U.S. Politics, 8

[BloodRider]

Knitting, and knitting, and knitting.................

[Guest Raidne]

This rant would make more sense if the market did bear the inflated pricing, but it very clearly did not. Just like for about 8 or 9 months pogs were very popular and kids spent all their allowance to have the best ones, then they weren't worth anything anymore. It was my fault for buying something dumb that I should have seen wasn't worth what I was paying for it.

Tormund, that's a load of completely dishonest bullshit. Perhaps there are a few condos in Florida to which you could fairly make that comparison. That does not look like a graph representing pog sales to me.

The people on Wall Street did know, they also knew that they would receive government cash as soon as they asked for it. You, I believe, loudly advocated giving it to them, over my objections.

Oh, I don't think so. They didn't even realize they'd need it. Goldman had an inkling before everything went upside down, and then they shut the door on everyone else. Seriously - they did not know.

More importantly, I advocated a lot of things, none of which actually happened. And no, I still don't believe that letting the short-term credit market crash would have been even slightly a good idea. But I do think a little more...let's say finesse was called for, certainly.

ETA: I hereby also move that all further bad analogies only be to words not starting with P, unless they are more than 5 letters.

[Tormund Ukrainesbane]

Tormund, that's a load of completely dishonest bullshit. Perhaps there are a few condos in Florida to which you could fairly make that comparison. That does not look like a graph representing pog sales to me.

I don't see how. Anyone who was paying any kind of attention knew that the housing market was going to crash. People can't afford to spend 5 times their annual income on a house. Houses everywhere outside North Dakota were selling for way higher than the average incomes of their respective markets could bear up under.

Oh, I don't think so. They didn't even realize they'd need it. Goldman had an inkling before everything went upside down, and then they shut the door on everyone else. Seriously - they did not know.

I work for these guys, remember? They knew.

[TrackerNeil]

Democrats can only blame themselves for generally failing to realize how stupid people are. Karl Rove, like Adolf Hitler before him, realized that if you give people really any old excuse to go with (they have WMD! Polish saboteurs attacked our radio station!). But even he did not realize that people would actually vote for O'Donnell.

Although I don't agree that Americans are stupid, I think there is much truth in this statement. Democrats have this silly idea that because they are often on the right side of the issues in terms of policy, they'll win elections. In fact, you'll often hear Democrats say, "When we talk about the issues, we win." This is demonstrably not true, because Republicans have won many an election in which they were on the wrong side of the issues.

I think most people make most of their decisions emotionally, and that includes voting. That being said, the side that manages to frame its position in the most emotionally satisfying way tends to win regardless of the facts. (Obviously, when one arrives at a decision purely on emotion, the facts are meaningless.) Republicans, with their vast right-wing media machine, are quite adept at taking unsupported, unsustainable, and demonstrably foolish but emotionally satisfying positions on the issues, and winning thereby. Democrats, who think facts matter to most people, oftentimes goof it.

In essence, the car Republicans are trying to sell is older, uses more fuel and is less reliable than the car the Democrats are selling, but they're far better salesmen. Of course, Americans are then left with a lemon, but that's a different problem.

[Perin Stone]

I don't know. Did he? I suspect in same cases yes, and in others no, but people of your frame of mind seem to want to think everyone belongs to the latter group, and screw who gets hurt.

Which is plainly immoral, IMO. You can blame your psychological need to continue to believe in a just world, probably.

I mean, really, let's say 75% of people were greedy jerks who got in way over their heads (only, you know, not, like trillions of dollars over their heads tanking the entire national economy over fictitious assets while banking millions, but a couple hundred thousand in hopes of making a few tens of thousands).

And let's say 25% of people aren't.

What part of your brain says we should totally screw over the 25% because of the other 75%?

And, what I always really, really wonder that nobody can ever answer - what does punishing even that greedy 75% really get you? What are the actual benefits and costs of doing that? Have you thought about that?

Probably not. It's just emotion, and it's irrational, and it's why people vote for tea party candidates.

Where exactly was I saying that we should screw anyone?

Do I feel bad for the people that lost their jobs and/or got sick and lost their homes? Absolutely.

Do I feel bad all the people that got a mortgage they couldn't afford? Hell no.

My only "psychological need" is a belief that people should take responsibility for their actions, good or bad. Unfortunately it seems like I'm in the minority in that belief nowadays....

Guess I'll just have to go vote for my local tea partiers to make myself feel better. :rolleyes:

[MinDonner]

They knew, and yet they were pretending otherwise. Why? So they could continue suckering people into their pyramid scheme. I was paying a lot of attention to the housing market in the runup to the crash (put offer on house while prices still rising, waited a year for it to complete, hoping to God it wouldn't fall through or we'd be stuffed) and ALL the banks, newspapers, media*, everything, were insisting that house prices were a one-way bet. "It's a bubble!" was treated as tinfoil-hat craziness.

*the one exception here was Moneyweek, which is why this is now the only financial publication that I will trust

[Former Lord of Winterfell]

I'm not sure this is a bad thing. If employers start jettisoning group plans en masse, more people will be forced to the exchanges, which will then create a stronger constituency for improving them.

Except that if employers quit offering insurance because of the costs, then those same unacceptably high costs are going to be reflected in the costs of insurance offered in the exchanges. Employers dropping coverage is just a symptom, not the real problem. And if the exchanges won't permit insurers to raise rates, then they'll just quit offering insurance.

Perhaps even a public option will resurface, to my way of thinking also not a bad thing.

And I think that smart people within the Administration and in Congress know that. In essence, this plan is intended to fuck things up so badly that people will demand a public option, which is why those on the left who opposed the plan missed the point. However, I'm not so sure you'll get a public option. You may just get a rejection of government involvement period. It could go either way when the shit hits the fan, depending upon which way the political winds are blowing.

As for the poll, I've tried unsuccessfully to find the actual questions, but I'm curious about the claim that most people support eliminating preexisting condition limits. Sure, if you asked most people that question standing alone, they'd say yes because there's no apparent cost attached.

The real question is if they'd be willing to pay higher insurance premiums and higher taxes to eliminate restrictions on preexisting conditions. I"m not sure that question was asked.

Given that the vast majority of unions don't negotiate such provisions into their contracts, and don't even have such provisions in the plans they sponsor themselves, I wonder how willing people truly are to pay for the cost of that benefit.

[Guest Raidne]

Wait, are you arguing that Goldman knew the crisis was coming but didn't-expect-to / didn't-know-if-they-would receive a government handout?

No, I'm saying that nobody but Goldman saw the writing on the wall and that probably nobody even had time to think about the possibility of government handouts. Goldman turned around and tried to buy as many credit default swaps (CDS) as it could, and f*ck everyone else, and it did. F*ck everyone else. Because that's when the bottom dropped out of the collateralized debt obligation (CDO) market - that's when everyone actually saw the writing on the wall. Goldman led a charge to the door and then slammed it shut on everyone else.

Which is totally legit of them, it's just that it cost all of us a lot more money to bail everyone out because of it.

Also, strictly speaking, Goldman didn't get that much of a handout. They didn't need it. And, strictly speaking, taxpayers have gotten over 20% back on what we loaned them. But anyway, what they needed was for AIG to get a handout so they could get paid for their CDSs. They kind of got the biggest handout and kind of didn't get one at all.

But anyway, really, nobody was sitting around going, oh, screw this, let's take HUGE risks because the government will bail us out!!! Nobody had any idea that would be necessary.

[Former Lord of Winterfell]

But anyway, really, nobody was sitting around going, oh, screw this, let's take HUGE risks because the government will bail us out!!! Nobody had any idea that would be necessary.

I don't think it's quite that simple, but pretty close. A lot of people figured they'd make a shitload of money and then just bail fast when it all went south. Just because they couldn't predict exactly when the bottom would fall out doesn't mean they didn't know it was coming. They weren't playing roulette as much as they were playing musical chairs.

[TrackerNeil]

Except that if employers quit offering insurance because of the costs, then those same unacceptably high costs are going to be reflected in the costs of insurance offered in the exchanges. Employers dropping coverage is just a symptom, not the real problem. And if the exchanges won't permit insurers to raise rates, then they'll just quit offering insurance.

Or, the government will be forced to increase the subsidies to policyholders, which will create a real incentive for cost-saving measures. Still not a bad outcome, in my opinion.

As for the poll, I've tried unsuccessfully to find the actual questions, but I'm curious about the claim that most people support eliminating preexisting condition limits. Sure, if you asked most people that question standing alone, they'd say yes because there's no apparent cost attached.

In the poll I linked, look for questions 65-67.

[Tormund Ukrainesbane]

But anyway, really, nobody was sitting around going, oh, screw this, let's take HUGE risks because the government will bail us out!!! Nobody had any idea that would be necessary.

Yes they were. Unfortunately there is no evidence for either my side or your side on this matter.

[Guest Raidne]

Yes they were. Unfortunately there is no evidence for either my side or your side on this matter.

There is all kinds of evidence for my side on this. There are quotes galore. Much more importantly, there is market behavior - I'm not sure you really get this. You think all these ibanks realized that their CDOs were worthless and then just sat around waiting for the government buy out instead of trying to make money?

I mean, I get where you're coming from, but people and companies took huge, huge losses when they could have made boatloads of money if they were buying default swaps. You really think they wanted the handouts over the boatloads of money from buying default swaps? Because what you're saying is that they bet against themselves on purpose.

If you think that's true that you don't believe in capitalism as a theory and never did.

Do you really believe this?

Coco, I have no idea what you're getting at there. You think a three page government document is evidence of planning? Are you nuts? We were sending corporations documents with less information that an elementary school permission slip. There were two blanks - my corporation is ______ and I would like $________.

I've told you my version of the story. Tell me the story where there was planning. How did that play out? And what does Geithner being on the phone with Goldman have to do with anything?

I'm not trying to be difficult - really - I just don't get what you're saying.

[TrackerNeil]

Back on the Republican "Pledge to America", I noticed something interesting regarding preexisting conditions:

We will make it illegal for an insurance company to deny coverage to someone with prior coverage on the basis of a pre-existing condition, eliminate annual and lifetime spending caps, and prevent insurers from dropping your coverage just because you get sick.

The emphasis there is mine, but it's crucial. Some people who have a preexisting condition might have lost prior coverage and would, under the Republican plan, be eligible for discrimination. And I'm not the only one to notice.

Essentially, I think Republicans are stuck here. They hate the ACA, but repealing it won't happen soon and even so would involve re-instituting some really unpopular practices like rescission and, naturally, discrimination based on preexisting conditions. Yet they can't abandon their rhetorical commitment to repeal without sending the Erick Ericksons of the party into orbit.

[Former Lord of Winterfell]

In the poll I linked, look for questions 65-67.

I must have a mental block. I've paged through the thread twice and can't find the link.

Back on the Republican "Pledge to America", I noticed something interesting regarding preexisting conditions:

The emphasis there is mine, but it's crucial. Some people who have a preexisting condition might have lost prior coverage and would, under the Republican plan, be eligible for discrimination. And I'm not the only one to notice.

I like that plan better. What you're really trying to do is to stop people from gaming the system by only signing up for insurance after they become ill, but without having a mandate. You could tweak the GOP plan by also barring exclusion for people who lost insurance due to being unemployed but gained new employment and insurance. Those folks aren't gaming. Or maybe say that exclusion is permissible for people who were employed by an employer who offered insurance but they elected not to participate. That might be the better way to do it.

Essentially, I think Republicans are stuck here. They hate the ACA, but repealing it won't happen soon and even so would involve re-instituting some really unpopular practices like rescission and, naturally, discrimination based on preexisting conditions. Yet they can't abandon their rhetorical commitment to repeal without sending the Erick Ericksons of the party into orbit.

I don't know about that. I actually think there is a good middle gound on the pre-existing conditions angle that the GOP can sell to voters. I'm glad you posted that link and pointed out the language because I was concerned that the GOP was just going to adopt the whole "no preexisting conditions exclusion" position wholesale.

[Guest Raidne]

I know this is aimed at T, but I certainly don't think capitalism is what we think it is.

Oh I know. I was thinking when I wrote it, "well, I'm sure as hell not saying this to Coco..."

Like T said, I can't prove this. But the incest between banking and the feds is so tight and so deeply rooted that it seems a little naive to assume that the banks weren't expecting a handout.

No, I really don't think so. They just want the government to leave them alone. But they're just not smart enough to operate without regulation, and here we are. They just f*cked up. They are bad at their jobs. End of story. That's my two cents.

In any case, they got their handout, and they are rich and we are poor. They won.

But, at the end of the day, we agree on that. After all, they still have all the jobs that they're bad at.

[TrackerNeil]

I like that plan better. What you're really trying to do is to stop people from gaming the system by only signing up for insurance after they become ill, but without having a mandate. You could tweak the GOP plan by also barring exclusion for people who lost insurance due to being unemployed but gained new employment and insurance. Those folks aren't gaming. Or maybe say that exclusion is permissible for people who were employed by an employer who offered insurance but they elected not to participate. That might be the better way to do it.

I don't know about that. I actually think there is a good middle gound on the pre-existing conditions angle that the GOP can sell to voters. I'm glad you posted that link and pointed out the language because I was concerned that the GOP was just going to adopt the whole "no preexisting conditions exclusion" position wholesale.

Oh, I am quite certain the GOP isn't going to adopt that wholesale; as you previously admitted, the party is willing to leave the uninsured behind.

In any case, I don't intend to re-argue the merits of the ACA - it's law and that's that - but I don't think you appreciate just how difficult repeal would be. First of all, the thing has to pass the House, and I am not clear that every single Republican member would vote for it. Then it's got to pass the Senate, which would be impossible with a Democratic majority and - thanks to the filibuster - nearly impossible with anything less than a filibuster-proof Republican majority. Even if those things were to happen, the GOP would have to either get Obama to sign off (snicker) or override his veto (guffaw).

Even if the GOP takes back the White House in 2013 there would still be the filibuster to contend with, and in any case by then many of the benefits of the law would have been in place for years. By then, I imagine any imperative for repeal will have cooled considerably. Besides, if there is one thing I know about Americans it's that they hate to give up their government-sponsored benefits. I'd like to know who in the GOP is going to tell senior citizens that the doughnut hole is being reopened, or 25-year-olds that their insurance coverage through Mom and Dad is going away.

I think the GOP would be wise to simply recognize that the ACA is law and work to make the law more efficient and effective. However, if John Boehner and Eric Cantor want to waste their efforts tilting at legislative windmills...well, it means they're taking time away from other, more harmful plans that are actually possible to achieve.

[Guest Raidne]

Coco, the problem with that article is that there aren't any clans, and none of those people trust each other either. It's not that, as the article says, "only the players have the information." Nobody has the information.

This transcript of Michael Lewis' interview about Mike Barry, Goldman Sachs, and AIG explains where I'm coming from.

And, OTOH, what Lewis advocates is a great idea: "The first is, it's crazy that a Wall Street firm can advise customers to buy and sell stocks and bonds and at the same time be making bets with its own money on those stocks and bonds." This is true - we should forcibly separate those businesses.

And who is advocating that? Paul Volcker.

But to you, Coco, Paul Volcker is one of the amorphous "them" because he worked at Chase, Treasury, and the Federal Reserve.

I mean, look, there is plenty of crony capitalism going on. There is a Board of Interlocking Directorates, and all that stuff. But the crash here wasn't caused by that. It was caused by stupidity by many and greed and a violation of the duty to the shareholders on the part of a few.

[The Progressive]

The fact that it's worth less doesn't mean that you can't afford it anymore. It just means you feel bad about paying. Fucking DEAL.

Man, I'm with you there until this part. The fact that it's worth less now isn't the number one reason why many people stopped paying their mortgage but because they have been laid off.

[Tormund Ukrainesbane]

There is all kinds of evidence for my side on this. There are quotes galore. Much more importantly, there is market behavior - I'm not sure you really get this. You think all these ibanks realized that their CDOs were worthless and then just sat around waiting for the government buy out instead of trying to make money?

There are quotes galore. Because they were lying. You don't come out and say "We knew you suckers would pick up the bill." You say "Oh woe is me, no one could have known this would happen."

I mean, I get where you're coming from, but people and companies took huge, huge losses when they could have made boatloads of money if they were buying default swaps. You really think they wanted the handouts over the boatloads of money from buying default swaps? Because what you're saying is that they bet against themselves on purpose.

Except they didn't take huge losses did they? They got 40 billion dollar checks from you and I? And somehow they were all able to pay back that money within 9 months. How long should it take to come up with $40 billion? If you are taking catastrophic losses, a lot longer than 9 months.

If you think that's true that you don't believe in capitalism as a theory and never did.

People reaping private profit, but socialized risk? That doesn't resemble capitalism whatsoever.

Oh I know. I was thinking when I wrote it, "well, I'm sure as hell not saying this to Coco..."

No, I really don't think so. They just want the government to leave them alone. But they're just not smart enough to operate without regulation, and here we are. They just f*cked up. They are bad at their jobs. End of story. That's my two cents.

But, at the end of the day, we agree on that. After all, they still have all the jobs that they're bad at.

They don't want the government to leave them alone. They love the government. The government writes the regulations they tell the government to write. The government writes them a check whenever they are in trouble. The government has been doing this since the railroad debacle in the 1800's. That's how they knew the government would do it, because the government always bails out favored industries. Every. Time.

ETA:

Man, I'm with you there until this part. The fact that it's worth less now isn't the number one reason why many people stopped paying their mortgage but because they have been laid off.

My experience may be anecdotal, but it is something I deal with every day in a professional capacity, and that just isn't true. People are paying a $300K payment on a $200K house and they feel like they're being cheated, so they walk away. Some have been laid off, but they are the ones asking for help, the ones walking away are the ones who don't like the fact that they gambled and lost.

[Guest Raidne]

T, I'm pretty sure Wall Street was on track to make a lot more than a $40 billion payout from the goverment that didn't even cover their losses.

And I assure you, Wall Street does not love the government. You can make a good case why they should, but they certainly don't.

This is so freaking strange to be on to be on the other side of this argument. Always one extreme or the other. Why don't you and Coco get together and tag team Isk and Chats. I'll just watch.