City Paper is not for tourists
Yesterday the Wall Street Journal columnist Daniel Henninger hailed the Chilean miner rescue as a “smashing victory for free-market capitalism.” In addition to Onion-grade self-parody, Henninger was also, he fully conceded, courting charges of “churlishness” to make such a claim “amid the boundless human joy of the minders’ liberation” — but these, he insists, are “churlish times.” Not so churlish, however, that his newspaper’s unsigned editorial on the matter would venture to draw any that the whole thing was “ultimately” a lesson in “the power of the human spirit.”
By contrast, the lead editorial in today’s Washington Post not only adopts Henninger’s “argument”, it makes no apologies for it. Dubbing the rescue an example of Chile’s just “rewards it has reaped from a 20-year history as Latin America’s most-free country” the Post took the opportunity to compare the country favorably to Brazil:
It’s not often enough recognized that Chile, which has embraced free markets and free trade to a far greater extent than Brazil, has grown twice as fast over the past two decades and become far richer and competitive in world markets.
What’s somewhat puzzling about this comparison is that, although Brazil’s economy is roughly ten times the size of Chile’s, their per capita GDP and rates of poverty are around the same. The most striking difference between the two of them is that Chile’s unemployment rate is close to 10% and Brazil’s is just under 7%, giving a larger proportion of Chileans time for marathon television watching sessions.
But if there is one thing you can count on from the Washington Post editorial page, it is to neglect the economy’s more conspicuous challenges—such as the foreclosure thing, about which they have yet to issue an official proclamation—in favor of seizing upon some “not often enough recognized” fiction about the economy and subsequently repeating and repeating it into what I can only assume they hope to achieve some sort of collective submission of logic.
Chief among the falsehoods they have spent the past two years robo-peddling ad nauseam is the narrative of the infallible Tim Geithner‘s sage stewardship of the economy, a narrative that hinges largely on the heroic success of the TARP, one of the few multibillion dollar Wall Street bailout programs Geithner himself played almost no part in designing. (You may recall the story of Hank Paulson bowing down before Nancy Pelosi and begging Jesus for her collusion in the plan.)
Geithner did not particularly like TARP, because it required him to figure out how to do something about foreclosures and that is a giant pain in the ass, but mostly because the bank executives did not much like TARP, because its ostensibly tantalizing $700 billion in federal funds came only at the voluntary subjection to all manner of nods to outmoded notions of “accountability” and “oversight” and “rule of law” and trips down to Washington in which they risked getting lectured by some poorly dressed “elected” official for coming down in the corporate jet. But the Treasury Secretary saw that TARP could be useful to him, because all the publicity it got for actually going down in a place C-Span cameras are allowed made the public think of TARP as code for “all bailouts”, thus enabling him to take credit for “ending” the bailouts every time a bank “paid back their TARP money” — with interest and fees! — so he could refinance them into a more obscure, less gratingly “transparent” bailout program.
And so last March the Post observed in an editorial titled “Citi coup” that while “hardly anybody” likes bailouts “it is clear that TARP not only has been successful but, in a real sense, also a great deal for taxpayers” — further reminding readers of the courageous “bipartisanship” of the whole affair. In April the board gave Tim Geithner a chance to congratulate himself on the op-ed page, in a column in which he attested to be “repairing our financial system at much lower cost than anyone anticipated” and “much less than was required to resolve the savings-and-loan crisis of the 1980s. By June the editorial board was referring to the “Wall Street bailout” in quotes, in an editorial lamenting the looming fate of the “martyrs” who now face the prospect of losing their jobs at the hands of the lunatic populace for having voted for the bill that “arguably saved the economy.”
By the fall there was no “arguably” about it; an October editorial headlined “The Tale of TARP: A good-news story that’s actually true.” And what about the spectacular failure of the legislation’s one attempt to acknowledge the suffering of Americans at the hands of this vastly toxic financial system? “Of all the uses of TARP, the only one that has clearly failed is the attempt to channel mortgage relief funds to troubled homeowners,” it conceded. “But even in that case, there’s a silver lining: So few people ended up qualifying that TARP has spent hardly any of the $41 billion it set aside for the job.” The thorough mendacity of this argument notwithstanding, it represents a slight rivision on its February stance on HAMP, in which the “silver lining” was that homeowners shouldn’t get relief at all: “You could almost call it a successful failure,” that one had concluded.
Like Geithner, the Post seemed to dislike the TARP primarily because it involved the intrusion of government officials charged with monitoring the flow of billions back and forth from Treasury on behalf of the supposed interest of taxpayers, like the “simplistic and hyperbolic” TARP overseer Elizabeth Warren, whose assignment to the job of setting up a Bureau of Consumer Financial Protection in September elicited condemation from the Post on grounds of her record of “zealous campaigns against what she called the ‘tricks and tracks’ of the banking industry.” The newspaper seems to hold in even lower regard TARP inspector general Neil Barofsky, stridently rebuking him for falling captive to the “enduring political clout” of a “special interest group” over a report questioning the criteria of the Administration’s indiscriminate and random shutdown of dealerships during the auto bailout and taking this incontrovertible evidence of Barofsky’s beholdenness as all the reason they needed to ignore anything else his 157-page quarterly report had to say, such as:
Notwithstanding this scaling back of TARP, an examination of the broader context demonstrates that the overall Governmental efforts to stabilize the economy have not diminished. Indeed, the current outstanding balance of overall Federal support for the nation’s financial system, in actual expenditures and guarantees, including ongoing initiatives run by the Federal Reserve System, the Federal Deposit Insurance Corporation, the Department of the Treasury, the U.S. Department of Housing and Urban Development, and other Federal agencies, has actually increased more than 23% over the past year, from approximately $3.0 trillion to $3.7 trillion, the equivalent of a fully deployed TARP program, largely without additional Congressional action, even as the banking crisis has, by most measures, abated from its most acute phases.
Other Washington Post editorials have characterized legislators’ shows of consternation over Wall Street corporate welfare variously as “grandstanding“, “dramatizing”, “political points scor[ing]”, and (among many others) “a fit of affected populism.” (The “fit” in question, over the $165 million in bonuses Geithner personally approved to compensate executives of AIG Financial Products months for their efforts unwinding the deranged bets that had required their $183 billion bailout, a necessary decision over which one editorial sarcastically accused Obama of opportunistically “declaring his ‘anger.'” (This was of course all the encouragement the Congressional Black Congress needed to justify spending the next six months, the page noted in a sarcastic Thanksgiving Day editorial, taking every opportunity to “hector” and “scapegoat” Geithner for their own unemployment problems.)
Mercifully for the Post’s conspicuously employed editorial writer, Geithner prevailed, steering economic policymakers away from what might have been a “massive and counterproductive federal intervention into corporate compensation decisions” and even avoiding lighter proposals like “say on pay,” whereby shareholders in a company might have been able to vote on executive pay practices, a proposal they predicted would render the day-to-day business of running a corporation as bureaucratic and dysfunctional as balancing the budget of the state of California.
Now, Tim Geithner has quite a chorus of mouthpieces in the mainstream media, which long been populated largely by that uncontroversial wing of the Democratic party that has always had problems giving a shit defending the economic interests of people whose party invitations they do not covet or the human rights of poor people who don’t happen to be desperate migrants fleeing the impoverished homeland of the world’s richest man to take the jobs our lazy natives (in their somehow unimpeachable version of events) “refuse to hold”, at least for the going market wage of something considerably less than the officially-posted pay of at least $7.90 an hour an English speaking native is taught to expect for a job skinning cattle hides on 20-second “work cycles” and that sort of thing.
So when I learned the newspaper’s editorials on economics are written mainly by Charles Lane, the former New Republic editor whose character, you’ll recall, was played by Peter Sarsgaard in the movie about Stephen Glass, I chalked the Post‘s above-average enthusiasm with regard to towing the Treasury line to Lane’s established weakness for the tall tales of obsequious fabulists.
Then I looked at some of Lane’s entries on the Post‘s “Post Partisan” blog, in which he has lambasted consternation about the prospect of Americans being unable to afford food on the basis of how many fat people we have here; dismissed public outcry over the epidemic of teacher layoffs in cash-strapped states on the grounds that, since unemployment is still much lower among teachers than it is in most non-financial industries, “you could argue that it’s the teachers’ turn to absorb some of the pain that they have been spared to date”; drawn outright preposterous comparisons in posts with no apparent point other than to display his fact-blind loyalty to Larry Summers and Israel; admonished Obama for insufficiently pandering to Glenn Beck and Paul McCartney for cracking a joke about George W. Bush; and called for Congress to lower the minimum wage.
Taken together, Lane’s views seem more like those of one of those just-a-hair-to-the-left-of-Grover Norquist right-wing ideologue whose affiliation I’m more accustomed to associating with words like “Heritage”; “Hoover”; “Freedom” or “Unification Church” than the Washington Post.But it’s been a long time since last I lived here. And while the guys in charge of the nation’s economic policy haven’t changed all that much, the times have certainly become more “churlish.” The combination requires a new era of radical postpartisanship, a cause for which Charles Lane is apparently ready to martyr himself.