AIG Bonus payouts was NO loophole and NO mistake...

According to an article in this morning's New York Times,

"...Democrats are mostly responsible for the A.I.G. bonus debacle, since Senator Christopher J. Dodd of Connecticut, chairman of the Senate Banking Committee, inserted language in President Obama’s economic stimulus package to exempt bonuses granted by contract before Feb. 11 from general restrictions on bonus payments."

Of course, this has nothing to do with the fact that Christopher Dodd represents Connecticut, the Insurance Industry Capital of the United States.

Schmuck.

UPDATE: (From the NY Daily News)

Gov. Paterson stuck to his guns Saturday, insisting he knew nothing about a $100,000 donation from AIG to the state Democratic Party days before his office helped save the insurance giant.

State Republicans charged the Democrats with stonewalling an investigation into the Aug. 29 donation, uncovered last week by The Associated Press.

In the first week of September, Paterson launched negotiations to save the financially strapped company.

The Democrat's "Religious Right"

Over at my fellow bloggers Joe.My.God and WickedGayBlog, there is an incessant harping on the Republican Party, and not a little antagonism towards those of us who would be gay and remain Republicans because of the Religious Right within our ranks. However, today's column by Wayne Besen ("Truth Wins Out" - www.waynebesen.com), who has impeccable credentials in the public fight against the Dobsons and "ex-Gay Movements" of the world, tells of the same problem at the higher echelons of the Democratic Party. I include parts of his article below:

Obama's Parent In The Pulpit Complex

"George W. Bush longed to escape his daddy's shadow, while Barack Obama has turned to shadowy preachers in his long search for a father figure. His filial approach to faith began with Rev. Jeremiah Wright and has now taken a sharp turn right.

The New York Times reports that the president has surrounded himself with a cadre of clerical crackpots known as the "Circle of Five." These holy men are: Rev. Joel Hunter, former head of the Christian Coalition; anti-gay Bishop T.D. Jakes; the ex-gay loving Rev. Kirbyjon Caldwell; and Jim "waffling" Wallis, a protean progressive. The only Obama shaman who isn't shameless is the civil rights era preacher Rev. Otis Moss Jr.

Rev. Jakes refers to homosexuality as "brokenness" and has claimed that he wouldn't hire a sexually active gay person. But it seems T.D. can't even keep his own son off the D.L. (down low). His "sexually broken" heir was arrested earlier this year for cruising a Dallas Park in search of gay men.

Wallis, the chief executive of Sojourners, a Christian magazine, holds "traditional" views on homosexuality and abortion, according to the Times article. Although Wallis has taken some affirmative steps on GLBT equality, he prides himself on not being a part of "the religious left."

Rev. Caldwell has endorsed Metanoia, an ex-gay ministry designed to "help homosexuals understand with God's help that 'change [is] possible." When the GLBT community worked to elect Obama, this is not what we thought he meant when he promised "change."

"Whoa, OK, so let's assume [the Obama Administration decides to release] a mealy mouthed message like 'the President does not believe in ex-gay therapy' or some such nonsense," wrote blogger Pam Spaulding. "If he doesn't, then what is he doing talking to Caldwell when there are plenty of other prominent pastors he could choose to break bread with who don't subscribe to that view?"

We must also remember that during his campaign, Obama tapped "ex-gay" gospel singer Donnie McClurkin to croon at a concert tour in South Carolina. And, this insult was compounded by the injury of selecting Rev. Rick Warren to give the Inauguration invocation.

I can live with Obama's poor Sunday choices if on Monday he hears our voices and passes landmark gay civil rights legislation. Still, it is disconcerting that such a cool and rational leader keeps returning to the theological armpit to fill his pulpit. Will spending time in the biblical backwater influence Obama's views and lead him to sell us down the river?

By embracing these conservative clerics, Obama is also setting a wretched example overseas. Last month, the State Department released a report to Congress that documents "an unfortunate crisis in human rights abuse directed against lesbian, gay, bisexual, and transgender (LGBT) people worldwide." Much of this violence was the result of brutal religious oppression. Yet, Obama pals around with reprehensible reverends, thus undermining his own administration's call for moderate religious leadership abroad.

...[W]e expect Obama to understand that his clerical choices do matter. It is time Obama stops searching for Daddy and becomes the man of the (White) house, by picking preachers who are not at irreconcilable odds with his human rights policies.



© 2008 Wayne Besen. All rights reserved.
Anything But Straight | www.waynebesen.com

AIG - So what else is new?

On March 9, after the Obama administration announced it would increase the US Taxpayer subsidy of AIG to 80% by pumping in another 30 billion, I wrote in this blog:

"...With all this cash, could AIG actually lose money? Well, friends, they just reported quarterly losses of 61 billion...The appropriate action is to allow AIG to fail, and distribute their clients to well-run companies. There are plenty of healthy, responsible Insurance companies who could and would benefit from taking on AIG's clients..."

Bush and Obama have both been shovelling dollars to AIG. Why? So they could be stabilized in the face of 61 billion losses per quarter? In spite of their best intentions, neither Bush nor Obama "get it." Government intrusion into the Marketplace always creates inefficiencies, always burdens the taxpayer and consumer, and always carries unintended consequences. This time, those consequences were highly visible: Millions of dollars in "bonuses" that were 'contractually mandated.'

Of course, if AIG was allowed to go bankrupt, as I have suggested multiple times before, those contracts would have been voided...and we wouldnt have the mess we have today. But far be it for Obama to listen to an Economist like me....

End Prohibition, End Drug Wars, Reduce Crime...

Reprinted from the March 7-13th edition of The Economist:

A HUNDRED years ago a group of foreign diplomats gathered in Shanghai for the first-ever international effort to ban trade in a narcotic drug. On February 26th 1909 they agreed to set up the International Opium Commission—just a few decades after Britain had fought a war with China to assert its right to peddle the stuff. Many other bans of mood-altering drugs have followed. In 1998 the UN General Assembly committed member countries to achieving a “drug-free world” and to “eliminating or significantly reducing” the production of opium, cocaine and cannabis by 2008.

That is the kind of promise politicians love to make. It assuages the sense of moral panic that has been the handmaiden of prohibition for a century. It is intended to reassure the parents of teenagers across the world. Yet it is a hugely irresponsible promise, because it cannot be fulfilled.

Next week ministers from around the world gather in Vienna to set international drug policy for the next decade. Like first-world-war generals, many will claim that all that is needed is more of the same. In fact the war on drugs has been a disaster, creating failed states in the developing world even as addiction has flourished in the rich world. By any sensible measure, this 100-year struggle has been illiberal, murderous and pointless. That is why The Economist continues to believe that the least bad policy is to legalise drugs.

“Least bad” does not mean good. Legalisation, though clearly better for producer countries, would bring (different) risks to consumer countries. As we outline below, many vulnerable drug-takers would suffer. But in our view, more would gain.

The Evidence of Failure

Nowadays the UN Office on Drugs and Crime no longer talks about a drug-free world. Its boast is that the drug market has “stabilised”, meaning that more than 200m people, or almost 5% of the world’s adult population, still take illegal drugs—roughly the same proportion as a decade ago. (Like most purported drug facts, this one is just an educated guess: evidential rigour is another casualty of illegality.) The production of cocaine and opium is probably about the same as it was a decade ago; that of cannabis is higher. Consumption of cocaine has declined gradually in the United States from its peak in the early 1980s, but the path is uneven (it remains higher than in the mid-1990s), and it is rising in many places, including Europe.

This is not for want of effort. The United States alone spends some $40 billion each year on trying to eliminate the supply of drugs. It arrests 1.5m of its citizens each year for drug offences, locking up half a million of them; tougher drug laws are the main reason why one in five black American men spend some time behind bars. In the developing world blood is being shed at an astonishing rate. In Mexico more than 800 policemen and soldiers have been killed since December 2006 (and the annual overall death toll is running at over 6,000). This week yet another leader of a troubled drug-ridden country—Guinea Bissau—was assassinated.

Yet prohibition itself vitiates the efforts of the drug warriors. The price of an illegal substance is determined more by the cost of distribution than of production. Take cocaine: the mark-up between coca field and consumer is more than a hundredfold. Even if dumping weedkiller on the crops of peasant farmers quadruples the local price of coca leaves, this tends to have little impact on the street price, which is set mainly by the risk of getting cocaine into Europe or the United States.

Nowadays the drug warriors claim to seize close to half of all the cocaine that is produced. The street price in the United States does seem to have risen, and the purity seems to have fallen, over the past year. But it is not clear that drug demand drops when prices rise. On the other hand, there is plenty of evidence that the drug business quickly adapts to market disruption. At best, effective repression merely forces it to shift production sites. Thus opium has moved from Turkey and Thailand to Myanmar and southern Afghanistan, where it undermines the West’s efforts to defeat the Taliban.

Al Capone, but on a global scale

Indeed, far from reducing crime, prohibition has fostered gangsterism on a scale that the world has never seen before. According to the UN’s perhaps inflated estimate, the illegal drug industry is worth some $320 billion a year. In the West it makes criminals of otherwise law-abiding citizens (the current American president could easily have ended up in prison for his youthful experiments with “blow”). It also makes drugs more dangerous: addicts buy heavily adulterated cocaine and heroin; many use dirty needles to inject themselves, spreading HIV; the wretches who succumb to “crack” or “meth” are outside the law, with only their pushers to “treat” them. But it is countries in the emerging world that pay most of the price. Even a relatively developed democracy such as Mexico now finds itself in a life-or-death struggle against gangsters. American officials, including a former drug tsar, have publicly worried about having a “narco state” as their neighbour.

The failure of the drug war has led a few of its braver generals, especially from Europe and Latin America, to suggest shifting the focus from locking up people to public health and “harm reduction” (such as encouraging addicts to use clean needles). This approach would put more emphasis on public education and the treatment of addicts, and less on the harassment of peasants who grow coca and the punishment of consumers of “soft” drugs for personal use. That would be a step in the right direction. But it is unlikely to be adequately funded, and it does nothing to take organised crime out of the picture.

Legalisation would not only drive away the gangsters; it would transform drugs from a law-and-order problem into a public-health problem, which is how they ought to be treated. Governments would tax and regulate the drug trade, and use the funds raised (and the billions saved on law-enforcement) to educate the public about the risks of drug-taking and to treat addiction. The sale of drugs to minors should remain banned. Different drugs would command different levels of taxation and regulation. This system would be fiddly and imperfect, requiring constant monitoring and hard-to-measure trade-offs. Post-tax prices should be set at a level that would strike a balance between damping down use on the one hand, and discouraging a black market and the desperate acts of theft and prostitution to which addicts now resort to feed their habits.

Selling even this flawed system to people in producer countries, where organised crime is the central political issue, is fairly easy. The tough part comes in the consumer countries, where addiction is the main political battle. Plenty of American parents might accept that legalisation would be the right answer for the people of Latin America, Asia and Africa; they might even see its usefulness in the fight against terrorism. But their immediate fear would be for their own children.

That fear is based in large part on the presumption that more people would take drugs under a legal regime. That presumption may be wrong. There is no correlation between the harshness of drug laws and the incidence of drug-taking: citizens living under tough regimes (notably America but also Britain) take more drugs, not fewer. Embarrassed drug warriors blame this on alleged cultural differences, but even in fairly similar countries tough rules make little difference to the number of addicts: harsh Sweden and more liberal Norway have precisely the same addiction rates. Legalisation might reduce both supply (pushers by definition push) and demand (part of that dangerous thrill would go). Nobody knows for certain. But it is hard to argue that sales of any product that is made cheaper, safer and more widely available would fall. Any honest proponent of legalisation would be wise to assume that drug-taking as a whole would rise.

There are two main reasons for arguing that prohibition should be scrapped all the same. The first is one of liberal principle. Although some illegal drugs are extremely dangerous to some people, most are not especially harmful. (Tobacco is more addictive than virtually all of them.) Most consumers of illegal drugs, including cocaine and even heroin, take them only occasionally. They do so because they derive enjoyment from them (as they do from whisky or a Marlboro Light). It is not the state’s job to stop them from doing so.

What about addiction? That is partly covered by this first argument, as the harm involved is primarily visited upon the user. But addiction can also inflict misery on the families and especially the children of any addict, and involves wider social costs. That is why discouraging and treating addiction should be the priority for drug policy. Hence the second argument: legalisation offers the opportunity to deal with addiction properly.

By providing honest information about the health risks of different drugs, and pricing them accordingly, governments could steer consumers towards the least harmful ones. Prohibition has failed to prevent the proliferation of designer drugs, dreamed up in laboratories. Legalisation might encourage legitimate drug companies to try to improve the stuff that people take. The resources gained from tax and saved on repression would allow governments to guarantee treatment to addicts—a way of making legalisation more politically palatable. The success of developed countries in stopping people smoking tobacco, which is similarly subject to tax and regulation, provides grounds for hope.

A calculated gamble, or another century of failure?

This newspaper first argued for legalisation 20 years ago (see article). Reviewing the evidence again (see article), prohibition seems even more harmful, especially for the poor and weak of the world. Legalisation would not drive gangsters completely out of drugs; as with alcohol and cigarettes, there would be taxes to avoid and rules to subvert. Nor would it automatically cure failed states like Afghanistan. Our solution is a messy one; but a century of manifest failure argues for trying it.

Cheshire Co., New Hampshire Republicans offer opinions on the GOP's direction

This afternoon, Republicans in Cheshire County, NH were invited to an open meeting in Keene to voice their opinions about the future of the Republican Party. To be sure, there were many opinions.

Jennifer Horn, last year's unsuccessful candidate for Congress, served as the MC. Those who attended were quickly divided into groups to discuss issues such as voter outreach, party logistics, ranking issues by importance, media relations, etc. Oddly, attendees were not invited to join the work sessions of their choice, but were assigned topics haphazardly depending on their seats. Your truly, of course, defied the established order and participated in two groups: Voter Outreach and Issues. At the end of the hour or so meeting, summations were offered, and some short general discussion ensued.

The results were mixed, I think. Some members clearly understood the need to be technologicaly adept. Others were stuck in the 1950s, believing that phone trees were important, and that telling College students that Republicans supported Civil Rights in the 60s (over 40 years ago!) would somehow win them over...

I spoke up, of course. I believe that the Republican Party needs to do some real soul-searching. Unfortunately, the Elephants appear to be terrified of The Elephant in the Room: the stranglehold on the party by Religious Conservatives.

In spite of Jennifer Horn's stated belief that the GOP does not need to rebrand itself, she is terribly, terribly wrong.

An entire generation of new voters came to the polls believing that the Bush administration and Rush Limbaugh represent Republican ideals. Republicans spent eight years defending sickening deficits, exploding budgets, and “big-government” programs that they would have railed against had they been proposed by a Democratic Administration. We were inexcusably silent as America, the great hope of the world, became represented by images of torture and Guantanamo Bay. Republicans should have been outraged…but instead, we defended “our guy” in the white house, and earned the public’s disdain. They grew tired of the Bush administration’s vision of America.

The GOP must articulate in clear terms positive, pro-active solutions for the problems and concerns that the American people have. Access to health care and secure retirement provisions are national concerns: We cannot simply be ‘against’ universal health care or social security, we must present clear, pragmatic, appealing alternatives.

As these proposals are formulated, we must be careful not to fall prey to the idea that we must choose to side with either the “moderates” or the “conservatives” within the Party. A lukewarm, “me-too” version of the Democrats is not a solution, but neither is cliché-ridden pandering to a shrill religious right. Rather, Republicans must forge a new path, a path that is consistent with both the Republican philosophy and the American spirit, and which resonates with voters of all stripes: we must combine fiscal conservatism and responsibility with social tolerance and liberalism. The Republican Party claims to be the party of small government and maximum personal freedom. It’s about time we reclaimed that heritage in a consistent manner.

As we present our alternatives, we must eradicate the mean-spiritedness, the innuendos, the mud-slinging, and the anger from our speech. We must offer vision, hope, and a future to all. If we want young people, minorities, and immigrants in the party, then we need to really want them, not just tolerate them and accept their contributions.

At the gathering, numerous snide remarks were made about the 'liberal media,' lawyers, teachers, and liberals in general. "Immigration" - a complete non-issue to anybody in Cheshire County, New Hampshire - somehow emerged as an important 'issue' to address. At my table, one religious conservative insisted that gay marriage and abortion were leading us to Socialism (I can't even begin to explain the twisted logic here...) On a positive note, I would say the majority at my table was tired of being the reloigious rights bludgeon.

I stated openly that we need to stop blaming immigrants, young people, gays, and the 'liberal media' for our problems, and was cut off by Horn, who insisted that the party does not 'blame' those groups for anything. And yet, that appears to be more of a political 'talking position' (the media was present) than the reality, as understood by the millions of Independents - and Republicans - who abandonned the GOP in the last election.

To be sure, there was a definite contingency present who agreed enthusiastically with me. We will not go away. But it will be a long hard fight - a fight that the GOP leadership seems very, very eager to avoid at all costs. But if they do not address it, one of those costs will be their own electoral success.

More Funds for AIG...

The U. S. Treasury Department announced today that another 30 billion dollars would be headed for troubled Insurance giant AIG. This is on top of the 150 billion already sunk into this Insurance Titanic, including 26 billion in loans from the Federal Reserve Bank.

This would put the US Government ownership of AIG at 80%.

It also would convert the stock that the US Government (Read: U S Taxpayers) has in the company from Preferred to Common Stock: and that means that if the company loses money, the U. S. Taxpayer gets socked first.

Now, with all this cash, could AIG actually lose money? Well, friends, they just reported quarterly losses of 61 billion.

The appropriate action is to allow AIG to fail, and distribute their clients to well-run companies. There are plenty of healthy, responsible Insurance companies who could and would benefit from taking on AIG's clients: companies like Guardian Life, New York Life, and the American Financial Group, all of whom have refused taxpayer bailout funds because they have operated their companies responsibly and profitably.

Which are the companies that are taking taxpayer funds?

- Banks that sold and traded in irresponsible sub-prime mortgages (required by Democratic President Carter, to 'help' low-income areas, and strenuously enforced by Democratic President Bill Clinton).

- Insurance Companies that invested in subprime mortgages and irresponsible banks after Banking Deregulation (signed by Democratic President Bill Clinton in 1999) permitted it. (See a pattern here?)

Meanwhile, healthy insurers that should be the focus of the public's purchases are put at competitive disadvantage by having the Irresponsible Government Favorites kept afloat with tax dollars. We are rewarding the inept, and hurting the wise.

Why? Why would Obama want 80% government control of an insurance Company?

Ah, lets just wait for his new Health Plan Initiative Wouldn't it be amazing if AIG suddenly became the US Government-funded Universal Health Insurer?

Hmmmm....