Bush's Failing Financial "Surge"

Here we are, with ringside seats--far too close for comfort--at the Great Global Crash of '08. Nobody's quite calling it that yet, but what else could it be? All over the world yesterday stocks plummeted; the Russian and Brazilian stock indexes went down so precipitously -- 19% and 13% -- that exchanges in both countries were closed for parts of the day; the Indonesian index tumbled an unprecedented 10%; the Paris bourse, 9%; the London FTSE 100, a historic 8%; and the main German index 7%; while, at the New York Stock Exchange, the Dow Jones dipped under 10,000 on its wild ride toward the depths.

In moments like this, if you're an American, you look for ironies. And here's one to consider. In the last year, the Bush administration's top officials have sunk much of their increasingly lame-duck energy into pacifying Iraq, and so getting it out of the news and the spotlight at least long enough for election '08 to happen (and undoubtedly long enough as well for them to get out of town in January). And then what happens? The administration is ambushed, not by Sunni militants or Shiite radicals but by its own people: investment bankers, lenders, hedge-fund managers, financial management types--the very people for whom they organized the world and who had long been playing fast and loose (and profitably) with our economic system. The ambush, of course, took the form of a financial meltdown of massive proportions for which, as in Iraq in 2003, the administration had clearly done no significant preplanning or war-gaming. And, as with the insurgency then, so now they operated by the increasingly worn seats of their pants. Their attempted $700 billion "surge," as stock exchanges around the world indicated yesterday, wasn't likely to pacify a global financial system near cardiac arrest.

And I'm getting to that irony, if you'll just hang on. But first recall the administration's dreams only five years ago. Then, they were convinced that they would create a Pax Americana globally and a Pax Republicana domestically that would last generations. Now, "Bush's brain" Karl Rove is talking about an Obama November victory, while what Iraq started, the economic meltdown looks to be ending.

Here's a sure thing: George W. Bush and Dick Cheney won't make it out of town in time, their wars will remain disasters, their imperial dreams so much smoke, and domestically, they may have created the conditions for a turning-point election that could bring to Washington not only a resurgent Democratic Party, but the first black president of the United States. Quite a record for one "commander-in-chief" presidency. The question is--as Chalmers Johnson wondered in his most recent piece, "Voting the Fate of the Nation,"--in the ruins of Bush's financial Katrina, are an Obama victory and a reconfiguring election possible, or will deep-seated racism and embedded regional party loyalties prove too much even for this catastrophic moment?

Comments (50)

1. It's going to be funny to watch the Right try to spin this (and the bail-out) as "solely the DEMOCRATS' idea!"....act as if Dubya and Paulson never even asked for the money but were somehow "forced" into it by Pelosi and Reid.

   Or they may throw ol' Hank Paulson under the bus to save Dubya.

   And McCain of course is going to try to blame Obama for "all that de-regulation" and hope somebody actually believes his "black is white, up is down, north is south, Oceania has always been at war with EastAsia" rhetoric.

   Fortunately recent polling shows that only 15% have confidence in McCain on economic issues. That's HALF of the 30% Bush Is Great Club that makes up the Republican base.

   Which ain't good for ol' Maverick and Glacier Gidget.

   Posted by Maskdelta at 10/07/2008 @ 11:19am

2. Congress sings "go on take the money and run"..................

   Posted by OneVote at 10/07/2008 @ 11:55am

3. No no no. This is economic catatrophe and the failed attempt to fix it aren't Bushes fault. Presidents don't affect economies. Except the last economic dip, which was all Clinton's fault.

   Did I get the Republican line right?

   Posted by Cccomfo1 at 10/07/2008 @ 11:59am

4. Now we got the Federal Reserve buying commercial paper from corporations.....under its emergency powers......hope the Federal Reserve is adding recourse clauses to its purchase agreements.....but you know....I doubt it....probably buying up standard contracts based on Standard & Poors & Moodys ratings...hahahahah. Details are unavailable - some transparency huh............

   Posted by OneVote at 10/07/2008 @ 12:07pm

5. WOW! this is all happening a bit faster than my plans for "economic meltdown." I saw the writing on the wall and have been slowly preparing with my limited resources for about a year.

   I am converting what little funds I have saved into gold. I am buying a used motorhome for more mobility in order to go where the food and jobs might be and have a roof over my head. I have been stockpiling cases of fresh MRE'S and tools both practical and defensive. Call me paranoid or call me crazy, but I still need a couple more months to put it all together. I just hope it holds together for another two months.

   Posted by chaoszen at 10/07/2008 @ 1:06pm

6. Back in 2000, when Hank Paulson was CEO of Goldman Sachs, he lobbied the SEC to enact a change in the "net capital rule" which governed the amount of leverage investment banks could use. The rule change allowed America's five largest investment banks to greatly increase their leverage ratios, from 12-1 to as much as 40-1. All five investment banks have since either collapsed or transformed themselves into commercial banks.

   Treasury Secretary Henry Paulson has tapped a former Goldman Sachs executive to be director of the government's bailout program. Neel Kashkari.

   Anyone who thinks that these two will be making decisions that will be in the best interest of the American people are delusional.

   I don't think most Americans mind paying taxes but if this money is just given away...

   This coming April is time for a tax-revolt in this country. Spread the word!

   Posted by jtitor at 10/07/2008 @ 1:10pm

7. I think it's fascinating that people who believe that 9/11 was an inside job seem to accept the fact that our current financial crisis just happened by chance because of partisan politics...

   The US is being invaded by our own government. The divisions we have are a deception, with the full intention of conquering us. BOTH of our candidates supported the bailout, as did the majority of Congress. They are protecting the true source of their power - Wall Street.

   None of what we are seeing today is random. This is all according to plan. Obama, McCain? Doesn't really matter. They only differ in their deception.

   Time for us to wake up.

   Posted by freiheit1 at 10/07/2008 @ 1:11pm

8. And regarding your mention of the NC polls, if McCain has to devote material resources to NC, he'll lose. It's that simple.

   Posted by Darin_the_Troll at 10/07/2008 @ 11:56am

   ha ha!

   i mentioned this last week and you blew me off saying 'no dem had one nc since people rode dinosaurs......'

   Posted by frosty zoom at 10/07/2008 @ 1:13pm

9. won

   maudits homophones...

   Posted by frosty zoom at 10/07/2008 @ 1:13pm

10. On a different note, the debate tonite should be interesting. The format is the "town hall" type that McSame prefers. But the repubs are saying they are not happy with it. Why? Because they always usually script these events and screen the paticipants.

    They don't deal well with an open forum where they might actually get some real questions. Should be good.

    Posted by chaoszen at 10/07/2008 @ 1:16pm

11. Time for us to wake up.

    Posted by freiheit1 at 10/07/2008 @ 1:11pm

    oh, shut up and go shopping.

    Posted by frosty zoom at 10/07/2008 @ 1:16pm

12. Posted by Darin_the_Troll at 10/07/2008 @ 11:56am

    Like FROSTY, I've made that point and pointed out that it may represent the downfall of McCain since it draws resources and time away from the "real battleground states".

    Unfortunately it seems they need to shore up their base and Palin was speaking at Eastern Carolina University in Greenville today! Which indicates they're in trouble.

    Posted by Maskdelta at 10/07/2008 @ 1:20pm

13. The last time NC voted Democrat, it was Carter in 1976.

    Now, I'm hearing a lot of Obama ads on the radio to and from work, but I doubt it will be enough.

    Posted by Darin_the_Troll at 09/22/2008 @ 1:50pm

    Posted by frosty zoom at 10/07/2008 @ 1:21pm

14. Fuld devoted his life to Lehman Bros. Too bad he didn't get life for his devotion to stone greed.

    Posted by Sorelish at 10/07/2008 @ 1:21pm

15. Posted by chaoszen at 10/07/2008 @ 1:16pm

    Don't discount McCain. He CAN "win" the debate tonight.

    He knows "town halls" and can work them. Obama not as much. Plus, he's got VERY low expectations, which means he can "pull a Palin".

    The trick will be if he tries any of his "Bill Ayers" "Red Meat for the Right" stuff....that doesn't play well with Indies and Moderates and could cost him more than it gains him.

    Posted by Maskdelta at 10/07/2008 @ 1:22pm

16. By the way you conservatives better hope something changes soon because if it doesn't you guys are going to have full and complete Democratic control of Congress, House, White House and Supreme Court very soon.

    Posted by Cccomfo1 at 10/07/2008 @ 1:22pm

17. Yeah according to the latest poll Obama is up in NC by 6.

    Posted by Cccomfo1 at 10/07/2008 @ 1:27pm

18. http://www.fivethirtyeight.com/2008/10/todays-polls-106.html

    God break down of today's polls.

    Posted by Cccomfo1 at 10/07/2008 @ 1:29pm

19. Posted by frosty zoom at 10/07/2008 @ 1:16pm

    =8>D

    Posted by freiheit1 at 10/07/2008 @ 1:33pm

20. He knows "town halls" and can work them. Obama not as much. Posted by Maskdelta at 10/07/2008 @ 1:22pm

    I agree. The debate could be dangerous for both of them. When real people are asking the questions people including myself tend to relate more closely with the question asked and the people asking them. If the question is not answered, or either candidate tries to spin it millions of americans will see that and react accordingly.

    Posted by chaoszen at 10/07/2008 @ 1:33pm

21. Posted by freiheit1 at 10/07/2008 @ 1:11pm

    You just called Bush and company socialist revolutionaries. Not that I disagree, I've expressed the same thing in print here. It's just a little jarring to see it coming from you.

    Go to a bookstore and read the introduction to Paul Krugman's book The Great Unraveling. It's called "A Revolutionary Power" if I remember correctly. Say what you will about Krugman, he called this one right in 2002.

    There is one huge similarity between McCain and Obama. Like Clinton and Bush (both Bushes), they have serious chips on their shoulders. Daddy issues, basically. Always trying to outdo the old man, or finish the job he ducked out of, or fill up that gap because he was never there.

    Of the bunch of them, Obama seems the least conflicted. So there is hope. Is it still legal to use the word hope?

    Posted by MyParadigm at 10/07/2008 @ 1:34pm

22. Also there will be schills in the audience, keep an eye out for them.

    Posted by chaoszen at 10/07/2008 @ 1:40pm

23. Obama seems the least conflicted. Posted by MyParadigm at 10/07/2008 @ 1:34pm

    Very astute post. Maybe it is because Obama never really had a "daddy" around to outdo. Although he may have some abandonment issues. If he does he has coped with them very well.

    Posted by chaoszen at 10/07/2008 @ 1:44pm

24. Stocks Decline From Paper Tiger Start Mike Taylor - TheStreet.Com 10/07/08 - 11:37 AM EDT Updated from 10:18 a.m. EDT

    Exerpt:

    'The Fed announced creation of a new lending facility to buy short-term commercial paper from businesses and said it expects the new lending program to remove the stoppage in the credit markets............

    The Fed's decision to begin buying commercial paper is "a radical change in the nature of the Fed," said Dirk Van Dijk, director of research at Zacks Equity Research. He said that the Fed is now essentially making unsecured loans to corporations. "The commercial paper market was the most constipated of all the financial markets," said Van Dijk. Getting commercial paper moving makes some sense, he said, although the actual impact of the Fed's move remains to be seen..........'

    Unsecured-nonrecourse loans to corporations.......geez....whats going on......

    Posted by OneVote at 10/07/2008 @ 1:45pm

25. About the "debate" (the oracle speaketh!) Obama will kick his butt if he manages to call McCain out on his dirty campaign, and gets him defensive. Because it's not defensible. And if he makes it a matter of character that McCain is indulging in negative campaigning at a time when the country has such huge problems ... it's over.

    Posted by MyParadigm at 10/07/2008 @ 1:50pm

26. Posted by Darin_the_Troll at 10/07/2008 @ 1:45pm

    I think the problem for McCain is Obama's 50 state strategy and a failing economy. This is putting states into play that he didn't think would be. That are always reliably red. Now they are starting to look more ad more purple. And the states that were just purple are now going blue. Which means he is having to battle on too many fronts and spread his resources thin. This election is starting to see the states that used to be battleground states become Demo states and the states that WERE reliably Republican become battleground states.

    Posted by Cccomfo1 at 10/07/2008 @ 1:53pm

27. I would like to see a knock out, drag out, good old fashion debate tonight. I want Obama to get close to McCain so he walks away and/or just gets mad. I want to see Obama piss him off-which shouldn't take much. I want to see Obama say "I Don't know but will find out" instead of having an answer for everything. He will have to say it fast so it doesn't get edited for more dumb adds. I want one to stand up and be a leader. He needs to show he can take a punch, get knocked down, and get up, brush himself off and show what you are suppose to do as a leader!

    Posted by psahome at 10/07/2008 @ 1:53pm

28. Posted by psahome at 10/07/2008 @ 1:53pm

    You need to be in Obama's corner like Burgess Meredith was in the film "Rocky" LOL.

    Posted by chaoszen at 10/07/2008 @ 2:00pm

29. "Economics Professor" George W Moron is giving a lame and sweaty speech in KY as I speak. He is relating economic theory in the "Theory of selling Desks". What a piece of work.

    Posted by chaoszen at 10/07/2008 @ 2:07pm

30. Sorry that was VA not KY. The dow ticker is right next to him at nearly 300 points down..

    Posted by chaoszen at 10/07/2008 @ 2:10pm

31. LOL chaoszen- I actually sent their email back with a suggestion on tonights debate for Obama...LOL Lets see if he takes me up on my advice. If he mentions Boeing Strike here in Washington State, hate to say it, yes, the closest state to Alaska, you know, not that far from the Russia State.

    I actually feel sorry for "W", he will never live this down and where is he going to find friends?

    Posted by psahome at 10/07/2008 @ 2:12pm

32. Now he is talking bout "Drillin" as a key point to solve the economic crisis. Drill Baby Drill even though oil companies are multinational and sell their products on the world market to the highest bidder. Even though the oil companies have no intention of "Drillin" especially when oil is down. Even though the oil companies only lobbied to open up our more of our public lands to drill on in order to increase their bottom line. Even though oil companies don't even have enough of a supply of drill bits to drill what they are drilling now.

    It would be funny if it wasn't so tragic.

    Posted by chaoszen at 10/07/2008 @ 2:18pm

33. McCain can't follow that strategy because he starts out in a very deep hole.

    Posted by Darin_the_Troll at 10/07/2008

    no, he's fallen in.

    Posted by frosty zoom at 10/07/2008 @ 2:19pm

34. His face is so red you could light a cigarette on his cheek.. What a sorry bastard..

    Posted by chaoszen at 10/07/2008 @ 2:20pm

35. Now they are starting to look more ad more purple. And the states that were just purple are now going blue.

    Posted by Cccomfo1 at 10/07/2008 @ 1:53pm

    that's because they are bruised.

    Posted by frosty zoom at 10/07/2008 @ 2:21pm

36. He is doing a very good Nixon impression circa 1972..

    Posted by chaoszen at 10/07/2008 @ 2:22pm

37. I actually feel sorry for "W", he will never live this down and where is he going to find friends?

    Posted by psahome at 10/07/2008 @ 2:12pm

    riyadh

    Posted by frosty zoom at 10/07/2008 @ 2:23pm

38. He is rambling now. How awkward.

    Posted by chaoszen at 10/07/2008 @ 2:24pm

39. Speaking of the Dubya...

    Josh Brolin will host SNL this weekend....look for atleast ONE good Dubya sketch out of that.

    Maybe "Dubya" (Brolin) meets "Palin" (Tina Fey)?

    Posted by Maskdelta at 10/07/2008 @ 2:49pm

40. I actually feel sorry for "W", he will never live this down and where is he going to find friends?

    Posted by psahome at 10/07/2008

    Paraguay

    Posted by chaoszen at 10/07/2008 @ 3:19pm

41. Hmm. You know I kinda feel bad for Dubya. He will be remembered as one of if not THE worst President ever. I don't think he ever wanted to be President to begin with. I think it was forced on him. Now he is panicing. Look for nothing more than a way out. He will get it in a few months. But he is stuck with one of the biggest crisis in this country in a long time and he has not a damn clue of what to do about it. I bet he was hoping to just coast through the last few months of his Presidency however someone saw fit to make sure that wasn't the case.

    Posted by Cccomfo1 at 10/07/2008 @ 3:22pm

42. I actually feel sorry for "W", he will never live this down and where is he going to find friends? Posted by psahome at 10/07/2008

    Israel?

    Posted by Cccomfo1 at 10/07/2008 @ 3:23pm

43. What a piece of work.

    Posted by chaoszen at 10/07/2008 @ 2:07pm | ignore this person | warn this person

    Caught Bush's speech. What frickin nonsense this guy is spewin out. He talks about helping small business and in the same breadth applauds the Federal Reserve buying IOU's of multi-national corporations that have shipped our jobs overseas and have been laying off people right and left for decades. Oh I forgot....it will trickle down to small business...just got to be patient for it to kick in......

    Posted by OneVote at 10/07/2008 @ 5:13pm

44. There's still time for Bush to Wag The Dog with an airstrike (maybe by proxy)on Iran. That'll show everyone we need a warrior in the White House next year.

    Posted by Quasimodo at 10/07/2008 @ 5:34pm

45. McCain's a good debater. Damn... the WWF crowd will respond to the bulldog face and herky gestures, lipstick or not. Straight-faced lying. Impressive. Obama should describe him as a tremendous politician, talking about special interests while super-mega-special-interest-lobbyists have been driving his so-called straight-talk bus all over the road.

    Posted by winyahn at 10/07/2008 @ 9:39pm

46. That damn Bush!!

    What other idiots signed on to this disaster?

    Thank god no democrats were involved!!

    What? They did?

    Well that shows some backbone!

    Wow! Go get him Nancy!

    NIMRODS!!

    NADER/GONZALES '08

    Posted by bleedingheart at 10/07/2008 @ 9:44pm

47. Posted by bleedingheart at 10/07/2008 @ 9:44pm

    I respect the idealism, but don't find Obama to be as hopelessly implicated as you imply. The nature of the senate itself accounts for some of what drives your cynicism. Nader's gift and destiny is to continue in an outsider-idealist mode. In this capacity, yes! NADER/GONZALES '08

    Posted by winyahn at 10/07/2008 @ 10:56pm

48. I actually feel sorry for "W", he will never live this down and where is he going to find friends?

    Posted by psahome

    Huh? If there's any justice in this world, Dubya will find plenty of friends... in the Cell Blocks of Leavenworth.

    Posted by koroviev at 10/08/2008 @ 04:15am

49. Friends, this is not time for panic. Economic boom and bust cylces happen on regular basis and we should see them for what they are.

    What is happening now is that the artificially-inflated prices of housing and oil have burst and we are seeing this reflected on Wall street stocks losing value.

    The credit crunch was engineered to hold the middle class hostage in order to pass the $700B bailout of Wall street in congress.

    The cash crunch is a direct result of extreme concentration of wealth in few hands who deter money flow. To fix the economy, we need to re-distribute the wealth from the few among the many. The trickle down theory does not work.

    I am not exactly a big fan of socialism as it has many short-comings, but at this point, we have no other choice. Free market economy has ran its course.

    We need our government to create jobs and regulate the private sector that has run amok. Slowly but surely this transition will happen, but I'm afraid it will not be a painless process and we will not have an overnight cure for the problem.

    And I hope our next president will have enough common sense to end Bush's mindless war on terror and focus his attention on alleviating poverty in our own country.

    Posted by diogenes2 at 10/08/2008 @ 2:53pm

50. Posted by winyahn at 10/07/2008 @ 10:56pm

    winy, bleeding is a GOP poser, not a Naderite.

    Keep note of his posts, he focuses almost all his attacks on Obama and on other topics, he sounds just like a right-winger....not a "progressive".

    Posted by Maskdelta at 10/08/2008 @ 3:03pm