Cheney's offensive defense of his crimes

Ex-Vice President Dick Cheney is trying to keep himself out of prison by going on the offense against President Obma's release of the torture memos. It looks to me like Cheney has violated the law by authorizing specific acts of torture. If the call for justice gathers steam, he would be in the legal crosshairs.

The idea that we should not prosecute these heinous crimes because they are somehow in the past ... is absurd on the face of it. All crimes we prosecute have occurred in the past. We don't yet convict individuals of future crimes. Is there anything more absurd in a nation of law?

The one good thing that should come of Cheney's taking to the soapbox, is that the issue will arouse the people to cry out for justice, to punish — according to our laws — the leaders who thought they could get away with torture.

The Tag Teams: Geithner & Summers vs. Krugman & Stiglitz

Tim Geithner's and Larry Summers' and careers and personal wealth benefited from the recent derivatives bubble. They are up to their armpits — again, career-wise — in support of the bank bailout plan. They are connected, you might say ... in several dimensions.

On the other hand, Paul Krugman and Joseph Stiglitz, Nobel Prize-winning economists, say the bank bailout plan is not so hot.

Krugman writes in his column America the Tarnished in The New York Times:

In an article in the current issue of The Atlantic, Mr. Johnson, who served as the chief economist at the I.M.F. and is now a professor at M.I.T., declares that America’s current difficulties are “shockingly reminiscent” of crises in places like Russia and Argentina — including the key role played by crony capitalists.

In America as in the third world, he writes, “elite business interests — financiers, in the case of the U.S. — played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive.”

Stiglitz is quoted in Stiglitz Says Ties to Wall Street Doom Bank Rescue in Bloomberg.com::

All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.

If it's tag teams, Geithner & Summers vs. Krugman & Stiglitz, we know who should win ... but in wrestling, you go by the script ...

Let me put it this way ...

Let me give you an example to explain my view of money or "financial instruments".

I have end stage renal disease and I am being evaluated for a kidney transplant. In the evaluation process — looking forward — they told me that if I had a volunteer kidney donor who was not a good tissue match for me, I could participate in a multiparty transplant group where my volunteer would give her/his kidney to someone else and the other person's volunteer would give her/his kidney to me. This could involve as many participants as could be efficiently — in medical terms — handled.

Let's call the agreement between the parties a "transplant agreement" or "transplant instrument". It is quite obvious that the agreement is only worth more than the paper it is printed on IF there are enough kidneys to go around. And if — for example — twice as many agreements come in play as available kidneys because transplant hospitals "sold" more transplant agreements in the short term simply because they could earn a huge profit from selling the transplant agreements ... and then a need for kidneys from individuals holding transplant agreements exceeded the number of actual kidneys available ... Dah! The market would collapse, wouldn't it?

The same is true of money or "financial instruments". They make the exchange of diverse items in multifaceted transactions over time and distance possible ... but only if I am able to get something I want for a price I am willing to pay when I want it ... for the money I have ... unless I can borrow some ...

The Obama (Geithner?) bank bailout plan ... is a swindle

In today's Op Ed piece published March 31st in The New York Times, Obama’s Ersatz Capitalism, Joseph E. Stiglitz lays out the the problem with the Obama (Geithner?) bank bailout plan. It's a swindle of taxpayer money to benefit the banks that helped get us into this mess.

And when we start thinking about the government coordinating the auction of banks' toxic assets ... for the purpose of recapitalizing the banks ... so they can start lending ... so we can start borrowing and spending? What's wrong with this picture?

Geithner seems to believe these toxic assets have real value, and by getting them priced "realistically" it will put the financial system back on its feet.

He probably hasn't visited many ghost towns where the buildings are still standing because they are worth less than the cost of their demolition.

Financial gurus lose sight of the fact that money and other financial instruments have no value in themselves. Their value derives from adding efficiency in making transactions in the market between seemingly diverse elements, including the guarantee of future events ... allowing us to pay for something such as a home or auto over its use life, instead of up front. (However ... when you start paying double-digit interest on groceries bought on a credit card, or lose the means — a job — for making the payments ... dah!)

At the end of the day — as in, "at the end of the bubble" — if there aren't other real goods or services to put up to back up whatever financial instruments are in play ... well, golly gee whiz ... why DO bubbles keep happening? And aren't we watching the Obama financial team repeating the basic "borrow to invest more than we will ever be able to repay (or get back)" of the bubble syndrome?