Editore"s Note
Tilting at Windmills

Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

September 17, 2008

ANOTHER MCCAIN REINVENTION UNDERWAY.... Yesterday, on the "Today" show, John McCain rejected the notion of government intervention to support AIG, saying, "I do not believe that the American taxpayer should be on the hook for AIG." NBC's Matt Lauer asked, "So, if we get to the point, in the middle of the week when AIG might have to file for bankruptcy, they're on their own?" McCain replied, "Well, they're on their own."

This morning on "Good Morning America," McCain took a far different line on the bailout. "I didn't want to do that. And I don't think anybody I know wanted to do that. But there are literally millions of people whose retirement, whose investment, whose insurance were at risk here," McCain said.

It was yet another reminder that when it comes to addressing trying economic times, McCain has to pretend he never believed all of the things he's always believed.

A decade ago, Sen. John McCain embraced legislation to broadly deregulate the banking and insurance industries, helping to sweep aside a thicket of rules established over decades in favor of a less restricted financial marketplace that proponents said would result in greater economic growth.

Now, as the Bush administration scrambles to prevent the collapse of the American International Group (AIG), the nation's largest insurance company, and stabilize a tumultuous Wall Street, the Republican presidential nominee is scrambling to recast himself as a champion of regulation to end "reckless conduct, corruption and unbridled greed" on Wall Street. [...]

McCain hopes to tap into anger among voters who are looking for someone to blame for the economic meltdown that threatens their home values, bank accounts and 401(k) plans. But his past support of congressional deregulation efforts and his arguments against "government interference" in the free market by federal, state and local officials have given Sen. Barack Obama an opening to press the advantage Democrats traditionally have in times of economic trouble.

This is more than just about giving Obama an opening; it's principally about McCain trying to reinvent himself on the fly, hoping no one notices.

[In 1999], McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country's financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies.

That bill allowed AIG to participate in the gold rush of a rapidly expanding global banking and investment market. But the legislation also helped pave the way for companies such as AIG and Lehman Brothers to become behemoths laden with bad loans and investments.

McCain now condemns the executives at those companies for pursuing the ambitions that the Gramm-Leach-Bliley Act made possible.

In other words, McCain personally gave the financial industry a green light to do exactly what they did. And now he's outraged.

It's precisely why McCain's economic message has been so oddly incoherent this week. Turning on a dime, he's gone from supporting fewer regulations to supporting more, from supporting less oversight to supporting more. McCain is slamming Wall Street execs for playing a dangerous game after McCain helped throw out the rules.

McCain said during the Republican primaries, "The issue of economics is not something I've understood as well as I should." He continues to prove it with each passing day.

Steve Benen 11:16 AM Permalink | Trackbacks | Comments (40)

Bookmark and Share
 
Comments

The Honorable Senator John McCain has, I presume, a bit of Scot in him so let him hear me out - Fool me once, Shame on you! Fool me twice, Shame on me!

Well, the Keating Five would seem to be shame on them, and with this current crisis, Shame on Who?

Oh, I forgot, from what I've seen over the past 6 months, John McCain has no shame! -Kevo

Posted by: kevo on September 17, 2008 at 11:21 AM | PERMALINK

[In 1999], McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.)

And let's not forget that in 1996, McCain wanted Gramm to be president.

Posted by: danp on September 17, 2008 at 11:22 AM | PERMALINK

"This is more than just about giving Obama an opening; it's principally about McCain trying to reinvent himself on the fly, hoping no one notices."

This is something Obama needs to jump on NOW (we can't count the MSM doing it on their own, they need a push). Show both interviews back to back in an ad. Note they are both ONE DAY Apart. Feed the growing meme that McCain LIES, DISTORTS and will SAY ANYTHING to get elected.

It also feeds how much he flip-flops.

Posted by: thorin-1 on September 17, 2008 at 11:24 AM | PERMALINK

They need to pound on Gramm until it's impossible to separate him and his work from that of the McCain campaign.

Since they're one and the same, that's only fair.

Posted by: TR on September 17, 2008 at 11:26 AM | PERMALINK

Can we call John, the Weathervane?

Posted by: Former Dan on September 17, 2008 at 11:30 AM | PERMALINK

The answer is, and was, that we need to bail out AIG.

If you look back, Bear Sterns died very quickly and needed to be bailed out because an unplanned bankruptcy might have been deadly.

Fannie and Freddie were too big to fail and had an implicit guarantee on the debt already. So we bailed out the debt, which we would have had to do in any case, and made the stock basically worthless.

Lehman was in big, big trouble for a long time. If you were doing business with Lehman last week then you should have known the risks you were taking. (The averge guy who had an account at Lehman is, and was, unaffected by the failure.)

AIG fell apart too quickly. Who would have thought last Friday that AIG would have failed on Tuesday?? I have my life insurance with AIG. It is safe, and, because of regulation, would have been safe even if AIG failed.

If AIG declared bankruptcy this morning it might have triggered a 5,000 point drop in the Dow. I would have been shocked if the drop would have been less than 3,000 points.

Anyway, getting to your main point. McCain and Biden were wrong when they said that we shouldn't bail out AIG.

Before you flame me about never helping the little guy, I am in Houston and I didn't need to evacuate. However, those jerks in Galveston who stayed after a manditory evacuation are getting bailed out right now. They are lucky they aren't dead. We do bail out the little guy when they make dumb moves too.

Posted by: neil wilson on September 17, 2008 at 11:31 AM | PERMALINK

John McDrool is so desperate to win before he kicks the bucket that he's become a shameless panderer who shape-shifts his positions to accomodate the winds du jour. It is not a pretty sight.

Posted by: Doofus on September 17, 2008 at 11:31 AM | PERMALINK

McCain seems to be blaming the whole mess on greed and corruption on Wall Street. There is greed and corruption on Wall Street just as there is in all sectors. The greater problem is the rigid adherence by certain Republicans to a market philosphy that does not work perfectly. Just as we believe in the need for "evidence based medicine," we need "evidence-based regulation." Lower taxes and deregulation is the mantra of these Repbulicans, and it ignores results which allow greed and corruption to flourish.

Posted by: livelytom on September 17, 2008 at 11:39 AM | PERMALINK

Hey, McCain, if you remove the speed limits, don't act shocked -- shocked!! -- when people drive like maniacs.

The ironic part is that all the "onerous regulation" these companies chafed against would have saved them from their own worst instincts and kept them in business.

Posted by: gradysu on September 17, 2008 at 11:40 AM | PERMALINK

Can we call John, the Weathervane? -Former Dan

Ol' Weathervane McCain. A little burst of hot air is all it takes to get him to change direction.

Reminds me of the icon I made for the Official John McCain Flip-Flop List.

Posted by: doubtful on September 17, 2008 at 11:43 AM | PERMALINK

Obama really needs to be hitting McCain hard over his lack of understanding of the economy and his temper. Thad Cochran, the Republican Senator for Mississippi, had a great quote a while back about how McCain is too hotheaded to be President, but I haven't heard about the Obama campaign using it.

Posted by: mfw13 on September 17, 2008 at 11:45 AM | PERMALINK

[In 1999], McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign. The Gramm-Leach-Bliley Act aimed to make the country's financial institutions competitive by removing the Depression-era walls between banking, investment and insurance companies.

I think it's interesting to note that Bill Clinton signed this bill (something somebody should ask him about after the election).

In addition, if Hillary were the VP pick, I can't help but wonder if we would lose this issue as a line of attack (undoubtedly, she'd claim that she privately argued against Gramm-Leach-Bliley while simultaneously advocating for it in public).

Also, where was Biden on this issue?

We can't be too careful.

Posted by: CJ on September 17, 2008 at 11:45 AM | PERMALINK

McCain really does not understand jack about economics or finance. That flip flop on AIG is classic. It's obvious his handlers briefed him in between the two statements.

It reminds me of Bush on foreign policy - before he was elected, he never went outside the USA, he didn't know the names of anyone, Musharraf's name was "General", etc.

With Bush, the save came when the narrative came out that Bush would "surround" himself with smart foreign policy experts. We all know how that turned out, but McCain can't say the same. His "economic experts" got us into this mess (Phil Gramm) and represent the worst of the empty suit CEO class (Carly Fiorina). I wonder what he'll do?

Posted by: Joshua on September 17, 2008 at 11:45 AM | PERMALINK

This is the third reinvention of John McCain in less than two weeks. I don't think anybody is going to give John a pass this time. I suspect he is going to be grilled on this topic over and over again. It's news, real news.

Posted by: Ron Byers on September 17, 2008 at 11:49 AM | PERMALINK

Aren't there around 486 other Republicans running for national office? How much do they agree with their party's next leader? How much does he agree with them? How do they manage the massive message synchronization effort when the message changes so often?

Posted by: apm on September 17, 2008 at 11:52 AM | PERMALINK

Also, where was Biden on this issue?
According to Govtrack, Biden voted "Nay" on Gramm-Leach-Bliley.

Posted by: Dennis - SGMM on September 17, 2008 at 11:53 AM | PERMALINK

Yes, Johnny, please help rescue us from yourself.

Posted by: Vincent on September 17, 2008 at 11:59 AM | PERMALINK

It is interesting to watch a leopard trying to change its spots.

I would like some talking head to ask McCain if he now repudiates his previous votes in favor of deregulation and if he now believes he was wrong. It's a simple question.

Posted by: Lori on September 17, 2008 at 12:00 PM | PERMALINK

John McCain has been taken over by Karl Rove and no longer has any control over what comes out of his mouth. At this point the only presidential slot he's worthy of is in Disney's "Hall of Presidents" where the words of the robotic former heads of state mingle with the clack and whir of the machinations that drive their awkward, obvious movements.

Posted by: chrenson on September 17, 2008 at 12:03 PM | PERMALINK

In the Senate every Dem voted against it except Fritz Hollings.

Camus

Posted by: on September 17, 2008 at 12:03 PM | PERMALINK

McCain has a verbal habit that he uses everywhere when he needs to talk about his policies.

It is kind of a punt, or an indemnification, or a hedge "I don't really like policy X".

Today it is "I didn't want to do that."

This has as much real substance as "I don't like paying taxes" or "I really didn't mean to spend that much on clothes".

This is a pretty weak hedge where he passes the buck and never acknowledges the difference between his ideological world view and reality.

Another example is his blaming Obama for the tone of his campaign.

But why are these examples not used against him?

He is basically saying that he is weak, nobody listens to his ideas, or follows them and almost everything should be done differently. In other words: he isn't a leader. He hasn't lead by example, by persuasion, by personal qualities, so his solution is that he needs more actual power, as president, to get stuff done. Almost all of his rhetoric is steeped in the language of the victim.

We don't need this in a president, he will continue in the role of victim even as president.

Posted by: tomj on September 17, 2008 at 12:33 PM | PERMALINK

But McCain did take time yesterday to attack Obama for 'trying to exploit the financial disaster for political gain'
http://www.post-gazette.com/pg/08260/912618-100.stm

Posted by: N.Wells on September 17, 2008 at 12:36 PM | PERMALINK

I was going to e-mail Steve Benen about these awesome new flip flops (78 and 79 I think). Then I saw who wrote the post.

oooooops

Posted by: Robert Waldmann on September 17, 2008 at 12:37 PM | PERMALINK

So far the American people have shown no sign of understanding the ideological difference between Republicans and Democrats, and in particular, that these last eight years have demonstrated, in graphic terms, that Reaganomics doesn't work.

Given that, it seems this election will be viewed as simply a personality contest between Obama and Palin/McCain (Biden is a stealth candidate at this point, having dropped off the radar screen). And I am very concerned that Obama's more aggressive style won't produce results, but simply antagonize those who have already decided on Palin/McCain.

Posted by: hark on September 17, 2008 at 12:40 PM | PERMALINK

John McCain has steadily sunk to the point where he is totally ineffective as an executive, in any capacity.

(2009: a distracted aide rushes in to the Oval office, tie askew; "Mr. President!! Mr. President!! The Chinese have crossed the Taiwan Strait in force! They're retaking Taiwan!!! What do we do??"

CAMERA ONE: Closeup of President McCain seated at his desk, popeyed with shock and obviously playing for time: "Ummm....would that be the Shiite Chinese, or the Sunni Chinese, Tom? I mean, maybe we should bomb Iran! Can't be too careful, you know, when the security and prosperity of the American people are at stake! I know, because I was a POW for quite a long time."

CAMERA TWO: Pan hard right and zoom on Vice-President Palin, on her feet with fists clenched: "Everybody just stay calm!! All right, is there a professional snowmobile racer here? No?? FUCK! Well, does anyone know how to gut a moose? What???What the hell is the matter with you people? Do I have to do EVERYTHING myself??"

FADE TO BLACK.)

Posted by: Mark on September 17, 2008 at 12:56 PM | PERMALINK

If I were the spin doctor...

"Senator McCain removed restrictions on banks with the intention that they would invest money in a manner that would produce greater profit so as to produce prosperity for shareholders. This was a wholly realistic expectation. It was not apparent that corporate management at multiple financial firms would recklessly commit suicide just because the flexibility to do so was available.

The flexibility was put in place to allow greater breadth of investment opportunities which many firms have used wisely and a few have incomprehensibly used to run themselves off cliffs. The outrage at the idiocy of Bear Sterns, AIG, and Lehman Brothers management is perfectly consistent with the business goals Senator McCain hoped to promote. The consequences of these measures are a result of his not having foreseen the heights of incompetence and irresponsibility some corporate directors were capable of. These will require minor fixes that Senator McCain is exceptiuonally qualified to enact."


If the McCain campaign would like to hire me as a speechwriter, I'll take whatever Karl Rove is getting + 20%.

Once I've collected my fees, expect me to sign off permanently having committed seppuku, having brought shame upon my family.

Posted by: williamjacobs on September 17, 2008 at 12:59 PM | PERMALINK

"In other words, McCain personally gave the financial industry a green light to do exactly what they did. And now he's outraged."

Mccain doesn't want to force companies to behave responsibly, but he gets mad at them when they don't. Similarly, think of his comment that he supports the "concept" of equal pay, but doesn't want to tie the hands of business. In other words, he wants them to pay women the same as men without forcing them to. And here we see the crux of conservative economics: Leave corporations alone and they'll do what's best for everyone. Bush said environmental regulations are unnecessary because corporations will take care to be low-pollution on their own- it didn't work. Corporations have to do what makes them the most money- if they put some moral principle over profit, their prices will simply be undercut by a less scrupulous company. This isn't a positive or negative moral trait- the point is that companies are not entities capable of morality. This is a fallacy embraced by the left as well- how many times have you heard a liberal friend complain about how Wal-Mart treats its employees? But why should Wal-Mart treat its employees better if it isn't required to do so? There will always be some other company willing to go the extra step for profit. That's why regulation is necessary- markets are too competitive to expect companies to voluntarily give up profits for the greater good. The only way is to force every company to do whatever we as citizens think is necessary- that way it's still a level playing field (note: this rant is largely inspired by Robert Reich's Supercapitalism, an excellent book about how we as citizens can adapt to a 21st century economy).

Getting back to the election, the simplest way to boil it down is this: John Mccain's philosophy is "trust the big guys- they've got your back." Obama's is "trust isn't enough- we need to watch them and make sure they're not taking advantage of us." Look at the number of big businesses and financial institutions failing and tell me who's right.

Posted by: Jurgan on September 17, 2008 at 12:59 PM | PERMALINK

Before you flame me about never helping the little guy, I am in Houston and I didn't need to evacuate. However, those jerks in Galveston who stayed after a mandatory evacuation are getting bailed out right now. --Neil Wilson

It's good you made it through Ike. Congratulations on your luck.

Staying in Galveston may have been foolish, but to label those who stayed as "jerks" is top grade assholery.

Posted by: Rob Gainey on September 17, 2008 at 1:02 PM | PERMALINK

And here is the price we pay (headliner on Drudge, making it the required story for the media to cover):

http://news.yahoo.com/s/ap/20080916/ap_on_bi_ge/bank_deposits_safety

Federal bank insurance fund dwindling

By MARCY GORDON, AP Business Writer Tue Sep 16, 7:49 PM ET

WASHINGTON - Banks are not the only ones struggling in the growing financial crisis. The fund established to insure their deposits is also feeling the pinch, and the taxpayer may be the lender of last resort.

The Federal Deposit Insurance Corp., whose insurance fund has slipped below the minimum target level set by Congress, could be forced to tap tax dollars through a Treasury Department loan if Washington Mutual Inc., the nation's largest thrift, or another struggling rival fails, economists and industry analysts said Tuesday.

...

Posted by: Neil B on September 17, 2008 at 1:13 PM | PERMALINK

[In 1999], McCain had joined with other Republicans to push through landmark legislation sponsored by then-Sen. Phil Gramm (Tex.), who is now an economic adviser to his campaign.

McCain now condemns the executives at those companies for pursuing the ambitions that the Gramm-Leach-Bliley Act made possible.

In other words, McCain personally gave the financial industry a green light to do exactly what they did. And now he's outraged.

Forgive me Steve, but perhaps you can tell me how this blatantly "evil" bill somehow made it through a Democratic House and then got signed into law by a Democratic President? Don't they deserve the same amount of blame that you are attempting to saddle McCain with for "throwing out the rules"? Inquiring minds want to know. lol

Posted by: Chicounsel on September 17, 2008 at 1:13 PM | PERMALINK

Unfortunately, I fear that Hark has it right.

Issues and competence don't matter....it's just a personality contest.

Until the dominant media theme changes from "McCain is a honorable war hero and Palin is a spunky mom" to "McCain has become a dishonorable liar and Palin is a nice person but not qualified to be President", Obama is going to have a lot of trouble regaining the upper hand.

Right now, the fact that Obama & Biden are far more qualified than McCain & Plain to run the country has become irrelevant.

The race for the presidency has become "American Idol".....

Posted by: mfw13 on September 17, 2008 at 1:15 PM | PERMALINK

OMG!! Just realized that in 1999, the GOP were in control of the House. My bad. But it was still signed into law by Bubba. Perhaps he was "conferring" with Monica at the time and simply checked the wrong box.

Posted by: Chicounsel on September 17, 2008 at 1:19 PM | PERMALINK

I wonder how much John and Cindy's net worth has plummeted in the past week. Those would be some nice numbers to get a hold of... "Sure John McCain supports regulation... when his retirement/portfolio is on the line."

Posted by: Matt on September 17, 2008 at 1:23 PM | PERMALINK


chico...perhaps he snuck it into the bill...like he did with the change in energy trading he snuck into the omnibus spending bill in late 2000...

say....

how'd that work out for the energy trading industry?

Posted by: mr. irony on September 17, 2008 at 1:24 PM | PERMALINK

Mr. Irony:

It does not appear to be the case that this something that stuck into a massive CR bill that Clinton had to sign.

The following is an excerpt of the White House Press Release for the day Clinton signed this into law:

16 November 1999-THE WHITE HOUSE: Office of the Press Secretary -- Statement by the President (C)1994-99 M2 COMMUNICATIONS LTD RDATE:121199 Today I am pleased to sign into law S. 900, the Gramm-Leach-Bliley Act. This historic legislation will modernize our financial services laws, stimulating greater innovation and competition in the financial services industry.


Posted by: Chicounsel on September 17, 2008 at 1:41 PM | PERMALINK

Chicounsel: Most of us know that Bills (I mean, laws ;-) ) are in the end compacted together using contributions from different lawmakers from usually both Parties. The sides try to compromise and can't get just what they want. The President has to sign what he's got on the desk or none at all, so it doesn't mean he (or she ...) thinks the Bill is ideal - just that signing is the LoTE compared to not signing it.

Republicans tend to push for the most permissive slant and measures inside the Bill, compared to Republicans - hence they are usually "more" to blame for what happens if permissiveness is a factor. And "more" or "less" is really all we're going to get with realistic politicians of either party. Likely: "But you knew that, didn't you?"

Even a conservative can understand this modest complexity and "nuance" about the issue ...

delver24

Posted by: Neil B on September 17, 2008 at 2:00 PM | PERMALINK

OMG!! Just realized that in 1999, the GOP were in control of the House. My bad. But it was still signed into law by Bubba.

Idiot.

Still, Chicounsel has a point. I say neither John McCain nor Bill Clinton deserves our vote for president this year.

Posted by: Gregory on September 17, 2008 at 2:29 PM | PERMALINK

McCain was in error to claim that people's insurance was at risk. It was not, no matter what happened to AIG. If that's his excuse, he's even more clueless than I had previously imagined.

Posted by: freelunch on September 17, 2008 at 2:53 PM | PERMALINK

Why is no one but kevo talking about the Keating Five? I was just a kid, I don't really remember, but it seems to me it had something to do with folks losing their homes, and John McCain's lust for deregulation was at fault (among other things)? Am I wrong?

Posted by: rabbit on September 17, 2008 at 3:04 PM | PERMALINK

There comes a time when the stupendiosity of stupidity and malfeasance and willful ignorance and bizarrity just calls for silence.

John McCain isn't fit to be President.

Posted by: MarkH on September 17, 2008 at 7:49 PM | PERMALINK




 

 

Read Jonathan Rowe remembrance and articles
Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

Advertise in WM



buy from Amazon and
support the Monthly