No Newts

Now that Newt is converting to Catholicism, he can confess every time he lies. They will likely have to get a priest on 24 hour stand by.

Counterpoint:
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Ex chief economist of the IMF, now MIT prof Simon Johnson:
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http://bit.ly/EMOqS
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the American financial industry gained political power by amassing a kind of cultural capital—a belief system. Once, perhaps, what was good for General Motors was good for the country. Over the past decade, the attitude took hold that what was good for Wall Street was good for the country. The banking-and-securities industry has become one of the top contributors to political campaigns, but at the peak of its influence, it did not have to buy favors the way, for example, the tobacco companies or military contractors might have to. Instead, it benefited from the fact that Washington insiders already believed that large financial institutions and free-flowing capital markets were crucial to America’s position in the world.
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One channel of influence was, of course, the flow of individuals between Wall Street and Washington. Robert Rubin, once the co-chairman of Goldman Sachs, served in Washington as Treasury secretary under Clinton, and later became chairman of Citigroup’s executive committee. Henry Paulson, CEO of Goldman Sachs during the long boom, became Treasury secretary under George W.Bush. John Snow, Paulson’s predecessor, left to become chairman of Cerberus Capital Management, a large private-equity firm that also counts Dan Quayle among its executives. Alan Greenspan, after leaving the Federal Reserve, became a consultant to Pimco, perhaps the biggest player in international bond markets.
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These personal connections were multiplied many times over at the lower levels of the past three presidential administrations, strengthening the ties between Washington and Wall Street. It has become something of a tradition for Goldman Sachs employees to go into public service after they leave the firm. The flow of Goldman alumni—including Jon Corzine, now the governor of New Jersey, along with Rubin and Paulson—not only placed people with Wall Street’s worldview in the halls of power; it also helped create an image of Goldman (inside the Beltway, at least) as an institution that was itself almost a form of public service.

“I’ve known Newt Gingrich for about 20 years now and I’ve always enjoyed him intellectually, but detested him politically.”
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Joe-In Newt’s case you don’t find this statement horribly contridictory on your part? After all Newt constantly uses intellectually dishonest arguments to advance his cause. Meaning he really does not believe 90% of the bullcrap he says, but he knows the press will treat him like he is dead serious. By the way he is way more concerned about being seen as a leader of a cause than he is interested in practicing what that cause truly believes in.

Jay-read Simon’s article a few days ago. Glenn has linked to it and it is a must read. A lot of people will not like what they read, but the truth about ones self in this case, ones country is very hard to take. Specifically when our discourse is demoniated by the likes of Newt, Rush, Hannity and a press uninterested in informing people.

Joe-
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Can you provide some examples of intellectually sound things that Newt has said? From what I’ve read, he just flails around with crazy talk.

Well, why is all this money being tossed around, anyway? These mustelids claim that Obama is trying to nationalize things and turn this into a communist (or at best, a socialist) state, but when you think about it, nationalization would be cheaper in the short run.
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The reason so much money is being spent is because he doesn’t want to nationalize, the exact opposite of their contentions.
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I’m with you Joe. With the economy starting to show glimmers here and there, if it starts to do more than glimmer, these guys will all be relegated to smokey basements, chanting in front of posters of David Koresh and Timothy McVeigh.
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All while furiously smoking Rush Limbaughs’ ceegar!
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As for Newt, I remember him clearly pumping the hatred in the days before the bombing of the ERM building in 1995. Like the chameleon he is (and I should choose an animal lower down in the food chain), he tried for a mantle of respectability.
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I’ll always remember him as the $6,000,000 GOPAC man:
http://www.realchange.org/gingrich.htm

Joe Klein:
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It’s really wrong to frame this as a battle of ideas between the thoroughly discredited (except at Ignatius’ and Brooks’ soirees) Newt Gingrich, and the saviors of the people Geithner and Summers. This is just not so. It is a battle of ideas between those who see in Geithner’s plan the continuation of a broken and corrupt finance system worthy of a banana republic, and those who believe that the short-term political risks of a real restructuring program outweigh the potential long-term benefits (presumably you, Joe Klein).
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Matt Yglesias outlines the real, non-Gingrich debate over Treasury’s policies here:
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Will Marshall definitely thinks this:
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In short, Obama and Geithner are working to restore the financial sector as it existed roughly a decade ago, before the frenzied run-up in real estate prices and the bubble in securitized loans. But as the president has said, the regulatory minimalism of the Bush years must be replaced with a new regime that extends oversight to hedge funds and derivatives and ensures that we never again face the necessity of bailing out companies that are too big or too interlaced to fail.
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The administration’s critics envision a more fundamental restructuring: a dramatic shrinking of the financial-services sector; an end to easy credit; a tight corset around any lending practices that might smack of seduction or predation; the permanent intrusion of government into matters of firm strategy and compensation; and, somewhat ironically, a return to the old, black-and-white days when conservative bankers took modest risks for modest profits.

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So there isn’t really any debate over the bankrupt, dishonest declarations of New Gingrich whatsoever, Joe Klein, and your attempts to bolster your own (shaky) arguments over what should and should not be done (“Geithner–and yes, Summers–have shown excellent balance, a respect for the free market system plus an awareness that the public needs to be protected from the sharks“) by contrasting the Administration with a laughable conservative ideologue don’t do the job.
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You should be examining these cogent arguments,
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There are three main kinds of things that can be done to prevent us from getting into this problem again: Regulate size, regulate risk, and regulate failure.
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As best one can tell, the administration is currently pursuing a strategy that’s based on the second and third options. They’re imagining something like the old airline industry, in which a handful of large players operate from a privileged position (in this case, government guarantees) but subject to heavy regulation. They’d also like a rewrite of laws such that there’s a way to manage a post-failure takeover. I think all this is fine, but option two is very unlikely to work over the long term. Calculated Risk observes that even if the Fed had earlier been specifically tasked with regulating systemic risk that wouldn’t have accomplished anything—the Fed was led by people who didn’t believe there was a problem: “How would a systemic-risk regulator help if they miss the problem?” This is a point I’ve made over-and-over again. Our problem was more fundamental than flawed rules, it was flawed leaders. And I doubt it’s a problem that’ll go away. Regulatory capture is bound to afflict this kind of situation. And the combination of toothless regulation and explicit government guarantees will allow the large institutions to squeeze out the small ones.
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Which is why I agree with James Kwak that fundamentally we need some option one. Smaller banks will pose fewer systemic risks. Smaller banks will also be somewhat less effective at capturing regulators. And smaller banks will be easier to clean up when they f[ai]l. Indeed, calculated ambiguity about who will and won’t get rescued if there’s a need for a bailout will be easier to maintain with small institutions.

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, not Gingrich’s silly anachronisms.
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I’m really not feeling well enough to comment sufficiently (I’m sick at home in bed), but here’s what we have to consider, if we take Newt’s arguments seriously for a minute or two.
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Thank you for reading and considering this, Joe Klein.

Newt is not intellectually interesting, at all, and never has been.
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Here is his latest list of big ideas. None of them are interesting or new. It might be a good idea to change the way we do air traffic control, but that’s not one of the 8 biggest issues facing America. It’s on the list because he is, at heart, a sci-fi writer.
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He also compared Reagan to Chamberlain for talking to Gorbachev. Gingrich is as interesting intellectually as Hugh Hewitt. I know he claims otherwise, but Pete Hoekstra claims some stuff is true too. Doesn’t make it so.
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(reposted w/ fewer links…)

I just want to say something here. I think we have begun to reflexively attack here without really fully examining what the post is about. We tend to want to press our point of view so much that we don’t take the time out to recognize that maybe we are missinig the point. Again I am saying we because I include myself in that number.
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I don’t think this post is about Joe Klein endorsing the Geitner Plan. This post is about him calling out Gingrich’s bullsh*t (he says bull pucky) right wing talking points. Whether you agree with Geitner’s plan or not you have to applaud the fact that Joe Klein is willing to do this when so many of the Village refuse to because of Newt’s “intellectual reputation”. Hell even KT takes up for Newt now and again and says he has some “new” ideas. Now honestly I am beginning to wonder if this is even the real Joe Klein because its a pleasant suprise for me that he is starting to call the people out that we have been wishing would be called out by the media for years now. Try to find another Villager who comes close to trashing Newt’s point of view on this issue the way Klein does and the way it deserves to be.
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Now obviously I agree that whether the Geitner plan will work or is the right move is debatable. I don’t think its 100% that it won’t work but I realize there are serious questions about it. But this post aint about any of that. Its about giving President Obama some room to actually get his work done without taking ridiculous pot shots from the right that nobody in the MSM seems to be willing to stand up to. And I for one am glad Joe posted this and I hope he keeps it up.

Get well SZ. Sorry that you are under the weather,

I look at Newt (who gave him that name?) and see a pattern: set up an outfit, write a screed with some outlandish theory, collect money to work through an “institute” and take a little time off to have something on the side, all the while condemning Bill, and complaining about being seated with the peasants on Air Force 1 and having to use the back door.

In his current incarnation he is Mr Serious; a problem solver selling bogus wares. How he gets on CNN is a mystery ( no, its not). Fox News provides the go to venue for garbage in/garbage out stuff.

A new Newt is born every few years.

To Catholics everywhere: you really want this guy in your fold?

If you really, badly want to be the next president, sooner than later, the stance to take now is Newt’s. He personally has everything to gain and nothing to lose by continued economic failure. Self-centered, selfish, personal gain and gratification is what he is all about. Same as what has caused the mess we are now experiencing.
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bitterpill, this is a cheap shot, but I am entitled as a recovering catholic. Newt will make an excellent, the best, catholic. It is the perfect refuge for the right wing nuts.
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sz, hope you recover quickly.

Joe, don’t you get it? The word ‘socialism’ is the new ‘n!gger!n!gger!n!gger’ in the Heartland(note the constant Third World references). The base isn’t smart enough to know what ‘socialism’ means, and the GOP brain trust is smart enough to know that and what the base is really scared of…this is about WASP America losing it’s mind as it sees hegemony slip away forever. Seriously, you don’t think Glen Beck is weeping for the loss of an economic system do you?
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People have just woken up to the fact that the corporations and the government have fused? We are not a bright people. Joe…the DFHs you’ve been running from your whole life weren’t trying to harm you. No, they were trying to warn you!
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Has anyone noticed we seem to be in the middle of a police brutality epidemic?
http://rawstory.com/blog/2009/03/freedom-for-man-who-shot-at-cop/

For those who are second-guessing Joe’s motivation for the post, didn’t anyone notice that he’s pi$$3d? Unlike many of us, Joe plunges into the heart of Right-wing commentary and occasionally comes back with a strong need to vent. I don’t know if Obama’s plan is too friendly to the current controlling interests or not but the question is irrelevant to whether or not Newt Gingrich is an a$$hat.
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Thanks for the post Joe….

I’m not sure thinking about Newt Gingrich is worth anyone’s time.
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There’s no such thing as a “serious” discussion about Newt Gingrich’s ideas about the economy, because Gingrich has no serious ideas OR influence.
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Signing off now…

rose83
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I agree about the ideas part and totally disagree about the influence part. So far he has been the only Republican who has criticized Rushbo and not walked it back. Plus he seems to be the “gold standard” for House Republicans. They are all judged against Newt’s mythical reign which is more fantasy than fact. Hell for that matter it was Newt who came out with “Drill Here Drill Now” last year which DID resonate with right wingers. He still has just enough influence to be dangerous and it makes sense to discredit him before he gets the chance

the financial services industry was given free rein–by Republicans and Democrats (I’m still looking at you, Larry Summers)
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I feel this is an appropriate use of centrism.
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And this:
Their unwillingness to protect average Americans from the untrammeled rapacity of an unregulated market is a disgrace.
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Should remove any doubts how Klein feels about the current incarnation of the GOP.

Oh yeah, Paul Dirks– this isn’t a bad post at all.
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I just think it’s worth pointing out that Newt Gingrich is not, never has been, and never will be an intellectual. He’s a beneficiary of the soft bigotry of low expectations we have for conservative thinkers.

sgwhite – huzzah your comment #9.
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Joe- you aren’t even tempted to call Bachman unpatriotic? Hard to see what noninflammatory epithet one can call someone who’s advocating the overthrow of the government (albeit by “orderly” means, though one gets the idea she doesn’t mean elections.)

I look at Joe from the perspective of what he was a few years ago. When I first signed on here, he was typical Republican pundit, spewing out the rights’ TP’s on everything from race to economy.
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I really cannot criticize him too strongly at all, and I think his motives for posting his articles are probably as honest as anyone I’ve seen.
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KT gets disengenuous at times, and justifies it as just doing her job. AMC tries constantly to come in from the right under the radar, that is, when she is actually posting something of consequence. Micheal Schearer has his good moments and very, very bad moments, trying to straddle the fatual gulf between the moderates and the right in the GOP. Amy Sullivan, weeeeelll. ???????
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Joe is, the best of the bunch, I think.

Dirks
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I got that. But Newt belongs in the “just go away” category, not in the intellectually interesting category.

And most of those who have been in a position to evaluate the real effectiveness of Obama’s agenda are either dead, retired, or dead and retired.
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It’s going to be very hard for a 30-something dyed-in-the-wool “conservative” commenter, like most seem to be, to convince me that they really know what they are talking about.
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So basically, even given that Newt is old enough to have a father who’s experienced it, the only courses of action proven to work are those that FDR put in place.
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It makes absolutely no sense it all to re-invent the wheel in these more-or-less extreme times – and that is what is making the GOP so irrelevant now.

Rose:
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I was thinking about SG’s comments, and I’m guessing that perhaps this post is simply demonstrative of the almost absolute, surreal disconnect between the Beltway/media bubble and engaged news consumers/the public.
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The fact is that the world that Joe Klein inhabits is an intellectual carnival fun-house, where the inhabitants are constantly gauging reality via the distorted images they see of themselves in media mirrors. When Meet The Press convenes an “Economic Round Table Discussion”, they invited an array of Serious luminaries, amongst them CNBC’s Erin Burnett and Newt Gingrich.
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Here is a transcript of the Serious “discussion” between America’s greatest economic minds:
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Meet The Press – Sunday, March 08, 2009
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Gregory: could we have another Depression and would that be really Great???
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Ahamed: we could if try to address the deficit and not spend enough
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Gregory: so we should be Republicans?
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Ahamed: no I said the opposite dimwit
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Gregory: OMG how could GE be in a trouble – GOD help us all!
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Burnett: there are no real problems – just fear and lack of confidence
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Gregory: we need national Viagra
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Gregory: so what is causing all these problems
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Burnett: the media
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Gregory: no things are really bad – help me Mort
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Zuckerman: it’s all confidence – hell I’ve stopping picking up $100 bills of the street
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Gregory: Let me quote the Wall Street Journal
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Gingrich: conducting a War on the Rich and Successful will lead them to put their money in a mattress
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Gregory: so sad
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Gingrich: a clawback will take money that people thought they had earned which definitely put a crimp in the time-machine business
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Gregory: so Mort we’ve established that Obama has ruined America
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Mort: I don’t agree
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Gregory: away with you!
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Gregory: Why doesn’t Obama make people confident but shutting down all ATMs?
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Ahamed: my stars you are quite the moron aren’t you?
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Burnett: maybe we could let AIG fail
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Gregory: so sad
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Gingrich: look this is a whole new world – a Senator actually called CEOs idiots!
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Gregory: no!
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Gingrich: he should have been responsible and accused the Democrats for drowning susan smith’s children
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Gregory: exactly
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Gingrich: Obama needs to decide if he is going to succeed or do the right thing or adopt Republican policies
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Gregory: why hasn’t Obama solved all of America’s problems?
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Mort: gee i don’t know maybe they’re hard to solve?
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Burnett: he’s fulfilling promises – which is an odd experience
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Gregory: the eastern europe economy is not doing good
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Ahamed: Dracula has been reduced to drinking V-8
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Gregory: everybody has to sacrifice
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Ahamed: we need people to be responsible
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Gingrich: I’m not impressed by Obama he has a lot to learn
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Gregory: you could teach him
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Gingrich: right he’s never served his dying wife with divorce papers in the hospital
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Gingrich: no one is going to start a new business with Obama talking about shutting down the Metropolitan Opera
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Zuckerman: i have to say that Newt is a true idiot
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Gregory: but i looove him
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Zuckerman: we need to fix the economy
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Burnett: Lazy sick people are going to bankrupt America
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Gregory: why is Obama doing to so much
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Burnett: Obama is moving at light speed – he needs to slow down and let the rest of us catch up
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Gingrich: i will be proven right – we need to have an emergency dialog and admit that the Democrats cause all immorality
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Gregory: we need a bigger bloat
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Ahamed: the strong must help the weak
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Gregory: Newt you said Obama is just like Nixon and Haldemen who were criminals
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Newt: Exactly – objecting to Rush’s hate will stop us from coming together as a nation – attacking Rush is partisan
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Gregory: so Rush is the Republican party?
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Newt: um no did I just say that?
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Gregory: yes
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Newt: this nation has to have once in a 100-year conversation about why homeless women should get free laptops unless they are having their period
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Gregory: you’re such an idea man!!

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Newt Gingrich was called upon to deliver his thoughts on the economy during political media prime-time, and nobody –least of all the inane and incompetent David Gregory– in their strange, disconnected world thought twice about it. It’s incredible. They really do live in Versailles.
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So I suppose that we can strive to understand how it comes to be that Joe Klein is having this sort of bizarre debate with somebody who believes in the economic equivalent of Intelligent Design. He truly isn’t familiar enough with the non-Beltway world to know that Meet The Press sounds like Meet The Press to engaged news consumers.
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I just think that it behooves him and the reality-based community for us to let Joe know that the real, serious debate is out here, and if he’d like to be sufficiently intellectually armed for what’s coming down the road, he should pay more attention to it instead of gazing into fun-house mirrors.

God, I feel like dog-crap on the sidewalk…thanks for the well-wishes, folks.
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I can barely hold my head up. teh suxxor!

Here is my Shorter Joe Klein;
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I like Newt Gingrich personally but acknowledge that he is an ass hole. And when it comes to talking politics he is a BIG TIME ass hole who ruins all serious discussions. To prove that I am a better person than Newt I won’t call him the names that he calls everyone else but I will say nobody should listen to him. Here is an example of some more crazy sh*t he has said recently about Geitner and Obama.
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cue the transcript
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This is just fear mongering and its ridiculous and and nobody believes it anymore oh by the way I actually like the Geitner plan so screw Newt and what he thinks. And Krugman thinks he is retarded too.

Here is a NYT Magazine cover story that fleshes out some of Newt’s influence with at least some members of the republican party.
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http://www.nytimes.com/2009/03/01/magazine/01republicans-t.html
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He may have more current relevance to the republican party than the republican party has to policy.

Mr. Klein, this post has not a single bit of substance in it that contradicts the ‘bull pucky’ in Newt’s rant. All you have written is a series of vacuous pronouncements, all variations on “I’m right.” On some level, this is understandable. 99% of this blog’s readership is predominantly liberal, so I suppose you figured that they had already come to the same conclusion (and you were right). Still, there is no substance.
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I’m still trying to figure out what you called a “reasoned public reaction.” Are you talking about the recent bonus episode? That was anything but reasoned. Or might you be talking about the Treasury plan? Yes, placing authority to seize non-bank financial companies with a political appointee sounds like a GREAT idea.
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With all your ranting about the Beltway planet, it sounds like you’re trying to make up for being an inhabitant of that planet yourself. Or, perhaps, trying to make up for ridiculously elitist columns like your “kill your air conditioner” screed.

yoshiattack:
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Joe Klein is describing the reasoned public reaction to being shown the representatives of their oligarchy of financiers parading around on television.
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…a CNN/Opinion Research Corp. survey released Monday suggests the public opposes plans to provide more taxpayer dollars to banks and major domestic automakers.
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Thirty percent of those questioned said they’re confident Wall Street will make the right decisions to help the country overcome the current recession. Slightly fewer — 28 percent — said they had such confidence in bankers and financial executives. And 26 percent said they’re confident that auto executives will make the right economic decisions.

yoshi
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So which is it? Do you want us to keep having to bail out non banks that are systemic risks or do you want to put into place a system that will allow for the winding down of those entities? I swear man I don’t get some people. This isn’t a power grab. Its a viable alternative to dumping truckloads of money to companies like AIG and instead handling them just like the FDIC handles banks. See thats the problem with having such a rigid philosophy as the conservatives at least claim to have. On the one hand you oppose govt intervention like bailouts which have to be done to preserve our financial system. On the other hand you oppose govt intervention in terms of putting in common sense regulations to keep institutions like AIG from NEEDING a bailout. If you have any philosophy that is absolutest like conservatives claim to be many times you will end up opposing both sides of the argument.
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Don’t even get me started on “conservative” pro lifers who endorse the death penalty and promote war.

s_z: don’t die, we need you around to meticulously take apart spob’s arguments.
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And to hold us to higher standards of discourse, as uncomfortable as those might be.

SZ:
I don’t believe that’s what Mr. Klein is talking about. Nowhere does he mention the levels of confidence people have in financial executives or investment bankers. If that was indeed what he meant, then he’s still out of luck. The “national mood” is only tangentially related to proving his point.
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SG:
As to your first hand, yeah, I didn’t like the bailouts. In fact, every time I see the Treasury secretary have to beg in place of the AIG FP execs, I feel bad for him. See this:
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http://www.cbsnews.com/stories/2009/03/25/politics/otherpeoplesmoney/main4891193.shtml?source=RSSattr=HOME_4891193
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And its attendant link:
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“It is true that the collapse of Lehman Brothers last September led to a crisis of confidence among depositors in banks and money-market funds, which had a dramatic effect on markets. Letting AIG’s derivative counterparties take a significant haircut, however, should not lead to such a crisis. AIG’s obligations are to derivative counterparties, not to depositors. Moreover, governments world-wide are now committed to backing fully the claims of depositors in financial institutions.”
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http://online.wsj.com/article/SB123751263240591203.html
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The bailouts were marked by fear-driven thinking. Another great instance of that: 9/11 as a talking point. That really worked well for the invasion plan.
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As for the GOP’s other hand, you assume that Geithner’s plan is the only kryptonite that will be able to save us from another crash. This is not taking into account that failures at existing regulators led to this crisis. Maybe if we can get them to do their jobs, this won’t happen again. Besides, as we know, the further power is politicized, the worse it turns out.
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Something else discussed in the CBS article, as well as one that SZ has posted, is using antitrust regulation to keep companies like AIG from getting too big. This is also something to consider.

yoshiattack:
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using antitrust regulation to keep companies like AIG from getting too big…is also something to consider.
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You sound like a liberal. That’s what we think. We don’t think that the Obama Administration is doing enough to limit the de facto Kremline-esque bureaucracies of Citi, B of A and AIG. The point of democratic capitalism isn’t to create huge quasi-state entities owned by private interests that compete with government in being socialistic in their dealings with each other and private citizens in practice.
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This is not taking into account that failures at existing regulators led to this crisis.
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That’s sort of the point: we don’t really have regulators for firms like AIGFP. Robert Rubin –Bill Clinton’s Treasury Secretary– led the successful effort to deregulate credi-default swaps and their markets. Since CDO’s are arguably neither SEC-jurisdiction securities nor FDIC-regulated debt, nobody did a goddamn thing about them…that, and the fact that their friends and colleagues were becoming obscenely, effortlessly, banana-republic rich.

Yoshi: your response to SZ and SGW noted for it arguments as distinct from talking points. Thank you.

But to get back to Newt. What do you think about his various endeavours to “refine” his thinking which almost always depends on a new institute and a call for funds to challenge some mythical left enemy and the publication of yet another windy book.

Recall that this guy helped close down government in Washington and has been spending lots of time re-inventing himself. What is distinct about Newt 2008?

I wonder how Joe Klein feels about this though.
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http://harpers.org/archive/2009/03/hbc-90004640
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One of America’s NATO allies—which supported the Bush Administration’s war on terror by committing its troops to the struggle–has now opened formal criminal inquiries looking into the Bush team’s legacy of torture. The action parallels a criminal probe into allegations of torture involving the American CIA that was opened this week in the United Kingdom.
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Spain’s national newspapers, El País and Público reported that the Spanish national security court has opened a criminal probe focusing on Bush Administration lawyers who pioneered the descent into torture at the prison in Guantánamo. The criminal complaint can be examined here. Público identifies the targets as University of California law professor John Yoo, former Department of Defense general counsel William J. Haynes II (now a lawyer working for Chevron), former vice presidential chief-of-staff David Addington, former attorney general and White House counsel Alberto Gonzales, former Assistant Attorney General Jay Bybee, now a judge of the United States Court of Appeals for the Ninth Circuit, and former Undersecretary of Defense Doug Feith.

yoshi
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As for the GOP’s other hand, you assume that Geithner’s plan is the only kryptonite that will be able to save us from another crash. This is not taking into account that failures at existing regulators led to this crisis. Maybe if we can get them to do their jobs, this won’t happen again. Besides, as we know, the further power is politicized, the worse it turns out.
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Do you know who was regulating AIG? The OTC. Thats not optimal at all and it showed obviously. Also because of the way current structure is set up all a company has to do is locate their headquarters in a state where they kow the attendant regulator is weak. Thats pretty much why AIG is in CT. I agree that regulators failed but I also feel that there were limits to what they could do because of current regulations or the lack thereof. There aren’t really any regulations for derivatives because they were invented kind of out of thin air and no regulation followed their inception. Its kind of like the pro athletes who use PEDs. Everytime they come up with a new test then the people who make and take PEDs come up with new ways to beat the test. The only way to keep up is to update the regulatory structure and give regulators the tools they need to enforce them. But there still will be times when those companies get slammed and we have to have a way to protect tax payers from that. What Geitner was asking for is basically to have a mechanism in place so that non banking institutions that threaten our way of life aren’t rewarded with bailouts next time but are wound down safely and sold off much like the FDIC.

SG, having influence in the GOP isn’t the same thing as having influence in general. Gingrich is a fairly influential member of a marginalized party. The real debate, as stuart points out, isn’t between Geithner and Gingrich. And by pretending otherwise Joe is making it easier for the real debate between reality-based economic thinkers to go unnoticed, which is really just a huge boost for Geithner et al. The media-imagined “contest” between Geithner and Gingrich has about as much suspense as a Kate Hudson movie. I’m not a conspiracy theorist, but given Klein’s stated support for Geithner’s plan, his efforts to elevate the intellectually enjoyable Gingrich to the status of Geithner’s rival is certainly interesting.

Joe Klein:
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…this is what made last week’s lynch mob like a third world government when the Congress literally got out of control, panicked, panicked because people were mad at it…
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If you think about it, the premise of this statement is exactly what’s wrong with Newt Gingrich and his old, discredited ideology.
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Newt doesn’t seem to understand that the defining characteristic of third-world, banana republics is not that governments are immediately responsive to –even afraid of arousing the wrath of — their citizens, it is precisely the opposite.
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What differentiates emerging market regimes from mature, highly developed, democratic capitalist states is that in, a majority of the third world nations, a majority of citizens fear the wrath of their government.
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How could Newt Gingrich get that basic calculation wrong? How can he mistake the concerned reactions of the legislature to the justifiable outrage of its constituents for what happens in emerging markets?
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In many third-world countries, the political and economic elites lounge together in their haciendas, completely comfortable with the high level of stratification that imbues their cultures and societies, and absolutely confident in the capability to terrorize their resource-less populations into submission in the face of the most vile and overt injustices. Does Newt Gingrich not know this?
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It’s truly revealing of Gingrich’s philosophy that he would get this fundamental reading of history and the facts so wrong. It explains just how badly people of his ideological cast govern on behalf of ordinary people when they are entrusted with political power.
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What’s truly incredible –inconceivable in a developed democratic capitalist state to which Gingrich nominally aspires, actually– is that someone who could get the definition of a banana republic so perversely wrong could be considered an “intellectual” by media elites, and invited on Sunday talk shows to display such mental prowess.
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Thank you for reading and considering this, Joe Klein.

The fact is that the world that Joe Klein inhabits is an intellectual carnival fun-house, where the inhabitants are constantly gauging reality via the distorted images they see of themselves in media mirrors. When Meet The Press convenes an “Economic Round Table Discussion”, they invited an array of Serious luminaries, amongst them CNBC’s Erin Burnett and Newt Gingrich.
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stuart, I can’t believe you’re still watching the Sunday shows. Any chance that’s why you’re ill?
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I’m normally a very calm person, but I’m really angered by the media, financial and political elites’ refusal to grow up and accept reality. I feel that many of them are just being willfully stupid. Hasn’t reality intruded on their carnival? How can someone like Erin Burnett not rethink her worldview? She’s still young, unlike Gingrich. She hasn’t devoted decades to advocating bad political and economic policies. I don’t know if it’s just groupthink on steroids, but whatever it is I can’t watch it anymore.

Rose:
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The only reason that I still watch the Sunday bobble-heads is because it makes reading the Bobble-speak Translations even funnier.
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God, my face hurts. I have to lie down now.

I know that we have arguments to the contrary staring us right in the face, but is the kind of Village consciousness that assumes an appropriate discussion of the economic crisis includes Gingrich (and not, say Yves Smith or Jay Ackroyd) really a generational thing?
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Newspapers’ decline is a sign of democracy, not a symptom of its death
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The “necessary for democracy” argument also assumes that readers are less civically engaged if they digest their news online. How absurd. Gen Y is likely far more knowledgeable about their world than Boomers were. The problem is that Boomers appeared more knowledgeable to one another because they all knew the same things. The limited array of media meant people were generally civically minded about the same things and evaluated one another based on how much of the same media they’d seen. The diversity available in today’s media—facilitated greatly by the internet—means it is hard to evaluate someone’s civic mindedness because they may be deeply knowledgeable and engaged in a set of issues you are completely unfamiliar with. Diversity of content and access to it, made possible by the internet, has strengthened our civic engagement.

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Is it because of the “Three Networks and the Morning Paper” culture that the Village is the way that it is?
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…Or are they just vapid and entitled magpies?

I guess Matt Taibbi was none to impressed with Jake DeSantis’ resignation letter:
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Like a lot of people, I read Wednesday’s New York Times editorial by former AIG Financial Products employee Jake DeSantis, whose resignation letter basically asks us all to reconsider our anger toward the poor overworked employees of his unit.
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DeSantis has a few major points. They include: 1) I had nothing to do with my boss Joe Cassano’s toxic credit default swaps portfolio, and only a handful of people in our unit did; 2) I didn’t even know anything about them; 3) I could have left AIG for a better job several times last year; 4) but I didn’t, staying out of a sense of duty to my poor, beleaguered firm, only to find out in the end that; 5) I would be betrayed by AIG senior management, who promised we would be rewarded for staying, but then went back on their word when they folded in highly cowardly fashion in the face of an angry and stupid populist mob.
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I have a few responses to those points. They are:
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http://www.smirkingchimp.com/thread/20988

What are some of Newt Gingrich’s relevant policy proposals?
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Modernize via personal social security savings accounts
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Modernizing Social Security through personal social security savings accounts would raise take-home pay and free workers to put billions of dollars in savings and investment; that would be a huge benefit to our economy. The accounts indeed represent a new, very large tax-free shelter for saving and investment. It adds up to a dramatic increase in savings and investment-and an economic boom.
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The Ryan-Sununu bill provides for a personal social security savings account option for Social Security and solves the long-term problems of the program. Under this bill, workers & employers would still contribute a total of 6.4% [of income]. But this is money that belongs to the workers in their own individual accounts, so it is not a tax that goes to the government. The Ryan-Sununu plan would be effectively the largest tax cut in world history.
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Personal social security savings accounts will in fact fulfill the promise that the Social Security system cannot deliver: a guaranteed retirement account.
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Source: Gingrich Communications website, http://www.newt.org Dec 1, 2006

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Elderly people should watch Jim Cramer on CNBC, pick his winners, and they’ll have “a guaranteed retirement account“.
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Genius. What else?
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Retirement policies & tax policies ARE health policies
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21st century healthcare would break down barriers of isolation & encourage people to stay active. In a very real sense national retirement & tax policies ARE health policies When these policies make it harder to stay active and easier to become indolent, we are fostering illness, decline, and actually increasing our health expenses. Good health is about a lot more than health policy.
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69% of workers aged 45 to 74 reported that they plan to work in some capacity in their retirement years, even if they won the lottery. For those aged 33 to 52, the younger boomers, 75% said they would work into their retirement years.
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The baby boomer’s desire to stay active is good news for the economy. We must recognize that rethinking government rules for retirement and reforming Medicare to encourage economic activity are key steps toward a better future. The policies that may have made sense in earlier eras when people died younger are simply not applicable in an era when more people are healthier longer.
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Source: Saving Lives and Saving Money
by Newt Gingrich, p.193-194 Sep 22, 2003

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Did he just say what I thought he said?
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“national retirement & tax policies ARE health policies”
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Social Security as currently constituted makes “it easier to become indolent” as one eases into being elderly?
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The solution to our broken health care system is to start “rethinking government rules for retirement and reforming Medicare to encourage economic activity” so that people don’t get Medicare, even when they keep working into their seventies?
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This Newt Gingrich’s program for the country…to put Social Security into the stock market, and force people approaching their seventies to work longer, so we can save on Medicare expenses?
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…and Joe Klein says “I’ve always enjoyed him intellectually“?
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What exactly were the fruits of this man’s intellect served up for Joe’s enjoyment? Is his taste in novels exquisite? Can he summarize Proust in a few minutes? Is he a plain-spoken string theorist? Does he know the end of pi?
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It couldn’t possibly be his intellect as related to his political program, obviously. This is intriguing.
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What has Joe Klein “enjoyed” about Newt Gingrich’s intellect over the years, exactly?

stuart @ 6:30, That’s interesting. Maybe if you bowl alone you’ll discover new and innovative ways to… okay this metaphor is not working. But still, I think there are some benefits to cultural fragmentation, even if it does lead to more estrangement.
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IMO, generational explanations for the MSM’s cluelessness are not as convincing as gender explanations. Obviously I believe that young women have a lot to contribute to political discussions, but women who don’t look like Erin Burnett also have a lot to contribute. Male-dominated groups tend to not function as well as more gender-balanced groups. However, obviously gender and age are very linked. Older people are probably more sexist, so the MSM baby boomers’ bias against women may contribute to the lack of intellectual diversity; shutting out women who don’t look like Erin Burnett will result in a less intellectually diverse discussion. The identification of so many progressive causes with women – e.g. health care, environment, peace – just adds to all this.

SZ:
I guess you could say I’m a centrist. That’s what I’ve thought myself as (a mod Republican), but sometimes I wonder if my positions really classify me as such. I’m not exactly liberal on Iraq, or abortion.
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As to the second point; there seem to be clear instances where the SEC could have done more in relation to the financial collapse. Not to tag it all on them, of course, but nevertheless:
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“In theory, it was only a matter of time before hyperleveraging came unraveled. A pair of hedge funds managed by Bear Stearns collapsed in June 2007 as a result of huge losses in subprime mortgages.”
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“Investors who wanted to reconcile the numbers with the company’s conflicting explanation got no help from the SEC. Its voluntary program had given the agency a window into the secretive industry, revealing Bear Stearns’ rising concentration of subprime mortgages, its questionable risk management and its yawning ratio of debt to capital, according to a later inspector general’s report. But the SEC failed to warn the public and didn’t urge the bank to improve most of its practices, the inspector general reported.”
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sevenoaks07:
Thanks! Although I do have to say that I don’t follow Newt as much. He hasn’t said anything particularly interesting as of late…
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The conservatives I pay the most attention to are Krauthammer, and (some time ago) Victor Davis Hanson. Kristol was okay, but one time he struck me as a nicer, right-wing version of Klein.
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SG:
The problem seems to have the most to do with the regulators. As noted in the above linked article, the SEC could have done more in regards to Bear Stearns and Lehman Brothers, along with firms like them.
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Giving a nonindependent, political appointee power to seize non-banking institutions smacks of too much power in too corruptible hands. Moreover, the problem is general blindness on the part of our regulatory apparatus, and that extended to Treasury this last crisis. Giving them the power to seize hedge funds would have been useless, as they didn’t use it. Again, the problem is getting people to do their jobs. Is additional oversight necessary? I believe so. Additional INDEPENDENT oversight.
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By the way, being wound down and sold off sounds like a description of Chapter 11. And by the OTC, do you mean the OTC bulletin board? My super Wikipedia detective work tells me that is not a regulatory agency…

yoshiattack:
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I guess you could say I’m a centrist.
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That would certainly explain your antipathy toward liberals.
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I’m not exactly liberal on Iraq
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Guess what? Neither are most Democratic members of Congress (especially the Senate)!
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…or abortion.
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Centrists are really, really afraid of abortion. They know that their daughters will probably need to have them sometime after they get to university, but they’re OK if the little working people have more babies and screw up their lives, so they keep quiet about the subject whenever they can.
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They like to say “safe, legal and rare“. What principled people they are!
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Centrists really mean “religious traditions are for stupid people and our grandparents, but we can’t say that on network television, where they don’t allow condom commercials –even during ‘You ARE the father’ episodes of the Maury show…“.
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So if you have some sort of principle about the subject that doesn’t have to do with reflexively meeting in the middle of anything, or what’s practical for people in power to do with the least controversy, you might not be a centrist after all.
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You might just be a moderate conservative, like they have in Britain –but not here.

yoshi
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Sorry I meant OTS Office of Thrift Supervision

Correction: as they wouldn’t have used it

One more point, the President also nominates the head of the FDIC so whats the difference?

yoshiattack:
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…And you are quite correct about the failure of the SEC, so I’ll concede that argument. The fact remains, though, that either regulators need to widen their interpretation of the scope of their jobs –not bloody likely– or we need more cops on the financial beat with specific jurisdiction over new financial instruments.

yoshiattack:
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Just to clarify: when I say it’s “not bloody likely” that regulators would voluntarily widen the scope of their inquiries, I don’t mean that bureaucracies aren’t tending toward being populated with ruthless bureaucrats, I mean that these particular set of regulators all seem to be or to be good friends with people who’ve held high positions at Goldman F*cking Sachs.

Sorry guys, forgot that I didn’t add the link to the Time story. If you haven’t already googled it then here it is:
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http://www.time.com/time/magazine/article/0,9171,1881989-3,00.html
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SZ:
Whew! Didn’t realize there were that many connotations associated with “centrist” before. That would make me a moderate conservative, then. As for new regulatory agencies, perhaps that would be useful. It all depends on the details. However, I’m reminded of the very real threat of bureaucratic morass…
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SG:
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Thanks for the clarification. To your point, the President does appoint heads of independent agencies – but their job security isn’t tied to him (the President can’t dismiss them). They also have (often mandated) bipartisan committees who are likewise shielded from political winds. Is it a perfect solution? No, but nothing in life is.

So, Joe Klein comes out shooting from the hip like Wild Bill and says that 46% of American Voters with “Gingrich et al will remain banished somewhere in the outer darkness–and the Fox News cave-ghetto–until they realize that the Obama Administration’s economic plans are not at all extreme …”

For a man who claims he is calm [not angry at all] [always takes his time] [never looses his cool] WOW! HE SOUNDS REAL ANGRY NOW!

Joe, you speak from both sides of the mouth and all four sides of the face, just like your master. I suggest you take a deep breath, calm down, then read and comment on:

Courtesy of His Friends …. Quotes: Verbatim at

http://ikejakson.wordpress.com/2009/03/07/courtesy-of-his-friends-%e2%80%a6-quotes-verbatim/

The “problem” with the Gullible Old Poopers and “Conservatives” and “Libertarians” is that they don’t understand that “freedom” without responsibility and accountability is also a form of anarchistic tyranny.

[...] does surprise me is that so many in the media regard Newt as some kind of serious intellectual. Here’s Joe Klein today (I cite Klein because I think he’s one of the more reasonable members of the punditocracy): [...]

The Republican Party is little more than a party of pro-business, evangelical fascists now. That’s all there really is to it. If that’s what you want, go ahead and vote for it.

[...] i so invested in obama that im blind to reasonable opposition? of course not. joe klein brings the context: One imagines that if John McCain were President and Paul Krugman had said, out of the box, that he [...]

smoothjazz2008, are you me with a different screen name? LOL.

[...] an otherwise sensible critique of Newt Gingrich, Joe Klein writes:One imagines that if John McCain were President and Paul Krugman had said, out of the box, that he [...]

[...] No Newts [...]

[...] 20 years now and I’ve always enjoyed him intellectually, but detested him politically,” Joe Klein recently wrote in his blog for Time. “The reason for the latter is his now-anachronistic first resort to anger; again and again, he [...]

[...] http://swampland.blogs.time.com/2009/03/28/no-newts/ [...]

[...] and you can bet it won’t hurt his chances of being on “Meet The Press” or being enjoyed intellectually by Joe Klein. People who read left-leaning blogs know that Newt lied, but we already knew Newt was a [...]