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Tuesday, October 28, 2008
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Wednesday, September 24, 2008
Numbing Numbers
This is pretty thick, but worth reading and pondering. We found it on Daily Kos, and this essay appeared on at least two other websites on September 21st.
Almost no one is mentioning “credit default swaps.” Looks like this is the heart of the problem. The numbers are humongous. It should make everyone suspicious of the bailout proposition, especially the way they are trying to rush it through.
Three Times is Enemy Action
by Devilstower
Sun Sep 21, 2008 at 06:03:41 AM PDT
“Once is happenstance. Twice is coincidence. Three times is Enemy Action.”
– Auric Goldfinger
James Bond’s wealthy nemesis may have had an obsession with gold, but he judged, quite correctly, that if people keep putting your plans awry, that was likely their intent.
In 1982, the same year John McCain entered the Senate, a bill was put forward that would substantially deregulate the Savings and Loan industry. The Garn-St. Germain Depository Institutions Act was an initiative of the Reagan administration, and was largely authored by lobbyists for the S&L industry — including John McCain’s warm-up speaker at the convention, Fred Thompson. The official description of the bill was “An act to revitalize the housing industry by strengthening the financial stability of home mortgage lending institutions and ensuring the availability of home mortgage loans.” Considering where things stand in 2008, that may sound dubious. It should.
Seven years later, the S&L industry was collapsing. What was the cause? Garn-St. Germain handed the S&Ls a greatly expanded range of capabilities, allowing them to go head to head with full service banks, but it didn’t give them the bank’s regulations. Left to operate in an anarchistic gray area, S&Ls chased profits, indulged in amazing extravagances, and cranked out enough cheap mortgages to fuel a real estate boom. They also experimented with lots of complex, creative — and risky — investments, even though they didn’t have the economic models to really determine the worth of the things they were buying. The result was a mountain of bad debts and worthless “assets.” Does any of that sound eerily (or nauseatingly) familiar?
It wasn’t a foregone conclusion. In 1985, three years after the deregulation of the S&Ls, the chairman of the Federal Home Loan Bank Board saw that the situation was already looking shaky, with the potential to become much worse. He instituted a rule to limit the amounts and types of investments S&Ls could carry on their books in an effort to head off disaster. However, many savings and loans — among them Lincoln Savings & Loan Association of Irvine , CA, which was headed by a fellow named Charles Keating — promptly ignored these rules.
Now enters a familiar cast of characters. First to pop up was the universally beloved Fed-chief-to-be, Alan Greenspan. Greenspan argued against the loan board’s new rules, and persuaded Reagan to appoint one of Keating’s pals to the board to blunt the requirements. A quintet of senators, among them John McCain, began having meetings with both the management at Lincoln and the regulators at the loan board. ] Alan Greenspan also helped out with a letter to the regulators, asking that Lincoln be exempt from the new rules. With their help of Greenspan and their pet senators, Lincoln was able to stay in business an additional two years, at the end of which they failed — taking the life savings of 21,000, mostly elderly, investors with them.
How involved was John McCain? McCain and Keating had known each other since 1981 and had become fast friends. Of all the “Keating Five,” it was McCain who moved into the life of the Lincoln S&L chief. The two men vacationed together multiple times, with the whole McCain clan (babysitter included) heading out for Keating’s private Caribbean property on Keating’s private jet. McCain didn’t think to actually report these trips, or pay for them, until the investigators were breathing down his neck. And McCain took his payment in the form of more than just vacations. Keating and other members of Lincoln ’s parent company padded McCain’s pockets with $112,000 in campaign contributions.
In John McCain’s biography, he called his meetings with Keating and regulators “the worst mistake of my life,” though from the text you’d think this was a spur of the moment decision, not something that McCain did repeatedly over a space of years. Still, you might think that a “worst mistake” would stay fresh in his memory.
It certainly didn’t fade quickly for the country. Following the S&L crisis, the Resolution Trust Company was formed to swallow up the debt of Lincoln and 746 other S&Ls gone wild, and taxpayers were left with the $125 billion bill. The resulting budget deficit forced cutbacks in other programs. The artificial real estate boom collapsed and housing starts fell to their lowest levels in decades. Finally, the whole nation settled in for a period nasty enough that three years later someone could still campaign around the idea “It’s the economy, stupid.”
Even so, by 1999 Phil Gramm — who had entered the Senate two years after McCain and quickly become the economic guru of the Keating Five maverick — put forward the Gramm-Leach-Bliley Act. This Act passed out of the Senate on a party line vote with 100% Republican support, including that of John McCain. (To be fair, the bill eventually passed again with a wide margin following revisions in the House.)
This act repealed part of the Glass-Steagall Act. This may sound like a bunch of Congressperson soup, but the gist of it is that Glass-Steagall was put in place in 1933 to control the rampant speculation that had helped cause the collapse of banking at the outset of the depression, and to prevent such consolidation of the banks that the nation had all its eggs in one fiscal basket.
Gramm-Leach-Bliley reversed those rules, allowing not only more bank mergers, but for banks to become directly involved in the stock market, bonds, and insurance. Remember the bit about how S&Ls failed because they didn’t have the regulations that protected banks? After Gramm-Leach-Bliley, banks didn’t have that protection either.
Gramm wasn’t done. The next year he was back with the Commodity Futures Modernization Act, which was slipped into a “must pass” spending bill on the last day of the 106th Congress. This Act greatly expanded the scope of futures trading, created new vehicles for speculation, and sheltered several investments from regulation.
As with both Gramm-Leach-Bliley and Garn-St. Germain, large parts of this bill were written by industry lobbyists. This famously included the “Enron Loophole” that exempted energy trading from regulation and was written by (big suprise) Enron Lobbyists working with Gramm. Not coincidentally, Senator Gramm, the second largest recipient of campaign contributions from Enron, was also key to legislating the deregulation of California ’s energy commodity trading.
Thanks to this fortunate trifecta of Gramm-crafted legislation, Enron was able to create “EnronOnline” and trade electricity in California with absolutely no oversight or transparency.
They quickly worked out how to game the system. Previously, there had been only one Stage 3 rolling blackout in the history of California . Within months, the system had been manipulated by traders to generate 38 such blackouts and wholesale electrical prices had gone up more than 3000%. Despite production capacity equal to four times the demand during winter, energy traders even engineered a blackout in mid-January.
During the confusion of these deliberate “shortages” and “price spikes,” the California administration of Gray Davis — blind to speculator manipulations because of the walls erected by Gramm’s legislation — was forced to sign energy contracts at enormous rates. There was little choice, because most of California ’s public utilities were on the brink of bankruptcy from the rising wholesale prices.
In a single year, Gramm’s legislation allowed speculators to bring the state to its knees. Enron alone looted California of $11 billion. The manipulations of the energy market were also a major factor in Davis getting the hook, helped usher the governator into power, and they still have repercussions in California ’s budget battles today. By the end of that year, the depth of Enron’s deception could no longer be hidden, and the whole company came crashing down in the largest bankruptcy in history — at the time. This brought more billions lost in mutual funds and pension funds across the country, and played a major role in the economic downturn of 2001.
But that was only the second act. The combination of Gramm-Leach-Bliley and the Commodity Futures Modernization Act was a toxic cocktail whose total damage was greater than the sum of its parts.
The first Act promoted bank buyouts and mergers that reached such an insane pitch that the average consumer could only keep up by tracking the changing names on their checks and credit cards. Mercantile buys Ameribanc and Mark Twain. Firstar buys Federated and First Colonial. US Bancorp buys Mercantile and Firstar. And, because it allowed brokerages and insurance companies to mingle with banks, the Act cemented a trend that was already (and illegally) underway in which all those terms had become rather quaint. Is Wachovia a savings bank, an investment bank, a brokerage, or an insurance provider? The answer is “yes.”
In allowing financial institutions to grow to Godzilla-sized proportions, Gramm-Leach-Bliley helped ensure that we would have financial entities that were “too big to fail.” Rather than choosing to enforce rules that kept these institutions apart, the deregulators chose to create monster bankeragasurances whose downfall (and existence) was enough to threaten the whole system.
But if Gramm-Leach-Bliley removed the limits on size and scope, these new institutions still needed fuel. With many financial transactions operating on razor thin margins, and increasing automation sapping the profits from trading of all sorts, they needed a new way to generate the funds required to swallow their brethren in the merged fiscal corporation pond. For that, the Commodity Futures Modernization Act was a godsend.
Among those instruments which the CFMA sheltered from regulatory scrutiny was something called the “credit default swap.” A kind of insurance one bank could exchange with another, credit default swaps supposedly made it safe for banks to take on ever riskier forms of debt. The Act didn’t invent these swaps, though they were relatively new. Instead, by placing them in a state where they were not only unregulated but almost perfectly opaque, credit default swaps were turned into the perfect vehicle to fuel a Wall Street revolution. No one had any idea what these things were actually worth, they were traded “over the counter” without being administered by any exchange, and even the SEC could monitor their existence only indirectly.
Who would cheer for a new kind of financial instrument that was difficult to understand, invisible to regulators, and impossible for even the whizziest of Wall Street whiz kids to value? Guess.
More recently, instruments that are more complex and less transparent–such as credit default swaps, collateralized debt obligations, and credit-linked notes–have been developed and their use has grown very rapidly in recent years. The result? Improved credit-risk management together with more and better risk-management tools appear to have significantly reduced loan concentrations in telecommunications and, indeed, other areas and the associated stress on banks and other financial institutions.
–Alan Greenspan, 2002
Get that? Greenspan loved credit default swaps. He opined again and again that such instruments would be the salvation of the industry by spreading around risks. To the mighty Greenspan, both their complexity and their lack of transparency were good things, since swaps would only be handled by the big boys who knew how to play with fire.
When questioned about his support of Gramm’s legislation, John McCain called his friend (and by then, campaign co-chair) Gramm “one of the smartest people in the world on the economy” and pointed out that Greenspan also favored the acts Gramm and his coalition of lobbyists had authored. If both Gramm and Greenspan were on his side, McCain couldn’t possibly be in the wrong.
Except, of course, that he could.
From the beginning, there were plenty of people in the financial community whose opinion of these unregulated credit swaps was not as rosy as that of Gramm, Greenspan, and McCain. Chief among those speaking in opposition was SEC Chairman, Arthur Levitt. Levitt argued that what the industry needed was more transparency, especially when it came to complex instruments like default swaps, and he testified to this before Gramm’s Senate Banking Committee,.
“In my judgment, the risk of this regulatory approach is simply unacceptable for America ’s investors.”
–Arthur Levitt, 1999
Gramm paid no attention.
Credit default swaps did allow the banks to share risks. So much so, that banks raced each other in an effort to find more risks. They made it possible for the down payment on homes to become 3%, 1%, 0%. Skip the credit check, avoid the employment requirements, damn the torpedoes, full speed ahead! We’ve got a credit default swap, we can do anything!
The encouragement and “safety” that credit default swaps provided made the sub-prime mortgage market possible. Just as with the deregulation of S&Ls in the 1980s, the market was suddenly flooded with easy credit. The result was a real estate boom, soaring home prices, and a plague of “Flip that House!” shows on cable.
As the banks piled up crappy mortgages, they heaped on ever more of the credit default swaps — and they still had no idea how to value the things. Worse, they began to trade the swaps themselves as if they were an investment, treating them like something worth holding instead of a big bundle of cartoon bombs whose fuses were already lit. Since very few loans were falling into default at the time, owning a default swap seemed like a way to collect fees without ever paying out. Banks wanted more, and more, and more.
A secondary market for trading swaps exploded into existence, and swaps were traded with absolutely no consideration for the nature or quality of the underlying investment. Swaps changed hands a dozen or more times, growing in “value” as they went. Worse still, no one regulated who could buy a swap, so it was (and is) perfectly possible for a company to acquire swaps that theoretically cover billions of dollars in loans, even if that company doesn’t have a red cent on hand to cover those swaps should the loans default.
· How big did this market become? Here’s business correspondent Bob Moon and host Kai Ryssdal on American Public Media’s Marketplace from back in the spring.
· BOB MOON: OK, I’m about to unload some numbers on you here, so I’ll speak slowly so you can follow this.
· The value of the entire U.S. Treasuries market: $4.5 trillion.
· The value of the entire mortgage market: $7 trillion.
· The size of the U.S. stock market: $22 trillion.
· OK, you ready?
· The size of the credit default swap market last year: $45 trillion.
· KAI RYSSDAL: That’s a lot of money, Bob.
· As in three times the whole US gross domestic product, Bob. And the truth is that Moon probably underestimated. The unregulated and poorly reported credit default swaps may have actually passed $70 trillion last year, or about $5 trillion more than the GDP of the entire world.
· So, are you starting to get an idea of just how big a genie Phil Gramm and his pals unleashed?
With some regularity over the last eight years, fiscal whistle blowers have tried to raise their hands and register a protest. Um, sirs? Is it altogether a good idea to run up debts exceeding all the assets it’s even possible to hold? But so long as no one actually had to pay off on the swaps, the party went on. Even usually conservative (in the fiscal sense) companies like AIG started to worry that they were being left behind and leapt headlong into the swap pool.
Shortly after Greenspan’s departure in 2006, the Federal Reserve took the unusual step of issued a joint statement along with the SEC to warn about the risks associated with credit default swaps. But by that point, the damage was already severe. If swaps lost their value, most of those who had played the game would find their giant firms abruptly valued in pocket change. The only solution was to cover the problem with still more swaps and keep moving.
Then a funny thing happened. After years in which banks had handed out loans willy-nilly, guarded by the indestructible swap, people and companies started to really default on those loans. Credit slowed, home prices fell, and the whole snake started to eat itself tail first.
Suddenly, credit default swaps were not sources of limitless cash. It turns out that an insurance policy — even a secret, unregulated policy — is occasionally expected to pay. Speculators started to look at the paper they were holding and for the first time realized it could all be worthless. Worse, it could (and did) represent a massive debt; one that no one had the funds to cover.
When Bear Stearns fell apart last March, it was only suspected that a big part of the effort in saving the giant investment bank was keeping their holdings in credit default swaps from unraveling and spreading to other institutions. Naturally, part of solving this problem involved creating a new credit default swap to cover Bear Stearn’s potential debt. But the all-purpose swap was starting to lose its power. Shortly after Bear Stearns went belly up, AIG reported the largest quarterly loss in the company’s history, taking a $11 billion hit on revaluing its holdings of swaps. The party was definitely coming to a close.
When AIG finally collapsed this week, there was no doubt about the primary cause of its failure. The previously well grounded company had “gotten itself involved with something called credit default swaps.” Point of irony alert: Arthur Levitt now serves on the AIG board… or at least he did until the government had to take over most of AIG to salvage the company from the very idiocy Levitt had warned of in 1999.
This week, the Bush administration announced the beginnings of a plan to salvage what remains of the financial markets. At first glance, it appears that the plan will consist mainly of creating a kind of “garbage pit,” a fund or group of funds — cousins of the Resolution Trust that was created during the S&L crisis — into which those people who have dabbled in bad debts can toss their problems. Only this time the cost to the taxpayers is at least $700 billion… and a big bite out of representative democracy.
The expansion of unregulated Savings and Loans in the 1980s brought on the collapse of that industry, a crippling of the economy, and left taxpayers holding the bag. Maybe that was only happenstance. Those pushing for the Garn-St. Germain Depository Institutions Act may not have known what they were doing.
The deregulation of the California electricity market, along with the protections provided to Enron through Phil Gramm’s lobbyist-written legislation brought blackouts, fiscal and political chaos, and left taxpayers holding the bag. But the people who engineered that event — people like Gramm and Greenspan — had already seen what happened with the S&Ls. They should have known better. Still, perhaps that was only coincidence.
The sub-prime mortgage crisis that has not only come so close to utterly destroying the markets, but has ruined the value of many people’s homes and left millions with mortgages they can’t pay, was also the outcome of the deregulation created by these men. The very predictable outcome. When taxpayers are left holding the bag for $1 trillion this time around, it’s hard to believe it’s any sort of accident.
This is enemy action. This is a bullet deliberately fired into the economy by men willing to exercise their ideology regardless of the cost to taxpayers. Men who have every expectation that they can plunder the system again and again, while the public picks up the tab. John McCain may not have had his finger directly on the trigger, but he was there. He assisted. These were his personal friends and philosophical comrades. He may not be the high priest, but he has been a loyal acolyte in the cult of deregulation.
It may come as a surprise to the champions of deregulation, but nobody likes regulation. The restrictions that were placed on banks, S&Ls, and other institutions in the 1930s weren’t put there because someone thought it would be fun. They were put in place because they addressed problems that had just been clearly and painfully revealed. They were put in place because they were necessary.
It’s bad enough if John McCain didn’t know that. It’s far worse if he did.
Almost no one is mentioning “credit default swaps.” Looks like this is the heart of the problem. The numbers are humongous. It should make everyone suspicious of the bailout proposition, especially the way they are trying to rush it through.
Three Times is Enemy Action
by Devilstower
Sun Sep 21, 2008 at 06:03:41 AM PDT
“Once is happenstance. Twice is coincidence. Three times is Enemy Action.”
– Auric Goldfinger
James Bond’s wealthy nemesis may have had an obsession with gold, but he judged, quite correctly, that if people keep putting your plans awry, that was likely their intent.
In 1982, the same year John McCain entered the Senate, a bill was put forward that would substantially deregulate the Savings and Loan industry. The Garn-St. Germain Depository Institutions Act was an initiative of the Reagan administration, and was largely authored by lobbyists for the S&L industry — including John McCain’s warm-up speaker at the convention, Fred Thompson. The official description of the bill was “An act to revitalize the housing industry by strengthening the financial stability of home mortgage lending institutions and ensuring the availability of home mortgage loans.” Considering where things stand in 2008, that may sound dubious. It should.
Seven years later, the S&L industry was collapsing. What was the cause? Garn-St. Germain handed the S&Ls a greatly expanded range of capabilities, allowing them to go head to head with full service banks, but it didn’t give them the bank’s regulations. Left to operate in an anarchistic gray area, S&Ls chased profits, indulged in amazing extravagances, and cranked out enough cheap mortgages to fuel a real estate boom. They also experimented with lots of complex, creative — and risky — investments, even though they didn’t have the economic models to really determine the worth of the things they were buying. The result was a mountain of bad debts and worthless “assets.” Does any of that sound eerily (or nauseatingly) familiar?
It wasn’t a foregone conclusion. In 1985, three years after the deregulation of the S&Ls, the chairman of the Federal Home Loan Bank Board saw that the situation was already looking shaky, with the potential to become much worse. He instituted a rule to limit the amounts and types of investments S&Ls could carry on their books in an effort to head off disaster. However, many savings and loans — among them Lincoln Savings & Loan Association of Irvine , CA, which was headed by a fellow named Charles Keating — promptly ignored these rules.
Now enters a familiar cast of characters. First to pop up was the universally beloved Fed-chief-to-be, Alan Greenspan. Greenspan argued against the loan board’s new rules, and persuaded Reagan to appoint one of Keating’s pals to the board to blunt the requirements. A quintet of senators, among them John McCain, began having meetings with both the management at Lincoln and the regulators at the loan board. ] Alan Greenspan also helped out with a letter to the regulators, asking that Lincoln be exempt from the new rules. With their help of Greenspan and their pet senators, Lincoln was able to stay in business an additional two years, at the end of which they failed — taking the life savings of 21,000, mostly elderly, investors with them.
How involved was John McCain? McCain and Keating had known each other since 1981 and had become fast friends. Of all the “Keating Five,” it was McCain who moved into the life of the Lincoln S&L chief. The two men vacationed together multiple times, with the whole McCain clan (babysitter included) heading out for Keating’s private Caribbean property on Keating’s private jet. McCain didn’t think to actually report these trips, or pay for them, until the investigators were breathing down his neck. And McCain took his payment in the form of more than just vacations. Keating and other members of Lincoln ’s parent company padded McCain’s pockets with $112,000 in campaign contributions.
In John McCain’s biography, he called his meetings with Keating and regulators “the worst mistake of my life,” though from the text you’d think this was a spur of the moment decision, not something that McCain did repeatedly over a space of years. Still, you might think that a “worst mistake” would stay fresh in his memory.
It certainly didn’t fade quickly for the country. Following the S&L crisis, the Resolution Trust Company was formed to swallow up the debt of Lincoln and 746 other S&Ls gone wild, and taxpayers were left with the $125 billion bill. The resulting budget deficit forced cutbacks in other programs. The artificial real estate boom collapsed and housing starts fell to their lowest levels in decades. Finally, the whole nation settled in for a period nasty enough that three years later someone could still campaign around the idea “It’s the economy, stupid.”
Even so, by 1999 Phil Gramm — who had entered the Senate two years after McCain and quickly become the economic guru of the Keating Five maverick — put forward the Gramm-Leach-Bliley Act. This Act passed out of the Senate on a party line vote with 100% Republican support, including that of John McCain. (To be fair, the bill eventually passed again with a wide margin following revisions in the House.)
This act repealed part of the Glass-Steagall Act. This may sound like a bunch of Congressperson soup, but the gist of it is that Glass-Steagall was put in place in 1933 to control the rampant speculation that had helped cause the collapse of banking at the outset of the depression, and to prevent such consolidation of the banks that the nation had all its eggs in one fiscal basket.
Gramm-Leach-Bliley reversed those rules, allowing not only more bank mergers, but for banks to become directly involved in the stock market, bonds, and insurance. Remember the bit about how S&Ls failed because they didn’t have the regulations that protected banks? After Gramm-Leach-Bliley, banks didn’t have that protection either.
Gramm wasn’t done. The next year he was back with the Commodity Futures Modernization Act, which was slipped into a “must pass” spending bill on the last day of the 106th Congress. This Act greatly expanded the scope of futures trading, created new vehicles for speculation, and sheltered several investments from regulation.
As with both Gramm-Leach-Bliley and Garn-St. Germain, large parts of this bill were written by industry lobbyists. This famously included the “Enron Loophole” that exempted energy trading from regulation and was written by (big suprise) Enron Lobbyists working with Gramm. Not coincidentally, Senator Gramm, the second largest recipient of campaign contributions from Enron, was also key to legislating the deregulation of California ’s energy commodity trading.
Thanks to this fortunate trifecta of Gramm-crafted legislation, Enron was able to create “EnronOnline” and trade electricity in California with absolutely no oversight or transparency.
They quickly worked out how to game the system. Previously, there had been only one Stage 3 rolling blackout in the history of California . Within months, the system had been manipulated by traders to generate 38 such blackouts and wholesale electrical prices had gone up more than 3000%. Despite production capacity equal to four times the demand during winter, energy traders even engineered a blackout in mid-January.
During the confusion of these deliberate “shortages” and “price spikes,” the California administration of Gray Davis — blind to speculator manipulations because of the walls erected by Gramm’s legislation — was forced to sign energy contracts at enormous rates. There was little choice, because most of California ’s public utilities were on the brink of bankruptcy from the rising wholesale prices.
In a single year, Gramm’s legislation allowed speculators to bring the state to its knees. Enron alone looted California of $11 billion. The manipulations of the energy market were also a major factor in Davis getting the hook, helped usher the governator into power, and they still have repercussions in California ’s budget battles today. By the end of that year, the depth of Enron’s deception could no longer be hidden, and the whole company came crashing down in the largest bankruptcy in history — at the time. This brought more billions lost in mutual funds and pension funds across the country, and played a major role in the economic downturn of 2001.
But that was only the second act. The combination of Gramm-Leach-Bliley and the Commodity Futures Modernization Act was a toxic cocktail whose total damage was greater than the sum of its parts.
The first Act promoted bank buyouts and mergers that reached such an insane pitch that the average consumer could only keep up by tracking the changing names on their checks and credit cards. Mercantile buys Ameribanc and Mark Twain. Firstar buys Federated and First Colonial. US Bancorp buys Mercantile and Firstar. And, because it allowed brokerages and insurance companies to mingle with banks, the Act cemented a trend that was already (and illegally) underway in which all those terms had become rather quaint. Is Wachovia a savings bank, an investment bank, a brokerage, or an insurance provider? The answer is “yes.”
In allowing financial institutions to grow to Godzilla-sized proportions, Gramm-Leach-Bliley helped ensure that we would have financial entities that were “too big to fail.” Rather than choosing to enforce rules that kept these institutions apart, the deregulators chose to create monster bankeragasurances whose downfall (and existence) was enough to threaten the whole system.
But if Gramm-Leach-Bliley removed the limits on size and scope, these new institutions still needed fuel. With many financial transactions operating on razor thin margins, and increasing automation sapping the profits from trading of all sorts, they needed a new way to generate the funds required to swallow their brethren in the merged fiscal corporation pond. For that, the Commodity Futures Modernization Act was a godsend.
Among those instruments which the CFMA sheltered from regulatory scrutiny was something called the “credit default swap.” A kind of insurance one bank could exchange with another, credit default swaps supposedly made it safe for banks to take on ever riskier forms of debt. The Act didn’t invent these swaps, though they were relatively new. Instead, by placing them in a state where they were not only unregulated but almost perfectly opaque, credit default swaps were turned into the perfect vehicle to fuel a Wall Street revolution. No one had any idea what these things were actually worth, they were traded “over the counter” without being administered by any exchange, and even the SEC could monitor their existence only indirectly.
Who would cheer for a new kind of financial instrument that was difficult to understand, invisible to regulators, and impossible for even the whizziest of Wall Street whiz kids to value? Guess.
More recently, instruments that are more complex and less transparent–such as credit default swaps, collateralized debt obligations, and credit-linked notes–have been developed and their use has grown very rapidly in recent years. The result? Improved credit-risk management together with more and better risk-management tools appear to have significantly reduced loan concentrations in telecommunications and, indeed, other areas and the associated stress on banks and other financial institutions.
–Alan Greenspan, 2002
Get that? Greenspan loved credit default swaps. He opined again and again that such instruments would be the salvation of the industry by spreading around risks. To the mighty Greenspan, both their complexity and their lack of transparency were good things, since swaps would only be handled by the big boys who knew how to play with fire.
When questioned about his support of Gramm’s legislation, John McCain called his friend (and by then, campaign co-chair) Gramm “one of the smartest people in the world on the economy” and pointed out that Greenspan also favored the acts Gramm and his coalition of lobbyists had authored. If both Gramm and Greenspan were on his side, McCain couldn’t possibly be in the wrong.
Except, of course, that he could.
From the beginning, there were plenty of people in the financial community whose opinion of these unregulated credit swaps was not as rosy as that of Gramm, Greenspan, and McCain. Chief among those speaking in opposition was SEC Chairman, Arthur Levitt. Levitt argued that what the industry needed was more transparency, especially when it came to complex instruments like default swaps, and he testified to this before Gramm’s Senate Banking Committee,.
“In my judgment, the risk of this regulatory approach is simply unacceptable for America ’s investors.”
–Arthur Levitt, 1999
Gramm paid no attention.
Credit default swaps did allow the banks to share risks. So much so, that banks raced each other in an effort to find more risks. They made it possible for the down payment on homes to become 3%, 1%, 0%. Skip the credit check, avoid the employment requirements, damn the torpedoes, full speed ahead! We’ve got a credit default swap, we can do anything!
The encouragement and “safety” that credit default swaps provided made the sub-prime mortgage market possible. Just as with the deregulation of S&Ls in the 1980s, the market was suddenly flooded with easy credit. The result was a real estate boom, soaring home prices, and a plague of “Flip that House!” shows on cable.
As the banks piled up crappy mortgages, they heaped on ever more of the credit default swaps — and they still had no idea how to value the things. Worse, they began to trade the swaps themselves as if they were an investment, treating them like something worth holding instead of a big bundle of cartoon bombs whose fuses were already lit. Since very few loans were falling into default at the time, owning a default swap seemed like a way to collect fees without ever paying out. Banks wanted more, and more, and more.
A secondary market for trading swaps exploded into existence, and swaps were traded with absolutely no consideration for the nature or quality of the underlying investment. Swaps changed hands a dozen or more times, growing in “value” as they went. Worse still, no one regulated who could buy a swap, so it was (and is) perfectly possible for a company to acquire swaps that theoretically cover billions of dollars in loans, even if that company doesn’t have a red cent on hand to cover those swaps should the loans default.
· How big did this market become? Here’s business correspondent Bob Moon and host Kai Ryssdal on American Public Media’s Marketplace from back in the spring.
· BOB MOON: OK, I’m about to unload some numbers on you here, so I’ll speak slowly so you can follow this.
· The value of the entire U.S. Treasuries market: $4.5 trillion.
· The value of the entire mortgage market: $7 trillion.
· The size of the U.S. stock market: $22 trillion.
· OK, you ready?
· The size of the credit default swap market last year: $45 trillion.
· KAI RYSSDAL: That’s a lot of money, Bob.
· As in three times the whole US gross domestic product, Bob. And the truth is that Moon probably underestimated. The unregulated and poorly reported credit default swaps may have actually passed $70 trillion last year, or about $5 trillion more than the GDP of the entire world.
· So, are you starting to get an idea of just how big a genie Phil Gramm and his pals unleashed?
With some regularity over the last eight years, fiscal whistle blowers have tried to raise their hands and register a protest. Um, sirs? Is it altogether a good idea to run up debts exceeding all the assets it’s even possible to hold? But so long as no one actually had to pay off on the swaps, the party went on. Even usually conservative (in the fiscal sense) companies like AIG started to worry that they were being left behind and leapt headlong into the swap pool.
Shortly after Greenspan’s departure in 2006, the Federal Reserve took the unusual step of issued a joint statement along with the SEC to warn about the risks associated with credit default swaps. But by that point, the damage was already severe. If swaps lost their value, most of those who had played the game would find their giant firms abruptly valued in pocket change. The only solution was to cover the problem with still more swaps and keep moving.
Then a funny thing happened. After years in which banks had handed out loans willy-nilly, guarded by the indestructible swap, people and companies started to really default on those loans. Credit slowed, home prices fell, and the whole snake started to eat itself tail first.
Suddenly, credit default swaps were not sources of limitless cash. It turns out that an insurance policy — even a secret, unregulated policy — is occasionally expected to pay. Speculators started to look at the paper they were holding and for the first time realized it could all be worthless. Worse, it could (and did) represent a massive debt; one that no one had the funds to cover.
When Bear Stearns fell apart last March, it was only suspected that a big part of the effort in saving the giant investment bank was keeping their holdings in credit default swaps from unraveling and spreading to other institutions. Naturally, part of solving this problem involved creating a new credit default swap to cover Bear Stearn’s potential debt. But the all-purpose swap was starting to lose its power. Shortly after Bear Stearns went belly up, AIG reported the largest quarterly loss in the company’s history, taking a $11 billion hit on revaluing its holdings of swaps. The party was definitely coming to a close.
When AIG finally collapsed this week, there was no doubt about the primary cause of its failure. The previously well grounded company had “gotten itself involved with something called credit default swaps.” Point of irony alert: Arthur Levitt now serves on the AIG board… or at least he did until the government had to take over most of AIG to salvage the company from the very idiocy Levitt had warned of in 1999.
This week, the Bush administration announced the beginnings of a plan to salvage what remains of the financial markets. At first glance, it appears that the plan will consist mainly of creating a kind of “garbage pit,” a fund or group of funds — cousins of the Resolution Trust that was created during the S&L crisis — into which those people who have dabbled in bad debts can toss their problems. Only this time the cost to the taxpayers is at least $700 billion… and a big bite out of representative democracy.
The expansion of unregulated Savings and Loans in the 1980s brought on the collapse of that industry, a crippling of the economy, and left taxpayers holding the bag. Maybe that was only happenstance. Those pushing for the Garn-St. Germain Depository Institutions Act may not have known what they were doing.
The deregulation of the California electricity market, along with the protections provided to Enron through Phil Gramm’s lobbyist-written legislation brought blackouts, fiscal and political chaos, and left taxpayers holding the bag. But the people who engineered that event — people like Gramm and Greenspan — had already seen what happened with the S&Ls. They should have known better. Still, perhaps that was only coincidence.
The sub-prime mortgage crisis that has not only come so close to utterly destroying the markets, but has ruined the value of many people’s homes and left millions with mortgages they can’t pay, was also the outcome of the deregulation created by these men. The very predictable outcome. When taxpayers are left holding the bag for $1 trillion this time around, it’s hard to believe it’s any sort of accident.
This is enemy action. This is a bullet deliberately fired into the economy by men willing to exercise their ideology regardless of the cost to taxpayers. Men who have every expectation that they can plunder the system again and again, while the public picks up the tab. John McCain may not have had his finger directly on the trigger, but he was there. He assisted. These were his personal friends and philosophical comrades. He may not be the high priest, but he has been a loyal acolyte in the cult of deregulation.
It may come as a surprise to the champions of deregulation, but nobody likes regulation. The restrictions that were placed on banks, S&Ls, and other institutions in the 1930s weren’t put there because someone thought it would be fun. They were put in place because they addressed problems that had just been clearly and painfully revealed. They were put in place because they were necessary.
It’s bad enough if John McCain didn’t know that. It’s far worse if he did.
Monday, September 15, 2008
Friday, July 11, 2008
What-a-Jolly-Street
First let me explain that on Lopez Island is a dump and recycling center where a man named Neil sorts and arranges those things that are reusable and opens his "store" a couple days a week for people to come and get anything they can use. People on the island donate items they no longer need. It's like a Goodwill, but free. It comes from the problem of being on an island where waste disposal is a challenge, and where people believe in reusing things instead of buying everything new. It's an inconvenience to go to a big shopping area to buy things, too. You have to spend an hour or more in transit by ferry, just to get to the mainland. Then there's the car trip to Seattle.
When we went to Lopez Island, I wanted to go to Neil's Mall (aka The Dump). Not because I wanted to bring home a bunch more stuff. No, this time I planned to bring back very little. After all, I've been going through closets and trying to get rid of stuff, so why would I want to bring more stuff home?
But I knew, I just had a feeling, that there would be something special there that would mean something to me. I just had a strong intuition about that. It would be something that really didn't matter to anyone else, but it would be meaningful to me. I thought I would find it in the book section, or on the shelves near the books. But I wasn't sure it would be a book. I thought maybe it would be a box or something. I had a sense about the size of it.. that it would be about 10 or 12 inches by 7 or 8 inches, and maybe two or three inches deep. It was a vague feeling and I didn't pay a whole lot of attention to it, not consciously anyway.
When we got there, I briefly scanned the clothing, found a couple of items that looked cool, including a vintage flannel shirt with funny dogs on it and a black sweater with silver star buttons. I put them in the car and then walked over to the book section. My eyes scanned the shelves. (I'm always hoping to find Opal Whitely's "The Fairyland Around Us" but I don't expect to. I missed my opportunity for that one, the time I passed it by at Smith Family Books, before I knew who Opal Whitely was, back in 1989 or so.) Anyway, I didn't even have to search for the book I had come for. It was lying right on top of a stack of books on the childrens' shelf: "365 Bedtime Stories."
There was the familiar scene on the cover, brightly colored, the one I remember so well from my childhood, of old Mrs. Apricot telling stories to the neighborhood children. I think it was my sister's book, actually. We used to call it "What-a-Jolly-Street" instead of the actual title, because that was the name of the street that the characters lived on. Every page holds a different short story, one for each day of the year. It begins with Baby New Year and ends with Father Time. Okay, so my sister and I used to think the book was a bit silly, the name of the street especially so. Some of the stories were quite boring. We made fun of it.. but it inspired stories I wrote of made-up kids in made-up neighborhoods. And I remember well the map on the inside of the book cover. It depicted the homes on the street, where the children lived, and the school and Mrs. Apricot's house, all labeled with a key.
So I picked up the book and opened it. Printed on non-archival paper, the pages are evenly yellowing. It seemed so familiar that I was surprised to find that it was not the actual book that belonged to my sister. But there is no writing inside, and we always wrote our names in our books. The spine had been carefully mended with clear tape. The hard cover is cardboard, which is also disintegrating at the edges. The copyright is 1955. Overall the book is in good shape, considering the material it's made of.
When I got home, I googled it. I found that other revised editions were published later, and apparently this version is the original. It is a collector's item now. But for me, it's a memory. I can hardly wait to show it to my sister!
When we went to Lopez Island, I wanted to go to Neil's Mall (aka The Dump). Not because I wanted to bring home a bunch more stuff. No, this time I planned to bring back very little. After all, I've been going through closets and trying to get rid of stuff, so why would I want to bring more stuff home?
But I knew, I just had a feeling, that there would be something special there that would mean something to me. I just had a strong intuition about that. It would be something that really didn't matter to anyone else, but it would be meaningful to me. I thought I would find it in the book section, or on the shelves near the books. But I wasn't sure it would be a book. I thought maybe it would be a box or something. I had a sense about the size of it.. that it would be about 10 or 12 inches by 7 or 8 inches, and maybe two or three inches deep. It was a vague feeling and I didn't pay a whole lot of attention to it, not consciously anyway.
When we got there, I briefly scanned the clothing, found a couple of items that looked cool, including a vintage flannel shirt with funny dogs on it and a black sweater with silver star buttons. I put them in the car and then walked over to the book section. My eyes scanned the shelves. (I'm always hoping to find Opal Whitely's "The Fairyland Around Us" but I don't expect to. I missed my opportunity for that one, the time I passed it by at Smith Family Books, before I knew who Opal Whitely was, back in 1989 or so.) Anyway, I didn't even have to search for the book I had come for. It was lying right on top of a stack of books on the childrens' shelf: "365 Bedtime Stories."
There was the familiar scene on the cover, brightly colored, the one I remember so well from my childhood, of old Mrs. Apricot telling stories to the neighborhood children. I think it was my sister's book, actually. We used to call it "What-a-Jolly-Street" instead of the actual title, because that was the name of the street that the characters lived on. Every page holds a different short story, one for each day of the year. It begins with Baby New Year and ends with Father Time. Okay, so my sister and I used to think the book was a bit silly, the name of the street especially so. Some of the stories were quite boring. We made fun of it.. but it inspired stories I wrote of made-up kids in made-up neighborhoods. And I remember well the map on the inside of the book cover. It depicted the homes on the street, where the children lived, and the school and Mrs. Apricot's house, all labeled with a key.
So I picked up the book and opened it. Printed on non-archival paper, the pages are evenly yellowing. It seemed so familiar that I was surprised to find that it was not the actual book that belonged to my sister. But there is no writing inside, and we always wrote our names in our books. The spine had been carefully mended with clear tape. The hard cover is cardboard, which is also disintegrating at the edges. The copyright is 1955. Overall the book is in good shape, considering the material it's made of.
When I got home, I googled it. I found that other revised editions were published later, and apparently this version is the original. It is a collector's item now. But for me, it's a memory. I can hardly wait to show it to my sister!
Sunday, July 6, 2008
Frightening Plants
Blackberries in Oregon are delicious, free and plentiful. In August I carry a couple of small buckets in my car at all times, just in case I come across a blackberry patch. Some of my friends carry garden clippers, because it's easier and less wounding to clip the thorny vines away before reaching for the berries. However, there is danger, in addition to the spikes on the branches.. poison oak lurks among the blackberry brambles.
About 24 hours after contact with the toxic oil from the poison oak plant, my skin develops large yellow fluid-filled blisters. The itchiness is unbearable. The torment lasts for 2 - 3 weeks. I have to take prednisone to quiet the allergic reaction, which can continue up to a month as my body inflames, trying to fight the toxins in my system. Everything reacts, I become irritable and itchy skin becomes tender and painful, sending pain down to the very roots of the nerves.
One time at age 17, while hiking with friends, I came into direct contact with so much poison oak that my left arm swelled into a blimp shape. Trails of yellow blisters evidenced the track the branch had left as it brushed my arm. I still have the scar, a long white line, where the blisters broke. That was before I knew what the plant looked like.
"Leaflets three, let it be." But lots of plants have leaves of three.But I know what poison oak looks like. The shiny oil makes the leaves glisten, especially in spring and summer. They turn vibrant red in autumn. People have said that you can't get poison oak in winter. They are wrong. All parts of the plant carry the toxic oil.
I can't even pet animals that live in areas where there is poison oak. I can't live in the woods or in the country, because I love cats. They bring the oil home on their fur. I've had friends who were offended when I wouldn't pet their dog because they live near open fields where poison oak grows. I love animals and I'd love more than anything to pet them and play with them. But people just don't understand what this plant does to me.
Once when we had a French girl staying with us for the summer and we went out to pick blackberries, I warned her about this plant that could make you break out in a horrible rash. She didn't believe me. She thought I was playing a trick on her. I guess they don't have poison oak or ivy in France.
Thankfully there is Fels Naptha bar soap. It's a detergent, which is necessary to break down the oil from the plant. Other products, like Technu, have been developed, but in my experience, Fels Naptha works much better, and it's far cheaper. I'm never without it on a camping trip. My friends' father was a volunteer fire fighter, and that's what they always washed with after coming back from fighting fires. It will dilute the oil, if used within two hours of exposure. Then, of course, you must also wash all of your clothes immediately. The oil stays potent for a long time, I'm not sure how long. But that's why it can seem like you can start healing, only to have it get worse again. Since it takes 24-48 hours for the allergic reaction to begin, it's sometimes hard to pinpoint the source of the contaminant.
I took pictures on my walk yesterday, laughing at myself for the fear reaction I was having. I knew I didn't touch it. And it can't jump out an attack. Or can it? When I got home I showered with Fels Naptha.
The next morning I woke up with my heel itching intensely. Looking down, I saw the distictive yellow fluid-filled blister. Impossible! I had been wearing shoes and socks! But I wore sandals at other times.. so apparently sometime in the previous day or two, I had come into contact with a tiny glossy leaflet three, lurking somewhere in the grass where I had been walking...
About 24 hours after contact with the toxic oil from the poison oak plant, my skin develops large yellow fluid-filled blisters. The itchiness is unbearable. The torment lasts for 2 - 3 weeks. I have to take prednisone to quiet the allergic reaction, which can continue up to a month as my body inflames, trying to fight the toxins in my system. Everything reacts, I become irritable and itchy skin becomes tender and painful, sending pain down to the very roots of the nerves.
One time at age 17, while hiking with friends, I came into direct contact with so much poison oak that my left arm swelled into a blimp shape. Trails of yellow blisters evidenced the track the branch had left as it brushed my arm. I still have the scar, a long white line, where the blisters broke. That was before I knew what the plant looked like.
"Leaflets three, let it be." But lots of plants have leaves of three.But I know what poison oak looks like. The shiny oil makes the leaves glisten, especially in spring and summer. They turn vibrant red in autumn. People have said that you can't get poison oak in winter. They are wrong. All parts of the plant carry the toxic oil.
I can't even pet animals that live in areas where there is poison oak. I can't live in the woods or in the country, because I love cats. They bring the oil home on their fur. I've had friends who were offended when I wouldn't pet their dog because they live near open fields where poison oak grows. I love animals and I'd love more than anything to pet them and play with them. But people just don't understand what this plant does to me.
Once when we had a French girl staying with us for the summer and we went out to pick blackberries, I warned her about this plant that could make you break out in a horrible rash. She didn't believe me. She thought I was playing a trick on her. I guess they don't have poison oak or ivy in France.
Thankfully there is Fels Naptha bar soap. It's a detergent, which is necessary to break down the oil from the plant. Other products, like Technu, have been developed, but in my experience, Fels Naptha works much better, and it's far cheaper. I'm never without it on a camping trip. My friends' father was a volunteer fire fighter, and that's what they always washed with after coming back from fighting fires. It will dilute the oil, if used within two hours of exposure. Then, of course, you must also wash all of your clothes immediately. The oil stays potent for a long time, I'm not sure how long. But that's why it can seem like you can start healing, only to have it get worse again. Since it takes 24-48 hours for the allergic reaction to begin, it's sometimes hard to pinpoint the source of the contaminant.
I took pictures on my walk yesterday, laughing at myself for the fear reaction I was having. I knew I didn't touch it. And it can't jump out an attack. Or can it? When I got home I showered with Fels Naptha.
The next morning I woke up with my heel itching intensely. Looking down, I saw the distictive yellow fluid-filled blister. Impossible! I had been wearing shoes and socks! But I wore sandals at other times.. so apparently sometime in the previous day or two, I had come into contact with a tiny glossy leaflet three, lurking somewhere in the grass where I had been walking...
Monday, June 30, 2008
From under the bed
I've been cleaning out the file cabinets and going through the boxes under the bed. Here are some things I found. Most come from when Heather was age 4 thru 8 years old.
Sunday, May 11, 2008
There’s an ANGE in chANGE.
The night before his visit, we heard that Obama would be coming to the University of Oregon. On the news we saw them setting up the outdoor stage in front of the Knight Library. He was due to arrive at 7:45 PM Friday, and gates were going to open at 5:45. This was incredible luck -- he was coming back to Eugene at a time when I could go see him without missing work! I could leave school after my last class, and we could arrive to get in line a couple of hours before the gates opened. We had been on our way to France when he came in March, but I heard that people started lining up really early, and not all of the 11,000 people got in. (However, he stopped and addressed the people outside, and spoke to them for about 15 minutes.)
Anyway, Joy and I had agreed that if Obama ever came to Oregon we would try to go together. She did see him in Salem in March, but we couldn’t go together at that time, so I called her as soon as I heard about this visit to Eugene. She said she’d talk with her husband and would call me back after dinner. When she did, she said that her husband wasn’t coming, but another friend from our elementary school, Carol P., wanted to drive down with her. I haven’t seen Carol since 6th grade. So this added another fascinating dimension to an already amazing episode about to unfold.
I have a little bit of hand-shaking history with previous presidential candidates.
I am proud to say that I was fortunate to shake Bobby Kennedy’s hand when he came to Sunset High School in 1968. I wasn’t yet old enough to vote, but I was passionately interested in the election that year. I will never forget it.
By mere chance, I was able to shake Bill Clinton’s hand at the Eugene airport in 1992. It was a small crowd and Heather was four. He looked me directly in the eye and he was very intense. He is a tall man, but he was dwarfed by four very black secret service agents towering above and tightly encircling him, penetrating the crowd intently with their gaze. The whole experience was very intense and I’m glad to have been there. But I can’t say I am proud to have shaken Bill Clinton’s hand.
But I didn’t expect to have a chance to shake Obama’s hand. I was grateful that I would have the opportunity to see him in person, but I did not expect to be able to get close.
Joy and I agreed to keep in touch by cell phone and find each other once they got here. She and Carol aren’t familiar with Eugene or the UO campus. She said that they would leave in time to find us in line around 5:30. It thought it was cool they were coming down, but I frankly thought it would be a miracle if we found each other in the crowd. So I went into this, thinking it best just to go with the flow, and I had no expectations of everything meshing.
Amazing things..
• Spring sunshine, lilac-scented air, skies pure blue, shirt sleeve weather.
• At 3:45 PM when we arrived downtown, we noticed no unusually heavy traffic. It was easy to find a parking place in a neighborhood about five blocks from campus.
• All the streets were marked with 2-hour parking limits, but no meters. The limit expired at 6:00 PM, 2 hours and 15 minutes away. We were discussing whether to risk getting a ticket for the extra 15 minutes. I advocated for the risk – wasn’t seeing Obama worth a $10 ticket? Besides, I was pretty sure that all the police in town would be occupied at the rally and other events on campus. Just as we were getting out of the car, the meter maid approached in her little cart. Daniel asked her if we would get a ticket if we left the car. She grinned and said, “No problem, you’re fine!” She wasn’t chalking the tires on this round; she was just checking for chalk marks. It must have been her last time through and she was on her way to the rally, too (I’m guessing).
• We walked up 13th Street and approaching campus we could see the colorful booths of the international street fair. One block in to campus, we saw a row of white canopies with security gates set up between Condon and Chaplain Halls, directly across from Lillis Business complex. Uniformed men and women were working to set up the gates, arranging the long black trunks they had been packed in and getting organized. But where were the crowds of people we expected?
• Other than the security gates, the overall atmosphere was a typical spring day on the university campus. Technicolor blue sky, verdant green lawns, rainbow tie-dye blowing in the gentle breeze at the street fair. It was like a scene straight out of the movie, “Across the Universe.” Students sprawled on grassy lawns, alone or in groups, reading, studying, talking on cell phones. Everything seemed so laid back, typical Eugene-style. And this was where Obama was due to arrive in less than four hours? We looked around in disbelief, then settled down in the sunshine on the grass. Heather went off to browse the street fair. After teaching on my feet all day, it felt wonderful to rest my achy back on soft grass, my head in Daniel’s lap. I almost drifted off to sleep in the warm sunshine. Heather returned with a vegetarian burrito. It felt like a moment made in heaven.
• Eventually a short rotund uniformed policewoman approached, telling us that she had been instructed to clear the lawn. She directed us to go to the line, which was forming at the EMU (student union), a couple of blocks away. A few people got up and walked off in the direction of the EMU. We thought, oh well, it was too good to be true, and started to follow. But after speaking with one or two groups on the grass, the police woman stationed herself in front of the gates and did not move. Several groups of people remained on the grass. I walked over and asked her what their plan was, and she shrugged and said, “I was just told to clear this area,” indicating the patch of grass in front of the gates.
• Awhile later, a young man with a staff badge stood up on a stump and announced in a loud voice that everyone needed to clear the lawn and go to the line. “There are still some good places in line! You should go there now and secure your spot!” His urgency prodded a few more lollygaggers to jump up off the lawn and hurry down in the direction of the EMU.
• It was so pleasant hanging out on the lawn that I just did not want to give that up to go stand in a crowded line of people several blocks away. Even if it did mean getting a spot further back in line, I was willing to risk that. The more I looked around, the more I doubted they would be able to clear the street or block people from entering from 13th St. We walked a ways toward the EMU, and we asked various officials – secret servicemen, city policemen on bikes and campaign staffers – what the plan was. We calculated how they might be planning to bring the line through to the gates. We watched a few of the vendors slowly packing up their wares. By 5:00 most of the booths were still standing, people were still browsing and shopping and it was clear that there was no way they would be able to block the street. And everyone we spoke to said there were no plans to do that. The only place they were keeping cleared was the lawn in front of the security gates.
• I had been giving cell phone updates to Joy and Carol, who were on the road. They would need to find a place to park, and then find us on campus. To direct them to 13th St. was easy. It would have been harder to explain how to get to the EMU to find us in a long line. We decided to take our chances. We found a comfortable spot on a wall in front of Condon Hall and waited.
• We saw three Obama supporters wearing home made t-shirts printed with OBAMA vs HILLARY – BROs B4 HOs. Not something I would wear on a t-shirt, but I asked if I could take their picture. They were chipper and friendly, and funny! They said they would not get near enough for a photo with Obama in those shirts, because they didn’t want the media to grab it and accuse him of endorsing the slogan. This struck me as surprisingly insightful.
• I got a call that Joy and Carol had arrived in Eugene. They had mistakenly taken the wrong exit, but they found their way across the Ferry Street Bridge. I directed them to the neighborhood where we had parked, they found a spot and were already walking toward us on 13th St. by 5:30. Thus, they met up with us two minutes before the gates opened! We had time for hasty hugs and greetings.. and then..
• We walked right up without a fuss and passed through security. They searched everything, but they let Carol pass with her bag of provisions. I didn’t expect that. Carol and Joy needed to find a restroom, so we split up.
• Daniel, Heather and I went to the front of the stage. But Daniel went off to the left over on the side, standing at a bike rack rail barricade. He motioned me over, saying that the secret service guy guarding the door to the adjoining Art Museum told him that Obama would be coming out through those doors, and he would shake hands with the crowd right there before going up on the stage. So that’s where we positioned ourselves. We still had 2 hours to wait.
• Joy and Carol arrived just minutes later (I forgot to ask where they had found a bathroom). Joy had brought her deck of cards with bizarre pictures of GW Bush dressed in drag and morphed versions of dogs. It was a distracting set of cards to play gin rummy with, but we sat on the warm cement and played a round of cards as people gathered behind us. It was fun.. but we couldn’t concentrate. Every once in awhile Joy would put down a card and interject, “Oh look, he’s a dog on that one,” which caused me to giggle at the silliness of it all. I didn’t know when the game was supposed to end.. so I played past when I should have stopped!
• It was fascinating to watch the people, and all the goings-on around us. Finally we gave up on the card game and stood up.
• A golden-curlylocks toddler suddenly pulled down his pants and started to take a tinkle in the middle of the lawn. His mother dashed across, shooing him to another place on the other side of the sidewalk, so he could leave his pee in the Museum garden. We were laughing like crazy, and of course I whipped out my camera, not quite catching the funniest moment before mom intervened.
• The bleachers behind the stage were gradually being filled with people, directed by a staffer who had been pulling supporters from the line at the EMU. He arranged them according to how they would show up on TV behind the stage. It was a multicultural, multiage mix of men and women. Many were white middle-aged women, stereotypical Hillary voters. (I had actually joked about carrying a sign that said “White Middle-Aged Woman for Obama” but I wouldn’t actually do it.. I am so against these generalizations about how people will vote based on their demographic. That’s like trying to guess how people think based on how they look. It’s ridiculous.)
• Speaking of signs, they passed out mass-produced signs to the audience that said “CHANGE WE CAN BELIEVE IN” and the bleacher people were given hand-painted signs with various slogans. It was supposed to look like they were home made, but they were evidently painted by the same person with different colors of paint. Actually I didn’t see a single home made sign. I think this rally was on too short notice.
• A variety of music genres was blasting from huge speakers. Some folk, rock, pop, old and new, but all of it upbeat and inspirational. It set a happy tone and I watched some of the young people mouth the words to songs I had never heard. Other songs were familiar, ones I knew well enough to sing along with.
• Watching the secret service men held its own drama. They were dressed in black suits and white shirts, of course. Their shoes were polished to a high gloss. They wore characteristic gold lapel pins. Earlier some were wearing sun glasses like the Blues Brothers. They had earpieces attached to wires that went down into their coats. I saw one man speak into his hand, but I didn’t see a mic. It looked like he was speaking directly into the knuckle of his thumb. One man in particular looked the stereotype of the military man: bristly brush crew-cut, jutting chin, and muscle-built stature. Overall, their faces remained serious, but most didn’t appear to be under high tension.
• At one point, another secret service agent approached that man and said something into his ear. Suddenly the serious demeanor broke into a huge grin. The two men began taking off their ties! They folded them meticulously and tucked them in a pocket inside their jackets. They unbuttoned their collars and we watched as these same actions were repeated by all the secret service agents on the scene. This was just cracking me up! I mean.. they were supposed to start to appear casual (this is Oregon after all!) but even that was a formalized ritual that obviously came in the form of an order from a superior officer!
• All this time a very small elf-like girl-person had been weaseling her way up behind us. She was exactly half my height. She persistently pushed at our backs, determined to secure a spot in front. Eventually I turned to her and asked her to give me a little space. I told her, “When he comes out, I’m going to let you stand here, so don’t worry.” After that, she moved back a little, and we made room for her between us. She did not speak English, but apparently understood what was said to her. She had a pen and tablet ready for an autograph and her tiny hands handled her camera with dexterity. I noticed that the digital menu was in Asian characters; I think she was Korean. At first I thought she was a very small college student, but at the end of the rally, after she told me “Thank you” I asked her age. I could barely understand, and had to ask her to repeat. She replied, “ee-reb-en.” (11)
• Soon the nervous and excited girl who is the UO student body president, came onstage, then Ernie Kent, then Peter DeFazio. Each gave a very brief speech. I kept watching the glass doors, planning how I would take photos. I decided to put the camera on video setting so that I wouldn’t have to set up camera shots while trying to shake Obama’s hand. I held the camera in my left hand, so I could shake hands with my right.
• Behind the glass doors I could see flashes of Obama’s smile. He’d peek out at the crowd, and he was laughing.. you could tell that he was having a great time!
• Finally he came out. As we had been told, he began by going through the crowd where we were standing, both hands outreached, shaking as many hands as possible. I didn’t know it, but Daniel had it planned what he wanted to say. He later told me that Obama looked him right in the eye when Daniel said, “Remember the plug-in hybrid – it’s the future.” And Obama nodded and told him, “I won’t forget.”
• The rest is history. He gave his speech as the twilight became night. The sky indigo blue. The crowd loving the fact that we finally have an American hero, someone willing to sacrifice for the love of this country and its people. Someone who believes in the power of change.
It was a perfectly magical evening.
Anyway, Joy and I had agreed that if Obama ever came to Oregon we would try to go together. She did see him in Salem in March, but we couldn’t go together at that time, so I called her as soon as I heard about this visit to Eugene. She said she’d talk with her husband and would call me back after dinner. When she did, she said that her husband wasn’t coming, but another friend from our elementary school, Carol P., wanted to drive down with her. I haven’t seen Carol since 6th grade. So this added another fascinating dimension to an already amazing episode about to unfold.
I have a little bit of hand-shaking history with previous presidential candidates.
I am proud to say that I was fortunate to shake Bobby Kennedy’s hand when he came to Sunset High School in 1968. I wasn’t yet old enough to vote, but I was passionately interested in the election that year. I will never forget it.
By mere chance, I was able to shake Bill Clinton’s hand at the Eugene airport in 1992. It was a small crowd and Heather was four. He looked me directly in the eye and he was very intense. He is a tall man, but he was dwarfed by four very black secret service agents towering above and tightly encircling him, penetrating the crowd intently with their gaze. The whole experience was very intense and I’m glad to have been there. But I can’t say I am proud to have shaken Bill Clinton’s hand.
But I didn’t expect to have a chance to shake Obama’s hand. I was grateful that I would have the opportunity to see him in person, but I did not expect to be able to get close.
Joy and I agreed to keep in touch by cell phone and find each other once they got here. She and Carol aren’t familiar with Eugene or the UO campus. She said that they would leave in time to find us in line around 5:30. It thought it was cool they were coming down, but I frankly thought it would be a miracle if we found each other in the crowd. So I went into this, thinking it best just to go with the flow, and I had no expectations of everything meshing.
Amazing things..
• Spring sunshine, lilac-scented air, skies pure blue, shirt sleeve weather.
• At 3:45 PM when we arrived downtown, we noticed no unusually heavy traffic. It was easy to find a parking place in a neighborhood about five blocks from campus.
• All the streets were marked with 2-hour parking limits, but no meters. The limit expired at 6:00 PM, 2 hours and 15 minutes away. We were discussing whether to risk getting a ticket for the extra 15 minutes. I advocated for the risk – wasn’t seeing Obama worth a $10 ticket? Besides, I was pretty sure that all the police in town would be occupied at the rally and other events on campus. Just as we were getting out of the car, the meter maid approached in her little cart. Daniel asked her if we would get a ticket if we left the car. She grinned and said, “No problem, you’re fine!” She wasn’t chalking the tires on this round; she was just checking for chalk marks. It must have been her last time through and she was on her way to the rally, too (I’m guessing).
• We walked up 13th Street and approaching campus we could see the colorful booths of the international street fair. One block in to campus, we saw a row of white canopies with security gates set up between Condon and Chaplain Halls, directly across from Lillis Business complex. Uniformed men and women were working to set up the gates, arranging the long black trunks they had been packed in and getting organized. But where were the crowds of people we expected?
• Other than the security gates, the overall atmosphere was a typical spring day on the university campus. Technicolor blue sky, verdant green lawns, rainbow tie-dye blowing in the gentle breeze at the street fair. It was like a scene straight out of the movie, “Across the Universe.” Students sprawled on grassy lawns, alone or in groups, reading, studying, talking on cell phones. Everything seemed so laid back, typical Eugene-style. And this was where Obama was due to arrive in less than four hours? We looked around in disbelief, then settled down in the sunshine on the grass. Heather went off to browse the street fair. After teaching on my feet all day, it felt wonderful to rest my achy back on soft grass, my head in Daniel’s lap. I almost drifted off to sleep in the warm sunshine. Heather returned with a vegetarian burrito. It felt like a moment made in heaven.
• Eventually a short rotund uniformed policewoman approached, telling us that she had been instructed to clear the lawn. She directed us to go to the line, which was forming at the EMU (student union), a couple of blocks away. A few people got up and walked off in the direction of the EMU. We thought, oh well, it was too good to be true, and started to follow. But after speaking with one or two groups on the grass, the police woman stationed herself in front of the gates and did not move. Several groups of people remained on the grass. I walked over and asked her what their plan was, and she shrugged and said, “I was just told to clear this area,” indicating the patch of grass in front of the gates.
• Awhile later, a young man with a staff badge stood up on a stump and announced in a loud voice that everyone needed to clear the lawn and go to the line. “There are still some good places in line! You should go there now and secure your spot!” His urgency prodded a few more lollygaggers to jump up off the lawn and hurry down in the direction of the EMU.
• It was so pleasant hanging out on the lawn that I just did not want to give that up to go stand in a crowded line of people several blocks away. Even if it did mean getting a spot further back in line, I was willing to risk that. The more I looked around, the more I doubted they would be able to clear the street or block people from entering from 13th St. We walked a ways toward the EMU, and we asked various officials – secret servicemen, city policemen on bikes and campaign staffers – what the plan was. We calculated how they might be planning to bring the line through to the gates. We watched a few of the vendors slowly packing up their wares. By 5:00 most of the booths were still standing, people were still browsing and shopping and it was clear that there was no way they would be able to block the street. And everyone we spoke to said there were no plans to do that. The only place they were keeping cleared was the lawn in front of the security gates.
• I had been giving cell phone updates to Joy and Carol, who were on the road. They would need to find a place to park, and then find us on campus. To direct them to 13th St. was easy. It would have been harder to explain how to get to the EMU to find us in a long line. We decided to take our chances. We found a comfortable spot on a wall in front of Condon Hall and waited.
• We saw three Obama supporters wearing home made t-shirts printed with OBAMA vs HILLARY – BROs B4 HOs. Not something I would wear on a t-shirt, but I asked if I could take their picture. They were chipper and friendly, and funny! They said they would not get near enough for a photo with Obama in those shirts, because they didn’t want the media to grab it and accuse him of endorsing the slogan. This struck me as surprisingly insightful.
• I got a call that Joy and Carol had arrived in Eugene. They had mistakenly taken the wrong exit, but they found their way across the Ferry Street Bridge. I directed them to the neighborhood where we had parked, they found a spot and were already walking toward us on 13th St. by 5:30. Thus, they met up with us two minutes before the gates opened! We had time for hasty hugs and greetings.. and then..
• We walked right up without a fuss and passed through security. They searched everything, but they let Carol pass with her bag of provisions. I didn’t expect that. Carol and Joy needed to find a restroom, so we split up.
• Daniel, Heather and I went to the front of the stage. But Daniel went off to the left over on the side, standing at a bike rack rail barricade. He motioned me over, saying that the secret service guy guarding the door to the adjoining Art Museum told him that Obama would be coming out through those doors, and he would shake hands with the crowd right there before going up on the stage. So that’s where we positioned ourselves. We still had 2 hours to wait.
• Joy and Carol arrived just minutes later (I forgot to ask where they had found a bathroom). Joy had brought her deck of cards with bizarre pictures of GW Bush dressed in drag and morphed versions of dogs. It was a distracting set of cards to play gin rummy with, but we sat on the warm cement and played a round of cards as people gathered behind us. It was fun.. but we couldn’t concentrate. Every once in awhile Joy would put down a card and interject, “Oh look, he’s a dog on that one,” which caused me to giggle at the silliness of it all. I didn’t know when the game was supposed to end.. so I played past when I should have stopped!
• It was fascinating to watch the people, and all the goings-on around us. Finally we gave up on the card game and stood up.
• A golden-curlylocks toddler suddenly pulled down his pants and started to take a tinkle in the middle of the lawn. His mother dashed across, shooing him to another place on the other side of the sidewalk, so he could leave his pee in the Museum garden. We were laughing like crazy, and of course I whipped out my camera, not quite catching the funniest moment before mom intervened.
• The bleachers behind the stage were gradually being filled with people, directed by a staffer who had been pulling supporters from the line at the EMU. He arranged them according to how they would show up on TV behind the stage. It was a multicultural, multiage mix of men and women. Many were white middle-aged women, stereotypical Hillary voters. (I had actually joked about carrying a sign that said “White Middle-Aged Woman for Obama” but I wouldn’t actually do it.. I am so against these generalizations about how people will vote based on their demographic. That’s like trying to guess how people think based on how they look. It’s ridiculous.)
• Speaking of signs, they passed out mass-produced signs to the audience that said “CHANGE WE CAN BELIEVE IN” and the bleacher people were given hand-painted signs with various slogans. It was supposed to look like they were home made, but they were evidently painted by the same person with different colors of paint. Actually I didn’t see a single home made sign. I think this rally was on too short notice.
• A variety of music genres was blasting from huge speakers. Some folk, rock, pop, old and new, but all of it upbeat and inspirational. It set a happy tone and I watched some of the young people mouth the words to songs I had never heard. Other songs were familiar, ones I knew well enough to sing along with.
• Watching the secret service men held its own drama. They were dressed in black suits and white shirts, of course. Their shoes were polished to a high gloss. They wore characteristic gold lapel pins. Earlier some were wearing sun glasses like the Blues Brothers. They had earpieces attached to wires that went down into their coats. I saw one man speak into his hand, but I didn’t see a mic. It looked like he was speaking directly into the knuckle of his thumb. One man in particular looked the stereotype of the military man: bristly brush crew-cut, jutting chin, and muscle-built stature. Overall, their faces remained serious, but most didn’t appear to be under high tension.
• At one point, another secret service agent approached that man and said something into his ear. Suddenly the serious demeanor broke into a huge grin. The two men began taking off their ties! They folded them meticulously and tucked them in a pocket inside their jackets. They unbuttoned their collars and we watched as these same actions were repeated by all the secret service agents on the scene. This was just cracking me up! I mean.. they were supposed to start to appear casual (this is Oregon after all!) but even that was a formalized ritual that obviously came in the form of an order from a superior officer!
• All this time a very small elf-like girl-person had been weaseling her way up behind us. She was exactly half my height. She persistently pushed at our backs, determined to secure a spot in front. Eventually I turned to her and asked her to give me a little space. I told her, “When he comes out, I’m going to let you stand here, so don’t worry.” After that, she moved back a little, and we made room for her between us. She did not speak English, but apparently understood what was said to her. She had a pen and tablet ready for an autograph and her tiny hands handled her camera with dexterity. I noticed that the digital menu was in Asian characters; I think she was Korean. At first I thought she was a very small college student, but at the end of the rally, after she told me “Thank you” I asked her age. I could barely understand, and had to ask her to repeat. She replied, “ee-reb-en.” (11)
• Soon the nervous and excited girl who is the UO student body president, came onstage, then Ernie Kent, then Peter DeFazio. Each gave a very brief speech. I kept watching the glass doors, planning how I would take photos. I decided to put the camera on video setting so that I wouldn’t have to set up camera shots while trying to shake Obama’s hand. I held the camera in my left hand, so I could shake hands with my right.
• Behind the glass doors I could see flashes of Obama’s smile. He’d peek out at the crowd, and he was laughing.. you could tell that he was having a great time!
• Finally he came out. As we had been told, he began by going through the crowd where we were standing, both hands outreached, shaking as many hands as possible. I didn’t know it, but Daniel had it planned what he wanted to say. He later told me that Obama looked him right in the eye when Daniel said, “Remember the plug-in hybrid – it’s the future.” And Obama nodded and told him, “I won’t forget.”
• The rest is history. He gave his speech as the twilight became night. The sky indigo blue. The crowd loving the fact that we finally have an American hero, someone willing to sacrifice for the love of this country and its people. Someone who believes in the power of change.
It was a perfectly magical evening.
Friday, April 18, 2008
ABC's Deplorable Debate
This letter says so well what I was thinking when I watched the debate on Wednesday night. Mostly, I felt angry that the moderators wasted our time with so much dribble. This open letter appears on Economist’s View.
April 18, 2008
An Open Letter to ABC about the Presidential Debate
We the undersigned deplore the conduct of ABC’s George Stephanopoulos and Charles Gibson at the Democratic Presidential debate on April 16. The debate was a revolting descent into tabloid journalism and a gross disservice to Americans concerned about the great issues facing the nation and the world. This is not the first Democratic or Republican presidential debate to emphasize gotcha questions over real discussion. However, it is, so far, the worst.
For 53 minutes, we heard no question about public policy from either moderator. ABC seemed less interested in provoking serious discussion than in trying to generate cheap shot sound-bites for later rebroadcast. The questions asked by Mr. Stephanopoulos and Mr. Gibson were a disgrace, and the subsequent attempts to justify them by claiming that they reflect citizens’ interest are an insult to the intelligence of those citizens and ABC’s viewers. Many thousands of those viewers have already written to ABC to express their outrage.
The moderators’ occasional later forays into substance were nearly as bad. Mr. Gibson’s claim that the government can raise revenues by cutting capital gains tax is grossly at odds with what taxation experts believe. Both candidates tried, repeatedly, to bring debate back to the real problems faced by ordinary Americans. Neither moderator allowed them to do this.
We’re at a crucial moment in our country’s history, facing war, a terrorism threat, recession, and a range of big domestic challenges. Large majorities of our fellow Americans tell pollsters they’re deeply worried about the country’s direction. In such a context, journalists moderating a debate–who are, after all, entrusted with free public airwaves–have a particular responsibility to push and engage the candidates in serious debate about these matters. Tough, probing questions on these issues clearly serve the public interest. Demands that candidates make pledges about a future no one can predict or excessive emphasis on tangential “character” issues do not. This applies to candidates of both parties.
Neither Mr. Gibson nor Mr. Stephanopoulos lived up to these responsibilities. In the words of Tom Shales of the Washington Post, Mr. Gibson and Mr. Stephanopoulos turned in “shoddy, despicable performances.” As Greg Mitchell of Editor and Publisher, describes it, the debate was a “travesty.” We hope that the public uproar over ABC’s miserable showing will encourage a return to serious journalism in debates between the Democratic and Republican nominees this fall. Anything less would be a betrayal of the basic responsibilities that journalists owe to their public.
Spencer Ackerman, The Washington Independent
Eric Alterman, City University of New York
Dean Baker, The American Prospect Online
Steven Benen, The Carpetbagger Report
Julie Bergman Sender, Balcony Films
Ari Berman, The Nation
Brian Beutler, The Media Consortium
Michael Bérubé, Crooked Timber, Penn. State University
Joel Bleifuss, In These Times
Sam Boyd, The American Prospect
Lakshmi Chaudry, In These Times
Michael Cohen, The New America Foundation
Lark Corbeil, Public News Service
Brad DeLong, Brad DeLong’s Semi-Daily Journal and UC Berkeley
Adam Doster, In These Times
Kevin Drum, The Washington Monthly
Gerald Dworkin, UC Davis
Henry Farrell, Crooked Timber,George Washington University
James Galbraith, University of Texas at Austin
Todd Gitlin, Columbia University, TPM Cafe
Merrill Goozner (formerly Chicago Tribune)
Ilan Goldenberg, The National Security Network
Arthur Goldhammer, Harvard University
Robert Greenwald, Brave New Films
Chris Hayes, The Nation
Don Hazen, Alternet
Michael Kazin, Georgetown University
Ed Kilgore, The Democratic Strategist
Charlie Kireker, Air America Media
Richard Kim, The Nation
Ezra Klein, The American Prospect
Mark Kleiman, The Reality Based Community, UCLA
Scott McLemee, Inside Higher Ed
Ari Melber, The Nation
Rick Perlstein, Campaign for America’s Future
Katha Pollit, The Nation
David Roberts, Grist
Thomas Schaller, Columnist, The Baltimore Sun
Adele Stan, The Media Consortium
Jonathan Stein, Mother Jones Magazine
Rinku Sen, ColorLines Magazine
Matthew Shugart, UC San Diego
Mark Thoma, The Economist’s View
Michael Tomasky, The Guardian
Cenk Uygur, The Young Turks
Tracy Van Slyke, The Media Consortium
Kai Wright, The Root
Matthew Yglesias, The Atlantic Monthly
[Update: In case there is any confusion, I should have made clear that the letter is a group effort.]
April 18, 2008
An Open Letter to ABC about the Presidential Debate
We the undersigned deplore the conduct of ABC’s George Stephanopoulos and Charles Gibson at the Democratic Presidential debate on April 16. The debate was a revolting descent into tabloid journalism and a gross disservice to Americans concerned about the great issues facing the nation and the world. This is not the first Democratic or Republican presidential debate to emphasize gotcha questions over real discussion. However, it is, so far, the worst.
For 53 minutes, we heard no question about public policy from either moderator. ABC seemed less interested in provoking serious discussion than in trying to generate cheap shot sound-bites for later rebroadcast. The questions asked by Mr. Stephanopoulos and Mr. Gibson were a disgrace, and the subsequent attempts to justify them by claiming that they reflect citizens’ interest are an insult to the intelligence of those citizens and ABC’s viewers. Many thousands of those viewers have already written to ABC to express their outrage.
The moderators’ occasional later forays into substance were nearly as bad. Mr. Gibson’s claim that the government can raise revenues by cutting capital gains tax is grossly at odds with what taxation experts believe. Both candidates tried, repeatedly, to bring debate back to the real problems faced by ordinary Americans. Neither moderator allowed them to do this.
We’re at a crucial moment in our country’s history, facing war, a terrorism threat, recession, and a range of big domestic challenges. Large majorities of our fellow Americans tell pollsters they’re deeply worried about the country’s direction. In such a context, journalists moderating a debate–who are, after all, entrusted with free public airwaves–have a particular responsibility to push and engage the candidates in serious debate about these matters. Tough, probing questions on these issues clearly serve the public interest. Demands that candidates make pledges about a future no one can predict or excessive emphasis on tangential “character” issues do not. This applies to candidates of both parties.
Neither Mr. Gibson nor Mr. Stephanopoulos lived up to these responsibilities. In the words of Tom Shales of the Washington Post, Mr. Gibson and Mr. Stephanopoulos turned in “shoddy, despicable performances.” As Greg Mitchell of Editor and Publisher, describes it, the debate was a “travesty.” We hope that the public uproar over ABC’s miserable showing will encourage a return to serious journalism in debates between the Democratic and Republican nominees this fall. Anything less would be a betrayal of the basic responsibilities that journalists owe to their public.
Spencer Ackerman, The Washington Independent
Eric Alterman, City University of New York
Dean Baker, The American Prospect Online
Steven Benen, The Carpetbagger Report
Julie Bergman Sender, Balcony Films
Ari Berman, The Nation
Brian Beutler, The Media Consortium
Michael Bérubé, Crooked Timber, Penn. State University
Joel Bleifuss, In These Times
Sam Boyd, The American Prospect
Lakshmi Chaudry, In These Times
Michael Cohen, The New America Foundation
Lark Corbeil, Public News Service
Brad DeLong, Brad DeLong’s Semi-Daily Journal and UC Berkeley
Adam Doster, In These Times
Kevin Drum, The Washington Monthly
Gerald Dworkin, UC Davis
Henry Farrell, Crooked Timber,George Washington University
James Galbraith, University of Texas at Austin
Todd Gitlin, Columbia University, TPM Cafe
Merrill Goozner (formerly Chicago Tribune)
Ilan Goldenberg, The National Security Network
Arthur Goldhammer, Harvard University
Robert Greenwald, Brave New Films
Chris Hayes, The Nation
Don Hazen, Alternet
Michael Kazin, Georgetown University
Ed Kilgore, The Democratic Strategist
Charlie Kireker, Air America Media
Richard Kim, The Nation
Ezra Klein, The American Prospect
Mark Kleiman, The Reality Based Community, UCLA
Scott McLemee, Inside Higher Ed
Ari Melber, The Nation
Rick Perlstein, Campaign for America’s Future
Katha Pollit, The Nation
David Roberts, Grist
Thomas Schaller, Columnist, The Baltimore Sun
Adele Stan, The Media Consortium
Jonathan Stein, Mother Jones Magazine
Rinku Sen, ColorLines Magazine
Matthew Shugart, UC San Diego
Mark Thoma, The Economist’s View
Michael Tomasky, The Guardian
Cenk Uygur, The Young Turks
Tracy Van Slyke, The Media Consortium
Kai Wright, The Root
Matthew Yglesias, The Atlantic Monthly
[Update: In case there is any confusion, I should have made clear that the letter is a group effort.]
Sunday, March 2, 2008
Saturday, February 16, 2008
Walking by the river in February
Yesterday after the arts workshop it was sunny and cold, late afternoon shadows creating sharp contrast against the buildings downtown – black outlines against pale inanimate shapes like the color of human flesh after a winter-long hibernation under clothing. I talked my husband into going for a walk with me. We headed down the bike path near the river. Everything was still naked from winter, trees bare, the brown water’s surface reflecting the sky and shore like a bowl full of mercury. Only the sounds revealed that Spring is on its way.
Above us, pairs of Canada geese honk their chatter to one another. Assorted chirps, quacks, and gurrrumphs from thickets of spiky brambles reveal each creature’s cry for a mate and the search for a nesting place in the bright watery cold. In the water, small groups of ducks gather and start to pair off. One pair of iridescent green mallard heads goes head-to-head in a stand-off like Bighorn sheep. I noticed at least six different varieties of webfoot waterfowl, and some that looked like a cross between wild and domestic varieties.
Mallards are easy to identify. “Make Way for Ducklings” was one of my favorite children’s books, and I read it to my daughter, same as my mother read it to me. There are the Canada Geese of course. One large white goose floats among the wild ones, like the rebel who escaped the barnyard in another children’s book “The Day the Goose got Loose.” I don’t recognize the small black, white-beaked bird that sits on a log with a pair of mallards, but I think it is some kind of duck. When the three jump into the water, the mallards drift smoothly across the surface, but the little black one’s head juts forward and back, like the walking birds that scour grocery store parking lots for morsels of food. With its white beak jerking brightly back and forth against the dark water, it seemed to me that the motion might attract predators from above. But I am not the one who designed this creature or its predators, and so I decided to relax and enjoy the show.
Far across the water, a large dark crane or heron stands alone. Nests of sticks are showing in leafless trees above. They wait for the next generation of these solitary exclamation points that punctuate our waterways in summertime. Ducks and geese slide in circles in the water around the crane, and one gigantic Canada goose poses on a stump nearby. He spreads his wings in a display certain to attract a female desiring strong and healthy offspring. He poses like that for outstretched minutes, so that no girl goose can miss him, and no gander will dare challenge him. Far above in the naked tree branches perches a pair of bald eagles.
The white head of the male flashes in the lowering sunlight, and the large brown female rests on a branch slightly lower, near her mate.
There is so much stillness. The eagles, the crane, the gander with outstretched wings; it feels as if the birds are conserving their energy, their life force, for the burst of life about to be fulfilled in the coming weeks.
Under the vegetation at water’s edge, a pair of nutria burrows in the mud. They turn to dip into the briny water, swimming a bit, diving slowly, coming back up, but never venturing far from the muddy banks. One of them has gray whiskers, making me think of men who cycle the Eugene bike paths with their neatly trimmed gray beards, or pull up next to me in a hybrid Prius or economy sedan, at a stop light when I’m driving home from work. Men who are friends of my husband look like this too. Their short gray beards make them appear wise, like college professors who spend their days behind a typewriter in a wood-paneled office, heavy tomes lining the bookshelves. I have to remind myself that they are probably the same age as I .. and I think about their childhood paralleling mine in the 1950s and 1960s. Many of them look better now than they did as young men, and I wonder if they know it.
Anyway, it’s just a thought, and it will pass. Like the nutria, fulfilling its life’s destiny along a muddy river bank on a cold and clear almost-spring late afternoon in February.
Above us, pairs of Canada geese honk their chatter to one another. Assorted chirps, quacks, and gurrrumphs from thickets of spiky brambles reveal each creature’s cry for a mate and the search for a nesting place in the bright watery cold. In the water, small groups of ducks gather and start to pair off. One pair of iridescent green mallard heads goes head-to-head in a stand-off like Bighorn sheep. I noticed at least six different varieties of webfoot waterfowl, and some that looked like a cross between wild and domestic varieties.
Mallards are easy to identify. “Make Way for Ducklings” was one of my favorite children’s books, and I read it to my daughter, same as my mother read it to me. There are the Canada Geese of course. One large white goose floats among the wild ones, like the rebel who escaped the barnyard in another children’s book “The Day the Goose got Loose.” I don’t recognize the small black, white-beaked bird that sits on a log with a pair of mallards, but I think it is some kind of duck. When the three jump into the water, the mallards drift smoothly across the surface, but the little black one’s head juts forward and back, like the walking birds that scour grocery store parking lots for morsels of food. With its white beak jerking brightly back and forth against the dark water, it seemed to me that the motion might attract predators from above. But I am not the one who designed this creature or its predators, and so I decided to relax and enjoy the show.
Far across the water, a large dark crane or heron stands alone. Nests of sticks are showing in leafless trees above. They wait for the next generation of these solitary exclamation points that punctuate our waterways in summertime. Ducks and geese slide in circles in the water around the crane, and one gigantic Canada goose poses on a stump nearby. He spreads his wings in a display certain to attract a female desiring strong and healthy offspring. He poses like that for outstretched minutes, so that no girl goose can miss him, and no gander will dare challenge him. Far above in the naked tree branches perches a pair of bald eagles.
The white head of the male flashes in the lowering sunlight, and the large brown female rests on a branch slightly lower, near her mate.
There is so much stillness. The eagles, the crane, the gander with outstretched wings; it feels as if the birds are conserving their energy, their life force, for the burst of life about to be fulfilled in the coming weeks.
Under the vegetation at water’s edge, a pair of nutria burrows in the mud. They turn to dip into the briny water, swimming a bit, diving slowly, coming back up, but never venturing far from the muddy banks. One of them has gray whiskers, making me think of men who cycle the Eugene bike paths with their neatly trimmed gray beards, or pull up next to me in a hybrid Prius or economy sedan, at a stop light when I’m driving home from work. Men who are friends of my husband look like this too. Their short gray beards make them appear wise, like college professors who spend their days behind a typewriter in a wood-paneled office, heavy tomes lining the bookshelves. I have to remind myself that they are probably the same age as I .. and I think about their childhood paralleling mine in the 1950s and 1960s. Many of them look better now than they did as young men, and I wonder if they know it.
Anyway, it’s just a thought, and it will pass. Like the nutria, fulfilling its life’s destiny along a muddy river bank on a cold and clear almost-spring late afternoon in February.
Sunday, February 3, 2008
Running in Circles
I woke up in the dark this morning, after dreaming about my found friends and I started again to think about this: it's such a cool thing about this medium of communication -- myspace, wordpress, e-blogger, and it all started on the found comment board..
We become friends with people that we never met. We are able to share our entire lives, not just the right-now lives, so it seems we can get to know each other as whole people, as we might have known each other if we had met 20 or 30 years ago. Some of us have even crossed paths on the same physical landscape along the west coast over the past 30+ years, and I'm sure if we had met along the way, we would have run in similar circles. And this is true for those who were not at the same age at the same time, as well as for those of us who were - because out here in Internet Land all events really are simultaneous. Like Einstein said.
For me it feels like there are no lines delineating age, gender, appearance, or any other physical characteristic that tends to limit and define us in "real life." In real life, it's hard to be friends with the opposite sex or people of different generations. Here, if we choose, we can have relationships based purely on what we think, what we feel, and how we treat each other.
It's just really really cool. I like it a lot.
The sun is coming up now, on another rainy day in beautiful gray-green Oregon. The daffodils are shooting up their green signals that spring is on its way. The circles continue, and we keep running in them. Or walking, skipping, jumping, limping, swimming, flying, tapping away on a computer key board -- whatever the case may be. Out here, it’s all the same.
We become friends with people that we never met. We are able to share our entire lives, not just the right-now lives, so it seems we can get to know each other as whole people, as we might have known each other if we had met 20 or 30 years ago. Some of us have even crossed paths on the same physical landscape along the west coast over the past 30+ years, and I'm sure if we had met along the way, we would have run in similar circles. And this is true for those who were not at the same age at the same time, as well as for those of us who were - because out here in Internet Land all events really are simultaneous. Like Einstein said.
For me it feels like there are no lines delineating age, gender, appearance, or any other physical characteristic that tends to limit and define us in "real life." In real life, it's hard to be friends with the opposite sex or people of different generations. Here, if we choose, we can have relationships based purely on what we think, what we feel, and how we treat each other.
It's just really really cool. I like it a lot.
The sun is coming up now, on another rainy day in beautiful gray-green Oregon. The daffodils are shooting up their green signals that spring is on its way. The circles continue, and we keep running in them. Or walking, skipping, jumping, limping, swimming, flying, tapping away on a computer key board -- whatever the case may be. Out here, it’s all the same.
Monday, January 21, 2008
First Kiss
“Two little lovebirds
sitting in a tree
K-I-S-S-I-N-G…”
(Remember the rest? … first comes love, then comes marriage, then comes baby in a baby carriage! So glad we had that rhyme to teach us how it works!)
Anyway, my friend Mona’s blog made me reflect about my first kiss.
When I was in 7th grade, one of my best friends lived in the rural farm town of Ridgefield, Washington, about 30 miles from the Portland suburb where I had recently moved. David Baker was a year older than I. My friend had a huge crush on him; in fact all the girls at her school did. He was a quiet, shy, skinny kid, light brown hair, blue eyes, and a few freckles across his nose. Maybe it was because I was a mysterious stranger, an unknown girl from the city, that he took a liking to me.
In my new home in an upper-middle class suburb, living next door to doctors’ and lawyers’ kids, I was the plain and homely kid wearing sale-rack clothing. My parents’ teacher’s salaries were not on the same level as theirs. But when I went to visit my friend in this rural farm town, the other kids didn’t look down on me; in fact just the opposite. They thought I was cute and cool. Probably it was the novelty of the “new girl” in a small town, because I was nothing much to look at during that awkward growing-up stage.
It was the first of May, the fresh sunshine of spring in the air, and Ridgefield was having their annual May Day celebration that Saturday. There was a small town parade in the dusty streets, and all the kids were out looking for fun. We found David and some other friends, and went out to hang out in a wooded spot somewhere nearby. David and I climbed a tree and sat on a large branch side-by-side. He was holding my hand, and then he leaned over and kissed me.
It was more of a peck than a kiss, awkward (we were trying not to fall off the branch) and as I remember we were sitting a few inches apart. Both of us shy and not certain what to do. To be honest, I was more thrilled by the fact that a boy liked me, than by a feeling of attraction toward him in particular. The fact that this was a boy that the other girls considered hot, added extra appeal, of course.
Perhaps there was a tad bit of guilt about the fact that it was my friend’s crush. But she had been chasing him shamelessly, embarrassing him in front of the other kids, loudly proclaiming her love for him. It was obvious it was going nowhere. She was a fun and funny girl, always had everyone in stitches, and she didn’t seem to mind much that he liked me. In fact, she quickly transferred her affections to one of his friends, and continued to try to “fix us up” after my departure. But, like Mona said, boys don’t write letters. I think David did write back to me once, though. And he called long distance a few times. But I fell in love with another boy in my own town soon thereafter (my “first love” at age 13) and I didn’t miss David.
A year later when David got his driver’s license, he and some friends drove to my town to visit. They weren’t very interesting to me. I was attracted to the bohemian, artistic, hippy boys with long hair. David and his friends were country boys, cowboys, with short hair, playing country-western music on the car radio — not my type at all. He probably felt the same way about me, because he didn’t pursue it.
As my life traipsed along its own path, I protested the war in Vietnam, and held disdain for the young men who didn’t resist the draft, those who went to war unquestioning. Now I have more compassion for them, more understanding about why they did it, but back then, I held the opinion that if they would just refuse to go, the war would end. I felt it was an unjust war, and it needed to be over, and in my idealistic teenage brain I thought that if people would just refuse to participate, it would end. That was the rhetoric at the time, and it seemed to make sense.
Not long after his visit, David went into the army. I don’t know whether he enlisted or was drafted. I stayed in contact with my friend from Ridgefield; she married (I was her maid of honor) and had three children before I finished college.
It wasn’t until many years later that I visited her town, and we were reminiscing and sharing laughter about our teenage foibles and I said, “I wonder whatever happened to David Baker.” And she said matter-of-factly, “He was killed in Vietnam.” I was incredulous… how could that have happened, that my “first kiss” — a boy I would never forget — was killed in Vietnam so many years before, and I hadn’t known? My friend assumed I knew, of course. Everyone in their town had known, and certainly he wasn’t the only casualty. Still, I was surprised at how emotionless she sounded.
The next time I saw her was probably 15 years later. I asked her, are you sure that David Baker was killed in Vietnam? She said yes. I don’t think I really believed her. I wondered if his name was inscribed on the Vietnam Memorial Wall in Washington D.C. and I thought I would look for it if I ever had the opportunity to go there.
Then in 2005 a traveling version of the Vietnam memorial came to where I live. Set up in a grassy field in a park was the black wall, along with photos, messages and other memorabilia left by families and friends of the dead sons, brothers, husbands, fathers… Along with the other visitors, I was moved to tears.
I thought there would be no hope of finding a name… but there was! Under a tent were several books on stands, huge volumes with names of all the dead whose names are on the wall. I found David’s name, David Wallace Baker, Ridgefield, Washington, his birth date and the date he died. That’s when I remembered that his birthday had been the day before mine. He was less than 6 months past his 19th birthday when he died; he did not even live to see adulthood.
And the book told what section of the wall to find his name, so I went to look.
It wasn’t until that moment that I truly believed that this was how my first kiss’s life ended, just in the bud of youth, right after I graduated from high school, probably on the same day as my first day of college. The skinny quiet, freckly kid, who shyly gave me my first kiss, sitting on a tree branch, that sunny dusty day in May 1965.
I didn’t have any photos of David, but I found one online. I have a few of myself and my friend and some of her high school events around that time. David was there, but I didn’t take his picture. I also have a few of my friend’s wedding, which I think was in 1970, the year David died, the year I graduated from high school.
Also, I would like to share a few of the pictures I took on the day that I last *saw* David Baker, his name on the Vietnam Memorial Wall.
Thursday, December 27, 2007
Monday, December 24, 2007
Sunday, December 16, 2007
Sunday, December 2, 2007
Christmas Cards
These are some of the Christmas cards I've made over the years. The earliest one was when I was 10. My mother mimeographed it on the school ditto machine. The copies were in purple mimeograph ink. I scanned the image and changed the colors for our family Christmas card a few years ago. I started making my own designs in high school art class in 1967-68. The earliest ones were silk screen prints. In subsequent years, I used linoleum block prints. When copies became easier and less expensive, I was able to easily duplicate line drawings. In later years I have taken some of my lino cuts, scanned them or changed the images for new cards. I also enjoy using vintage images from magazines or childhood photos of Daniel's and my families. As a theme, I may be inspired by events in our lives. Or the inspiration may come from something I've been thinking about, a dream, a fairy tale or family heritage. This is the one time each year that I do an art project. Dates approximate.
Tuesday, November 20, 2007
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