Obama's plan to juice the economy (see, Senate Allies Fault Obama on Stimulus, NYTimes 2009-01-09):

President-elect Barack Obama’s economic recovery plan ran into crossfire from his own party in Congress on Thursday, suggesting that quick passage of spending programs and tax cuts could require more time and negotiation than Democrats once hoped.

Senate Democrats complained that major components of his plan were not bold enough and urged more focus on creating jobs and rebuilding the nation’s energy infrastructure rather than cutting taxes.

Sounding like Henry Paulson, the P.-E. is trying to hustle his economic package through the legislature without due deliberation, warning that the recession “could linger for years” if Congress doesn't pass his plan within weeks, as if a problem that grew across three decades of deregulation and neglect will become more intractable if not addressed in a month.

For anyone scratching his head over the need for tax cuts at a time when the country is already suffering its worst deficit in history, it's reassuring that at least some of the Democratic leadership is prepared to spend the time necessary to think things through before taking action. Among other benefits, a more deliberate process will be likelier to thwart conservatives' intentions to use the crisis to help the corporate class with tax cuts and deregulation.

Half the swag originally delivered to Paulson is still unspent, and the first order of business for the new Congress ought to include deciding how it should be allocated. It can't be left to Obama's team of Wall Street refugees to decide whether the second $350 billion goes to helping working families with credit for essentials like mortgages, car payments and loans for education, rescuing those facing foreclosures, keeping small businesses afloat, assisting city and state governments to avoid killing off capital projects and laying off tens of thousands of employees, or other efforts.

At the moment, Obama's recovery outline calls for spending as much as $775 billion over the next two years, on top of what has already been doled out to no apparent effect. While some support will apparently go to investment in clean energy and other new technologies, if the intention is to inject money into the economy by creating jobs, the most obvious place to start is with rebuilding an infrastructure -- roads, bridges, schools, public housing, medical facilities -- that has been in decline since the Nixon years.

It's mildly amusing to witness the belated concern of Republicans and moderate Democrats about high spending and big deficits, but the majority can't expect to placate them and achieve real change. If the conservatives won't support economic reform without being bribed by tax breaks and deregulation, moderates and progressives need to proceed without them. Carter, Reagan, Bush, Clinton, Bush...Enough is enough.

quote unquote: The New WPA

"Economists from across the political spectrum agree that if we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double-digit unemployment and the American dream slipping further and further out of reach." -- Barack Obama (2009-01-03)

Essential Reading: Fixing a Broken System

In a two-part essay in the Times on The End of the Financial World As We Know It and How to Repair a Broken Financial World, business writer Michael Lewis and hedge fund manager David Einhorn recount the following:

Weeks after receiving its first $25 billion taxpayer investment, Citigroup returned to the Treasury to confess that — lo! — the markets still didn’t trust Citigroup to survive. In response, on Nov. 24, the Treasury handed Citigroup another $20 billion from the Troubled Assets Relief Program, and then simply guaranteed $306 billion of Citigroup’s assets. The Treasury didn’t ask for its fair share of the action, or management changes, or for that matter anything much at all beyond a teaspoon of warrants and a sliver of preferred stock. The $306 billion guarantee was an undisguised gift. The Treasury didn’t even bother to explain what the crisis was, just that the action was taken in response to Citigroup’s “declining stock price.”

Three hundred billion dollars is still a lot of money. It’s almost 2 percent of gross domestic product, and about what we spend annually on the departments of Agriculture, Education, Energy, Homeland Security, Housing and Urban Development and Transportation combined. Had Mr. Paulson executed his initial plan, and bought Citigroup’s pile of troubled assets at market prices, there would have been a limit to our exposure, as the money would have counted against the $700 billion Mr. Paulson had been given to dispense. Instead, he in effect granted himself the power to dispense unlimited sums of money without Congressional oversight. Now we don’t even know the nature of the assets that the Treasury is standing behind. Under TARP, these would have been disclosed.

This is another example, at once striking and symptomatic, not only of government waste and corruption, but of the breakdown of our democratic institutions themselves. No one knows anything, William Goldman famously observed. As it turns out, no one is accountable for anything, either.