No Runny Eggs

(H/T – Jon Sanders)

Where, oh where do I go with this story about a dead goldfish named Princess registered to vote through a third-party voter-drive effort from Lake County, Illinois? I could go with the whole FISH angle, but that isn’t exactly family-friendly (FISH is one of the vulgar acronyms we on the good side of the toll booths apply to those on the far side of them).

I could go with the fact that the owner of the dead goldfish, Beth Nudelman, is a registered Democrat, but according to The News Organization That Cannot Be Quoted™, she’s the one that blew the whistle. Wait a minute – I will start there. From the article…

She said she wrote election officials a humorous note explaining why the fish was ineligible to vote.

I’ll bet the letter read something like this: “I really would like to register Princess to vote, but she’s worm food, and this isn’t Chicago where the dead are 110% ‘Rat voters.”

I could, and will, also point out that the tactics of the third-party group, Women’s Voices, Women Vote, are quite similar to sometimes-partner ACORN’s tactics. Indeed, Steve Strum, legal counsel for the Illinois State Board of Elections, notes that this particular effort, which used a mailing list purchased from a vendor, has generated numerous complaints. Also, this particular episode has attracted the attention of the Lake County sheriff’s and state’s attorney’s offices.

Now, how did Princess the dead fish end up on that list? The Nudelmans used her name on a second phone line for a computer modem. That in itself raises a question; why did they feel the need to do that? Ameritech and its follow-on companies SBC and AT&T, didn’t prohibit one from having 2 lines.

The more-observant may ask, “Why are they targeting Illinois when no Republican will likely ever win a statewide election again?” Lake County is, or at least was very-recently, a Republican area marked for takeover. Indeed, there was once a barn on the north end of the Tri-State that was essentially a GOP billboard.

Mary Katharine Ham and Guy Benson put together a very lengthy case against Barack Obama over at Hot Air, edited by Ed Morrissey. From abortion and especially the “punished by a baby” line (pursued by mostly Shoebox here), to taxes, to radical associations, to lack of foreign policy judgement (which was not at all cured by his running mate, specifically Biden’s inexplicable like of Iran’s Mad Mullahs), to a distain of American life, to the race card, to a lack of accomplishments, they make the case far better than I can.

I saw Colin Powell’s endorsement on “Meet the Press” as I waited for a flight home on Sunday. I had other focuses yesterday so didn’t get a chance to put my comments up on the endorsement.

After reading the transcript, I note that Powell did not address any policy issues that he liked of Obama’s. Rather, his entire endorsement appeared to come from a drinking of the “Hope and Change” kool-aid.

Powell tried to use his observations of how the two candidates addressed the last few weeks of economic debate as his deciding factor:

On the Obama side, I watched Mr. Obama and I watched him during this seven-week period. And he displayed a steadiness, an intellectual curiosity, a depth of knowledge and an approach to looking at problems like this and picking a vice president that, I think, is ready to be president on day one. And also, in not just jumping in and changing every day, but showing intellectual vigor. I think that he has a, a definitive way of doing business that would serve us well.

Now I know that Powell has always been at best, a moderate Republican. He firmly believes in abortion and affirmative action. However, what is Powell referring to when he says that Obama is “not just jumping in and changing every day?” Is Powell really that obtuse not to see the numerous position changes that Obama has taken in the past two years? For example, I’ll bet that Colin Powell would label the Iran Revolutionary Guard as a terrorist organization but Obama has been on both sides of the issue in June alone.

What is Powell thinking when he says that Obama “has a definitive way of doing business that would serve us well.” If he ever held Republican views, Powell would have aligned on fiscal values. Can Powell actually believe that Obama’s admitted redistribution of wealth aligns in anyway with what “would serve us well?” Can Powell believe that spending an additional $1 trillion each year “serve us well?”

I’m sorry. I had a great deal of respect for Colin Powell. I believe him to be an honorable man. However, is endorsement of Obama leads me to conclude that Powell never was a Republican and registered as such only for personal attention or gain or, he is now being intellectually dishonest about his reason for endorsing Barack.

I will continue to honor Colin Powell’s service. However, from this day forward, this blogger will view all of what Mr Powell says with an enormous amount of skepticism.

In case you missed it:

Obama Camp Scraps National Anthem

According to Newsmax.com, the Obama Campaign scratched the National Anthem at one of their rallies:

to make room for another speaker.

Let’s see, this is the guy who quit wearing the flag lapel pin because:

it has become a substitute for “true patriotism” since the Sept. 11, 2001, terrorist attacks.

Later he began wearing it when it made the political statement he felt was appropriate for the moment….like when he visited US car manufacturers or military bases.

Looks like just one more example of where Barack comes first, Country comes second. Maybe we should start getting used to it.

I decided that with all the bad news today, I need a lot of stiff drinks. The fun will start about 7:45, and because Shoebox is still out of town, I invited Josh Schroeder to cohost. In fact, if this place goes down (again; I had a server outage around 5 pm), Josh does have the CiL window embedded on his site.

If I can remember to stick to the conventions; the questions will be in italics, the answers (you’ll know because I will stick either McCain or Obama in front of them) will be in plain text, and my comments inline with either a question or answer will be in italics.

I may be a bit later than 7:45; I have a meeting at my church at 7.

I see you guys started without me. The CiL is now open!

Dean Reynolds from CBS news writes an interesting article. In it he provides comparisons between working and traveling with the Obama campaign and the McCain campaign. Under normal circumstances this wouldn’t be material worth a post but then, this isn’t a normal Presidential race.

After painting Obama as the campaign master with a full, aggressive schedule, he goes on to the comparisons.

Reynolds complains that the Obama campaign is so full that it has a tough time making and sticking to schedules:

Obama’s campaign schedule is fuller, more hectic and seemingly improvisational. The Obama aides who deal with the national reporters on the campaign plane are often overwhelmed, overworked and un-informed about where, when, why or how the candidate is moving about. Baggage calls are preposterously early with the explanation that it’s all for security reasons.

If so, I would love to have someone from Obama’s campaign explain why the entire press corps, the Secret Service, and the local police idled for two hours in a Miami hotel parking lot recently because there was nothing to do and nowhere to go. It was not an isolated case.

About McCain’s scheduling he says:

The McCain folks are more helpful and generally friendly. The schedules are printed on actual books you can hold in your hand, read, and then plan accordingly. The press aides are more knowledgeable and useful to us in the news media. The events are designed with a better eye, and for the simple needs of the press corps. When he is available, John McCain is friendly and loquacious. Obama holds news conferences, but seldom banters with the reporters who’ve been following him for thousands of miles around the country. Go figure.

Reynolds makes specific examples of how the campaigns work to accommodate and make best use of the press traveling with them. About Obama:

Nor is there much sympathy for those of us who report for a newscast that airs in the early evening hours. Our shows place a premium on live reporting from the scene of campaign events. But this campaign can often be found in the air and flying around at the time the “CBS Evening News with Katie Couric” is broadcast.

In comparison, regarding McCain:

The other day in Albuquerque, N.M., the reporters were given almost no time to file their reports after McCain spoke. It was an important, aggressive speech, lambasting Obama’s past associations. When we asked for more time to write up his remarks and prepare our reports, the campaign readily agreed to it. They understood.

Even the plane environment is different between the two campaigns:

The McCain campaign plane is better than Obama’s, which is cramped, uncomfortable and smells terrible most of the time. Somehow the McCain folks manage to keep their charter clean, even where the press is seated.

Some may dismiss this as the whining of a broadcast ego having to do actual work. While I can’t rule that out, it doesn’t really matter to the larger issue I note in his writing.

In Reynolds description I see the definition of the two men that Reynolds has been following. Knowingly or not, of Barack Obama Reynolds writes that he is:

• Egotistic – He sees no reason to keep the folks responsible for supporting him informed.   People appear to be required just to assume that “The One” has a good reason without need for explanation.
• Self Centered – yea I know running for President is important but don’t you think a could at least let people know what the plan is for the day?
• Insensitive to other people’s needs and issues – unwilling to let the people who are trying to get him elected attend to the jobs that will help that cause?   Can’t even provide for common cleaning and

Reynolds’ article describes McCain as, well, the exact opposite.

There’s nothing really new in what Reynolds describes of Obama.   The traits that come to the forefront are traits that we’ve known about him for awhile.  

If Reynolds’ assessment is typical of other reporters who have traveled with both campaigns, I find it odd that while the MSM wants Obama to be President, they find no qualities in him that would make him a friend.

To paraphrase an old adage:   Character is what people see in you when the camera lights are off!  

If only people saw more of Obama without the Hollywood wrapping.   If they did, this would be a far different race.

The “News agency who shall not be named,” along with others, is reporting that the last few weeks of the campaign could get VERY personal.

On Saturday, Sarah Palin finally led the campaign in whacking Obama with his Bill Ayers connection:

“This is not a man who sees America as you see it and as I see America,” Palin said today. “We see America as the greatest force for good in this world. If we can be that beacon of light and hope for others who seek freedom and democracy and can live in a country that would allow intolerance in the equal rights that again our military men and women fight for and die for, for all of us.”

She then continued, “Our opponent though is someone who sees America, it seems, as being so imperfect that he’s palling around with terrorists who would target their own country.”

Of course, the MSM quickly ran to Obama’s aid with retorts along the line of the following:

But as the New York Times reported today, Obama was never “palling around” with Ayers. “A review of records of the schools project and interviews with a dozen people who know both men, suggest that Mr. Obama, 47, has played down his contacts with Mr. Ayers, 63. But the two men do not appear to have been close. Nor has Mr. Obama ever expressed sympathy for the radical views and actions of Mr. Ayers, whom he has called ‘somebody who engaged in detestable acts 40 years ago, when I was 8.'”

Those vapidity of that retort has been covered time and again so no need to rehash that. Now that Palin has taken up the line of attacking Obama about the company he keeps, the Obama campaign, responding as if this is a second grade playground fight says: “Oh yeah, well, so are you!” The Obama campaign threatens to drag out the Keating 5 history as their retort of “bad associations.”

Bring it on!

No one of the MSM outlets have spent ANY time investigating Obama’s links and involvement with Ayers, Rezko or the Chicago Political machine. On the other hand, they have spent inordinate time trying to dig up dirt on Palin, to no avail, creating false scandals for McCain….and, they’ve looked into the Keating 5 and have already tried to do McCain in with an attachment to McCain!

In case you forgot, the New York Times tried to resurrect McCain’s involvement to the Keating 5 back during the primaries, February, 2008 to be exact. They tried to derail McCain’s primary run. Not for a lack of effort, they were unable to make the charges stick. In fact, Bob Bennett (Bill Bennett’s brother) came to McCain’s defense, both during the original Keating 5 investigation and again in February:

ROBERT BENNETT, DEFENSE ATTORNEY: Well, Senator McCain did not want a repeat of what occurred years ago in South Carolina, namely a real smear campaign, and asked me to assist them, and I have been assisting him. And this — I’m just — I think what the “New York Times” did here was shameless, just shameless. As you pointed out in the lead, it’s almost entirely unsourced.

You know, I’m in a pretty unique position to talk about John McCain. First, I should tell your listeners I’m a registered Democrat, so I’m not on his side of a lot of issues. But I investigated John McCain for a year and a half, at least, when I was special counsel to the Senate Ethics Committee in the Keating Five, which, by the way, this “New York Times” article goes back to and discusses, goes back years and years.

And if there is one thing I am absolutely confident of, it is John McCain is an honest and honest man. I recommended to the Senate Ethics Committee that he be cut out of the case, that there was no evidence against him, and I think for the “New York Times” to dig this up just shows that Senator McCain’s public statement about this is correct. It’s a smear job. I’m sorry.

and

BENNETT: Well, you know, maybe I was prophetic. I wrote that chapter a long time ago. If your listeners want to know about the Keating Five case, I have a whole chapter on it. What happened was that I had recommended that John McCain be cut out of it and not go forward. And, you know, I call it the way I see it. As I said, I’m a Democrat. And I recommended they go forward against Senators DeConcini, Senator Cranston and Senator Riegle.

But if you cut out John McCain, you would have had 28 days of public hearings with just Democrats in the dock. So, it’s probably the first time in the history of the Senate that they rejected the advice of their counsel to exonerate a senator.

Obama has shown time and again a lack of understanding about history. That’s a trait that should be a concern to many people. However, in this case, I’m happy that Obama has no awareness of history. If he had, he would know that Keatin 5 has been beat to a pulp by all of his best historical corrupters. Despite their best efforts they haven’t been able to twist the facts far enough to indict McCain.

If “associations” become the issue during the last 4 weeks, expect the Obama bus to be hitting a lot of road bumps!

The expectations are very low, so let the alcohol flow. The fun will start about 7:45 pm, assuming I’m awake that is.

If I’m here, and I remember to actually blog the thing (heh), the questions will be in italics, the answers in normal type, and my comments in-line with a question or answer in parentheses. Since this is a drunkblog, the etiquette lamp is out.

At least I would be drunkblogging with CiL if it were up. Instead, we’re doing it the old-fashioned way below the window.

We’re more-or-less back, though CiL is at capacity. Sorry about that.

20:05 – Biden praising socialism, Palin reminding us McCain was pushing reform 2 years ago.

20:22 – My bull-fucking-shit meter is pegged on Biden.

20:24 – Palin – I fought “Big Oil” while Obama voted for them?

So you’re not taking anything off the table? Palin – Oh Hell No!

20:25 – Biden – Obama voted for the alternative fuel while he wanted to screw Big Oil (and keep us dependent on your friends the Mad Mullahs, Plugs?).

20:26 – Would you have supported tightening up bankruptcy rules? Palin – Yes, but things have changed. It’s a toxic mess on Main Street that’s affecting Wall Street.

20:28 – To Biden – We need to let bankruptcy courts screw the lenders (fuck that shit).

20:30 – Palin – Energy independence is the key to our future. It’s not about who is getting a tax break.

What about Gorebal “Warming”? – Palin – I’m in the only Arctic state, but it’s not just man.

20:31 – Palin – An “all of the above” approach also helps other countries keep the environment clean.

To Plugs – It’s EVIL AMERICAN CONSERVATIVES’ FAULT! (FUCK YOU!)

20:33 – If you hit refresh, the CiL SHOULD be working.

The bill previously referred to as “The Bailout” but appropriately classified as a “workout” (I’ll explain more later) looks to be heading for another vote.   While the timing is still to be determined, some sources are suggesting that the Senate may vote first and do so as early as Wednesday evening.

Folks have been working to figure out what adjustments need to be made to pick up the additional 12 votes that the first vote lost by.   While there were rumors, and frankly I thought the likely path, that SanFranNan was going to load up more socialism into the bill to get her more liberal folks on board, it now looks like there are a combination of items that are being considered.

Included in the “let’s get more libs on board” are these items:   my comments in italics

1. Banning some forms of short selling – I’d have to see more details but I can’t imagine a situation that I would support long term.   We have seen in the current short selling curb, numerous examples where the removal of short selling has actually hurt the price of the stock.   How can that be?   Turns out that folks who buy long on companies use short selling to help protect themselves from unexpected down turns in the stock.   If they can’t protect their downside, especially in situations of high volatility, they won’t play on the long side.
2. Extending Unemployment Benefits – No and hell no!   This is the kind of stuff that would allow the Republicans to sit out another vote.   This bill needs to stay focused on restarting the credit markets.   This issue does nothing in that area!
3. Double the Property Tax Deduction for People Who do not Itemize Deductions – Again, no and hell no for the same reasons as #2
4. More Spending on Transportation and Infrastructure – Ditto 2 and 3.   The argument is that this is putting money into the economy.   If Paulson is right, there is no money needed in the economy.   In fact, Billions of dollars have already been pumped into the economy.   We don’t need the Govt. borrowing more especially when we don’t know where the next fire is that we may need to fight.

Other ideas being proposed:

1. Increase FDIC insurance to $250K for each depositor – OK, sleeves out of your vest on this one.   It may provide some help in stemming runs on banks but I don’t know that it addresses the credit issues.   My understanding is that during the RTC days, and even today, FDIC uses some pretty broad authorities to determine the amount that actually gets covered by each depositor.   I believe many depositors with balances over the current $100K mark, were fully covered by the FDIC.
2. Remove/Adjust Mark to Market requirements – As I understand it, the SEC could do this on their own.   In fact, there are rumors that they may do that even if not in the bill.   This absolutely needs to happen.   Mark to Market  works when their are fluid markets for the assets you are valuing.   When the market become illiquid or worse, functions essentially as multiple fire sales, mark to market can actually mis price assets.   Many people will debate  the level, or if mark to market has impacted our current financial situation.   Trust me, Mark to Market has not caused this mess but it has surely exacerbated and accelerated  the deterioration of balance sheets.

Where does that leave us?   it looks like for the most part, the bill will come back as it was on Monday.   I don’t expect any changes that do more than allow some group of Representatives to change their minds.   After rereading Monday’s bill again, my biggest concerns remain that Paulson can buy assets from pensions and (and I just picked this up in my last rereading) no where in the bill do I see that he must specifically buy only the mortgage backed securities.  

In short,  this bill  leaves me feeling like the guy who has a bomb ticking down from :30 and he needs to decide which of 50 wires to cut.   I know we have to cut a wire.   If we’re right, we live.   If we’re wrong, well, stay tuned for tomorrow’s show!

Postlude:   I referred to this as a “workout” earlier.   This bill has been badly sold…that is if it is as many are selling it i.e. a situation where Paulson will buy assets, hold them for a while and place them in the hands of a healthier institution later, hopefully without a loss.   If the program works as that, this looks much more like a typical financial system workout i.e. at the end of the day we get our money although we may have to adjust the terms or payment amounts along the way.   If this really is a “workout” (as I believe it is intended to be) than Paulson and others should be making that point and selling it as such.   If it is a bailout, buyer be ware!

If you think that representation from San Francisco could not get any more leftist than San Fran Nan, take a look at this video of Cindy Sheehan’s discussion of her economic platform.

Gurgle, Gurgle, Gurgle!

In a close vote, 205 – 228, the “bailout” bill was defeated.   Bush, Paulson, Pelosi and everyone else who was interviewed after the vote, still say we are in a crisis.   I guess the natural question is:   Now What?

First, let’s take a quick look at how the bill was defeated.

The defeat began with Nancy Pelosi giving one of the more partisan speeches I can remember hearing given by a Speaker in a situation where the Speaker knew the vote was close and really wanted the bill to pass.   Rather than fight for a common purpose, Nancy took her 2 minutes to point fingers at every Republican ever elected.   You really need to see it to believe just how insultingly partisan her comments were:

After experiencing Pelosi’s petulance and seeing that the Dem’s were only able to get 60% of their caucus to support the bill, I’m inclined to agree with Soren Dayton over at RedState.com. I too believe that Pelosi intended this bill to fail so that she could continue to scream Buuuuuuuuush for at least another week of the election season. Pelosi believes, incorrectly, that doing nothing will provide her Presidential candidate, plausible deniability and the same ability to cry Buuuuuuush/McCaaaaaaain up until the next debate.

Perhaps the first question is: Do we need to do anything? I think the answer to that, sadly, is yes. Here are just three stories of commercial financing ending or having terms attached that are a dramatic change:

– Catepillar (via the Chicago Tribune)
– State of Tennessee (via The Tennessean)
– McDonald’s (via the Chicago Tribune)

OK, something needs to be done, what?

In my perfect world, I would like to see the original Paulson bill come back. Strip out the pension support the mortgage term renegotiation and a few other ornaments from TARP and I would support it. That said, I don’t think that’s going to happen.

If Pelosi is at all interested in getting a bill done, an assumption we have to work with or the remainder of the discussion is moot, I’d be willing to bet that right now she has all kinds of piglets lined up waiting to be inserted in any bill she may bring back. As has been pointed out before, she has enough Democrat members that she doesn’t need any Republicans to pass a bill.

In order for Nancy to get her caucus to fully support the bill she would likely need to be even more draconian on the pay issues. She would also likely add the provision that sends earnings from the asset sales to ACORN and La Raza back in. Finally, I would expect to see some provision that would have direct help for homeowners who are facing foreclosure. While this may be Nancy’s druthers, I don’t see that a bill with those provisions would get through the Senate unless Wall-street had a dramatic, sustained meltdown. If a true panic sets in, all bets are off.

Another possibility is that nothing is done. I don’t think that’s going to happen because Nancy is not going to let the meltdown be hung around her neck even if she really believes it’s Buuuuuuush’s fault. No, she’s likely to do something.

The final option (assuming the Republicans can’t just rewrite the bill from scratch, and I don’t think there’s any possiblity of that) is to rebring essentially the same bill to the floor. There are two problems with this approach: First, there’s no chance that Pelosi would risk another shoot down unless she was absolutely sure the votes were there. Second, if the bill is the same, how do you get Republicans to change their vote when the public appears to be behind them and elections are getting even closer?

Here’s my plan:
First, we need to get someone to talk to the American people and communicate clearly the challenge we face. No more finger pointing, politicking or use of nebulous terms like “crisis!” If this is truly a crisis than explain it to us. We’re smarter than you think and we tend to band together across ideologies when we see a true National crisis in front of us (think 9/11). If you can’t put it into terms that the majority of Americans can understand, regardless of whether we agree with them, than you haven’t done your job as a National leader!

Second, the current group has lost all credibility! President Bush, Paulson, Pelosi, Reid, Frank, Dodd etc. all have personal skins to lose in this. Of them, the only one that I believe has personal integrity, but won’t allow himself to get into the gutter far enough to fight this out, is President Bush.

We’ve been told every couple of months for the past year that we have a “Crisis!” Housing, Bear Sterns, AIG, Lehman Brothers. We’re worn out from crisis’! Worse yet, each one that comes up is supposed to be “the act” that gets us past any further crisis. To date, that hasn’t happened.

As I said, the current crop has lost all credibility. I believe that is a big reason why the bailout bill failed. The public says “fool me once shame on you, fool me twice, shame on me!” They want to know that the money that they are about to put up will actually be used for the purpose it is intended for and that the folks running it are not just mouthing “American Taxpayer” but actually working in the best interest of the American taxpayer!

To that end, I propose that we need a new leader for this effort! I propose that if Paulson really believes this to be the crisis he has been telling everyone it is, he should work with President Bush and Congress and get Mitt Romney to run the effort.

Putting Mitt in would serve two purposes. First, while he  did run  for President, Mitt is outside of the Washington establishment.   You won’t find anyone who has no political affiliation to handle the job  but Mitt should be close and seen by most folks as a strong problem solver with an excellent financial mind. If you ask most people, they would say he is known for saving the horribly mismanaged Utah Olympics and that would go a long way towards credibility. Second, if Paulson handles the program, he will be replaced when the next President is elected. This is a role that needs continuity and needs to stay apolitical if it is to be successful. Putting Mitt in now would satisfy both of those needs.

Perhaps the most important reason for Mitt to be involved is that it would give a reason for Republicans to change their vote. While they may still not like all aspects of the bill, if a cogent explanation for the need was provided (something Mitt could do better than anyone in Washington) so that the public understood the need for the plan, adding Mitt’s name would allow Representatives to tip toe down the middle with a line that sound like: “I don’t like this. However, the case has been made and it’s important that we try this. If anyone can return all the money and perhaps a profit to the American taxpayer it is Mitt Romney.”

There is no easy answer here. I believe the bill that was voted down today is now the best possible hope we have. If we can get it back and get a trusted and capable overseer, we could yet find a silver lining in this mess.

Revisions/extensions (6:54 am 9/30/2008, steveegg) – Cleaned up the formatting slightly.

I wish I had one of those flashy light thingys that Drudge has….maybe I can get Steve to get me one for Christmas!

Speaking of Christmas….

It was closing in on midnight as I was tearing into the sausage last night. I tried to give a bit of editorial but honestly had though through it well enough. Today is another day and I have now had a chance to drink some coffee and think through this mishmash of legislation.

One line from last night’s post popped out at me this morning:

Treasury is also to focus on purchases assets held by retirement plans

Huh?   I thought the purpose of this bill was to reflate capital in companies that are at the core of our lending. What have retirements funds got to do with that?

Sure, large pension funds invest in assets. Sure, they invest in debt backed securities. Some of them even do a small amount of direct lending. While there could be some, I’m not aware of any pension fund that lends directly to homeowners.

This provision, this single paragraph in the bill, is there to provide political cover for Democrats. They have inserted this provision to reflate numerous union pension funds. Merry Christmas pension funds!   This is a horrible provision!

If the purpose of this bill is to restart our lending and pension funds do little if any direct lending, why are we allowing any of these funds to be allocated to them? This will siphon some amount of funds and move them away from their primary target. Which brings me to my other concern with this bill.

This bill gives far too much latitude without even so much as guidelines to the folks who brought this disaster to us. They didn’t make good decisions in the past, why should we expect them to now?

I remain conflicted on this bill. I feel a little like the first person who received chemo for cancer felt:

Doctor: “You have cancer. We believe that the best way to cure it is to give you poison! We think we can poison you to the fine point where your body throws out. If we miss by just a little bit, well, you die.”

Patient: “Oh, OK.”

I’ve read the bill…all 110 pages.   You can to, it’s here!

While most of this has been reported, there are a few clarifications that are worth noting:

Trouble Assets Relief Bill – TARP

• Gives the Secretary of the Treasury the ability to Purchase or Insure these assets.   The combination of the amount purchased and the net amount, after premiums paid, can not exceed $700B
• Several times in the bill there are notations that TARP should act to maximize the taxpayer’s dollars…nice sentiment, we’ll see what happens.

While generally saying they are to be non discriminatory, there are areas where the bill says Treasury should consider uniquely:

• Treasury is instructed to consider the financial health of the institution they buy assets from.   If the asset purchase will not help the financial viability of the entity, Treasury is “instructed” to put that institution at the bottom of their purchase list.
• On the other hand, the Treasury is to look favorably on institutions that have less than $1B, were adequately capitalized as of 6/30/08 and served low or moderate income populations…..isn’t that part of what go us into this problem?
• Treasury is also to focus on purchases assets held by retirement plans

The Board of TARP includes: Chair of the FED, the Secretary of the FED, Director of the Federal Home Finance Agency, Chairman of the SEC, Secretary of HUD…none of these people seemed to have forseen this problem.   Are they the best folks to have giving oversight to this?   I’ve heard Mitt Romney’s name proffered to handle this thing.   Wouldn’t it be best to have some folks that are outside of those who created or allowed the problem to direct the resolution?

All revenues recouped go to the General Fund for reduction of Debt – This is a big issue!   How do you suppose the Dems will glom onto this and play games like have been done with Social Security?

The “Golden Parachute prohibition” does not apply to existing contracts and only applies as long as TARP owns securities or debt of the particular institution as a part of the asset purchase

As has been reported, TARP gets $250B now, $100B after the President sends a report to Congress and the remaining $350 after a second Presidential certification.   The final amount does not need Congress’ consent but Congress may vote to block it.

The bill does require TARP to receive warrants for non voting shares or Senior Debt of each company it buys assets from.   The bill leaves up to the Secretary for the Treasury to determine what price the warrants will be or what amount of debt.   The bill does not have a provision for how or when the warrants or debt would be extinguished.   There ought to be a provision that requires sale or forfeiture of the warrants within a certain period after the debt is cleared.   We don’t want the Federal Government being stockholders of any publicly traded stocks for an extended time.

Any gain (Ha!) or loss from the sale of preferred stock of Freddie Mac or Fannie Mae will be allowed to be recognized as an ordinary loss (no gains here) for financial institutions as long as they were purchased prior to 9/6 2008.   Typically, if they were held over a year, these loses would be capital and limited to certain limitations.   This is a nicety, I don’t know that it means much to these institutions.

The institutions that have assets purchased from them will not be able to deduct more than $500K of executive compensation.   This only applies to institutions that have at least $300M purchased from them and applies until TARP terminates which would be 2011 at the latest.

A few thoughts:

This program should not cost the taxpayers anywhere near $700B.   If Paulson and company do their job properly, this should cost no more than administrative costs and may return positive money to the treasury.

I can’t seem to find a provision that says TARP needs to do something with the warrants by a certain date.   Typically, warrants have an expiration date so perhaps that is part of the negotiating.   I’m nervous that the Secretary of the Treasury gets to negotiate all of the warrants or debt received.   When you get to negotiate not only the amount you will pay for the debt but the amount someone will pay you to take it, well, that sounds a whole lot like loan sharking to me!

I like the continued references to focusing on managing for the taxpayer.   Unfortunately, this is a governmental agency that they are asking to do it.   Can anyone name me one governmental agency that is careful with taxpayer money?

I’m sure there will be more clarification coming.

I wrote last week that McCain’s gambit of suspending his campaign made the events of this weekend something like the gunfight at the campaign corral. It was going to be a high stakes gamble that would put the possibility of McCain’s election in the balance. It’s 7:30 PM and the House leaders have just had a brief news conference. Based on what it appears now will be passed, I’d say that as the smoke clears, McCain wins.

Remember that when McCain suspended his campaing last week, many people believed he did it as a political stunt. Blame John McCain for that as not doing a good job of communicating what he walked into. According to Bloomberg.com Lindsey Graham is quoted as saying:

“The fact is the House Republicans were not in the mix at all” until McCain arrived at the talks, said Graham, a South Carolina Republican. McCain “was decisive in regards to the House being involved.”

Tonight during the press conference, John Boehner, House Minority leader said:

they would have run over me like a freight train

While Nancy Pelosi calls House Republicans “unpatriotic” for missing a meeting, It turns out that they weren’t invited to it!

OK, so McCain was involved. Now the question is whether his attendance made any difference? To that, I’d have to say yes.

The latest bill has had the following positive changes:

• Funds that were to be siphoned to ACORN and La Raza have been stripped from the bill.
• The provision that allowed judges to reset mortgage terms has been stripped
• If the “work out” (no longer called a bail out) costs taxpayers money after 5 years, Congress has an affirmative responsibility to present a plan to recoup the cost.
• There will be an insurance program available as part of the program.

In comparison to what was inkled to us on Thursday, as Barney Frank and Chris Dodd frantically tried to head off McCain’s appearance in Washington, this bill has more accountability and doesn’t throw all vestiges of free market economics into the abyss.

While I’m far from happy about having to do this at all, I’ve concluded over the weekend that something needs to be done and the pure insurance option that the House Republicans were offering had too many shortcomings to effectively change the trajectory in any short order.

Had John McCain not arrived when he did, we would have had a 100% socialist, Big Government “solution” provided. Admittedly, this may only be 92% socialist, Big Government. Under the circumstances, I’d say that was an important 8%.

With the American public as anti “bail out” as the poles have suggested, the House Republicans have a good story to tell about how they, and only they, fought at all for the Taxpayer. If the Republicans point out McCain’s intervention and the changes made, I think the American public will see once again, who was a Leader and who merely tried to manage through a situation.

You know I wouldn’t miss this fun. John McCain and Barack Obama will be focusing on foreign policy and national security tonight from Ole’ Miss. Jim Lehrer will provide the “moderation”, and Shoebox and I will provide the libation.

For those new to the NRE liveblog experience, I do paraphrase a lot, questions will be italicized, answers will be in plain text, and my commentary in-line with either a question or an answer will be in parentheses. Commentary outside of a question or answer will also be in plain text. Let the drinking begin.

Fox News is reporting that Sen. Ted Kennedy (D-MA) has been taken to a Cape Cod hospital, and that his condition is not immediately known.

May the Lord extend His healing hand on the Senator.

Revisions/extensions (11:00 pm 9/26/2008) – Sen. Kennedy suffered a “mild seizure”, and should already be back home (the update in the linked Fox News story said that he had been cleared to return home sometime before the debate started).