The Bishop and the Butterfly: Murder, Politics, and the End of the Jazz Age

    OBAMA STARS IN THE MUSICAL GYPSY

    By Oxy Mora on Fri, 12/17/2010 - 11:32am |

    "Make em beg for more, and then don't give it to them": Mama Rose's advice to Louise.

    You can uh, you can uh, you can uh...uh...uh

    I have been uh uh uh frustrated with the messaging from Obama, let alone what he is actually doing as President. While the Republicans have the single message of "cut taxes" Obama seems to be all over the lot in his effort to be bipartisan. Progressives are baffled and/or angry. What does the President stand for?

    I wonder how many of us as head of a family or company in crisis would handle things? Would I, for example, try for some sweeping corrective action or would I slug it out day by day, trying to find a balance, doing what I had to do to hold things together until the situation slowly improved? Yes, that is what I would do and I think that is what Obama is trying to do. But will Obama, will we, end up in 2012 like Mama Rose. A melancholy end to a purposeful but ultimately selfish ambition.

    In "Rose's Turn", Rose sings, "Give em love and what does it get you?" and "Why did I do it? What did it get me?" and finally, "Thanks a lot ....and out with the garbage"  I'm afraid 
    Obama, and we, are going to end up like Mama Rose. But Louise, on the otherhand, found her stride. In my bones I think Obama is missing something, a unifying message, something which unites "us" against "them", a lesson Louise learned from the strippers. Ourselves as stripper? Hmmm

    My sense is that there is still much anger in the populace about the health care bill and about "Wall St.". I think the anger about health care is that it not only appears that the bill won't lower costs, but the idea that someone would pay a fine for not getting health care is a non-starter with a large cross section of people.I think Obama will sit back, play defense and see if he can make the bill better. I'm o.k. with that.

    As far as "Wall St" is concerned, I don't think Obama believes that size matters. That angers me because I think he is dead wrong. To my mind the banks are a monopoly, pure and simple. The banks need to be broken up into competitive units. Why are we thinking about screwing around with Social Security in terms of deficit reduction? The bulk of the deficit was caused by banks being too big to fail and having to be bailed out by us, and any fool can see that we are headed right back down that path--maybe not in the next few years, but in a 5-10 year frame, I think it's guaranteed to happen again.

    I was once involved in a production of "Gypsy'", and I thought about the "gimmick" song in relation to Obama and the need for a unifying message. There are many possible angles of comparison between Obama and the story line in Gypsy. Frank Rich had a great essay on the musical which I will attempt to reference below. But I still conclude with the song "You Gotta Have a Gimmick" and to my mind that "gimmick" is to break up the banks. And you know what, I don't even care if he's serious about it. I would just like to hear it.

    Comments

    Obama is the greater tinkerer in chief.  He's not a reformer, he's more of a repairman.

    He's certainly not interested in shrinking the banks.  I think this is partly because smaller American banks would fall prey to global behemoth competitors from abroad and partly because, as you say, he doesn't see anything inherently wrong with the banks being big.  Judged by his actions, I think you have to conclude that Obama doesn't believe there's anything structurally wrong with Wall Street or with the way the broader economy functions.  He thinks they can be tweaked to work better.  He looks at the car and says it needs a tune up while some of us look and say the engine needs to be replaced with something better.  So his approach to Wall Street reform creates some more consumer protections, creates some more transparency and bans some overtly bad practices like using government guaranteed deposits as capital for derivatives speculation but it leaves the banks intact.  An improvement?  Yes.  Adequate?  I don't think so.

    The same is true of health care.  A lot of us believe that to really have a good system you need to get the private insurers out of it or at least make sure thay're secondary rather than prime players.  That would entail replacing the current system with something else.  But Obama's approach was to say, "There are a few things I don't like about the current system.  How can we fix those things without dismantling it?"  And you get, basically, the old system with no rescissions, no pre-existing condition exclusions and universal coverage.  An improvement over what was there? Certainly.  What I wanted? No.

    When it comes to the wars in Iraq and Afghanistan I wanted total, complete and rapid withdrawals.  Obama preferred to alter the strategies but continue the operations.  I wanted him to roll back the Bush security state.  Obama has preserved every bit of it and has simply promised to use it more responsibly.

    In one sense I suppose its comforting to think that he's full of more radical ideas for change and reform but that he's hampered by his opponents and the intertia of the system.  But I don't see any evidence of that.  I suspect he kind of likes the current order and would just like it to work better.


    by Michael Maiello on Fri, 12/17/2010 - 12:32pm

    A very fair, reasonable, and eloquent comment, Destor.  I can't tell you how much I appreciate your level-headedness.   


    by LisB on Fri, 12/17/2010 - 2:02pm

    Lisa, and thank you for commenting. I appreciate your jumping in and I couldn't have described Destor's commentary better than you did. I also note your many efforts to strike a balance. I've been wanting to tell you that while you have a parent who is on the other side of the fence, I have a daughter with the same name as you and she is a "cultural" voter. It's very hard for me as a parent to accept her views and I really have to check myself not to say something I will regret later. Mainly I feel frustrated that I can't get through to her--she is voting against her own economic self interest and that makes me feel hopeless sometimes.


    by Oxy Mora on Fri, 12/17/2010 - 2:18pm

    Thanks for sharing that.  It is frustrating, isn't it?  Hard to watch, sometimes.  My mother is very good about keeping our political discussions "nice", though.  Used to be we would raise our voices, but now we're both better at steering clear of certain words, terms, hot buttons, exaggerations and generalizations, etc. etc.  We talk more about our feelings and less about "what an asshat that so-and-so in Congress is".  It helps.  I don't change her mind any, and she doesn't change mine any, but we are able to find things we can agree on.  Better than nothing, eh?

     


    by LisB on Fri, 12/17/2010 - 2:22pm

    Lisa, I tried a new approach, I said, "I know you are a cultural voter, I accept that." Actually, she didn't answer me, so in my infinite self assurance I thought maybe she would begin to make distinctions about the, uh, economics of the situation. Not to mention that many of the benefits of Democratic social policy she happily partakes in. She's now on Cobra--don't know if that was a Democratic advance or not, assume it was.


    by Oxy Mora on Fri, 12/17/2010 - 2:30pm

    Destor, thanks for your comments. It does seem that OBama is a tinkerer and a repairman. I think he was so intent on getting major legislation passed, get the health care system repaired--at least in name, that he failed to check the weather and the hurricane that approached in terms of voter disenchantment with economic progress. I don't know if the health care bill can be fixed. One thing I'd like to know more about is whether the state opt-out is a road to improvement or a dead end.

    As for the banks, if Obama doesn't appoint people like Levin who are in tune with Progressives I think he will be making a grave error. In effect he has bet his re-election on the tax bill but who knows the full impact on unemployment? Wouldn't a populist stance against the financial industry be a pretty good back-up plan. I was surprised to hear that three Fed District Presidents are in favor of splitting up the banks. It's the monopoly and the lack of competition that is the problem. I suspect that the reason this subject is radioactive in the Obama Administration is that in splitting up the bank it exposes the underbelly of bad assets.

    I think that if one of these Republican nobody candidates got onto the populist message of breaking up the banks they would represent an actual threat to Obama. If Benie ran as a third party candidate on an issue like the bank monopoly he would be a much bigger threat to Obama than Nader was to Al Gore.

    In tune with my narrative I'm reminded of Mama Rose's line to Louise as she was beginning her burlesque act: "Make em beg for more, and then don't give it to them". It seems like that's what the Republicans are doing to Obama and what he is doing to his base. Gypsy Rose Lee began to remove more and more veneer and eventually gave audiences a true effort, and it is high time Obama did the same with his base.  


    by Oxy Mora on Fri, 12/17/2010 - 2:10pm

    I kind of doubt that the Republican party would ever get behind such a populist candidate.  There is the possibility, as you say, of a populist third party spoiler.  But it seems as if any third party candidate will come from the "No Labels" bunch and I can assure you Michael Bloomberg has no interest in breaking up any banks.

    Beyond that, I wonder what breaking up the banks would mean to people.  I suppose there is some anger to be marshalled around the huge bonuses and compensation being paid out by banks that were on life support 18 months ago.  But outrage at pay is as old as dirt, especially when stocks are down.  Nothing ever comes of it.  Some members of the public shake their fists but then they get over it.  High ups within the banks wisely tell their people to be quiet about their haul and give some to charity.  The outrage fades.  Deep down, at least on the populist right, people aren't so angry about the bonuses because they imagine that some day their ship will come in and they'd like a ride when it does.  It's America.  We all think we're one good idea away from a million bucks (though that'd be normal person money on Wall Street).

    Beyond that, people kind of like megabanks.  I started covering Wall Street in 1999, as the consolidations really got going.  I was writing about it from both a corporate and a personal finance perspective.  While it's obviously true that huge risks were created and that the institutions grew so large that their failures would harm innocents, and while it's also true that many of the "synergies" touted in bank mergers were phony, there were some things that people like.

    First, there is no doubt that something like JPMorgan Chase is a stronger institution that 99% of the little banks that were around during the S&L years of the late 80s and earlier 90s.  If you look at FDIC takeovers since 2008 you'll see that small banks still dominate the list.  While I'm not saying that big is better, I am saying that small doesn't mean community focused, or well run.  Small means that the failure of the institution can be contained.  But if you take an even wider look at FDIC data, you'll see that while too big to fail sucks, small banks are more likely to fail.

    Second, people like the convenience of one stop financial shopping, even when it's to their detriment.  If I wanted to, I could do all my checking, savings, retirement investment and planning and consumer, home and education borrowing all through my bank, which is JPMorgan Chase, by the way.  I don't because its mutual funds and planning services are not to my liking and are too expensive.  But I could do everything there.  If I ever make enough money that it'd pay to have a wealth advisor from the JPMorgan side, you can bet I'd move everything there.  Those guys are good.  See?  It even works on me.  I have my entire financial life on one screen and 24 hour access to it.  I like that.  But that's a big bank feature.  I can always find a Chase ATM when I need cash as they're the most prevalent in the city.  And, since Chase acquired so many ailing firms during the crisis, I've been able to find a Chase ATM whereever I've gone on both coasts.  If I were at a small bank without so many ATMs I'd be pointlessly throwing money away on transaction fees.

    Anyway, enough about me.  I still think these banks should be brought down to more reasonable size and I do think that the old system where you had retail and merchant banks, investment banks, brokerages and wealth managers all operating as separate companies makes a lot of sense.  But I don't think, despite the way we talk around here, that people will get excited about it.  In the end most people just want 24 hour access, electronic bill pay, lots of no fee ATMs and a place to go first when they decide it's time for a mortgage or a mutual fund.  They like them big.


    by Michael Maiello on Fri, 12/17/2010 - 3:12pm

    Destor, thanks for your considered reply. It represents a great framework to discuss this. I do have some thoughts/answers, have to run out, but will answer later. Thanks much.


    by Oxy Mora on Fri, 12/17/2010 - 3:40pm

    Destor, let me set aside for the moment the issue of whether there is, or should be, concern and anger toward the mega banks.

    re the retail customer/investor's convenience I don't have an answer for the matter of transactions fees at ATM's. But as for convenience, in my own case I bank with USAA, have everything there. It is extremely good service. In my separate business I have a medium sized bank, credit lines, charge cards, the whole nine yards. J.P Morgan Chase has $2T and Dimon has stated his intention to ramp that up considerably. Simon Johnson(?) has stated that there are no economies of scale for a bank beyond the asset level of $100 Billion. Obviously the mega banks have developed a slew of arguments about competitivness, particularly relating to the international scene.

    As to why the TBTF banks are of concern I've done some research on it. One of the best articles was by Rob Johnson, for the Roovsevelt Institute, something along the line of "upside down"--will get the exact reference later. The angle is that we are about to attack Social Security for deficit reduction when it is the oligopolies--the real whales--that are the problem. A big part of the deficit is the bank bailout. The problem is that the top several banks have gotten larger even since the bailout, but the essential problem is the same. The incentives are wrong. If an organization knows, and all their parties know, that society has no choice but to save them again should they get in trouble, they will begin to party again, as they are now doing.

    So the urgency to reform the banks is a defense for not having entitlements dismantled. Because the deficit dangers from Social Security are miniscule compared to the past, or future, bank bailouts.

    The rest of the case rests upon competition domestically. Many small banks are failing, need to have better controls, etc. But the fact is that these banks are considered to be too small to survive.--isn't that a metaphor for just about everything that is lopsided in our economy.  


    by Oxy Mora on Fri, 12/17/2010 - 4:37pm

    Oxy, can't believe you left out, "Small World, isn't it?"


    by Oxy Mora on Fri, 12/17/2010 - 5:28pm

    Some of us look under the hood and say "Cool motor .... but, hey look! The head is blown, the fan-belt is holding on by a thread, you've got spark-plug wires 4 and 8 crossed at the distributor and it sounds like the main bearings are grinding ... and it looks like you simply refilled the radiator fluid, slammed the hood and said "good to go" not 250 miles ago. How fucking stupid are you people?"

    Or maybe that's just me (but, somehow I suspect there are at least a few others).

    OT: Have you heard/seen any deeper discussion of the released TARP audit documents? I've heard very little about what they revealed other than that everybody in the corporate world and their poodle lined up for a bit of free money. But very little analysis at all considering how much data was released. The whole thing sort of got stepped on by very important discussions of Julian Assange's penis.

     


    by kgb999 on Sat, 12/18/2010 - 1:47am

    Good afternoon, Oxy, Destor, LisB

    A pleasure to be back so soon. After the thread on Private Manning, I was hoping to find Dagblog addressing the tax "deal," the economy, and the banks. The two things--Manning's treatment--and the bank/tax debacle are not unrelated. As Destor puts it:

    "I wanted him [Obama] to roll back the Bush security state.  Obama has preserved every bit of it and has simply promised to use it more responsibly."

    Destor--you are generous when you say he's using it responsibly. One could say that the security state has intensified even--vide the TSA "pat downs" and the circus around Manning and Assange, where the last to scream traitor is suspected of treason himself.

    I would suggest that the continuation and intensification of the security state under Obama is around what Colonel Despard calls in his blog "a vacuum of political legitimacy in the country." Despard observes "Government has never been so alienated from its constituency. And people’s grievances are piling up, like the fallout from a slow leak at a nuclear power plant."  http://coloneldespard.wordpress.com/

    We move through this deadening miasma without  being able to act, and Obama, who perhaps had a vision of a fairer country when he ran, lost it in appointing a Clintonite economics team, who wanted to reprise the Neoliberalism Fandango of the 90s--not quite Gypsy Rose--which left us flushed until we found out that that was a bubble--the first of several to come in the second millenium.

    The extraordinary "compromise" to defund the republic by giving a free pass to its wealthiest citizens--yes a free pass--while the middle class eeks out a "respectable" existence a stone's throw from poverty, and the poor among us go without medication or food or heat is a moment of ancien regime proportions.

    Readers might think I'm exaggerating here, but how is the state on the one hand cutting taxes on people who have estates of over 2 million dollars,  which they can now legate to their heirs without paying a *penny*, while at the same time continuing to pay unemployment benefits with no sign of the job market recovering? (to give one example).

    It's madness, and to call it a "deal" or "compromise" is to further spread the toxic cloud. Watch the Republicans start to beat the Deficit War Drum.

    Some might say--"Seahorse, but the middle class is getting cuts too." Yes, those tax cuts are coming from our contributions to social security, so we are defunding social security in the future to pay for the fiction of tax cuts for the middle class now. I better get used to the idea of Spam in my old age.

    Destor, you also raise the point that "In effect he [Obama] has bet his re-election on the tax bill but who knows the full impact on unemployment? Wouldn't a populist stance against the financial industry be a pretty good back-up plan."

    While Bernie Sanders filibustered, an impossible dream came to me: Imagine President Obama declaring that whatever the political cost to him, even if it meant not running in 2012, he would force everyone to pay their fair share--including the "most blessed" among us. 

    "To right the unrightable wrong . . . ." 

    But I'm singing from the wrong musical. Whatever rationales Obama has mustered for himself in going along with this tax cut,  the fact that he's betrayed his base must tug at the man's conscience, if presidents have one. Thus the rush to accuse and to punish those who expose how government operates, or point out that our government is no longer acting in the interest of the average 50K (or less) salaried American.

    If popular sovereignty is not what legitimizes such a government, then fear and coercion must. You can't tinker with an angry populace (or from their point of view, an "angry mob.")


    by Seahorse (not verified) on Fri, 12/17/2010 - 3:31pm

    Seahorse, thanks for your comment. I'll be back a bit later to respond. Havn't  seen you here, welcome.


    by Oxy Mora on Fri, 12/17/2010 - 3:44pm

    Seahorse, I like your statement and thanks for reverting to my "musical" narrative. I think Despard's phrase "..a vacuum of political legitimacy int the country" is chilling. What I am concerned about is the possibility of a black swan event turning the tables on Obama and Democrats--can't put my finger on it, but of course the obvious would be a domestic attack of some kind. I think we are closer to destabilization by the tea party than we think and it's not that I don't think Obama's middle of the road strategy will work, which it probably will, I don't see protection to the downside because the event could be tied into the unresolved anger, magnifying it. That's why I think it is a huge mistake for Obama not to be out front in the matter of populist anger. And I think that resolving the absurd systemic risk of TBTF banks is the logical place to start.

    Depite the theme of Gypsy, "To right the unrightable wrong" is very much to the point.

    You know, in its time "Gypsy" was eclipsed by the "Sound of Music". As Sondheim commented, Maria Von Trapp was tough competition. Whereas Rose had a sad fate, Maria had everything--"She gets to be faithful to the cloth, lose her virginity, marry the richest man in town, escape the Nazi's and become successful in show business."

    It got me to thinking if Obama isn't Maria just at the point of escaping the Nazi's--and we don't yet know the ending but maybe he'll retire and open a ski lodge in Vermont, or maybe the Nazi's will take us all down.


    by Oxy Mora on Fri, 12/17/2010 - 5:38pm

    Update. After learning of Michelle Bachman's appointment to the Intelligence Committee I realize my understatements concerning internal destablization. Picture a domestic attack and the hysteria akin to 9/11. Who is front and center claiming radical measures like attacking Iran are now justified? It  a sense the internal threat of war demagogues makes issues like the bank monopoly pale  by comparison; but on the other hand it emphasizes the importance of Obama sopping up some of this domestic unrest with an anti-bank, anti-establishment stance before the unrest gets directed elsewhere by the likes of the Neocon/Chrisianista Bachmann.


    by Oxy Mora on Sat, 12/18/2010 - 11:32am

    Michelle Bachman's appointment to the Intelligence Committee

    Reminds me of your user name. The horror.  Surprised

    Got to try to look on the bright side, maybe by the end of the term she'll get a little (intelligence, that is.)


    by artappraiser on Sat, 12/18/2010 - 11:45am

    Artsy, don't know if she'll get any (intelligence) but she'll definitely have to strip before going into that secure briefing room.

    Actually the one stripper in the flashing lights kind of reminds me of her.

    But there I go falling into their trap. A diversionary tactic. They want us to make fun of her while they pick our pockets and develop a game plan to invade Iran. 


    by Oxy Mora on Sat, 12/18/2010 - 12:00pm

    Seahorse, I've been collecting material for a diary about investigating fraud in the Banks that led to the bubble, and will again, unless the Banksters are prosecuted to the full extent of the law, and their toxicity is cleaned up.  There is increasing evidence that banks won't lend, home-owners won't buy, people won't invest as long as there's such suspicion about the financial industry.

    The picayune investigations so far have left out the big banks entirely; the Financial Inquiry Commission is such a bad joke that according to the Sainted Brooklsey Born, four Republican members want to amend the report by striking out mention of key words that would actually point to massive fraud, and the importance of prosecuting it.  If the housing market mortgage titles aren't dealt with, housing will stay where it is: sluggish; and more people will lose their homes to bullet-courts and crap MERS faux-titles. 

    This is an area in which the President has absloutely no need for Congress; he can allocate the funds from TARP.  His HAMP program is also pretty much of a flop; that can also be fixed with some will.  It's nigh on to impossible any longer to think he has either the will or the capacity to care what happens to us in the future, but owes his fealty to the financial industry. 

    Can't wait to see who he chooses to replace Summers.


    by we are stardust on Fri, 12/17/2010 - 7:51pm

    I suspect the reality here is that we can't wait to see who Summers (and his Wall Street compadres) chooses to replace Obama - when they're done with him, of course..


    by SleepinJeezus on Sat, 12/18/2010 - 4:08am

    Right on target, Seahorse. Don't be a stranger around here. We need your perspective and your voice.

    "...how is the state on the one hand cutting taxes on people who have estates of over 2 million dollars,  which they can now legate to their heirs without paying a *penny*, while at the same time continuing to pay unemployment benefits with no sign of the job market recovering? (to give one example)."

    Let's move from musicals to literature. That Congress managed to achieve both objectives - tax cuts for heirs and increased unemployment disbursements - within the same piece of legislation is something that even Orwell would have eschewed as a vehicle to show how fucked up we are. He would have deemed it to be too implausible to pass as fiction.


    by SleepinJeezus on Sat, 12/18/2010 - 4:14am

    Although, in thinking about it further, I suspect Orwell would have returned to the character of pigs at the trough to make his point, if he chose to do so. Wink


    by SleepinJeezus on Sat, 12/18/2010 - 4:18am

    Great comment, Sleepin.

    The Tax package coupled with the appointment of Bachmann to the "Intelligence Committee" means that we have arrived at the end of fiction.

     


    by Oxy Mora on Sat, 12/18/2010 - 11:37am

     

    I think Progressives would be happier if Obama had gone with a different song from the show: "Together Wherever We Go" Then maybe everything would be coming up roses ...

    Sorry, I can't seem to get the video of the song embedded... oh well. [fixed]


    by MrSmith1 on Fri, 12/17/2010 - 3:49pm

    Mr. Smith, thanks for trying to embed it. Maybe we can rewrite the ending and have that song as the finale. Certainly we don't want "Rose's Turn". Thanks for commenting.


    by Oxy Mora on Fri, 12/17/2010 - 5:25pm

    Try it through your Firefox, Mr. Smith.  Usually works for me except later at night.  Dunno why that is.  ;o)


    by we are stardust on Fri, 12/17/2010 - 7:08pm

    [deleted]


    by Oxy Mora on Fri, 12/17/2010 - 11:38pm

    Not exactly what I had in mind and unable to delete it. Oh, well, if I squint it looks just as bad.


    by Oxy Mora on Fri, 12/17/2010 - 11:41pm

    http://www.youtube.com/v/zvZc_XHezL8?fs=1&hl=en_US


    by LisB on Fri, 12/17/2010 - 11:44pm

    Thanks everybody for the spirited attempts. Funny, when I tried using Firefox, I could see the video in my original attempt perfectly, but when I attempted, just for fun, to see if I could add it again with Firefox, I still couldn't do it.  And yet, I had no trouble embedding a video the other day on a different thread. Oh well, some times the magic works ...


    by MrSmith1 on Sat, 12/18/2010 - 12:38am

    Lisa, thanks so much. Is that Obama and the Republicans or are those Progressives ready to move on?  Or maybe those are the three largest banks with assets of $10 Trillion dollars.


    by Oxy Mora on Sat, 12/18/2010 - 11:50am

    Thanks for that delete. I needed that.


    by Oxy Mora on Sat, 12/18/2010 - 11:51am

    Much obliged for the video.

    Now that the fucked up Tax bill has been passed, what do we do?


    by Oxy Mora on Sat, 12/18/2010 - 11:46am