The Strident Centrist Blog

Devilstower at DailyKos pushes back against the right wing’s attempt to pin the financial meltdown on the Democrats, and in the process gives a pretty good, step-by-step history of the mutation of credit default swaps into the toxic potion they became. The most fateful step in the process was in the middle of the chain:

Stage 4 (Fatum casus)
I have a swap. I really, really want someone to take my swap. Only even with every incentive I can offer, not enough people are loaning. Sure, there’s a record amount of hypothetical money sloshing around the system thanks to me and my swaps, but it’s still not enough. So what can I…

Wait a second. Swaps are unregulated. No one says I have to have enough resources to cover the swap, and even better, no one says I have to offer the swap to the person who actually made the loan! Hey buddy, see that loan over there? You may think it’s iffy, but I think it’ll hold up. In fact, I’m so sure it will, I’ll sell you a credit default swap on it that pays off if it fails. You don’t make the loan, you don’t have to pay off on the loan, you don’t have anything to do with the loan. You just pay me the fee. And if that guy loses his money, you collect. How sweet is that!

This mutation is enormous (see how the genera changed up there?). At this point, credit default swaps have become completely divorced from the original function. A single loan can be covered by multiple swaps. There’s a complicated fiscal term for this. It’s called gambling, and at this stage, that’s all that remains of those little “insurance” policies. They no longer protect anyone from anything, they just offer a chance to place enormous overlapping side bets on everything.

Yesterday Minnesota Public Radio broadcast a replay of former CIA Middle East operative Robert Baer’s recent appearance at the Commonwealth Club of California, where he talked about his recent book entitled The Devil We Know: Dealing with the New Iranian Superpower. His observations made a lot more sense to me than the repetitive bloviating about the Persians that we’ve been hearing from across most of the political spectrum, but especially from the current administration and its shrinking band of apologists. Take a listen. It’s a bit less than an hour long, including the Q and A.

Here’s some info on Baer.

Retired CIA officer Ray McGovern, who helped prepare the Daily Briefings during the Nixon and Ford administrations, has some ideas about how President-elect should handle these events. Specifically, he suggests that the president should not just be a passive recipient but should also drive the process with his own marching orders. Here’s what he proposes as an opening salvo. And by the way, he also recommends that Obama take control of who does the briefing:

Nothing personal, Mike. But with all due respect, you will be able to understand why I would like to start with a fresh slate. Please inform your management that I would prefer a briefer untainted by the intelligence fiasco regarding Iraq. Add that I am offended that they would send me someone so closely associated with George Tenet, the consummate “fixer” of intelligence.

And please do not forget to pass along to your successor the requests I have made.

Christy Hardin Smith has been keeping an eye on the President-elect’s schedule and finds this:

This morning [Friday, November 7], President-elect Barack Obama will attend parent teacher conferences at his daughters’ school with his wife Michelle.

After a meeting with Vice President-elect Joe Biden, Chief of Staff Rahm Emanuel and the Transition Economic Advisory Board, President-elect Obama will hold a 1:30 p.m. (central) press conference at the Hilton Chicago. . .

. . .

It’s one thing to throw out pitchy slogans about “family values” while you spend your political capital undercutting policies and programs which actually support America’s families as the GOP has done the last few years. It’s another thing entirely to simply go out there and quietly support your own family, while simultaneously valuing support for the education and well-being of other people’s children by making programs like Head Start and CHIP and others a real priority.

“Fabius Maximus” more often than not blogs on matters of national security but has insightful views on other topics as well. Today, as the Republican Party moves ever closer to becoming a regional, racist rump, he goes back into the history books to point out its penchant for trying to hang on to power by compromising its founding principles.

This acceptance of institutional racism has had substantial and long-lasting effects:

* helping to poison race relations in America,
* betrayal of the Party’s proud heritage,
* polluting the Party’s foundations. and
* alienating large blocks of voters (not just Blacks).

GOP leaders since then have made modest efforts to shake off this legacy.

* starting the first Federal affirmative action plan (Nixon in 1969, the “revised Philadelphia Plan),
* proposing a national minimum income, the Family Assistance Plan (Nixon in 1969, see this account of its history),
* advancing minority leaders such as Colin Powell and Condoleezza Rice.

These have proved insufficient.

Perhaps in its time out of power the Republican Party’s faithful core can reflect on the party’s errors, both in doctrine and action, and find a new way forward — leaving the mistakes of the past behind them. America needs a strong opposition party, and the current institutional arrangements make creating a new national Party quite difficult.

I think it’s a very open question whether or not the “faithful core” of the GOP that Fabius is counting on has enough of an institutional memory left of what the party stood for in its best of times to pull off its restoration. That’s not to say it won’t remain a power for at least a decade or two, but I think he’s right in suggesting that the Republicans may be at the most crucial turning point in their history.

By the way, one more incident should be in the list of shameful race-related incidents in the list of GOP dances with racism that Fabius has compiled. Although it wasn’t directly related to the preservation of ruling power, it marked the beginning of the end of that party’s hold on the allegiance of African Americans. That incident was the egregiously discriminatory manner in which the Coolidge Administration, under the leadership of Herbert Hoover, administered the distribution of aid in response to the great Mississippi flood of 1927. It is wrenchingly described in John Barry’s wonderful book on the flood, its causes and effects, Rising tide : the great Mississippi flood of 1927 and how it changed America

The unreconstructed monarchist William Lind (he suggests that the world went to hell with the demise of the House of Hohenzoleren) believes that next Tueseday’s voting here in the United States may be only the first of two elections in the upcoming months that will be pivotal for our future. The other is likely to take place early next year in Israel if Tzipi Livni is unable to form government in the next week or two. Lind believes that if the Likud party wins the right to organize a cabinet, the results will probably be dire:

Those who imagine an Obama victory will see the neo-cons shown the door are in for an unpleasant surprise. Under the guise of neo-libs, they are no less influential in the Democratic establishment than in the Republican. The only way Likud could get shut out of a Democratic administration is if Obama bypasses the whole establishment in choosing his foreign and defense policy appointments. While that is fervently to be wished, it is probably not going to happen. Like figures on a medieval clock, the Republican and Democratic establishments succeed each other in an unbroken chain of policy failure.

A Likud government in Israel come next spring would make two wars virtually certain: a war between Israel and Hezbollah and another between Israel and Iran. The Israeli military leadership recently announced that in the event of another war with Hezbollah, Israel would destroy Lebanon’s civilian infrastructure throughout the country. Since the neo-libs will make certain America backs Israel to the hilt, world-wide Islamic anger over the unnecessary destruction of a small, helpless Middle Eastern country (at least a third of whose people are Christians) will focus as much on America as on Israel. Islamic 4GW organizations will get a huge boost to their recruiting and fundraising, while the legitimacy of Islamic states with ties to America will be further weakened.

. . .

It may be that elections in Israel hold more meaning for the United States than does America’s own coming vote. One writer quoted in the Washington Post said that if McCain wins, history will pay America a visit, “the shroud, the scythe and all Four Horsemen.” That may be no less true if Obama wins, unless he improbably finds the wisdom and courage to break with the Democratic Party’s foreign policy establishment. That establishment is as tied to Israel as Russia’s foreign policy establishment was tied to Serbia in 1914. Past, I suspect, is prologue.

I can understand why Obama sees a need to toe his party’s long-established line of unquestioning support of Israel during the campaign. I retain some hope, however, that he will prove to have the wisdom to make clear to the next government of that country, whatever its political stripe, that we will draw the line at supporting Israeli actions that clearly threaten our most vital national interests, and theirs as well if they could only see them. Friends don’t let friends drive drunk.

Here’s the summary of the Times endorsement:

As tough as the times are, the selection of a new president is easy. After nearly two years of a grueling and ugly campaign, Senator Barack Obama of Illinois has proved that he is the right choice to be the 44th president of the United States.

Mr. Obama has met challenge after challenge, growing as a leader and putting real flesh on his early promises of hope and change. He has shown a cool head and sound judgment. We believe he has the will and the ability to forge the broad political consensus that is essential to finding solutions to this nation’s problems.

In the same time, Senator John McCain of Arizona has retreated farther and farther to the fringe of American politics, running a campaign on partisan division, class warfare and even hints of racism. His policies and worldview are mired in the past. His choice of a running mate so evidently unfit for the office was a final act of opportunism and bad judgment that eclipsed the accomplishments of 26 years in Congress.As tough as the times are, the selection of a new president is easy. After nearly two years of a grueling and ugly campaign, Senator Barack Obama of Illinois has proved that he is the right choice to be the 44th president of the United States.

The editorial goes on to support its case in considerable detail. Other endorsements Obama received today were from the late Senator Barry Goldwater’s granddaughter and former Minnesota Republican governor Arne Carlson.

Update: So does Scott McClellan, former George W. Bush administration press secretary.

Josh Marshall at TPM jumps off from a mantra of his late biologist father to suggest that the early twenty-first century Republican Party is recapitulating its twentieth century origins in reverse as it melts down in the campaign of 2008:

And yesterday I had an political epiphany. As the McCain campaign staggers toward its conclusion, with electoral columns and pediments standing since 1966 buckling under their weight, the party seems to be cycling back through its history of character assassination, McCarthyism and wedge politics flimflam, only now with an desperate and parodic impotence taking the place of punishing rhetorical violence.

Southern strategy race-baiting, check! Hyper 9/11ist ‘the Dems are terrorists’ character assassination, check! Rep. Michelle Bachmann’s neo-McCarthyite manifesto and call for a new HUAC, check! ‘The Democrats want to bring socialism to America’, check! Who lost Georgia? Aspirational neo-Cold Warism, check! Mix these in with a general stew of 70s-90s soft-on-crime, Dems are pedophile weirdo-freak-loser wedge politics and we’ve basically got the full ground covered.

I don’t doubt that anti-tax politics retains a potent, if diminished resonance. And perhaps I’m just naive. But does ’socialism’, as a cudgel in the context of a national political campaign, not simply sound archaic? It is one more reason I sense the GOP’s and perhaps the conservative movement’s dying regression into its ideological infancy.

As the New York Times states today, this year’s Nobel Prize in Chemistry was won by Roger Y. Tsien and Martin Chalfie for their “development of a revolutionary technique that lights up the inner workings of living cells.” But another chemist who almost twenty years ago made a discovery that was an essential foundation for the prize-winning work now, at age 57, drives a courtesy van for an auto dealership for $10 per hour.

At popular request. Check it out at his blog.