The Imperial City And The World
Large standing military and security forces have troubled ruling regimes from the dimmest tribal pasts down to today. Governing ideology doesn’t matter: totalitarian, Marxist-Leninist, Mao-ist or American corporatist democracy/demotic – all rely on and are often threatened by these – in political science terms – ‘power institutions.’
What’s most discomforting to you? The Administration starts its 4th year of protracted, partisan trench warfare. Somehow it forgot that Catholic bishops and their friends nearly derailed the entire health care boondoggle over abortion issues. How precisely does one forget that searing experience?
Obama apologists claim re-energizing a new ideological front against them was the goal all along. Or if not the goal, they quickly add, don’t worry. Rick Santorum benefits – genius kung fu.
All of which tells us that Obama and Friends really don’t understand contemporary politics and our polity. Still. At this late date. Their calculations remain small, traditional, rooted in the Old Consensus.
Galvanizing reluctantly dormant social wedge issue politics will not serve to improve participatory political pluralism. Such easily avoided political malpractice energizes the most anti-liberal democratic, anti-Enightenment forces and gives them legitimacy.
Whether it temporarily benefits the electoral fate of a single individual is completely besides the point. Only neophytes look at this in the temporary tweet blip landscape. Giving voice to these forces needlessly will de-stablize and echo in politics beyond today’s 24 news cycle. Amateurs may think this is just a hornets nest within Rightist circles (a) today’s Movement began as ‘just a hornets nest’; (b) MSNBC, San Francisco and the Upper West Side are not the only Democratic weathervanes.
Obama by necessity is not only his own political agent. He — as any president — serves as steward for the fabric and weal of society. Some compromises and concessions are the oxygen for participatory democracy. When that itself is under siege and question, all the more reason to avoid such a Freshman Unforced Error.
Astute observers of American culture and politics know this to be true. This unnecessary political fumble? An augur. And reminder of what ‘victory’ will mean.
Team Obama heralds today’s settlement among 5 banks, the feds and 49 states. $25 billion “to help hard working Americans”. Were that it so.
Under terms of the settlement, the five lenders won’t have to pay out the bulk of the $25 billion. Some $17 billion represents credits applied toward targets lenders have to modify some of the loans on their books. Some of those modifications would have happened anyway. Based on a complex formula, bankers will earn credits on a sliding scale depending on the type of modification. The least costly refinancing methods might earn a lender as little as a nickel on a dollar; the costliest would generate a dollar-for-dollar credit.
And so on. Our old friendly acquaintance Liz Warren observes she “hopes [the settlement] is the beginning, not the end” of efforts to hold banks accountable for their destructive duplicities. Fake sincerity is equally grating, whether from Obama’s toothy visage or Mitt’s coiffed animatronics.
The settlement marks another kind of accounting transfer labeled as a ‘payment’. Mostly, money is merely moved from account to another. In that scheme of faux payments, California wins big. “$18 billion” in “payments” out of the “$25 billion paid”.
The real beneficiaries — as we know — are in fact the banks, not American citizens. A few specific Americans will benefit from the settlement’s narrow targeting. But the banks pay out almost nothing.
The State AGs posture saying the real victory is that banks will run the foreclosure mills with less blatant disdain for maintaining mere pretenses. Appearances must be maintained – that’s our victory. Americans who were evicted by bank fraud within a specific window – Jan 1, 2008-Dec. 2011 – will receive. . . $1,500. But hey, banking executives obtain some protection for liability. Turn that frown upside down!
What Barry announced is actually what Mitt Romney has been promising – expedite foreclosures, clear them out, fix ’em up and sell/rent. Realtors are on board with that. The liquid class are too, expanding holdings, buying at the bottom. Banks can now begin clearing overhang, improve their balance sheets. All needed, we are told, to improve the economy and get lending going again.
Except, of course, banks have essentially free money (ours, in almost zero interest accounts) and from the fed. And lend it out at obscene multiples – forget about gouging us using our money with debit card fees. Moreover, the banks’ current balance sheets are almost wholly separate from corporate America’s refusal to invest or spend over $2 trillion in idle cash. So let’s stop lying to ourselves.
Americans are trapped in upside down mortgages to the tune of $750 billion. This settlement will not apply to more than 5% of that market malfunction. And contrary to what politicians say, the very (slight) incentives in the Settlement further encourage banks not to help those remaining trapped underwater, even (especially) if completely current.
Those Americans and others are left behind, drowned out by photo ops and press conferences. Their distress and its resolution will have far greater impact on (a) returning economic growth; (b) a vibrant (as opposed to moribund functional) real estate market; and (c) ultimately the banks’ own well being. How inconvenient of them.
No one here likely would argue that a functioning real estate market responding to true market signals isn’t essential for the economy. Healthy (but not predatory) banking still eludes us, too.
Because that, ladies and gentlemen, is just what went down – millions of Americans thrown under the bus for optics and the possibility — maybe — of helping bank balance sheets.
Interesting to hear some conversations among the permanent Republican/Movement D.C. class begin to mutter that *they* would be better off with an Obama victory. He is fundraising gold. The 501(c)(4)s, consulting firms and the like have never seen profits or budgets like this. Hillary in pants suits, toting Vince Foster wrapped in a rug from love nest to public park days? Chump change. Obama has made them personally wealthy.
The reasoning is simple. A second term by definition peters out in less than 18 months. He’s already a convulsive caver. Besides, Obama is thumbs up on the bombing brown people front. Sam’s recent comment about the British tourists deported simply for using British slang about partying in America on Twitter gets a grudging nod for abusing executive power.
The car wreck in leadership fighting across the House and Senate Republican minority? More time to get ducks in a row. Assuming they at least hold on the House.
A Romney presidency by contrast presents unknowns. Access is everything. Which of them will be able return to the roles they were accustomed to under Bush? Feelings are running hard now. Robo calls that Romney is against kosher food won’t be forgotten. Worse? How will he govern? Like GHWB and propose something crazy and sensible like the ADA? Sununu, Romney’s attack dog, after all as GHWB CoS famously said “We have mortgages, not ideologies.”
The country and even government may be in decadent disarray. The above may be idle musing. Tribalism may trump all in a clear need to witness ‘destruction’. But Obama’s unquestionably been very very good to a surprising strata.
And self interest? What could be more emblematic of our times?