Recent Items

35 comments

    1. sherparick

      Jason, this is example of a “Red Herring.” No one has blamed the Tea Party or Sarah Palin for causing Mr. Loughner to attempt to assainante Congresswoman Giffords killing six others in the process, and wounding 13 other people. Rather, what I think folks have been saying is, now that this shooting has given us pause, perhaps we should go easy on rhetoric that suggests violence directed at an individual for his or her political positions and votes is okay and that one’s political opponents are treasonous scum “hell bent on destroying America” because he wants to raise the U.S. Government’s debt ceiling? http://www.huffingtonpost.com/2011/01/07/sarah-palin-obama-debt-ceiling_n_806014.html

      I do note that everything Mr. Loughner did, to buying his Glock 9mm in November, buying it with an extended 30 round clip, and carrying that morning to the Congresswoman’s event as a concealed weapon was perfectly legal up to the moment he pulled it out and started emptying bullets into people’s heads and chests. This is all thanks to the work of the Conservative Movement over the last 30 years, particularly in Arizona. You have guaranteed the right of ever unbalanced, schizophrenic, paranoid individual in the country to acquire the means to enact the most gory of power fantasies. And then you all say, “not our fault.” Instead, it is because of the “sick society you liberals made.” That is the a lovely use of the “strawman,” “red herring,” “non-sequitor,” and finally “ad hominem” arguments all rolled into one.

      1. Andrew Bissell

        I do note that everything Mr. Loughner did, to buying his Glock 9mm in November, buying it with an extended 30 round clip, and carrying that morning to the Congresswoman’s event as a concealed weapon was perfectly legal up to the moment he pulled it out and started emptying bullets into people’s heads and chests.

        Yeah, if only all these things had been illegal, Loughner never would have done them, and the police’s magical concealed weapons detectors would have spotted him before he got anywhere near the crowd.

        1. Anonymous Jones

          Well, I have no doubt that someone *could* do such things regardless of prohibitions, but at the same time, would someone in fact have? That is a different question…

          Making something more difficult may not prevent something, but at the same time, it does in fact make it more f*cking difficult to accomplish. There is that…

          Of course, reality is hard for you folks, I understand that. So please ignore my facts…please, live in your fantasy world, it is your right…

    2. joe

      You protest too much. You have no way of knowing to what extent Palin’s cross hair map and heated rhetoric incited this tragedy. Fact is it could have been what put the idea in the mad man’s mind and there is no way to prove otherwise. The congress woman specifically said the cross hair map went too far and made her worry about her safety.

  1. ChrisTiburon

    Re: The great Ferguson lecture, if freezes here, try the original source…

    http://mitworld.mit.edu/video/861

    Part of the new playbook of modern living is that you always cue up and test your media before presentation. Isn’t it painful to watch him bending over to reach his Mac? A few books stacked up would have saved his back.

  2. laughlinlvr

    Always been irritated by lecturers whose equipment doesn’t work. Also, the frequent apologies to the audience that they can’t see the visuals he brought compunds my irritation.
    I wonder if he apologizes in “Inside Job” for the camera being out of focus.

    1. Bob Falfa

      Red and blue bar chart with a dark background – hard to believe those were very clear even on his laptop/desk computer, let alone how washed out it would get through a projector in a big room. In his case, the quality of information was barely diminished by his lack of powerpoint skills. (Yeah, it was tough to say that as an EE graduate of a competing school.)

    2. decora

      well, how can we explain this, ‘crisis of the presentation’?

      it all goes back to the 80s. the wizards of silicon valley took data, and they sliced it and diced it into millions of pieces. then they sold that data off to users, all over the world.

      this encouraged the creation of risky data paths, such as these ‘projector backed lectures’, which enabled professors to make enormous arguments with far less ‘intellectual capital’ backing it up.

      this led, ultimately, to what we see here today. Charles Ferguson, a titan of the new intellectuals, crashed and burned, because instead of relying on old techniques, like chalk and a chalkboard, he threw caution to the wind and used this risky, projector backed lecturing.

      and all this time, where was the faculty administration? they were being payed off by the same industry that was giving them this new technology: Microsoft, Intel, IBM, all gave substantial amounts to universities during this time frame.

      In the end, it teaches a valuable lesson, about conflicts of interest, and about the dangers of greed.

  3. Attitude_Check

    His purchase of a weapon would not have been legal IF the local Sheriff did his job. It is now coming out that he was a very disturbed man who had made many threats against politicians and others in the past. He clearly crossed the line into felony behavior, but it was never investigated, and he was never charged.

    This is really a lesson that bad things happen when laws are ignored, law enforcement fails at it’s job.

  4. Aunt Deb

    Thanks very much for posting this link, Yves. I just saw Inside Job this past weekend and was wanting to see/hear more of Ferguson’s analysis. The questions at the end of the lecture are well worth the time, too.

  5. craazyman

    Loved the move! It was great.

    So that’s how this dude got all the access. He’s an MIT golden boy.

    I had to laugh at the Host’s introduction of Mr. Ferguson as a native son of MIT and an showcase for MIT’s educational achievment.

    Oh really?

    If we put Mr. Ferguson in the “Asset” side of MIT’s balance sheet — where he inarguably belongs — we have to put all their MIT zombie quants who trudged down to Wall Street and ran the levers of the same loot machine that Mr. Ferguson skewers, on the Liability side.

    By that measure MIT is a bankrupt zombie, just like the banks. bowahahahahahahah.

    But the MIT toastmaster dude has to sell his dogfood, just like the ratings agencies and everybody else. Ecce Homo, said Fred.

  6. Chester Genghis

    Re: Ferguson

    One of Ferguson’s first slides has a bullet point noting George Bush’s “Keynsian Spending Spree”.

    No, Mr. Ferguson, not all deficit spending is Keynsian!!! “Keynsian” is becoming a kind mindless reflex adjective (always applied to deficits) like “raging” fires, “bitter” recriminations, “nasty” divorce etc.

    Bush’s deficit spending was decidedly NOT Keynsian. If Bush were a Keynsian (laughable thought) he would have kept accumulated the surplus he inherited instead of spending it.

    1. Ryan

      I don’t think a single Keynesian exists in Washington when it comes to the bull side of the cycle.

  7. RSDallas

    Respectfully, I know Dr. Ferguson is a smart man, but he doesn’t really advance any thoughts, when applied, that would increase the knowledge of anyone in regards to understanding what caused this financial mess.

    I think he is beating around the bush to imply that the financial system is corrupt. You don’t have to have a PHD from MIT to conclude that. Corrupt leaders and financiers have been a part of our society from the beginning.

  8. Firean

    What has this to do with the topic of the blog posting here:

    “MIT Lecture by Charles Ferguson on the Financial Crisis” ?

    The intial comment is a response to another website ( quoted) and ought be removed as off-topic spam.
    Hopefully Ives Smith will remove it from what is an excellent Blog, and always( normally)a topical and informative, thread of replies.

    1. Firean

      My above reply was in response to the “Jason says:” posting yet appears out of that line.( to clarify)

  9. armchair

    A parliamentary system will fix things? That’s a classic non-solution proposal.

    It seems like a solid description, but I’d rather tune in to Stiglitz.

  10. Alex

    How do you spell the author of the 2005 paper he cites w.r.t. individual incentive structures? (Sounds like “Rijon.”)

  11. Aunt Deb

    Ferguson’s PhD is in political science. His interest in governmental structures and economics is long-standing. I think he proposes a structural political ‘fix’ because he believes the problem of corruption and collusion is too great to overcome using the current structure.

    In light of this, I found his downplaying of one of the questioners’ suggestion that the solution could be to make systemic use of actual, knowledgeable workers’ understandings of what was going wrong a bit puzzling. The man offered several examples of people who realized things were going radically wrong in their own job and suggested that these sorts of alarms should be the stuff that regulators looked for. Ferguson seemed to think this wasn’t a very viable idea. He does tend to be a systems analyst, I think, even though he clearly feels deep anger at individual financiers. His understanding of the source of corruption is not that these individuals are corrupt but that their behavior has no negative consequences for them in the current system.

  12. Dave Stratman

    Inside Job is an Inside Job: A Misleading View of the Economic Crisis

    by Dave Stratman.
    (first published byAxis of Logic)

    Monday, Oct 25, 2010

    Charles Ferguson’s new documentary about the current financial crisis, Inside Job, has gotten rave reviews from TIME, the Washington Post, and the Boston Globe among others. The Globe’s reviewer virtually guaranteed the film would lead to riots in the streets. As you can imagine, my expectations were high for this movie, if tinged a bit by cynicism about its Establishment reviewers. Unfortunately my cynicism was well-founded.

    Inside Job is an entertaining but misleading view of the economic crisis. True, watching the Chair of Harvard’s Economics Department and the Dean of Columbia Business School make fools of themselves on camera is worth the price of admission. But the documentary minimizes the extent of the looting of America and the world by the bankers, insurers, and their government enablers. It parades some very guilty and inviting targets across the screen but fails to look deeper into the forces behind the crisis. It obscures the role of the Federal Reserve. It presents some of the perps and other Establishment figures as reliable commentators. Finally the movie offers laughably inadequate solutions to the banking disaster.

    Minimizes the extent of the looting: The movie discusses TARP–the $700 billion bank bailout engineered by Treasury Secretary Hank Paulson, fresh from his job as CEO of Goldman Sachs, and the $120 billion bailout of AIG, the world’s largest insurance company. The entire AIG bailout, it so happens, went straight from AIG to Goldman Sachs, paying Goldman 100 cents on the dollar for bad investments it had made in AIG. While the obvious conflict of interest here and the fact that U.S. taxpayers have been left holding the bag for bankers’ losses on unwise, often fraudulent, investments are surely causes for outrage, the amounts in these two instances are mere drops in the bucket compared with the heavy-duty bailouts undertaken in the following months. The combined Bush and Obama bailouts were estimated in July 2009 by Neil Barofsky, Special Inspector General of the Troubled Asset Relief Program, at $23.7 trillion dollars. Inside Job’s focus on the relatively piddling amounts–less than a measly trillion dollars, for Pete’s sake–gives an entirely false picture of the extent of the damage that the bankers and government have wrought, the real effects of which will impoverish generations of Americans.

    Hides the real forces at work: Inside Job gives the impression that the current economic disaster is the result of the unrestrained greed and egomania of a relative handful of executives and stockbrokers at the highest echelons of the banking industry, aided and abetted by Washington lobbyists and university economics professors, who will apparently justify any crime if paid generous consulting fees by the bankers. To its credit the film indicts both Republicans and Democrats. The disaster begins to unfold as the Reagan Administration promotes the deregulation of Wall Street and of corporate America. The Clinton Administration, which moved Robert Rubin from Goldman Sachs to Secretary of the Treasury, then repeals the Glass-Steagall Act, the Depression-era legislation meant to protect citizens from the rapacity of the banks. The George W. Bush Administration tops this by reducing the staff of the Securities and Exchange Commission, the institution meant to regulate Wall Street, to one.

    Obama reveals himself in the film to be “Wall Street’s man.” Despite running on promises of reform, once in office Obama appointed Larry Summers, Tim Geithner, and reappointed Fed Chairman Ben Bernanke as his economics team. Larry Summers had led the Clinton Administration’s push to repeal Glass-Steagall. Summers was paid $20 million in consulting fees from the big banks in the years before he accepted Obama’s offer to head the Council of Economic Advisors. Tim Geithner was chair of the New York Federal Reserve Bank when Obama nominated him and was up to his neck in the reckless and fraudulent practices of the Wall Street banks. Geithner declared at his Secretary of the Treasury confirmation hearings that he does not believe in regulation. Ben Bernanke, who succeeded Alan Greenspan as chair, had already showed himself to be Wall Street’s man at the Fed.

    The film effectively indicts some of the chief actors in the economic crisis and the pathological culture they represent, but fails to place the earth-shattering crash in the context of real existing class society. Encouraging banks to leverage their bets on Mortgage-Backed Securities (MBS) up to 30 to 1 and even 50 to one; refusing to regulate “innovative” banking practices that were often fraudulent and always intentionally opaque so that clients couldn’t understand them; promoting fraudulent and predatory lending on an unimaginable scale; refusing to indict, prosecute, or even to discipline executives and firms guilty of egregious criminality; permitting firms to pay out billions of dollars in bonuses to their employees and hundreds of millions in salary to their CEOs even while the executives were bankrupting their companies (bankruptcies for which taxpayers were to be held liable): the consequences of these practices were foreseeable and their outcome predictable. They would result in a crash of monumental, unprecedented, global proportions.

    And who would be made to pay for these crimes? Why, the working people of the world, of course. You and me.

    The key point is not that the bankers got rich and the people got screwed. The question is, Why was this allowed to happen? Or rather, Why was it made to happen? This disaster did not happen overnight or by chance. It was engineered over decades of careful undermining of all the post-Depression regulations and legislation that protected people from just such catastrophes. None of the perpetrators of these monstrous crimes have gone to jail. How could the same bankers and bureaucrats who engineered this disaster, which supposedly threatened the very existence of the financial system, not be in prison but rather still be in charge? Because they did the job they were intended to do.

    The banking collapse was a carefully planned strategic attack on the working people of this country and the world. It was designed to do exactly what it is doing here and in Europe: create a massive crisis to justify “austerity” for the masses. This is what Naomi Klein has styled “disaster capitalism” at its most perverse. The capitalist class–the bankers and corporations and the Super-Rich–planned and encouraged this collapse in a thousand different ways precisely to create a disaster so compelling that they could dismantle every social benefit that ordinary people have achieved in the last century and a half. Tens of thousands of people have lost their homes to the banks and thousands more will. Millions have lost their jobs and may never find work again; the real unemployment rate–that is, if you count people so discouraged that they have given up the job search, and those who can only find part-time work–is a Depression-level 22.5% Thousands of teachers and other government employees are being laid off and many more will be as the disaster unfolds. The voices that are already calling for gutting or cutting Social Security and Medicare will become a swelling chorus as soon as the mid-term elections are over. Throughout Europe governments are gutting the social programs that have been in place in some countries since WWII and in others since the 1880s. The rulers created this crisis to strip the working class of the protections it had gained and to reinforce raw elite power. The disaster is a strategy in the class war.

    But weren’t these bailouts and the consequent austerity programs necessary? The answer is no. The gigantic bailouts were only necessary, explains John Hussman, President of Hussman Investment Trust, because Bernanke and Geithner and their backers in Congress chose to protect the bondholders of the “too big to fail” institutions rather than the public. The usual—and legally required—way of dealing with failed banks is to fire and replace their management, use their shareholders’ and bondholders’ capital to correct their balance sheet, and sell the bank’s good debts to a solvent institution. This is the method used recently in the case of Washington Mutual, the largest bank failure in U.S. history, and hundreds of other cases. Neither depositors nor taxpayers lose a penny in this process. Hussman points out that the bonds backing the “TBTF” banks in question represent more than enough capital to restructure the bank balance sheets and discharge the toxic debt.

    Obscures the role of the Federal Reserve in the disaster: The Federal Reserve Bank–the institution that controls our money supply and determines so much of our financial fate–is a private, profit-seeking institution owned by its twelve member banks. Most Americans are unaware of this fact. The Fed is not owned or controlled by the American people. Rather it owns and controls us. The Federal Reserve, backed up by Congress and the Bush and Obama administrations, has put us into a debt hole so deep we will never be able to climb out without impoverishing ourselves and our children. Inside Job never gives us this crucial bit of information: that the decisions of the Federal Reserve are the decisions of a private business looking out for the interests of the banking and corporate class it represents.

    Presents some perps as positive players: The film offers Rep. Barney Frank, Chair of the House Financial Services Committee, as a voice of reason, when he is in fact one of the enablers of the bankers’ crimes. Frank steered the TARP bill through the House. He is co-sponsor of the Frank-Dodd Financial Reform Bill, which provides a mere show of reform so that the games can continue. Former Fed Chair Paul Volker—who imposed 21% interest rates during the Carter regime to “zap labor”–and billionaire George Soros are part of the rogue’s gallery of commentators offering words of wisdom in the film.

    Offers laughably inadequate solutions: The film doesn’t quite come out and say, “More regulation would solve the problems that created this crisis,” but it doesn’t offer anything more than regulation as the solution. Re-regulation is obviously inadequate:

    •Regulations–as we have just seen–can be repealed or left unenforced.
    •The criminals who dominate the industry and their allies in Congress and the White House are still in charge.

    How could one possibly believe that effective regulations could be imposed without first defeating these powerful forces? If the film reported the real $24 trillion extent of the bailouts and showed the “disaster capitalism” strategy behind the crisis, it would be perfectly clear that the problem can only be solved with a revolution.

    Since Inside Job minimizes the extent of the problem and diverts attention from the forces and purpose behind the disaster, of course it is not going to propose a revolutionary solution. But the fact of the matter is, if we are to have a promising future, the stranglehold of Wall Street and the Masters of Great Wealth on our society must be broken.

    http://www.NewDemocracyWorld.org

    This article may be copied and posted on other websites. Please include all hyperlinks.

  13. Alex

    Another attribution question: Who is “Professor Petra from Harvard University”, the second questioner at the end? I would like to write to him and ask him which aspects of Marx relate to the issue.

  14. Victor Berry

    Who decided to let Lehman go bankrupt? There was only one person who had the authority to command Paulson, Bernanke, Geithner, et al to back off and not bailout Lehman and let the free market work. It was George W. Bush!

  15. Thomas Harrington

    The solution to the political duopoly is simple. Make all elections into write-ins. This is a far better solution than ranked order voting or parliamentary response. I’ve already written quite a bit on this and here is what I came up with.

    See below for the effects that this would have on America:

    Individual

    The individual voter would be forced to pick a candidate beforehand and know who that candidate was as an individual, rather than merely voting the party line. This would result in increased civic participation. Since voters would be looking at individual candidates in greater detail, candidates would have to be better qualified, rather than merely politically connected enough to get on the ballot.

    Institutional

    There would no longer be only two viable candidates – since it would no longer require immense resources to get on the ballot and thus the stranglehold of the two major parties on American political discussion would cease. Since there would be multiple candidates, debates and campaigns would no longer focus on merely slandering the opponent, but on attempting to positively distinguish a particular candidate as better than the rest of the candidates. Rather than using fear to convince voters to vote in opposition to a particular candidate (i.e. attempting to paint Obama as a socialist or McCain as a nazi), campaigns would have to convince voters to vote for a particular candidate through reasoned debate. Politicians could no longer rely on slinging mud, instead they would have to defend their own actions to the populace.

    At the same time, there is a high likelihood that smaller, more focused parties would form. Currently, the major parties are forced to compromise and conform to build a coalition – whether that coalition is a combination of the religious right and fiscal conservatives or a hodgepodge of special interests. They then use their power to please that portion of the populace rather than doing what is right for the entire country. Thus, parties that represent a smaller and more defined platform will appear and grow in influence. These parties will be held accountable for their actions because voters will not be forced to choose between one coalition or its polar opposite. This will result in a democratization of power – and hopefully, real compromise and real political parties.

    National

    Overall, as debates became less divisive, the nation would no longer be subjected to a biannual divide along partisan lines defined by nebulous and constructed ideology. Congress would begin to compromise, rather than stick to the party line since they would not be forced to conform by a system where only two viable candidates exist.

    Elections would also be faster – thus the nation would not suffer through over a year of electioneering and divisive so-called debates. The amount of expense devoted to these elections would most likely decrease, allowing these large sums of money to go to some pursuit more worthwhile than slandering another politician.

    Conclusion

    In short, government will function more efficiently and smoothly as soon as the false dichotomy of Democrat/Republican is removed from the election process. Our democracy has been damaged by the two-party system so that politicians can become career politicians not through merit, but through political connections, individuals can easily vote without performing due diligence, and masters of propaganda and “spin” can dominate the debate rather than intellectuals debating solutions to problems. This new voting system would rectify those problems – as well as the many others discussed above.

    To see the whole article or express your support for this idea go to: http://www.tryfreedom.us/?p=131

  16. Tania Lustrzanka

    I am extremely impressed with your writing skills and also with the layout on your blog. Is this a paid theme or did you customize it yourself? Either way keep up the nice quality writing, it is rare to see a great blog like this one today..

Comments are closed.