Truth and consequences

Bank CEOs have been covering their nakedness with TARPs now that we're all exiled east of unregulated free market Eden. But this is an inversion of Genesis; this particular Eden was run by snakes for snakes with nary a god in sight despite the snakes' claims to be masters of the universe.

These are the people we so generously bailed out. The sad part is that the bailout came with essentially no strings attached, a result of typical Bushist incompetence, carelessness, and cronyism, abetted by typical Congressional Democratic panic, naivete, and willingness to continue in an abusive relationship. Democrats, even after nearly eight years of blithering, blinding, bullshit-filled, insincere stupidity, couldn't manage to expect more of the same and put some teeth into TARP oversight (which is now left to the Obama administration to do for them).

Now the CEOs have launched a charm offensive to try to convince those of us after all that our money was well spent on them. We really are lending it out, they say, not just lining our pockets with it, bathing in it, and drying off our crotches with it after our skin turns all pruny with the designer scent of bath beads made of easy money.

Oh, bullshit.

The real truth is that credit is dry. Projects that would employ hundreds for a couple of years or more are unable to find financing today. Not public projects, private ones.

Despite this reality, amateur wingnut economists from the Republican Congressional caucuses to to Amity Shlaes to the illiterate, innumerate commenters on major metropolitan newspaper sites all agree on one thing: Don't stimulate the economy with anything related to government. They'd rather go hungry let others go hungry if the alternative is to do anything publicly funded. For these twisted savages in business suits, there simply is no commonweal.

Those of us who live in the world as it is, who don't prefer to sustain a discredited set of free market theories at the expense of beggaring their neighbors, don't really give a shit whether a job comes from public money or from private money. We realize that one of the crucial functions of a government is counter-cyclical spending to soften the rough patches and prevent deflation.

Obama and Tim Geithner are about to try TARP II, which will try to regulate these same CEOs into the lending behavior we want. I hope it works, but I know these weasels will do every thing they can to manipulate our oversight to their profit.

Better would be to learn that they can't be trusted: Temporary financial socialism is a better answer. Take these SOBs over, outsource their jobs, and make prudent loans in the public interest. When times get better, sell off the banking assets at a profit - a well-earned profit to be sure.

Update (2/13): Paul Krugman had this yesterday, a day after I did:

... temporary bank nationalization (the solution favored by a growing number of economists, myself included)...

But no way I'd claim priority; I got it from him in the past, I'm sure. Read the whole column. It's filled with good analysis.

The course of Humean events

If my old pen pal David Hume is relevant to the news, the least I can do is link to the story.

Hume was a very bright guy, not as well reputed among modern philosophers as he should be because he could write a clear sentence, paragraph, and essay. (Unlike Immanuel Kant, for example, who built Germanic ontological fractals.) Hume is understandable, so those who are accustomed to equating difficult with deep, mistake the measure of him.

Unlike Amity Schlaes groupie John Cochrane, to whom Brad Delong applies fiscal education without giving in to the understandable urge to butt-whip his economic toddler ass, Hume knew that simplicity and clarity are not the same as simple-mindedness and clearinghouses.

Conservatives are looking for and lusting for a simple answer. The best liberals are looking for the simplest and lustiest answer that still matches reality well enough to work.

Pardon me, sometimes I get carried away!

So much stupidity, so little time, I

Last week, I started a long post in response to antediluvian flood (heh) of stupidity in the comments section of this Boston Globe story. on the "debate" (similar to the bullshit, trumped-up "debate" between evolutionary biologists and creationist PR flacks) about the effectiveness of the New Deal. I mean, Amity Schlaes! (And some of her proponents - yes, the ever weak-ass globeisatrocious - can't even spell her name right!)

But my post ran several hundred words and wasn't close to finished. After all, modern American discourse generates such copious quantities of bullshit that even Hercules couldn't clean it all up. (He was a horseshit specialist anyway.)

So, I'll try to shovel away the wingnut bullshit one cow patty at a time. Here's the talk radio talking point that one clearly evident moron called jkkite (January 15, 7:41 AM) has taken away from Rush or some other manipulating dipshit:

everyone knows the wealthiest people in this country pay about 90% of all the tax revenues. it's a fact. please keep your uneducated comments out of this, thx.

This an exaggeration of a Republican talking point, and it's a, well, outright lie that depends on the ignorance of those who want to believe it. Here's the Republican talking point, dressed up as best it can be, though still carefully ignoring the reality of the vast expansion of payroll taxes, which hit the working poor and the middle class, labelled "Percent of Federal Income Taxes Paid, 1980–2004" by the Hoover Institute (which couldn't have a more appropriate name):

The top 1% of incomes earn around $350,000 a year and up (2005 numbers here). If we match up these incomes with jkkite's "wealthiest people," we find in fact that they pay roughly 38% of income taxes (not all taxes by any stretch). In wingnut-world, that's totally close to 90%, right?

If 38% still seems like a lot, here's a funny thing: The top 1% of the wealthy own 40% of the private financial wealth in America (and 33% of the bigger pie that includes owner occupied housing). That tax rate doesn't seem so unfair now, does it? (Note: The top 1% of incomes and the top 1% of wealth are not exactly the same, but they overlap strongly.)

Furthermore, income tax receipts are a large part of Federal revenue, but they are just a little over 40% of the total, which makes the top 1%'s burden about 16% of the whole bundle.

The biggest other source? Payroll taxes - Social Security and Medicare - which are flat taxes up to their caps but then become completely regressive. The average rape and pillage CEO pays exactly the same amount on these as anyone earning over the cap of $102,000 (p. 61 of the 1040 booklet I received this year).

Soooo, if jkkite really cared about keeping uneducated comments out of the discussion, he'd have to SHUT UP!