5.13.12: You Can't Erase History

Aaron Ross Sorkin accurately said today that one of the problems for the banks is not that they're too big to fail, something that Jamie Dimon said did not support, but too big to manage.  The question is how can one Mr. Dimon, who is regarded as one of the best in his business, miss what he called a major mistake.  He went farther by saying that, "We know we were sloppy, we know we were stupid, and we know we used bad judgement."  Yet, RNC Chairman Reince Priebus said this was an example of how the Dodd-Frank law didn't work, meaning that we need to get rid of it.  We would conclude that he means that we would replace it with nothing, hence making the effort by investigators now looking into the bank's actions unnecessary in finding out why the bank lost $2 billion by trading credit derivatives and were designed to hedge against financial risk.

But if the CEO of JP Morgan Chase said that his company was sloppy, that means that they don't have a handle on or a proper way to monitor the traders that work for there.  It's an industry that has little time or interest in policing itself, but at the same token doesn't want to be regulated.  Our feeling is that you can not put blame on the banks for tanking the economy in 2008.  The rules at the time were that there were essentially no rules, and traders' obligations are to the bank and making money, not to a single home owner in Florida.  If we do not want to see another crisis like this again, then the government for the general welfare of the people have to put rules in place as prevention measures.  Of course the financial industry isn't going to like it, but as Mr. Dimon said, he supports large parts of the Dodd-Frank law.  However, he has also been critical, of course, so let's not deem Mr. Dimon with too many magnanimous-type adjectives,  especially when he talks about how the industry is in favor of letting the Bush tax cuts expire and raising the rates on capital gains. 

What we saw on today's show was a banker speaking more responsibly about the overall good of the the American people than a political party representative, the representative.  The logic is if a part doesn't work, you fix or replace it with something stronger, not to get rid of the part and then hope the thing still works without it.  But that is what Reince Priebus was advocating for today. Get rid of Dodd-Frank and replace it with nothing, and you will see a financial boom, but only in the short-term until the same thing happens all over, but not with housing, but some other industry next time.  Playing for the short-term is popular, instant gratification is now a core American trait, and that's the promise that Republicans carry with them.  However, it does nothing for the sustainable economic health of the country.  The cycle that we're seeing - Republicans delivering us 'high' times followed by a complete bust; then Democrats getting into office to try to clean up the mess, causing people, spurred by the Republican rhetoric, to become impatient for more high times; and then the Republicans, hoping the public forget the details of why they caused the problems in the first place, ask for control again and claiming that the law has made things worse. As Senator Carl Levin (D-MI) said, the war is within Washington.

Then you come to moments like these, 7 months before the election, with the RNC Chairman on Meet The Press taking cheap shots at the President saying that Mr. Obama is in love with the sound of his own voice and hasn't fulfilled the promises that he set.  All Republicans say that, and they all leave out the second part, which is that we're going to block every effort on his part to make good on those promises. 

[With all this stinging commentary, we as a column must officially go on record (again) to say that we're no fan of Reince Priebus and he does the Republican party, even in its currently radicalized state, a disservice as its foremost spokesperson.]

 But make no mistake, Mr. Priebus, the Republican Party and their corporate backers know that the country's demographics are changing to a more Democratic viewpoint and if Republican want to have their way and serve its interests, the time is now.  This is why you see a Republican House passing all kinds of bills that won't become law. It's like throwing darts at a board with your back turned, over the shoulder.  It's awkward and consistently miss the mark, but by chance you might hit it once.  That's what Republicans hope to accomplish in this instance. 

Economically, Republicans would like to return the country to Bush-era policies, we all know this, but the key word here is return, but we can not go back.  From this point, banks need to build their business given the rules in place because they have proven to be irresponsible [think Mr. Dimon's "We know we acted stupidly."]. 

What we said above translates to the marriage equity debate in as much as that Republicans should not be concerned with being on the wrong side of history (the short-term), but being history (the long-term).  They have to be willing to adapt or risk irrelevance. 

Last week, a funny thing happened on Meet The Press.  Usually, a historic act makes news, this time making news prompted a historic act, and after Vice President Joe Biden said he was 'comfortable' with gay marriage, the President came out and said that he personally was for it as well.  (Legislatively, he would leave it to the states to decide.) Chris Matthews found it interesting why the Administration would want to publicize the friction in the White House caused by Mr. Biden being out front on the issue.  We think that's the reason, the Obama Administration is stern when it comes to people knowing who exactly drives the boat, and that's Barack Obama.  It's not some kind of Bush-Cheney situation where the joke.. urrrr reality... was that Cheney really called all the shots.

Refreshingly, on today's program, the Chairman of the American Conservative Union Al Cardenas said that he was surprised by people's surprise. "A lot to do about nothing," he said.  We wouldn't dismiss it like that, but he does have a point.  People shouldn't be that surprised.  However, he also said that he thought this would cause an uprising of social conservative in November the likes of which we haven't seen for 20 some odd years.  Here, we would disagree because from 20 years ago to now, too many people's attitudes have changed, as well as demographics, and the impact he's suggesting will not come to fruition.

However, as Jonathan Capeheart noted, this is not a slam dunk for President though it has buoyed millions psychologically.  Within the body politic of Washington, the lines are being drawn, and not in sand.  People are looking for the permanent marker as we head down the stretch of the Presidential election, and Republicans are trying to figure out a way to ultilize the President's historic stance on gay marriage against him beyond this one issue because they can not erase it.


Round Table:  Lt. Governor of California Gavin Newsom; Chairman of the American Conservative Union Al Cardenas; Washington Post columnists Kathleen Parker and Jonathan Capehart; and MSNBC’s Chris Matthews.