In Wake of JP Morgan Chase Debacle, Where is the Tea Party Again?

The fine folks at JP Morgan Chase continued to make unchecked bets (the same kind that A.I.G. made and got burned) and lost big: $2 Billion in the last 6 weeks.  A few of those folks have since lost their jobs.  But not the man who lobbied the hardest against regulations that would prevent Chase from making those bets – no, he still has his job.  The shareholders are doing what they’re supposed to be doing: asking tough questions.  Will Dimon keep his job?  Sure – crony capitalism rewards failures at the top.

What I want to know is where are the massive rallies by the Tea Party calling for Dimon to be fired and regulations to be imposed on gamblers masquerading as bankers?

The answer is easy: there aren’t any and there won’t be any.  The Tea Party was co-opted by the same folks who perpetrated the worst activities that led up to the Great Recession and our continued economic malaise.  No substantive changes were made in the way Chase or other banks do business – save the tens of Trillions of dollars they got for free from the Federal Reserve.

The co-opting included distracting the populists in the Tea Party with the supposedly scarier threat of a Black Man in the White House.

Meanwhile, speculators were allowed to run up the cost of oil and gasoline, which acts as a choke collar on the American economy, and other right-wing economic theories were imposed across Europe, which has led to what is likely to be another recession:

[h/t Bonddad]

The combination of high oil/gas prices, US corporations sitting on Trillions of dollars in cash (not hiring), and European economic weakness will not help the US economy.  Will our “recovery” be over soon; will we follow Europe into weaker and weaker economic conditions?  Don’t ask the Tea Party, they don’t truly care.

Bush and Banks Robbing the American Taxpayer

I’ve written about this a little since Sep 15th, when everything in the financial markets went to hell.  I didn’t trust the Bush “administration” to handle the financial crisis with any degree of honesty or integrity.  I take no pleasure in reading news reports that my worst fears continue to come true.  Bush and Sec. Treasury Paulson are taking American taxpayers for a ride; a ride that they will never be held accountable.  How bad is it already?  As detailed by Jerome a Paris, here are the up-to-date details:

• the original $700 billion bailout;
• an additional $140 billion in tax breaks for banks (quietly non-announced by the Bushies);
• $150 billion for AIG, on much sweeter terms than they were paying for the earlier $85 billion bailout (with a whoopping 5% drop in the interest rate they have to pay, for instance);
• lest we forget, the $29 billion guarantee to JPMorgan for Bear Stearns assets (but that’s almost small change now);
• and $1,200 billion new liabilities on the Fed’s (ie ultimately the taxpayers’) balance sheet, backed by mostly junk paper;

That’s $2.3 Trillion in just under two months’ time.  From a party that will whine for the next four years that Democrats are being fiscally conservative.  Is it responsible or moral to give away more taxpayer money to banks that ran around unregulated for years?  Is it responsible or moral to renegotiate the AIG deal with a lower interest rate when they blew through their original giveaway in a few weeks’ time?  Is it moral or responsible for the Federal Reserve to refuse to identify the recipients of almost $2 trillion of emergency loans from American taxpayers or the troubled assets the central bank is accepting as collateral?

This is the kind of immoral and irresponsible behavior that cost the Cons the 2008 elections.  Yet, the lesson they’ve learned so far from the elections is they didn’t attack Democrats enough; they weren’t loud enough about their failed ideas and policies.  Believe me, the American voter heard more than enough disgusting Con attacks.  Voters have suffered under the Cons’ failed policies.  The problem is Con policies are too extreme for America.  If Cons want to come back toward the center-left the nation actually occupies, they’ll win plenty of elections.

Random Pieces 3/17/08 – Updated

Happy St. Patrick’s Day!

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I’m sure more than a few of us read that the Federal Reserve and JP Morgan Chase bailed out the large investment firm Bear Stearns last week. Actually, we’re the ones that bailed the bank out. Jeff Blum at OpenLeft has some darn good questions. For instance, why can’t we provide a few billion dollars to help out the borrowers? What benefit will bailing out this firm provide the rest of us?

My feelings on this are: we shouldn’t be bailing out large investment firms that knowingly took on incredibly risky investments. It’s interesting to listen to the economic elite put all the blame on the sub-prime mortgage mess on the people who signed the papers. According to the lenders, if people didn’t know what they were signing for, they shouldn’t have signed. Therefore, they deserve what happens to them. Well guess what, turnabout is fair play. If the borrowers should have known what they were getting themselves into, what responsibility should the lenders have? Apparently none.

Additionally, I find it very interesting that this move is reminiscent of activities last undertaken … in the Great Depression. But according to Bush, the economy is doing just fine! Why do Democrats constantly have to clean up Republican’t messages?

I also think it’s disgusting that these same elitists want government to stay out of their business with regard to application of regulations, but as soon as things look bleak they think it’s the government’s responsibility to bail them out. Seriously, WTF?! Does the ‘free market’ work or does it not? Really, who are the real welfare queens? Bear Stearns and the other large firms got themselves and the rest of us into this mess, more knowingly than those who borrowed from them. I have absolutely no pity for these entities who operated for years as though they were above the law. They should reap what they sowed – maybe a couple large firms’ failures would serve as a wake-up call to the remainder of them to work with regulators in the future. Bailing this firm out sends a message to all of the firms that taking on too much risk is okay since the taxpayers allow themselves to be fleeced time and time again.

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I love conservative economic policies. The U.S. is no longer the world’s largest economy.

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Update – Well isn’t this interesting: Bonuses handed out in 2006 at Bear Stearns totaled $2.6 BILLLION. As of today, the company is only worth 1/10 of that, down from $40B back in January. Tell me again why taxpayers got saddled with a multi-billion dollar bailout please. Oh yeah, because regulation is bad and greed is good.

Remember this when you pay your next insurance premium: we can’t afford universal health care because it’s more important to bail out Bear Stearns.

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Update 2 – Granny Doc nails it.