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The history of HCR isn't the only history being re-written

Generally, I like Dave Johnson, but this is just wrong. Here's how he reacts to the R "Pledge to America":

The deficit they created with tax cuts will be cured by ... tax cuts? The TARP bank bailout they left us with will be cured by ... tax cuts? The jobs that never appeared after their tax cuts will be created by ... tax cuts? The health care bill will be replaced by ... tax cuts? Terrorists will be fought with ... tax cuts?

Wrong on the historical record. Wrong. The Rs are not the party that "left us" with the TARP bailout. That's totally down to the Ds, who passed it. Moreover, Obama whipped for the bill. And significant parts of the R base opposed the bill vehemently -- these are the guys who want to abolish the Fed, mkay? They didn't want to bail out the banks at all. Those of us who were following this story 24/7 in Fall 2008 instead of the horse race actually know all this, so it's amazing to me, or not, that the community that used to call itself "reality-based" gets this stuff so wrong so often.

And it gets worse! This is the chart you need to understand the bailouts:


The bailouts as a whole amounted to trillions of dollars -- perhaps as much as $23 trillion. Most of the the looting bailing out was done by the Treasury and the Fed under Bush well before TARP was a gleam on Hank Paulson's skull. TARP, at a mere $700 billion, is a mere fraction of that total. However, until the extremely fortuitous collapse of Lehman (which ensured Obama's election), the bailouts were invisible to the general public -- and only became visible when TARP entered the legislative arena. The Ds, by passing TARP, accepting the bailouts, and continuing the Bush administration's policy of lack of transparency and accountability, consolidated, normalized, and ratified the Bush administration's power grab: Exactly as with torture.*

By using TARP as a shorthand or synechdoche or the bailouts as a whole, Johnson simultaneously minimizes the looting by substituting billions for trillions, obfuscates the timeline, and absolves the Ds of their very real responsibility, their culpability, for the largest upward transfer of wealth in world history. That's just wrong.

Why does this matter? As I keep saying: We're not funded well enough to maintain the same kind of structure of bullshit and lies that Versailles does; we can't lie our way to justice. We've got to get the history right, because evidence and reasoning are the only tools we all have, and they come for free (or at least at lower cost than the teebee, the think tanks, the endowed chairs, our famously free press and all the rest of the bullshit chain).

Here's Johnson's link again; please click through, since I want this post to show up in his tracker.

NOTE * It's useful to look at the financial crisis as a form of torture; that's one of the ideas behind Shock Doctrine.

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Submitted by jawbone on

which has fascinating new facts about the sinking of the Titanic. There was a straightforward mistake by the helmsman, further compounded by the chairman of the White Star Line to steam full speed ahead.

The blogger makes the comparison of the tragic mistake on the Titanic to the Titanic tragedy of our current crop of politicians is, perhaps, apt. And sad.

The Titanic example shows us that taking a wrong direction, or not changing a loosing game, can end in a tragic catastrophe.

Dredd Blog thinks that the Obama Administration made a mistake by steering to the right, and by staying the course the Bush II regime had set.

More at the link.

CMike's picture
Submitted by CMike on

Maybe it's just me but it seems like this and this have been showing up in place of this and this with greater frequency lately.

Submitted by jawbone on

bloggers are resisting any editing suggestons. It's like they think they don't need to be as clear as absolutely possible because they're busy and do a lot of typing and STFU anyway, you English teacher and major types. Don't embarrass us by notingo our typos!

Eeeek. I didn't even notice that spelling/misuse in the part I C&P's. Ooops.

Sic on me!

CMike's picture
Submitted by CMike on

When someone corrects me I'm usually not too appreciative even if I respond with a :).

Submitted by jawbone on

be referred to for years to come and it reflects on the argument being made, I would think people would want to make corrections -- if they could. Now, most comments, after a certain time or if a reply is made, can't be edited; posts can, afaik. The posts are the important issue, for posterity and the Cause (whatever it may be for the poster).

gizzardboy's picture
Submitted by gizzardboy on

Lambert, that is quite a chart with all kinds of categories I have never heard of. Where does it come from and are the categories explained there? I know about Bear Stearns, the Discount Window, Fannie Mae/ Freddie Mac and AIG, but the rest is totally unfamiliar territory and I thought I was paying attention!

Submitted by lambert on

... at The Big Picture, who's authoritative on this kind of stuff. I can't remember and/or decipher all the acronyms, and I'm sure there are differences in detail between them that are of great interest to financial engineers, but they all have the common characteristic of guaranteeing the bad bets and/or accounting control frauds of the big banks with government money. And except for TARP, they are all done without any oversight.

Submitted by Hugh on

I agree on all points. We need to get the history right to understand the problem and apply solutions that will work. We undercut our own credibility more and more as the fact based left blogosphere becomes more and more a mirror image of the right, we don't need no stinkin' facts, side.

The TARP was tiny compared to most of the Fed programs and even some of the Treasury ones, like its backstop to money markets. Worse the original rationale for the TARP, to buy up the banks' toxic assets, was almost immediately superseded by the Fed's much larger balance sheet expansion taking many of these on as collateral/repos.

gizzardboy's picture
Submitted by gizzardboy on

I followed the link to Barry Rithholz's article and even a link at the bottom, but still no chart.??? I don't want to be a pest, but I am interested in this.