From the (pretty far left) Guardian: 

Nick Robinson: "A question for you both, if I may. The prime minister has repeatedly blamed the United States of America for causing this crisis. France and Germany both blame Britain and America for causing this crisis. Who is right? And isn’t the debate about that at the heart of the debate about what to do now?" Brown immediately swivels to leave Obama in pole position. There is a four-second delay before Obama starts speaking [THANKS FOR NOTHING, GORDY BABY. REMIND ME TO HANG YOU OUT TO DRY ONE DAY.] Barack Obama: "I, I, would say that, er … pause [I HAVEN’T A CLUE] … if you look at … pause[WHO IS THIS NICK ROBINSON JERK?] … the, the sources of this crisis … pause [JUST KEEP GOING, BUDDY] … the United States certainly has some accounting to do with respect to … pause [I’M IN WAY TOO DEEP HERE] … a regulatory system that was inadequate to the massive changes that have taken place in the global financial system … pause, close eyes [THIS IS GOING TO GO DOWN LIKE A CROCK OF SHIT BACK HOME. HELP]. I think what is also true is that … pause[I WANT NICK ROBINSON TO DISAPPEAR] … here in Great Britain …pause [SHIT, GORDY’S THE HOST, DON’T LAND HIM IN IT] … here in continental Europe … pause [DAMN IT, BLAME EVERYONE.] … around the world. We were seeing the same mismatch between the regulatory regimes that were in place and er … pause [I’VE LOST MY TRAIN OF THOUGHT AGAIN] … the highly integrated, er, global capital markets that have emerged … pause [I’M REALLY WINGING IT NOW]. So at this point, I’m less interested in … pause [YOU] … identifying blame than fixing the problem. I think we’ve taken some very aggressive steps in the United States to do so, n
ot just responding to the immediate crisis, ensuring banks are adequately capitalised, er, dealing with the enormous, er … pause [WHY DIDN’T I QUIT WHILE I WAS AHEAD?] … drop-off in demand and contraction that has taken place. More importantly, for the long term, making sure that we’ve got a set of, er, er, regulations that are up to the task, er, and that includes, er, a number that will be discussed at this summit. I think there’s a lot of convergence between all the parties involved about the need, for example, to focus not on the legal form that a particular financial product takes or the institution it emerges from, but rather what’s the risk involved, what’s the function of this product and how do we regulate that adequately, much more effective coordination, er, between countries so we can, er, anticipate the risks that are involved there. Dealing with the, er, problem of derivatives markets, making sure we have set up systems, er, that can reduce some of the risks there. So, I actually think … pause[FANTASTIC. I’VE LOST EVERYONE, INCLUDING MYSELF] … there’s enormous consensus that has emerged in terms of what we need to do now and, er … pause [I’M OUTTA HERE. TIME FOR THE USUAL CLOSING BOLLOCKS] … I’m a great believer in looking forwards than looking backwards.

 The Heritage Foundation comments on the G-20 talks:

From the beginning, the Obama Administration and European Union leaders have been clear about what they wanted from Thursday’s meeting. Obama wants European nations to engage in more deficit spending (even though they have to pay significantly higher interest rates) to help jump start the global economy. EU leaders want firm commitments from the Obama Administration to agree to global financial regulation. Slowly but surely the two sides have come together.

For example, on March 14 German Chancellor Angela Merkel said she would not enact any further economic stimulus until the first round had time to take effect. But just twelve days later Merkel injected 82 billion euros ($110 billion) into the German economy, the largest bout of European stimulus spending to date.

Returning the favor, U.S. Treasury Secretary Timothy Geithner signaled the Obama Administration was more than willing to submit to global financial regulations telling reporters: “Our hope is that we can work with Europe on a global framework, a global infrastructure which has appropriate global oversight.” This is just about the worst agreement that the summit could possibly have produced. It’s the worst of both worlds: more so-called stimulus spending for everyone, a globalization of Europe’s slow-growth economic model, and a subversion of U.S. sovereignty by a new global super-regulator. Heritage analyst Theodore Bromund explains:

Europe’s call for a global regulator with a mandate to ensure the stability and balance of the world economy would be a tremendous step toward forcing its slow growth model on the rest of the world. … These policies are a return to the concept of one size fits all and to the belief that politicians and unelected bureaucrats on the global level can effectively manage the world’s economy. Europeans should ask why, if this model works so well, it failed to stop the build-up of systemic risk in Europe.

Instead of more deficit spending and increased bureaucratic control G-20 nations should be working to fight rising protectionism worldwide and addressing the common entitlement crises that they all share.

 From Investor’s Business Daily:

Rep. Barney Frank, the Democrat who sits atop Congress’ efforts to deal with the financial crisis, has enough chutzpah for 100 politicians — which is saying a lot.

In comments before testimony from both Treasury Secretary Tim Geithner and Fed chief Ben Bernanke Tuesday, Frank said he wants to regulate pay on Wall Street — even for companies that aren’t getting bailouts.

And he called retention bonuses — a time-honored practice on Wall Street and elsewhere in America in which key employees are compensated for their enormous value — "extortion" and "bribes."

Frank, one of the chief architects of the housing mess that’s brought us so low, isn’t satisfied merely with pretending he and his Democratic pals aren’t to blame for all this. No, exploiting voter anger over the now-infamous AIG bonuses, he also wants to dictate to American capitalism what it can earn and what it can’t.

This is the kind of thing that normally happens in Third World countries ruled by tinhorn dictators, or in fascist states, where the democratic rule of law has collapsed. Not the U.S.

Yet, that’s where we find ourselves today, isn’t it? Democrats in Congress, who steadfastly rejected virtually all efforts to reform Fannie Mae and Freddie Mac as they went on the wildest, most irresponsible lending binge in the history of finance, now pose themselves as the saviors of fallen capitalism.

The hypocrisy is nothing short of stunning.

Take Frank. As we’ve written before, he spearheaded congressional Democrats’ efforts in 1992, 2000, 2002, 2003 and 2005 to block reform of Fannie and Freddie.

Those two "government-sponsored enterprises" were the nexus of this crisis, holding $5.4 trillion of the $12 trillion in U.S. mortgages, while originating or funding 90% of the subprime market.

Their failures presaged the subsequent financial meltdown from which we’re still trying to regain our economic footing.

Then there’s Sen. Chris Dodd of Connecticut, another posturing moralist in the flap over AIG bonuses. He turns out to have inserted the bonuses into the bailout legislation in the first place.

An innocent move? Please note Dodd was No. 1 on the list of recipients of AIG’s political contributions. Also that his wife was a former director of IPC Holdings, a company controlled by AIG.

We wish all this tinkering with the private sector was limited to Congress. But it isn’t. The Treasury wants what the Washington Post called Tuesday "unprecedented powers to initiate the seizure of non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy."

Citing the AIG precedent, White House spokesman Robert Gibbs defended this radical move, saying on CNN, "We need resolution authority to go in and be able to change contracts, be able to change the business model, unwind what doesn’t work."

Breathtaking. Coupled with the vast expansion of government spending over the next 10 years, this is socialism, pure and simple.

Yes, we know it’s unfashionable to use the "S" word. But we’re willing to be unhip in the service of the truth.

It’s a frightening thing to see a once mighty, and free, capitalist economy placed under the heel of an incompetent government. But that’s precisely what’s happening now.

Executive pay, the focus of much public fury right now, is only the start. Your pay will be next, rest assured. So hold on to your wallets, sure, but also hold on even tighter to something even more precious that now seems at risk: your freedom.

 From Investor’s Business Daily:

Rep. Barney Frank, the Democrat who sits atop Congress’ efforts to deal with the financial crisis, has enough chutzpah for 100 politicians — which is saying a lot.

In comments before testimony from both Treasury Secretary Tim Geithner and Fed chief Ben Bernanke Tuesday, Frank said he wants to regulate pay on Wall Street — even for companies that aren’t getting bailouts.

And he called retention bonuses — a time-honored practice on Wall Street and elsewhere in America in which key employees are compensated for their enormous value — "extortion" and "bribes."

Frank, one of the chief architects of the housing mess that’s brought us so low, isn’t satisfied merely with pretending he and his Democratic pals aren’t to blame for all this. No, exploiting voter anger over the now-infamous AIG bonuses, he also wants to dictate to American capitalism what it can earn and what it can’t.

This is the kind of thing that normally happens in Third World countries ruled by tinhorn dictators, or in fascist states, where the democratic rule of law has collapsed. Not the U.S.

Yet, that’s where we find ourselves today, isn’t it? Democrats in Congress, who steadfastly rejected virtually all efforts to reform Fannie Mae and Freddie Mac as they went on the wildest, most irresponsible lending binge in the history of finance, now pose themselves as the saviors of fallen capitalism.

The hypocrisy is nothing short of stunning.

Take Frank. As we’ve written before, he spearheaded congressional Democrats’ efforts in 1992, 2000, 2002, 2003 and 2005 to block reform of Fannie and Freddie.

Those two "government-sponsored enterprises" were the nexus of this crisis, holding $5.4 trillion of the $12 trillion in U.S. mortgages, while originating or funding 90% of the subprime market.

Their failures presaged the subsequent financial meltdown from which we’re still trying to regain our economic footing.

Then there’s Sen. Chris Dodd of Connecticut, another posturing moralist in the flap over AIG bonuses. He turns out to have inserted the bonuses into the bailout legislation in the first place.

An innocent move? Please note Dodd was No. 1 on the list of recipients of AIG’s political contributions. Also that his wife was a former director of IPC Holdings, a company controlled by AIG.

We wish all this tinkering with the private sector was limited to Congress. But it isn’t. The Treasury wants what the Washington Post called Tuesday "unprecedented powers to initiate the seizure of non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy."

Citing the AIG precedent, White House spokesman Robert Gibbs defended this radical move, saying on CNN, "We need resolution authority to go in and be able to change contracts, be able to change the business model, unwind what doesn’t work."

Breathtaking. Coupled with the vast expansion of government spending over the next 10 years, this is socialism, pure and simple.

Yes, we know it’s unfashionable to use the "S" word. But we’re willing to be unhip in the service of the truth.

It’s a frightening thing to see a once mighty, and free, capitalist economy placed under the heel of an incompetent government. But that’s precisely what’s happening now.

Executive pay, the focus of much public fury right now, is only the start. Your pay will be next, rest assured. So hold on to your wallets, sure, but also hold on even tighter to something even more precious that now seems at risk: your freedom.

 From an article in The American Prospect:

Despite valiant efforts to assure their people that nothing is wrong, the autocrats cannot cover their economic holes. In Venezuela, Hugo Chavez, after first mocking the financial crisis as a danger to the West, now admits, "The fall in oil prices due to the current global financial crisis may have a negative influence on the economy of Venezuela." In Russia, where the stock market has fallen by some 70 percent since last spring and the ruble has weathered fierce attacks, Vladimir Putin recently declared he would launch new tax cuts because of the steep drop in Russia’s economy. As Stephen Sestanovich of the Council on Foreign Relations notes, "Russia is confronting virtually all the negatives at once – sharply declining export earnings from energy and metals, overleveraged corporate balance sheets and a chorus of bailout appeals, a credit crunch and banking failures, a bursting real-estate bubble." While unemployment, poverty, and unrest indicate cracks in the system of autocracy, there are signs that a nascent movement toward liberal democracy could take its place. Indeed, increasing numbers of Chinese are challenging the government, and in December, 303 Chinese intellectuals signed and published a daring manifesto called Charter 08, which demands an end to one-party rule. Charter 08 is only one sign that the autocracies are feeling the pressure. In Venezuela, Chavez’s allies lost ground to opposition parties in recent regional elections. In Russia, a worried President Dmitri Medvedev recently instructed police to stamp out social unrest caused by the downturn. In December, the police arrested some 100 people at a protest in the poor eastern city of Vladivostok; at roughly the same time, 1,000 people attended a protest in Moscow against the government. Even in the Persian Gulf and Central Asian states, normally some of the quietest parts of the world, the crisis has had political consequences. Kazakh activists have started holding rallies against the government, previously a rare occurrence in the country. Iran, too, faces instability. Inflation in the Islamic Republic is now running near 30 percent, and a powerful cleric mused publicly that the crisis could do "big damage." The autocrats clearly are worried. In addition to cracking down on the Charter 08 signers and other activists, Beijing recently announced a stimulus package worth $586 billion. In Gansu, local officials actually met with the protest leaders and vowed to invest some $3 billion in the area. The autocracies have money to burn. China has stockpiled nearly $2 trillion but is eating it up fast. Russia is spending nearly $10 billion a week defending the ruble, to little avail, as the value of the currency keeps plummeting. Though they can plow money into their economies, the autocratic leaders cannot make Western consumers shop or guzzle gas and so are powerless to control their major economic engines. And if regimes like Chavez’s try to get their economies under control by cutting government spending, they risk undermining their own power, which was bolstered by government social-welfare programs that often targeted the middle classes whose support they now need. Unlike 20th-century autocrats, such as Fidel Castro, who led their countries in wars of independence, most of today’s leaders came up through the political system and have no revolutionary bona fides to play. The modern authoritarian governments long ago abandoned real ideology. (Chavez is an exception: He has tried to fashion a modern statist ideology he calls the "Bolivarian Revolution.") China remains a nominally communist country…

In order to improve their standing on the world stage, today’s autocrats at least try to create the facade of democracy. Their people know about democratic movements in other countries, can access free media, and are not easily subdued. Because the authoritarian governments have created some semblance of a legal system, workers have begun to think they have rights. Compared to the 1980s, when word of demonstrations in China was passed from person to person, today middle-class demonstrators organize by text message, and news of protests quickly appears on Chinese blogs. Chinese and foreign reporters can also follow protests, making it harder for the security forces to get away with a real crackdown.

Neither the short term nor the long term looks good for Moscow, Beijing, and the other autocrats. In the near future, their economies will slow down severely and, in the case of Russia, likely fall into a serious recession. In China, many analysts believe unemployment will rise to its highest level in a decade. Growth is likely to dip below 8 percent, the magic number needed to keep creating enough jobs for all the people entering the work force in China.

Millions of Chinese migrant workers who can no longer find factory jobs will return to the interior of the country. Back in rural areas, anger is already rising. These unemployed workers, who have seen the wealth of urban elites in cities like Shanghai, could begin organizing larger demonstrations, smashing up local Communist Party offices and even attacking local officials. Middle-class protests are likely to rise as well – over issues of government competence like safety, land prices, and land evictions. Since the urbanites have media connections, they are able to get their stories onto Chinese blogs and news sites. Recently, parents of Chinese children who were made ill or died from tainted milk gathered together to push the government for better health care, refusing the regime’s attempts to essentially buy them off. (The government recently sentenced two people to death for playing a key role in the tainted-milk scandal.)

Thus far, the autocracies have kept groups of people with grievances against the government from forming united fronts. Moscow has achieved this through the skillful use of nationalism, which drives a wedge between liberal Russians and ethnic minorities with grievances against the government. Beijing has used a combination of crackdowns and payoffs to top demonstrators to keep labor protests separate from one another, preventing them from developing a common theme or common leaders.

Divide and conquer, though, won’t work forever. In China, rural and urban protests might soon begin to link up – through activist networks, religious groups, or blogs – and form a national protest. Charter 08 and a nationwide taxi-driver strike, both organized on the Internet, are a first hint of this nationwide movement.

The Great Depression fed dangerous new autocratic ideologies like fascism and communism; a second Great Depression could destroy them. While the economic crisis will cause untold human suffering in these and other countries, it is quite possible that, on the other side of it, we will see the end of that distinctive phenomenon of the late 1990s and early 21st century: the growth autocracy… 

Except perhaps in the US, where it is only just beginning?

 Thomas Sowell writes in part (read it all here):

We are not yet a banana republic, though that is the direction in which some of our politicians are taking us– especially those politicians who make a lot of noise about "compassion" and "social justice."

What makes this all the more painfully ironic is that it is precisely those members of Congress who have had the most to do with creating the risks that led to the current economic crisis who are making the most noise against others, and summoning people before their committee to be browbeaten and humiliated on nationwide television.

No one pushed harder than Congressman Barney Frank to force banks and other financial institutions to reduce their mortgage lending standards, in order to meet government-set goals for more home ownership. Those lower mortgage lending standards are at the heart of the increased riskiness of the mortgage market and of the collapse of Wall Street securities based on those risky mortgages.

Senator Christopher Dodd has played the same role in the Senate as Barney Frank played in the House of Representatives. Now both are summoning government employees and the officials of financial institutions before their committees to be lambasted in front of the media.

Dodd and Frank know that the best defense is a good offense. Both know how hard it would be to defend their own roles in the housing debacle, so they go on the offensive against others who are in no position to reply in kind, given the vindictive powers of Congress.

This political theater is in one sense cheap beyond words. In another sense, it is costly beyond words.

It is cheap because the politicians who are creating this distraction from their own role also voted for the very legislation that enabled contracted bonuses to be paid by companies like AIG that received government bailout money. If members of Congress can’t be bothered to read the laws they pass, then they have no basis for whipping up lynch mob outrage against people who did read the law and acted within the law…

Whether the particular executives who received bonuses were the ones responsible for AIG’s problems, or were among those who warned against those problems, is something that those of us on the outside don’t know. That includes those in politics and the media who are making the loudest noise.

The politicians claim to be protecting the taxpayers’ money. But having politicians trying to micro-manage any business is far more likely to make those businesses lose more money, including the taxpayers’ money.

Securities based on risky mortgages are what toppled financial institutions but it was the government that made the mortgages risky in the first place, by making home-ownership statistics the holy grail, for which everything else was to be sacrificed, including commonsense standards for making home loans.

Politicians and bureaucrats micro-managing the mortgage sector of the economy is precisely how today’s economic disaster began. Why anyone would think that their micro-managing the automobile industry, or executive pay across a wide sweep of other industries, is likely to make things better in the economy is a mystery.

The real point is to pander to envy and resentment against people who make a lot of money. Envy is always referred to by its political alias, "social justice."…

 

 Mark Steyn writes in the National Review, commenting on what he calls the ‘bailoutapalooza’: 

For six months now, Paulson, Geithner, and the gang have talked about it as a kind of technical correction, a recalibration that will re-inflate the credit bubble and get us back to “normal.” But it’s not about the arithmetic, it’s about restoring the concept of “moral hazard” that is vital to any functioning market but which the “socially liberal/fiscally conservative” circle-squarers have all but rendered extinct. No government can guarantee universal homeownership, or absurd returns on mediocre assets as a permanent feature of life. And to attempt to do so is to strip language of meaning. You’re debauching the currency — not in the “fiscal” exchange-rate nickel-’n’-dime sense, but something more profound: the very currency of liberty — property, contract, citizenship, responsibility.

(Read the whole column. It’s mostly about Arnie, the governor of ‘Collyvornya’, and it’s very funny.)

 What is the ‘Cloward-Piven’ strategy?

 First proposed in 1966 and named after Columbia University sociologists Richard Andrew Cloward and Frances Fox Piven, the "Cloward-Piven Strategy" seeks to hasten the fall of capitalism by overloading the government bureaucracy with a flood of impossible demands, thus pushing society into crisis and economic collapse. 

It is the strategy being used by Obama and the governing Democrats to turn America into a Socialist state.

Read all about it in Discover the Networks. 

 From Power Line:

Bill Otis sent us this email today:

McCain’s bounce had evaporated, and Obama re-took his lead in the polls, in mid- to late-September. At that time (September 19, specifically), the Dow Jones stood at 11,388.

By the end of September, as Obama’s lead widened and solidified, the Dow had fallen to 10,325.

It continued its slide through October. The day after the election, it dropped 486 points to 9139.

By inauguration day, when reality could not be finessed any longer, it had fallen to 7949.

In the month since the inauguration, it has continued to drop, and is now at 7530 [Ed.: Now 7466.]. This is the lowest it has been in 12 years, lower by a considerable measure than it was in the immediate aftermath of 9-11 (when the denizens of Wall Street had to fear not just for their portfolios, but for their physical survival).

To sum it up, the market has lost a third of its value in a scant four months – the four months in which it became clear that Obama would become, and then did become, President.

We hear all the time that the market dive is due to factors that occurred on Bush’s watch. That sounds quite plausible; indeed, it’s partly true. But mostly it isn’t, because it misses the central fact that the direction of the market is about the future, not the past. In other words, the market is much more about expectations than about the financial report for last quarter (which has almost always been anticipated and thus discounted). So it’s not Bush’s or Paulson’s blunders that have put the market where it is today. It is the (unfortunately realized) expectations about Obama’s stewardship of the economy that are driving this train, or trainwreck.

Paul [Mirengoff] comments: Of course, Obama re-took the lead in September, I would argue, because people figured out that the economy was collapsing.

I think that’s right. There is much in the current economic crisis for which Obama can’t be blamed–the real estate bubble that led to the financial collapse, which started to come to light in the fall and assured Obama’s election. Obama is responsible for all of that only to the extent that he was one of many in Congress who did nothing to help solve the problem. And he was, of course, very much on the take from Fannie Mae and Freddy Mac.

But granting all of that, it seems clear that investors are now voting with their wallets. In my view, just about everything the Obama administration has done (or announced its intention to do) will hurt the economy. The "stimulus" bill, to name just one example, was a joke. Obviously a great many investors agree; hence the ongoing decline in the stock market and the record prices being paid for gold–the classic hedge against bad government policies. The declining stock market and related price shifts are registering a vote of no confidence in the Obama administration and the Democratic Congress.

 In the speech he made on receiving his 1974 Nobel Prize, the great, free-market, anti-Keynes economist Friedrich von Hayek warned: 

To act on the belief that we possess the knowledge and the power which enable us to shape the processes of society entirely to our liking, knowledge which in fact we do not possess, is likely to make us do much harm. In the physical sciences there may be little objection to trying to do the impossible; one might even feel that one ought not to discourage the over-confident because their experiments may after all produce some new insights. But in the social field the erroneous belief that the exercise of some power would have beneficial consequences is likely to lead to a new power to coerce other men being conferred on some authority. Even if such power is not in itself bad, its exercise is likely to impede the functioning of those spontaneous ordering forces by which, without understanding them, man is in fact so largely assisted in the pursuit of his aims. We are only beginning to understand on how subtle a communication system the functioning of an advanced industrial society is based – a communications system which we call the market and which turns out to be a more efficient mechanism for digesting dispersed information than any that man has deliberately designed.

If man is not to do more harm than good in his efforts to improve the social order, he will have to learn that in this, as in all other fields where essential complexity of an organized kind prevails, he cannot acquire the full knowledge which would make mastery of the events possible. He will therefore have to use what knowledge he can achieve, not to shape the results as the craftsman shapes his handiwork, but rather to cultivate a growth by providing the appropriate environment, in the manner in which the gardener does this for his plants. There is danger in the exuberant feeling of ever growing power which the advance of the physical sciences has engendered and which tempts man to try, "dizzy with success", to use a characteristic phrase of early communism, to subject not only our natural but also our human environment to the control of a human will. The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson of humility which should guard him against becoming an accomplice in men’s fatal striving to control society – a striving which makes him not only a tyrant over his fellows, but which may well make him the destroyer of a civilization which no brain has designed but which has grown from the free efforts of millions of individuals.