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This why I still believe...

Sun, 03/08/2009 - 2:32pm — connecticut man1

that they knew about this "crisis" coming down the pike at least as far back as 2003 when they were using that obscure civil war era banking law to block the state lawsuits against the banking institutions. They knew this was all coming and they needed to get legislation in place that would protect the lifestyles of their rich and blameless allies.

"It turns out that one of the features of the 2005 Bankruptcy bill was to put derivative counter parties [like CDS holders] at the front of the line ahead of other creditors in bankruptcy proceedings. Actually, from what I can tell, they don't just go to the head of the line. They got to skip the line entirely. As the Financial Times noted last fall, "the 2005 changes made clear that certain derivatives and financial transactions were exempt from provisions in the bankruptcy code that freeze a failed company's assets until a court decides how to apportion them among creditors."" - Josh Marshall

Legislation like that doesn't just come out of nowhere.

It takes time for them to figure out what they want to achieve and how they want to achieve it. And then there is the need to find the right time and the right place to slip the junk in.

They could have solved many of these problems years ago and mitigated some of the disastrous results but, instead, they purposefully let it build while protecting themselves and waited for just the right time to unleash the "crisis" on the nation, knowing it would tie the hands of the next administration financially.

IOW: They did manage to drown the government in a Katrina sized bath tub.

Also, I think they were hoping the GOP could capitalize on it politically during the elections. What they didn't count on was John McCain's doe in the headlights reaction looking as stupid as it did, nor the fact that some would figure out how it all really happened so fast that a huge backlash would ensue coupled with the reality that Americans just don't trust republicans with their money anymore and in any way. The GOP is a walking and talking financial zombie.

This was all nothing more than a well orchestrated game of CYA and collusion between politicians and their financial owners. Real, honest "Disaster Capitalism" in an ufetterred free-market-run-amok at its worst.

 

Just expanding on a comment in Lambert's earlier diary on this...

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Thanks for making this a post

By gqmartinez on Sun, 03/08/2009 - 4:10pm

Deserves its own debate.

Personally, I'm not sure just how far back this goes but it sure has the scent of having been a long time planning. Though I think the greed on display here is separate from Norquist' bathtub. The bathtub may end up being a hurdle for the bailout of the banks since our economic standing is worse than the banks would have liked.

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The bathtub was just a side note

By connecticut man1 on Sun, 03/08/2009 - 4:38pm

really. But as far as disaster capitalists planning a controlled crisis would go, it would have left McCain and the GOP with every excuse needed to completely tear apart any and all of the social safety net, had he miraculously won, or, as it turned out, tie the hands of any winner on the Democratic side.

But all of this makes what Luaptifer's diary was honing in on even more prescient, IMHO. There is a reason that aspect of the Spitzer story was on the list of the most under-reported BIG stories for that time frame.

This is my actual initial reaction to seeing the diary:

Because, ya know, it wouldn't be such a nice gift for the republicans - to be able to turn against the bush admin. - at such an opportune time (by voting against a bail out) and the election coming up n' all.

  1. Dems vote for the bail out and they are damned by the "fiscal conservatives" as "big spenders."

  2. Vote against a bail out and the Dems are "do nothingers."

One of those two memes that will have to be beaten. Pick yer poison well.

You would think it might even have been why Spitzer was brought down in the first place. Because they might have wanted to wait until now to unleash the chaos. Not that the bushies have ever said anything that might suggest they would pull shit like this...

The aide said that guys like me were "in what we call the reality-based community," which he defined as people who "believe that solutions emerge from your judicious study of discernible reality." I nodded and murmured something about enlightenment principles and empiricism. He cut me off. "That's not the way the world really works anymore," he continued. "We're an empire now, and when we act, we create our own reality. And while you're studying that reality -- judiciously, as you will -- we'll act again, creating other new realities, which you can study too, and that's how things will sort out. We're history's actors . . . and you, all of you, will be left to just study what we do."

You don't think the bushies are playing ya? They are playing you all in the hopes of giving the republicans an edge to cut the Dems lead with... And no matter what way this all goes - the big spenders or the do nothings - in the end the shitpile will be shoveled higher and deeper onto the next administration.

McCain will be left with a great reason to cut programs and benefits if, god forbid, he wins. And if Obama wins... He will be saddled with too much debt to make a real dent in change.

The rich will be rewarded for failure and the poor will be stuck with the bill for generations to come.

Though, with contradicting unnamed Obama administration sources coming out of everywhere talking about "reforming social security" (Glen Greenwald), it is looking more and more like we MIGHT have to make sure Obama does not lead us into the trap of cutting the social safety nets, as well.

It also leaves me wondering, even more, just how much of an ally Ezra Klein is on any issue... Not just health care where he is either completely ignorant or a lying propaganda stooge trading truth for access. Maybe a bit of both? (Harsh, but merited, IMHO.)

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I had to edit this.

By connecticut man1 on Mon, 03/09/2009 - 7:51am

Since, after having been talked some sense into, I think this should be directed less towards R VS D politics and more towards "Money Party VS People Party" politics.

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