Kudlowmania!

Larry Kudlow denies his interest in Chris Dodd's Senate seat, in a way that makes it clear that all he wants if for a few more people to ask him to run and he'll do it.



Yes, Larry, please run. You are clearly what the GOP needs right now, another thinly closeted, thrice married, apostate recovering alcoholic and cocaine addict.

Yikes, a plan....

Unfortunately for all of us, Krugman is probably right.

The common element to the Paulson and Geithner plans is the insistence that the bad assets on banks’ books are really worth much, much more than anyone is currently willing to pay for them. In fact, their true value is so high that if they were properly priced, banks wouldn’t be in trouble.

And so the plan is to use taxpayer funds to drive the prices of bad assets up to “fair” levels. Mr. Paulson proposed having the government buy the assets directly. Mr. Geithner instead proposes a complicated scheme in which the government lends money to private investors, who then use the money to buy the stuff. The idea, says Mr. Obama’s top economic adviser, is to use “the expertise of the market” to set the value of toxic assets.

But the Geithner scheme would offer a one-way bet: if asset values go up, the investors profit, but if they go down, the investors can walk away from their debt. So this isn’t really about letting markets work. It’s just an indirect, disguised way to subsidize purchases of bad assets.

The banks would be crazy to begin to sell their troubled portfolios of assets while Geithner continues to promise them that at some point somebody will overpay for them. First it was 'the market', then it was 'the hedge funds' and now it is a combination of private capital with an explicit guarantee from you and I.

As Krugman points out, this is looking weirder by the day:

The likely cost to taxpayers aside, there’s something strange going on here. By my count, this is the third time Obama administration officials have floated a scheme that is essentially a rehash of the Paulson plan, each time adding a new set of bells and whistles and claiming that they’re doing something completely different. This is starting to look obsessive.

There are any number of other plans out there that do not rest upon the idea that these assets need to be purchased in such a way that the banks are saved. Temporary nationalization is just one. Why this administration remains fixated on the Goldman Sachs Recovery Plan is now looking very odd.

Round em up..

When I started this blog 360 posts ago, I began with a comment about Alberto Gonzales and John Yoo, basically noting that at the core of the Bush Administration's dark heart there were lawyers that were willing to justify imperious and illegal activities in order to support the franchise and curry favor with the fearmongers and "Mayberry Machiavellis" in the White House.

Brad Delong brings us up to speed on how the tide is turning against the actions of Yoo and the Office of Legal Council (OLC). The legal fraternity is slowly warming up to the idea that was clear to so many all along, that Yoo's work was an aggressive and conscious attempt to undermine our Constitution and he, Gonzales and men like David Addington were quite willing to shred 300 years of precedent to further their hateful agenda.

He quotes Brian Tamanaha, who belatedly arrives at this conclusion:

But the recent release by the OLC of several of the relevant memos removes any doubt: these memos were elaborate exercises in manipulative legal argument.... OLC lawyers were faced with a big hurdle: the applicable law was directly contrary to what the Administration wanted to do. (That’s the thing about law—it can get in the way.) Rather than concede that the actions were illegal and could not be done, however, the lawyers constructed a covering legal analysis which arrived at the desired ends. The soundness of their legal argument did not matter. What mattered was that OLC has the power to issue legal opinions that are authoritative for immediate purposes (within the executive branch) and the mere issuance of the opinion supplied the first part of the “good faith” excuse described above (providing a defense to those who directly engaged in the illegal conduct).

Tamanaha highlights on representative conclusion of an OLC memo penned by Yoo:

The courts have observed that even the use of deadly force is reasonable under the Fourth Amendment if used in self-defense or to protect others. Here, for Fourth Amendment purposes, the right to self-defense is not that of an individual, but that of the nation and of its citizens. If the government’s heightened interest in self defense justifies the use of deadly force, then it would certainly also justify warrantless searches.

Extremism in the defense of liberty is no vice, quoth Barry Goldwater.


I guess you had to be something other than a lawyer to see that the intent was pure evil all along.