Some Facts Adrift in Calvin Woodward's Article

AP's Calvin Woodward did some fact-checking about statements made by Biden and Palin at the VP debate.

Johny Radio did some fact-checking about statements made by Calvin Woodward.

BIDEN: Complained about "economic policies of the last eight years" that led to "excessive deregulation."

WOODWARD: Biden voted for 1999 deregulation that liberal groups are blaming for part of the financial crisis today.

RADIO: First, Mr. Woodward, 1999 PRECEDES the past 8 years of the Bush administration. Biden was NOT INCORRECT when he complained about the past 8 years of excessive deregulation. It's true.

Woodward is correct that Biden voted for the 1999 deregulation. That 1999 deregulation is the "Gramm-Leach-Bliley Act" (or "GLB"), which repealed a decades-old restriction on the ability of commercial banks to invest in the stock market.

That old restriction, the 1933 Glass-Steagall regulation, was put in place to prevent a repeat of the Great Depression, and to prevent consolidation of commercial banks, insurance companies, and the stock market such that the nation had all its eggs in one fiscal basket.

The 1999 GLB repeal of that restriction enabled vast mergers across the banking, securities, and insurance industries. It facilitated the predatory sub-prime lending boom that fed our current mortgage crisis. It removed government oversight on financial institutions. It "allowed interlocking directorships that made policing and unraveling the crisis like untangling a fishing reel backlash." It lowered the percentage of deposits banks were required to keep on reserve, in case of a bank-run. And, it articulated the concept that the government could not allow extremely large corporations to fail-- essentially, corporate welfare.

While it is true that President Clinton signed Gramm-Leach-Bliley, and Biden voted for it (and they should answer for that), the law was pushed through by a Republican Congress, was the result of decades of Republican pressure and a $100 million lobbying effort, and was authored by three Republicans. One of those authors, Phil Gramm, was the co-chair of John McCain's presidential campaign-- until McCain had to fire him for calling Americans "whiners" for complaining about the economy. We're not having a real economic recession, Gramm stated, only a "mental recession".

To be fair, Obama has stated he would not restore Glass-Steagall because, um, it's old fashioned.

As Mark Sumner reports in The Nation, Phil Gramm, McCain's chief economic advisor until the "whiner" gaffe, was a key figure in two other major financial crises: the S&L Crisis of 1988 which claimed the life-savings of tens of thousands, and the Enron Scandal, which cost the State of California $11 billion, along with the life-savings of thousands more people. Gramm calling us "whiners" is adding insult to injury.

Since officially stepping down from McCain's campaign, Gramm often accompanies McCain during the campaign, and continues to be an unofficial adviser on economic and financial matters.

McCain, lest we forget, was in 1989 at the center of one of the most explosive financial crimes of the decade, as one of the Keating Five-- an attempt to change financial regulations to justify a corporate felony that had already been committed, while enjoying hundreds of thousands of dollars in unclaimed luxury vacations, gifts, and good old, tax-free under-the-table cash. Reformer indeed.

The Washington Post printed about McCain: "In the aftermath of the Enron collapse and other accounting scandals, he was a leader..." What they neglect to mention is that BEFORE the Enron scandal, McCain's chief economic advisor, Phil Gramm, created the "Enron loophole" -- a regulatory gap that produced the Enron scandal, and which some analysts say is today the single greatest cause of out-of-control gasoline prices.

Sorry for whining.

If you really want to understand the mess we're in, read this article. It's not the dumbed-down pablum you get on CNN, but it's fascinating. It will implicate candidates from both sides of the aisle. If you're ready to go beyond sound-bites, give it a read.

It's simply common knowledge that the Republicans are the proud party of deregulation. It's misleading, at this time of economic crisis, for Palin, McCain, or Calvin Woodward to claim otherwise.

Biden, like most Dems, has over the course of his career voted against deregulation. McCain, like most Republicans, has over the course of his career championed deregulation. Big surprise.

In this writer's view, we need a new Glass-Steagall, with regulations designed to accommodate modern financial systems and instruments, to protect our economy from fallout without hobbling economic growth. But this $700 billion "bail out" plan does not address the roots of the crisis-- it's a kick-back. The most articulate reason we've heard from our Congress-people is "doing something is better than doing nothing."

What I want for Hannukah: some brains and guts in Washington.

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BIDEN: McCain's tax credit "will go straight to the insurance company."
WOODWARD: That's "not surprising".
RADIO: Maybe it's "not surprising", but it's NOT INCORRECT either. So it has no place in your "facts adrift" list.

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BIDEN: "McCain supports tax breaks for oil companies"
WOODWARD: McCain supports a cut in income taxes for all corporations.
RADIO: A cut for "all corporations" includes oil companies. Biden's statement was NOT INCORRECT, and does not belong in your list of "facts adrift".

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BIDEN: "McCain wants to deregulate the health care industry — like he did for the banking industry."

WOODWARD: McCain wrote: "Opening up the health insurance market to more vigorous nationwide competition, as we have done over the last decade in banking, would provide more choices of innovative products less burdened by the worst excesses of state-based regulation."

RADIO: How is what Biden said in any way contrary to McCain's statement? Check our economy to see the benefits of deregulating the banking industry.

Some facts adrift in veep debate

mattielax61

Fri Oct 3

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