Visit Your Local PBS Station PBS Home PBS Home Programs A-Z TV Schedules Watch Video Donate Shop PBS Search PBS
Photo of Bill Moyers Bill Moyers Journal
Bill Moyers Journal
Bill Moyers Journal
Watch & Listen The Blog Archive Transcripts Buy DVDs

« Assessing President Obama's Health Care Speech and Ideas for Reform | Main | Labor Pains »

Michael Winship - Let's Make a Deal: Beltway Edition

(Photo by Robin Holland)

Below is an article by JOURNAL senior writer Michael Winship. We welcome your comments below.

"Let's Make a Deal: Beltway Edition"
By Michael Winship

If you ever needed proof that Washington is governed by the Golden Rule – the one that says, he who has the gold, rules – you only have to look at the wagonloads of cash being dumped by big business into crushing President Obama’s domestic agenda.

Good gosh, how the money rolls in. And I’m not only talking about the millions bankrolling the gang war over health care reform. A couple of weeks ago, THE WASHINGTON POST reported that the energy lobby is barnstorming around the country holding rallies and concerts, giving away free lunches and tee-shirts, spreading the wealth like a drunken oil tycoon – all to defeat the cap-and-trade climate bill that squeaked through the House and now awaits a vote by the Senate.

The paper noted that in the first half of the year oil and natural gas groups spent $82.1 million lobbying Capitol Hill – but that environmental, health and clean-energy interests scraped together less than a quarter of that amount, $18.7 million. Money talks, and it’s murmuring in your ear, “Global warming, what global warming?”

Those energy lobby high rollers in denial aren’t the only ones who know how to throw a party. Last month, Public Citizen, the consumer advocacy group that was founded by Ralph Nader, released an investigation of the ten banks receiving the most Federal bailout money plus five trade associations fighting government attempts to more closely regulate consumer banking.

In the period between Election Day last November and the end of June, the groups scheduled 70 fundraisers for members of Congress. Along the way, they made $6 million dollars in federal campaign contributions.

Thirty-five of those 70 wingdings – half! – were thrown by the US Chamber of Commerce and its lobbyists. And a third of the money contributed to candidates came from the American Banking Association and affiliated lobbyists. Both organizations are fighting hard to keep the government from clamping down on the financial industry. In fact, the Chamber of Commerce is planning on spending a hundred million bucks to keep the noses of federal snoops out of their business.

It’s not hard to figure out why they’re so eager to grease palms and throw the regulatory bloodhounds off the scent. On August 31, Bloomberg News reported that Wall Street is getting ready for a major battle to prevent tighter government control of the nearly $600 trillion dollar over-the-counter derivatives market.

According to Bloomberg, “Five U.S. commercial banks, including JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp., are on track to earn more than $35 billion this year trading unregulated derivatives contracts. At stake is how much of that business they and other dealers will be able to keep.”

Astonishing to think about when you recall that just a year ago irresponsible derivatives trading was one of the reasons we were being sucked into the vortex of economic catastrophe. Equally astonishing to see the extravagant salaries banking executives are still raking in even while their foolish financial strategies made more and more of us eligible for the breadlines.

Recently, the Institute for Policy Studies, a progressive think tank, issued their annual executive compensation survey. This year’s is titled “America’s Bailout Barons.”

The institute took a look at paychecks for the top five executives at 20 financial companies – the ones that took the biggest helpings from the taxpayer-funded bailout buffet. From 2006 through 2008, they received an average of $32 million apiece – compensation packages that totaled $3.2 billion.

Just as a reality check, one hundred US workers making the annual average wage would have to work for more than a thousand years to make the money those hundred execs made in three.

Despite the financial crisis that nearly sank us a year ago, the front page of the September 12 NEW YORK TIMES reports that, “Backstopped by huge federal guarantees, the biggest banks have restructured only around the edges. Employment in the industry has fallen just 8 percent since last September. Only a handful of big hedge funds have closed. Pay is already returning to precrash levels, topped by the 30,000 employees of Goldman Sachs, who are on track to earn an average of $700,000 this year. Nor are major pay cuts likely, according to a report last week from J.P. Morgan Securities. Executives at most big banks have kept their jobs.”

If nothing is changed, MIT’s Simon Johnson, former chief economist of the International Monetary Fund, told the TIMES, the banks “will run up big risks, they will fail again, they will hit us for a big check.”

And look at this: while those executives are dancing with your dollars, the foreclosures they helped to bring on continue to rise. According to Moody’s Economy.com, nearly 1.8 million American mortgage holders will lose their homes this year – up from 1.4 million in 2008. And the Mortgage Bankers Association reports that the lion’s share of those foreclosures has shifted from the dreaded subprime mortgages that triggered this crisis to prime loans. That means people who were employed with sufficient income and security to take out a prime mortgage are losing their jobs and houses, too.

This jump in foreclosures is spreading nationwide to parts of the country previously not as hard hit, such places as Illinois, Idaho and Utah. In Oregon, where joblessness jumped to nearly 12 percent in July, foreclosures have skyrocketed 84 percent from a year ago.

So far, government programs intended to ease the hurt have had little effect. The Associated Press reported a month ago that despite a $50 billion mortgage bailout from Washington, only nine percent of the borrowers eligible for relief have seen their home loans modified.

Many of the banks involved have been dragging their feet, enjoying the bailout bucks but failing to spread them around. Some haven’t modified a single mortgage.

No wonder Rep. Barney Frank of Massachusetts, chair of the House Financial Services Committee, and Democratic Senate Whip Dick Durbin of Illinois are reviving the reform proposal that would allow bankruptcy judges to “cramdown” mortgage principal and interest rates to give homeowners some much-needed relief. Durbin said, “Waiting for banks to ‘volunteer’ to end this foreclosure crisis is a waste of time… This approach has failed miserably.”

Of course, you remember what happened the last time they tried to push “cramdown” through. Last spring, it was rejected by the Senate, 51-45. In anticipation of that vote, an exasperated Durbin told an Illinois radio station that, “The banks… are still the most powerful lobby on Capitol Hill, and they frankly own the place.”

Like what they’ve done with it?


Please note that the views and opinions expressed by Michael Winship are not necessarily the views and opinions held by Bill Moyers or BILL MOYERS JOURNAL.


TrackBack

TrackBack URL for this entry:
http://www.pbs.org/moyers/mt4/mt-tb.cgi/1858

Comments

I am looking to take out a cash advance loan, is a decent interest percent between 14 - 15% ??

For most people, Wall Street exerts a remote influence, if at all, any longer, by virtue of the fact that all of the jobs that would be funded by companies borrowing money on Wall Street are sending it overseas to pay for offshore help.

Since Wall Street doesn't hold the prominence it once had to support the industrial, manufacturing and distribution sector [in America] any longer, it's not about whether Wall Street can fail; of course, it can fail, and has - by distancing itself from its primary mission as America's money machine. It is now a global machine, and while it might be big, its utility is questionable where industry and Main Street are concerned today.

If it isn't fulfilling a function, why bother saving it? Internationals may step in to fill its shoes here just as easily.

For most people, Wall Street exerts a remote influence, if at all, any longer, by virtue of the fact that all of the jobs that would be funded by companies borrowing money on Wall Street are sending it overseas to pay for offshore help.

Since Wall Street doesn't hold the prominence it once had to support the industrial, manufacturing and distribution sector [in America] any longer, it's not about whether Wall Street can fail; of course, it can fail, and has - by distancing itself from its primary mission as America's money machine. It is now a global machine, and while it might be big, its utility is questionable where industry and Main Street are concerned today.

If it isn't fulfilling a function, why bother saving it?

Mouvinon wrote, in part, "All this while bailout mechanics, counterparty winners and big institution's "externalized" debt remain secrets. The public has no idea what we or our offspring owe or how we have been obligated behind closed doors with no volition. (This is the truth that comprises the teapartiers' half-truth.)"

As noted by Jack Martin, all YOUR information and mine, is available GLOBALLY!

It was an engineer working at Allied Signal (loads of military contracts) in Morristown NJ who used his corporate position in purchasing to buy the stuff that was used in the first attempt at bringing down the Twin Towers in the 1990s.

After the unlimited eavesdropping done on USA citizens, if there is another "terrorist" attack on USA soil, it will be because of who Homeland Insecurity and "international corporations" - banks, "insurance" companies, the "fannies", phone companies - and on and on and on - have as good little czarina "managers" working for them.

If my a-- is wide open and bare to the schreeking shrews and schills entering data into databases about my freckles and sushi charges and housing costs, it's open to one and all in the "global economy", ain't it? In other words, it WILL be an "inside" job.

The teaparty idiots LOVE having all that "insider" info, too, don't they? Too freekin' STUPID to realize that if they can get all that info on me and you then ALL "enemies" can do the same, huh?

And now they're fighting tooth and nail to keep their NO VALUE jobs, aren't they? Permisssion granted to take it ALL from someone else for the updraft under the cover of "homeland" security.

Endless possibilites in regards to what can be done when you have ALL the real data at your finger tips...since they are NOT paying themselves bonuses in derivatives or other "paper" but instead are getting IRS to pony up cash taken from us - well, what do YOU think we are in "debt" up to...? I already said - it's 12 trillion "lost" from all USA households.

I know I didn't buy that much stuff from WalMart. And everything I did buy went into the garbage after a couple of uses so even that "cheap" money was LOST to something that was never even worth the 2.99 to begin with...

So are you other correspondents saying that "only the indigent can feel compassion" as Bennet's selections suggest; with the inverse being that,"Anyone who feels compassion is a loser." Nowhere did I ridicule sincere belief (not founded in desperation) or decry free will. Nor did I ridicule the Christ figure. All I said was that I would not want my (imaginary, alas) grandchild to become a dupe of Reaganite smaltz.

Winship would have done better to focus upon the new legs Obama's stool (unfortunate metaphor for something stinking) is sprouting. 1.Cap and trade moving to reconciliation after House passage. (a poor substitute for clean energy and real regulation). 2. Consumer Financial Protection Agency (Plan) unveiled by Elizabeth Warren (bailout czarina). After the damage is done we will mildly regulate the language in consumer credit instruments and warn people about bad retirement moves they either don't have money for or can't control. All this while bailout mechanics, counterparty winners and big institution's "externalized" debt remain secrets. The public has no idea what we or our offspring owe or how we have been obligated behind closed doors with no volition. (This is the truth that comprises the teapartiers' half-truth.)
Winship was sloppy because he went straight for the red herring of mortgage foreclosures(heartstrings!,really a veiled threat, as all tamed pundits are wont to do) and neglected the bigger truth that no (none, nada) regulation has been passed (or even coherently proposed) for the outing of derivatives, credit default swaps and currency speculation still in full speed process. (Chinese and Saudi quant-heads are reeling too, right along with Mike Greenberger and Mike Hudson. K. Phillips and R. Batra detect that stock indexes are manipulated daily by the FED and Treasury (plus other agencies) for private benefit.)
Moyers and Winship seem like advance men for Obamanauts, and not candid commentators. What think ye correspondents? (Just because they throw out a rare liferaft for discourse opportunity does not mean they can save free speech. Maybe they are like the "imagined" voice from the shadows, meant for patsies.)

Michael Winship's erudite synopsis points a knowing finger at the effects of unregulated influence and advantage of private interests over the general public's health and welfare. As the comments to his missive herein demonstrate, even when presented with thoughtful and well-reasoned information, our people prefer to view it through the linear prisms of partisan rhetoric and pseudo-religious dogma, or entertain themselves with acrimonious assaults upon those who attempt substantive discourse.
We can not hope to cure the sickness that permeates our political system and the government that it produces if we continue to allow such nonsense to dominate our political discourse.
Wake up citizens, it is our Republic, and it is our responsibility to keep it!
(Captcha words: speech-Lend-Lease)

Klark Mouvinon wrote, in part, "And I would hate to live in a culture or under a government based upon that premise. It would be like paying late penalties to billionaires. Oops!"

I'll bet you the ranch, Klark, that you don't know the context in which Tolstoy wrote that "fiction". I can assure you that Bennett could not have been more machiavellian in his use of someone else's genius for making a point about the human heart in order to commit an inhuman act.

That's when the Russians really DO "gloat". They know that people in USA haven't got a clue about what the last Czar of Russia was up to. But even Mick Jaegar of Rolling Stones fame must have heard "voices" when he wrote "sympathy for the devil"...."Jesus" is never a voice in anyone's head.

Free will, Klark. Free will...

In his tome "The Book of Virtues" Reaganite conservative William Bennett includes Leo Tolstoy's tale of the little Russian shoemaker (chapter heading "Compassion" pgs.158-65)who lived in a cold basement and ate cabbage soup. In his anxiety about impending death he begins reading the Bible, which leads to the delusion of hearing Christ's voice coming from the shadows. In response he warms an indigent, feeds an abandoned mother and child and and makes peace between a juvenile robber and an elderly victim. But in the end he was left with his toil and his delusions. Maybe good deeds and empathy are rewarded in the afterlife, if there were one.
Neither I nor Tolstoy believes that our supposed Creator loves a patsy, and I do think the passage well accompanied by Woody Guthrie's singing of "There's Pie In the Sky When You Die." In any case I would not want my grandchild coming away with the impression that good deeds done by the nearly indigent are their own reward,or that only the deprived can feel compassion. And I would hate to live in a culture or under a government based upon that premise. It would be like paying late penalties to billionaires. Oops!

We have a slim choice of books here in the veterans home, but I'm reading what they have. WE get a few minutes on the librarian's computer to write friends. The hyperbaric treatment is beginning to heal my wounds, I think. Thanks to those who remembered me. Thanks for the two bills, Grady. Your essay was a little sloppy, Winship.

Lois Donnell wrote, in part:

"The Golden Rule" as traditionally used "Do unto others as you would have them do unto you"... is about the only rule or law that would need to be adopted by everyone for any reason...

Hi Lois,

You must have missed the poster who noted that the REAL "golden rule" is:

"S/He with the most gold, rules."

And quite frankly, with everyone out here in ether lalaland openly talking about what they like done to them, I'm afraid your version of the "golden rule" would do more harm than good if forced upon others.

Kind regards.

Your program this weekend started with some of the more virulent signs and posters at the 9/12 event in DC. It then progressed to an historical look at why conservatism has lost its way.

You neglected to focus on the very real economic reasons behind the protest, and the historical perspective of nations that have attempted nationalized this or that, and the chaotic results that ensue.

You would serve us better with an historical look at why Americans - both black and white - are so much better off than in the many countries of our fathers, and what attributes of this country have produced such prosperity.

And perhaps an examination of the etymology of "liberal", and why modern "liberals" are so il-liberal.

Mr. Winship focused on one of my fears, but the overriding one of Mr. Franks, etc. is that Congress led American citizens to believe there was oversite thru the FED, SEC, Treasury, Congressional Committies, & all along they knew the big guys were CROOKS they were INABLING.

B. Franks & company are trying to cover their tracks of ineptness, inabliness, incompetence, etc. so they can be re-elected. ALL they care about is being re-elected.

Good men & women are sent to Congress, but are not allowed to be heard until they are beaten into Washington form.

Mr. Winship, please cover "the rest of the story". Thanks for what you have done to date.

Billy Bob, Florida

"The Golden Rule" as traditionally used "Do unto others as you would have them do unto you"... is about the only rule or law that would need to be adopted by everyone for any reason... except in the case where someone may not care what is done to them... hopefully those people could be uncovered and stopped!!!! Politicians and business people and every citizens could be taught the benefits of following this "Golden Rule" (I wish)...

"The Golden Rule" as traditionally used "Do unto others as you would have them do unto you"... is about the only rule or law that would need to be adopted by everyone for any reason... except in the case where someone may not care what is done to them... hopefully those people could be uncovered and stopped!!!! Politicians and business people and every citizens could be taught the benefits of following this "Golden Rule" (I wish)...

"The Golden Rule" as traditionally used "Do unto others as you would have them do unto you"... is about the only rule or law that would need to be adopted by everyone for any reason... except in the case where someone may not care what is done to them... hopefully those people could be uncovered and stopped!!!! Politicians and business people and every citizens could be taught the benefits of following this "Golden Rule" (I wish)...

Post a comment

THE MOYERS BLOG is our forum for viewers' comments intended for discussing and debating ideas and issues raised on BILL MOYERS JOURNAL. THE MOYERS BLOG invites you to share your thoughts. We are committed to keeping an open discussion; in order to preserve a civil, respectful dialogue, our editors reserve the right to remove or alter any comments that we find unacceptable, for any reason. For more information, please click here.

THE MOYERS BLOG
A Companion Blog to Bill Moyers Journal

Your Comments

Podcasts

THE JOURNAL offers a free podcast and vodcast of all weekly episodes. (help)

Click to subscribe in iTunes

Subscribe with another reader

Get the vodcast (help)

For Educators    About the Series    Bill Moyers on PBS   

© Public Affairs Television 2008    Privacy Policy    DVD/VHS    Terms of Use    FAQ