(Hey… check this out! – promoted by Christian Avard)

VTblogosphereTV continues to assault the public access airwaves in central VT through ORCA Media and the Burlington area through V-CAM.

Now playing is an interview with JD Ryan, GMD frontpager and publisher of FiveBeforeChaos. Okay okay, he is a man who needs no introduction, as evidenced by his recent cavorting and galavanting about with Congress critters.

This interview was a blast. JD’s concerned that he cracked himself up a bit too much, but he just has to face the fact that he is funny. The first bit of the interview can be found over at FIve Before Chaos. More will follow over there, but I’d like to treat GMDers with the last portion of the interview, in which we discuss the Governor’s race, IRV, and Films of Questionable Quality. It all closes out with some Clinton harvest funk for your viewing and listening pleasure.

I really want to resist JD’s negative assessment of the Governor’s race. It is going to be a strong Democratic year nationwide, VT is  one of the most progressive states in the nation, and Douglas seems incredibly vulnerable to me. His record of vetoes alone ought to lose the race for him. His “the business of government is business” philosophy seems an incredibly poor match for the troubles we face.

But I just heard Douglas’s latest nasty but effective ad

and it makes me think he has got this one sewn up. With the wildly fluctuating polls, Pollina’s attempt to make it a two MAN race, and the hand-wringing and recriminations already  apparent on the left, it is hard to muster any hope for this race. Even the Legislative “keep Douglas under 50%” scenario seems increasingly unlikely.

Still,  with all that, I wonder about the question I asked JD. If Doulgas is below 50%, at what point would it be legitimate to choose the 2nd place finisher?  To me, if he is below 40%, that is a sure thing to unseat him. If he falls between 40-45%, then I would see that as fine grounds to unseat him, if not a slam dunk. It is that 45-49.9% range that is the most troubling to consider, and right now it is looking like the most likely scenario.

thoughts?

In a decision based on neither theory advanced in the debate here several months ago, Judge Sessions has ruled that Pollina is entitled to receive contributions up to $2,000.

I haven’t seen the decision yet, but the Free Press reports that the court ruled that announcing and raising funds as a Progressive qualified him to accept contributions for both the primary and general election ($1,000 each) despite not actually filing for the Progressive primary.  I’ll be interested to see the details of decision.  If the logic is taken at face value, a candidate wouldn’t even have to ever file at all to qualify for the $2,000 contribution limit.

The ruling also appears to open the door for a major party candidate to continue to accept contributions for the “primary” long after the actual primary.  Federal rules aren’t watertight by any means, but you do have to identify enough expenses that, at least in theory, were for the primary in order to use that portion of your total limit.  You also have to return general election contributions if you don’t make it past the primary.  Note in particular the first sentence of this excerpt from the FEC candidate guide:

A candidate is entitled to an election limit only if he or she seeks office in that election. Thus, a candidate who loses the primary (or otherwise does not participate in the general election) does not have a separate limit for the general. If a candidate accepts contributions for the general election before the primary is held and loses the primary (or does not otherwise participate in the general election), the candidate’s principal campaign committee must return the general election contributions

within 60 days of the primary.

the national Repub committee takes on Obama and ACORN.

The newest distraction du jour from the Republican Party side of politics is the non-existent but still well publicized “voter fraud” and other claimed (and unsubstantiated much less proven) voter registration transgressions on the part of ACORN … and Barack Obama who is apparently ACORN’s newest best friend (couple of years ago it was John McCain … click here ***sigh***).

So off we go to the GOP’s exposure of Obama and his nefarious connections to ACORN:

Obama’s Campaign “Paid More Than $800,000” To ACORN For Get-Out-The Vote Efforts; The Campaign Originally “Misrepresented” The Group’s Work To The FEC.  “U.S. Sen. Barack Obama’s presidential campaign paid more than $800,000 to an offshoot of the liberal Association of Community Organizations for Reform Now for services the Democrat’s campaign says it mistakenly misrepresented in federal reports.  An Obama spokesman said Federal Election Commission reports would be amended to show Citizens Services Inc. — a subsidiary of ACORN — worked in ‘get-out-the-vote’ projects, instead of activities such as polling, advance work and staging major events as stated in FEC finance reports filed during the primary.”

(GOP page)

Okay, Obama’s campaign mislabeled the activities it paid an “offshoot” of ACORN … gotcha’ there!

The Chicago ACORN Received Grants Of $45,000 (2000), $30,000 (2001), $45,000 (2001), $30,000 (2002), And $40,000 (2002) From The Woods Fund. (Donors Forum Website, ifs.donorsforum.org, Accessed 6/10/08)

*  NOTE: From 1993 To 2002, Barack Obama Served On The Board Of Directors For The Woods Fund.

(GOP page)

Damn, now we find out Obama served on the board of an organization that describes its grants thusly

The Woods Fund of Chicago typically awards $3.4 million in grants annually in four program areas: community organizing, public policy, the intersection of community organizing and public policy and arts and culture. Our grants lists reflect our continued commitment to giving voice to less-advantaged individuals and communities as they attempt to work diligently to achieve greater participatory democracy, especially in underserved, underresourced communities to reduce poverty and enable work.

(Woods Fund web page)

Son-of-a-bitch … gotcha’ again, Obama!

Obama Was Part Of Team Of Lawyers Who Represented ACORN In A Suit Against The State Of Illinois. “Obama was part of a team of attorneys who represented the Association of Community Organizations for Reform Now (ACORN) in a lawsuit against the state of Illinois in 1995 for failing to implement a federal law designed to make it easier for the poor and others to register as voters.”

(GOP page)

Can you believe this crap? Now we find out Obama, as an attorney, was working with community organizers in an attempt to force Illinois into following federal election laws! FREAKIN’ DESPICABLE! Yet one more gotcha’ against Obama.

Obama Directed Project Vote And Later Taught Classes For “Future Leaders Identified By ACORN And The Centers For New Horizons.” “He [Obama] says he is drawn to politics, despite its superficialities, as a means to advance his real passion and calling: community organization. … In 1992 Obama took time off to direct Project Vote, the most successful grass-roots voter-registration campaign in recent city history. Credited with helping elect Carol Moseley-Braun to the U.S. Senate, the registration drive, aimed primarily at African-Americans, added an estimated 125,000 voters to the voter rolls–even more than were registered during Harold Washington’s mayoral campaigns. ‘It’s a power thing,’ said the brochures and radio commercials. … Obama continues his organizing work largely through classes for future leaders identified by ACORN and the Centers for New Horizons on the south side.”

(GOP page)

Got that? Obama “took time off to direct Project Vote, the most successful grass-roots voter-registration campaign in recent city history.” What an anti-American asshole this guy is!

And Obama’s final transgression?

“[A]CORN’s political action committee endorsed Barack Obama for President. … The endorsement reflects a belief that Obama – who worked as a community organizer on the South Side of Chicago – understands that change must come from the ground-up, as part of a working coalition, rather than from position papers.”

(GOP page)

ACORN endorsed Obama because, like ACORN, Obama believes people are empowered to do the right thing when one works from the grassroots level up. That, “my friends”, is most definitely NOT what America is about … we really, really gotta stop this guy!

****heavy, heavy, heavy sigh****

I don’t know if the knotheads at the GOP understand what a pro-Obama site they’re operating, but after reading those things … well, Obama really does seem pretty damned decent.

Here's the second part of last Friday's interview I had with Peter Welch. Part 3 will be out Friday.

JD: It seems that as one looks at the political struggles through history, there always seems to be some sort of tipping point. There's this conventional wisdom that we've had to deal with since Reagan, at least, the whole “government is always the enemy” thing. Do you see – there's this thing, I like to call it “free market fundamentalism” in that it's completely faith-based…

PW: That's a great phrase… They've totally, completely, and utterly failed. Those free-market fundamentalists are now coming hat in hand to the government.

JD: Yeah, like a corporate socialism…

PW: …asking to be rescued.

JD: Any time it seems we look at any regulation, it's “Wahh!!! Free market, free market!” How do you see this changing the game, if we have, well, a Democratic President, huge majorities.. are we getting to a situation where you can finally throw this up in their face, and say, “No, there is no free market like that anymore”? Does this give you the leverage that you need, are you even thinking about that at this point?

PW: I am thinking about it. I'm thinking about it a lot. You know, the American people are going to make a big decision this year, and I think a major part of it will be to choose to have a government that's much more activist and on the side of smaller business and average Americans. And that requires an activist role for government, one that's been rejected.

Here's an example. You know, I'm in these oversight hearings, you know these trillions of dollars on derivatives? All of these securities… trillions of dollars of business. You know how many people we had in the enforcement follow-up division of the SEC? One under George Bush. One person. Okay? On the Consumer Product Safety Commission? You may remember that story about the Chinese toys? Lead paint? Millions and millions of toys being imported here, and they're subject to inspection. You know how many inspectors we have in that organization?

JD: One?

PW: One. Bush had contempt, utter contempt for government. He didn't care about being competent, as we saw with Katrina. He actually wasn't even willing to be competent about policies he cares about, like the war.

JD: As I was listening to him speak today, I kept thinking, “This guy is so in over his head, it's not even funny.”

PW: Yes. So, we've gotta restore that and revive it. We have to have consumer protections, in protecting us against bad products, protecting us from the predatory conduct of Wall Street, protecting us against the unbridled arbitrary power of the credit card companies. One thing after another requires and activist response and I believe the American people are seeing the price of a free check.

JD: That leads me kind of where I wanted to go next, and that's… when I was out in Denver, I spent a day down at Civic Center Park where the protests were going on… did you read the book that Markos [Moulitsas, founder of Daily Kos] gave you [Taking on the System]?

PW: I started to, it's amazing, actually.

JD: One thing in it that made sense to me… he talked about how some protest methods are a bit outmoded or outdated in today's environment, and I've always thought, in today's day and age, where we've been fighting this conservative infrastructure that's been in place since, I dunno, Goldwater? Watergate? You know, the Heritage Foundation and those other right-wing think tanks, that we're in a war of information and ideas, more than anything else. Controlling the narrative.

PW: Right.

JD: And we're fighting this entrenched idea, and by no means do I believe all Americans believe this, but this entrenched idea that you know, you're on your own, you know what I mean? And the frustration and the cynicism is likened to battered wife syndrome with the Democrats.

I'm looking for your thoughts on this… it seems like even since the Dems have taken over the House, you know, we've gotten the FISA capitulation, the war's still going on, we didn't get the renewal on the ban on offshore drilling, Leahy came in there in 2006 saying “Bush should be terrified!”, and Bush doesn't exactly look like he's shakin' in his drawers about anything, because he just ignores the rule of law, and there's little, if any, follow-up.

I'm just curious, how, we have a President who, I often like to say is about as popular as a spring-thaw dog turd on a warm late March Vermont morning, and what we just don't understand, especially those of us not in the Democratic Party but definitely on the left end of the spectrum, is time and time again, this letdown. Again and again. It usually starts out with Pelosi saying something really tough and strong, ant then it gets watered down more and more. The Republicans have been effective, simply by sticking to their guns. Maybe it's a lot harder to get liberals to all agree on something, and I think there's something to that, but what is it that keeps the Democrats from playing that hardball consistently?

PW: Well, I think it's two things. First of all, the Republican philosophy, the Washington Republican philosophy has been to basically to tear down government, okay, under the guise of talking about the individual, but do everything that helps the powerful individuals.

JD: But they wrap it up in a little mantle of populism.

PW: They wrapped it up like that, yeah. And so, they're anti-government, anti-tax, anti-regulation, and there's a certain simplicity and appeal to that. The reality is none of us like being regulated. The bloggers don't like it. It's a very diffuse process. So there's a lot to not like about it, especially when government can obviously overregulate, or it can overtax, so there's been a simplicity. And then, when the economy's been juiced up on the steroids of this credit bubble, then it can look like things are going fine. So shareholders who see their IRA's are going up don't get that upset about what's going on with some corporate executive ripoff pay. But we are now seeing the inevitable consequence of this “you're on your own” approach, with hollowing out of government and deregulation, so I think people have a different point of view on it now. I think the challenge for the Democrats is to focus on practical economic policies to start helping them.

The other thing that's tough is, of course, the way our government works under the Constitution. It's a very conservative document, the Constitution, because it makes accomplishing something extremely hard. So in the House, we actually have a working majority. And leaving FISA aside for a moment, I'll come back to that, on the economic agenda, you know, we've passed pretty progressive legislation. We've passed legislation to get rid of tax breaks for the oil companies, but it dies in the Senate. Passed economic stimulus, dies in the Senate. We passed price negotiation on prescription drugs, dies in the Senate. We rolled back these special premiums for the insurance companies on these Medicare advantage programs, dies in the Senate.

So, a lot of people who are citizens look at this and say “What's Washington doing?” They don't say “What's the House doing?” or “What's Peter doing?” They say “They're all the same”. So that's just something that I have to labor under, but the Senate doesn't have a rules committee, and they have a filibuster, so it's very slow to move and conservative, and the President's got the veto power.

JD: But still, maybe this might change, but I've had this feeling over the last two years that the Republicans are still in charge of things, and I'm not alone in that sentiment. The blogger Atrios recently said something that was kinda snarky the other day, “The Democrats sucked as a minority party. They suck even more as a majority party.”, and I think there's a lot of people that can relate to that.

PW: Sure.

JD: Because, it's still, even though Bush is sitting there with his deer-in-the-headlights look, to many of us, it doesn't feel like the Dems are running the show. The Republicans are still calling the shots. I mean, the Jay Rockefeller thing, with FISA, again. I mean, you have something in the Senate, the GOP stomps their feet, and it gets stopped. And I know, you're not in the Senate, but in general, there seems to be this timidity that our side seems to have that the Republicans don't. I think a lot of people, even without party affiliation want to support Democrats, but they see that, and…

PW: Well, I understand that, and a lot of times people will express to me their frustration with what's happened and I'll sit down and explain what I've done, and they're okay with that. And I share the frustration with them that it dies in the Senate, but when you have a filibuster that's been institutionalized so you don't even have to go through the ordeal of standing up and debating until you fall asleep… Any Senator can say they're going to filibuster, and it takes 60 votes to overcome that.

You know, a lot of us on the House side really wish that the Senate would really make someone who says they're gonna filibuster, actually make 'em do it. Make 'em stand up there for three or four days.

JD: Can they?

PW: Yes, that's the Senate.

JD: Well, then why don't they?

PW: I don't have the answer to that question. I mean, you gotta ask the Senators that.

JD: Personal hunch? Gut feeling?

PW: I really don't know. I mean, on the House side… You know we got great Senators, with Bernie and Patrick, but the institution is very, very slow. And on the House side, there's often frustration that our legislation doesn't even get taken up. The filibuster's a rule. It's not a Constitutional provision. In the Senate, it's amazing. You know, in the House, if somebody wants to propose an amendment, they have to get permission from the Rules Committee. And it's got to be germane, in other words, it's got to be relevant to the particular bill, so if it's a highway bill, you can't come in with an amendment on healthcare, let's say. It's got to be related to the highway project.

Well, I favor that, because it allows you to get work done. And it allows, I think, voters to have more accountability, because when I vote, there's much more clarity on what I'm voting on. It's more specific, so you get to know, yes or no, where I stand on that.

JD: Yes or no?

PW: Yes or no, yea or nay.

JD: Yes or no?

(laughter in the background)

JD: I was making a reference about your meeting in Barre last winter. We'll get to that in a bit.

PW: Oh, right….thanks. That's funny.

But in the Senate, any Senator can put a hold on the bill, any Senator can make as many amendments as they want on any bill, and they can make them on any subject, so if they want to make a healthcare amendment on a highway bill, they can do it. It's the rules.

JD: And the House doesn't have this..

PW: Free-for-all…

JD: …this mechanism to just bring things to a grinding halt if they wanted to.

PW: That's right, and I actually think that the majority has to rule, and people have to get some clarity about where we stand as individual legislators on the major questions of the day, and if they don't like what the House or Senate is doing, they can replace the members.

JD: Let's talk for a minute about the bipartisanship that we hear tossed around so much. When I look at the extremists that control the Republican party right now, I don't really want to compromise with them. I know there's the reality of the numbers and everything like that, but it seems so often that instead of, especially on things not of massive urgency, like FISA…we could have let the provisions expire.

PW: Fine with me, as you know.

JD: Exactly. And, I'm just kind of at a loss, with the messaging,and the feigned outrage of the Republicans, they're the master of the feigned outrage. They'll get out when something goes down, they'll have a press conference, next thing you know, it's all over the news. We're seeing it a little more but we're generally not seeing that kind of thing coming from the other side of the aisle, and there's a lot of frustration out there because of it.

PW: For me, it's about, “How do you get things done?” So, if I can work with somebody to get something done, I do. It's that simple. You know, I actually reached out to some Republicans to try to get them to agree to my stabilization fund on the bailout. The Republicans came up with this so-called “insurance plan” that was not workable, because they didn't have a way to pay for it. But the idea of it was similar to my notion of the stabilization fund paid for by the financial services industry to get us through this crisis. So I went over to some Republicans, and I said, “Look, this idea is really very similar in concept to the insurance proposal, whadya think?”

And I got a lot of them who were quite interested. Now, ultimately it was unsuccessful because by this point it was totally politicized and even if some members wanted to work with me, their leadership wanted a different agenda. So, for me, it's a pragmatic thing, just like it would be if, you know, I lived in a town and we're trying to figure out how to get uniforms for the kids on the baseball team, and here's a bunch of parents with different points of view, but you want to solve a problem, so you work with people on the same page to get things done.

JD: But do you think…I remember early on, one of the big criticisms of Obama being the “kumbaya candidate” and all that stuff… Issues like single-payer healthcare, for example. I don't know of too many Republicans that are going to support something like that.

PW: No.

JD: Well, how do you sit at the table with those people, then? Do you reach a point where their ideas are so antithetical to progress that… how do you do that?

PW: Well, there were a lot of people in the Vermont legislature and there are a lot of people in Congress who I just never get to common ground with. But, it's a case-by-case situation.

Down in Washington, there's been a lot of, like your phrase, free-market fundamentalism, and it just gets in the way of making any practical progress. Folks that believe that are against any solution that includes government. And, obviously, there's not much common ground there, so for me it's kind of a case-by-case kind of approach, you know? And it's really about – take your issue, like on regulation: I really think we have to be regulating the financial services industry. I think we should be putting much more limits on credit card companies and what they can do. Well, if somebody starts out and is flat out against doing anything, well, there's just no common ground. On the other hand, if they have some concrete proposals, and they say, “you know, the way you're doing this, can we do it this way? And here's why.” I listen to that. And if there's some way to essentially achieve the underlying purpose that I set out, but in a way that's somewhat different, and that can get more support, there's some political benefit to doing that.

JD: The compromise.

PW: Well, there's a difference between compromising principles and compromising on tactics, or specific means by which you accomplish a given goal.

Jim Douglas ought to be eminently beatable this year. Sure, he’s the incumbent, and Vermonters rarely boot incumbents. But he has a weak record to run on (his main TV ad touts his milktoast economic plan, which clearly indicates his lack of ideas), early polling indicated surprisingly high negatives for him, he’s presided over the Vermont Yankee mess, he preaches the same conservative orthodoxy that’s fallen into complete disrepute — and now the Democrats are steamrolling toward an epic victory across the country.

Obama’s got double-digit leads in a lot of polls, and Republicans are abandoning McCain in droves. (Yesterday, Rush Limbaugh asked Sarah Palin about her future political plans, implicitly conceding the election.) The Dems might get a super-majority in the US Senate: not only are they going to pick off the low-hanging fruit like John Sununu The Lesser, but they might ring up red-state wins over the likes of Liddy Dole, Mitch McConnell, Saxby Chambliss, and the guy warming Trent Lott’s seat. Hell, a damn comedian is poised to cut down Norm Coleman. (Yes, I know Franken is a liberal commentator and activist of note; but he’s had to overcome all the stupid things he said and did in his life as an entertainer.)

Meanwhile, here in liberal ol’ Vermont, we can’t lay a glove on Jim Douglas?  

We shouldn’t have to be desperately hoping for a three-way split — we should be counting the hours till Jim’s concession speech. If Douglas does win this year, I imagine the Dem and Prog leadership will blame Vermont’s track record of rewarding incumbency. In fact, they will have absolutely blown an historic opportunity to shut the GOP out of power once and for all.

(Let me make sure to spread the blame equally. Pollina has run a disorganized, underfunded, and generally pointless campaign. He had the chance to take the honorable way out by running for Lite-Gov on a tacit “unity ticket,” but his ego was too damn big for that, yessir. Then he abandons his party on filing deadline day for reasons that have never been adequately explained or explored. Pollina has, in short, jumped the shark. And no, I don’t believe that outlier poll that puts him in second place, not for a minute.)

Odum’s “Open Thread” post cited rumors that prominent Dems are staying away from Tom Costello in order to keep their options open for 2010. I wonder if some of the same thing isn’t going on with Symington; how active are other top Dems in campaigning and fundraising for Gaye? If any Democrat is slacking off or actively undermining this campaign for the sake of some potential personal edge in the future, then s/he is a complete and utter hack who should be banned by the party from consideration for any higher office anytime in the future.

Do I sound angry, incensed, frustrated? To quote a certain Miss Wasilla, you betcha.  

If you're a regular GMD reader, you probably don't spend too much time with the Obama haters. Thankfully, neither do I. Sure, we read about them in TPM, with their yells of “Terrorist” and “Kill him”, but they don't seem to rear their ugly heads around here too much.

I just got exposed to them, not exactly in person, but in enough of a dose to get a real sense of their vicious attitude. Over at Facebook they have a group called Anti-Obama and Damn Proud of It, and these people will give you a view of every backwards, misinformed, bigoted attitude you could ever hope to see.

For example, one of the first things you see is a joke about Obama being assassinated after he's inaugurated. No kidding. Then, if you delve into the discussion boards, you can find such highly relevant discussions as the one speculating about whether Obama is the antichrist. And they're not kidding about it.

 You can see repeated claims that Obama supporters think he's the Messiah., more than anyone's fair share of ridiculous posts rehashing minor slips of the tongue, and a rich and plentiful supply of posts making liberal mention of his middle name, his claimed religious background, his claimed racial background, mocking the very idea of racism in the United States; oh yeah, and unfounded questions about whether he was actually born in the United States.

There is one young guy named Rishi who has posted a large number of pro-Obama stories, and I just friended him to support what he's doing.

You might want to jump over there and see what it's like. It's pretty annoying to read, but on the other hand, this is really all they have, and these people are the best and the brightest among the Obama haters. In other words, they're totally out of ideas.

• Boys on the Side: This from Hallenbeck at vtbuzz:
  

  Independent gubernatorial candidate Anthony Pollina is taking the Rasmussen poll and running with it.

  He is trying to get Gov. Jim Douglas to agree to a debate, town-meeting-style, between just the two of them. No Gaye Symington.

• Web woops. The VDP’s website at vtdemocrats.org (first domain name I ever reserved…) was down most of the day, replaced by one of those generic catch-all sites on display instead. A quick whois search suggests (not confirmed) that they forgot to renew, but have made a hasty payment today and its likely the change back hasn’t propagated yet. What makes it bad timing is that its been discovered as folks click on the links from an email from Leahy’s leadership PAC encouraging folks to RSVP to the Election Eve Party, which comes up as nuthin.’ D’oh!
• So why have so many big name Dems been AWOL in regards to Lite Guv candidate Tom Costello? BP took Senator Shumlin to task for his less-than-ringing-endorsement a few diaries down, but Shumlin’s not the only one. Where is everybody?

  According to the scuttlebutt, its because all the various Dems who might be considering a run for the Governor’s office in 2010 (especially if a Leahy retirement creates a game of musical chairs) aren’t all that enthusiastic about the prospects of a Costello win and how that might impact their positioning.

  In a word: yuck.

by Dan DeWalt

Thomas Hermann for Congress Campaign

The Democrats in Congress,  abetted by the Republican leadership, have once again succumbed to fear and threats and have sold the American people down the river to the tune of over 700 billion dollars. Just as the Bush/Cheney administration used the uncertainty surrounding the attacks of  September 2001 to push through the previously prepared, draconian and un-American USA PATRIOT Act, so they now have taken advantage of financial turmoil to pillage the Treasury. The bankers and speculators needn’t be jealous of their war profiteering friends any longer; the government has graciously decided that the rest of us can pitch in and help them maintain their august stations.

Saying that Bush’s bail-out plan did not address the cause nor offer a solution to the problem, Peter Welch voted no and helped to defeat the first version of the bill. The defeat shocked Congress, but they did not recognize the foolishness of their haste. Rather than listening to the advice of scores of economists, including Nobel Prize in Economics Laureate, Joseph Stiegliz, who wrote them ,saying that the sky was not falling , that they had time to work out a plan that would actually address the problem, Congress instead chose to hold themselves hostage to the Dow Jones Industrial Average, twisted each other’s arms, added another $150 billion in tax breaks, pork and raising FDIC insurance, and lo and behold, Monday’s prowess and principles turn into Thursday’s shuffling into line and “reluctantly” voting yes.

This vote proves once again that Peter Welch’s first loyalty is to Nancy Pelosi and the Democratic Party leadership, with the interests of everyday Vermonters coming second.

To his credit, Bernie Sanders understood that this bail-out was wrong from the start, and he represented Vermonters well by voting no.

Vermonters have a clear choice and opportunity to let Peter Welch know that we do not approve of his vote for the bail-out. A vote for Progressive Party nominee Thomas Hermann, an Iraq war veteran serious about ending the war, is also a vote to resist the corporate influenced Democratic leadership that has neither the will nor the wherewithal to stand up to Bush/Cheney outrages. A vote for Thomas Hermann will tell Mr. Welch that we’re not going to be bamboozled any longer. If the government needs to rescue Capitalism from its excesses, taxpayer money should be used to stabilize the equation from the homeowners’ side, re-writing mortgages to reflect current market conditions, and providing jobs by spending on things like roads and bridges, health care and education, not keeping afloat the investment banks who have created this mess for their own profit. Taxpayers should not have to sacrifice critical needs, let alone our homes, to bail out the speculators.

From a minister delivering the opening remarks at a McCain rally in Davenport, Iowa:

“There are millions of people around this world praying to their god-whether it’s Hindu, Buddha, Allah-that his opponent wins, for a variety of reasons. And Lord, I pray that you will guard your own reputation, because they’re going to think that their God is bigger than you, if that happens,” said Arnold Conrad, the former pastor of Grace Evangelical Free Church in Davenport.

That’s right, god. If McCain loses, don’t bother showing your face around this planet anymore. All the other gods will be snickering behind your back, and all your followers will know you’re a wimp.

These people are just bizarre sometimes.

Last Friday, I sat down with Congressman Peter Welch in Burlington for about an hour. We had a conversation that touched upon the current financial mess, Democratic capitulation, Iraq and a few self-reflections. I'll be posting it throughout the next week or so.

JD: The bailout is what's on everybody's mind right now. It's funny, after you voted against the first bailout bill, and I mentioned to some people that I was meeting with you, they told me to tell him “nice job”, and after the second vote, I got a few emails saying “tell him I want to take that back!” It was obviously a difficult vote either way, if you read on GMD, odum kind of took you to task for it.

PW: Yes.

JD: You originally said in the article quoted in the Times Argus, “We're at the point that we have to choose, it's this bill or no bill – no bill is an absolute catastrophe.”, and, well, some of us see this as a false choice. And probably some of this comes from skepticism about the Bush administration, at this point how can you trust anything they say?

PW: Well, first of all, I don't trust anything they say. There was nothing in my final decision that was based on trusting George Bush at all.

JD: Do you trust Hank Paulson?

PW: It's not about trusting him; he's not the ideologue that Bush is, but my vote was not based on the credibility of Paulson. This – whether we like it or not, first of all, it's not surprising that this is happening. Many people who have said that is was reckless for us to allow such deregulation predicted at one point, we'd pay a price for it, because it was a house of cards.

You know, we had an economy that was built on credit, rather than an economy that was built on production, okay? So if you step back, a lot of people who were critical of the bailout, their criticism rightly goes back to the whole house of cards that was constructed and eventually, we didn't know when, it was just a question of when, not whether that house of cards would collapse. And so, I was not surprised.

Some folks raised this WMD question, that was a big deal, with Bush coming in, but there's a fundamental difference.

JD: When you refer to the WMD's, do you refer to the notion that Bush is basically –

PW: … making it up.

JD: Okay.

PW: But the reality of it is that these things were blowing up all around us – at AIG, Lehman Bros., Bear Sterns, Washington Mutual, Countrywide – Citibank losing 20 billion dollars, with these executives in there with these ripoff salaries and golden parachutes. The evidence of this financial meltdown was real, and these huge firms that made billions of dollars, in effect by running this speculative enterprise, were so excessive that they shot themselves in the head. Lehman Bros. Was borrowing at a 35 to 1 ratio, and as long as the housing market wsa going up, they were fine. Once it flattened and came down, they not only brought down a lot of innocent bondholders including an Arizona teacher's fund, a city in Norway, they destroyed their own business.

So, even the people who had a self-interest in having this continue, they were so reckless that they destroyed their own livelihood. So, I didn't need a lot of evidence that there was a problem, because it was hitting us in the face. What I needed, what was tough on this, there was two things. I was adamantly opposed to in the first bill that the president presented that was a three page bill, giving a total blank check, with literally no oversight and no taxpayer protection. Number two, a challenge and question for any of us, even those of us who have been harsh critics of deregulation, was what practical steps could we take to try to protect the taxpayers, Vermonters, Americans who did not participate in this reckless conduct but were going to suffer from the consequences.

The fact is, we're in uncharted territory, because of this credit crisis, and that's unique to this economic downturn that we have now.

JD: As I was doing some research about this, I came across a study pointed out by David Cay Johnston, a Pulitzer prize-winning economist, and he mentioned a study by the IMF and they studied 42 banking crises around the world in the last 37 years, and they concluded that bailouts usually don't work, and they often make things worse.

Do you feel like, in a sense, this is a big wager, a 700 billion dollar wager? I mean, how convinced are you that this is going to work, do you honestly just not know?

PW: We do not know. I mean, here's what I thought. Start with the beginning. I was convinced there was a crisis, and that the nature of this crisis was different than any other cyclical downturn we've had. In normal cyclical downturns, unemployment goes up, wages get depressed, tax revenues decline, and usually, since the Second World War, responded to that with stimulative economic activity. The government increases spending, you try to get the jobs programs going, to get consumer demand back up and unemployment down. We have that now. But what's so threatening, and so unique, in where we don't have the tools in the toolbox, is this credit squeeze. And that credit squeeze has happened because of deregulation, and creation of these exotic, basically casino bets collateralized debt obligations, credit deferred swaps, the mortgage-backed securities.

And, you know, in a way, it's important for me to explain the mortgage-backed security and how complicated it's gotten, because that gives people some perspective of how difficult the situation is that we're in. In the old days, if you were gonna buy a house, you'd go to your local banker, he'd check your credit, knows who you are, and he'd give you a loan, right?

In the new days, I'll give you an example of Lehman. They hire a mortgage origination firm, they go to neighborhoods that are often times low-income people, and persuade them to borrow far more money than they'll ever be able to pay back, and they reassure them it's no big deal, you can refinance, and your house price will be up, you know, 30 percent. So the mortgage originator gets you to sign a loan, so you borrow $300,000. Unlike your banker, he doesn't care whether you pay it back. Literally doesn't care. They make 2%, they make $6000 and walk away. They sell it to Lehman. Lehman then slices that loan up into thirty different pieces. They sell the first three years of repayment to, say, the New York Hedge Fund, the second three years to the Arizona Pension Fund, the next three years to the state employee's association, somewhere else.

JD: A big mess, basically.

PW: Exactly, and each time they slice it and dice it, they make a fee. They sell a huge chunk to the Bank of China. China is enormously invested in these mortgage-backed securities.

JD: They do seem to own a lot of us now –

PW: And, so it creates this incredibly complex problem once the real estate value goes down, because even if you default, you want to work something out, let's say you got laid off from your job or a pay cut,so you want to get a loan extension and work it out.. Well, you have to find the Bank of China, you've got thirty different people that own your loans. It's not like going down to the banker and asking to work something out.

What's also happened is lots of banks have these asset-backed securities on their balance sheet, and the reason the lending is drying up is because every bank is afraid to lend to another bank, fearing that while their money is over at the other bank, the regulators will come in a la Lehman and say “you're going into receivership” and the fear is that they're not going to get paid.

JD: Now that's where the nationalization of the banks come in. Thoughts on that?

PW: I actually prefer it to what we did, and we put in the legislation the authority for the Treasury secretary to do that. In other words, in looking at this, the initial reaction to the bailout is one of outrage, because the anger that Vermonters and Americans have towards the excesses on Wall Street is well-deserved. And my calls came in with people expressing that fury. But they also expressed some fear, because at the end of the day, our outrage is not a policy to get us out of this. And if we could wall this off, and say, “Well, this is Wall Street and those guys are getting what they deserve, let 'em go,” I would say “Absolutely.” But if what's happened there is coming here, and our job is to protect Vermonters as taxpayers and as folks with jobs, folks who are saving for their kids to go to college, then we have to ask the question, “What do we do?”

And, anyone who tells you they know exactly how to get their way out of this, they're kidding you, because this is a unique situation. Once we decided we had to act, my goal was to get the best possible bill, and we were a long way from the best possible bill. When that first one came up, there was a gun to our head, and the one thing I have from Vermont is the leverage of the vote they've given me. So I'm gonna use that to the last minute. And what I had been working to, to try to accomplish, some of it we got, some of it we didn't.

JD: What about the “NO BAILOUT” bill? The progressive caucus had that no bailout bill they were floating around.

PW: I favored that.

JD: You favored that?

PW: Yeah.

JD: Well, what were the realistic chances of something like that? Because I…

PW: They were zero.

JD: Because I noticed that Barbara Lee, Donna Edwards, they eventually all signed on to this one that passed.

PW: A lot of us were in the same boat. I mean, a lot of the most progressive members of the caucus did what I did. We fought to the last moment, for the best we could get, so we had to make a decision, yes or no, on the last legislation. And my judgment was that doing nothing would be even worse than the flawed bill.

And I'll you why. What got us here? What got us here was a hands-off, head-in-the-sand approach by government, acting as thought the government has no role in proper regulation that's necessary to protect consumers and businesses, okay?

JD: Like the Cato Institute was running the government or something.

PW: Exactly. So now we get to the inevitable consequence of deregulation, where Wall Street was allowed to run amok and they did. That says to me that we've got to act. And we have to act even though we don't necessarily get it perfect. We can't put our head in the sand and do nothing.

JD: In terms of the accountability, as I understand it , a chunk of the money is released right away, then there's another chunk that comes out at the discretion of the President?

PW: There's a lot of authority for the President.

Here's where the accountability is. First of all, let's be clear that i as a major decision for congress to authorize this bailout.

JD: But why not just 150 billion, and when they need more, to come back for approval again?

PW: I favored that. I was unsuccessful. Okay, there's a number of things that I thought would be much better,and a lot of my progressive friends fought for that we didn't get. One was bankruptcy protection. We need that because if we're going to unwind some of these loans, and you have 30 different borrowers, you really have to have the judicial process so there's some authority…

JD: So a judge can step in and renegotiate a rate…

PW: That's right. And tell people to go in a room and work it out, and if you don't, I'll settle it. Barney Frank worked hard for bankruptcy. We couldn't get it through the Senate.

JD: Where was the opposition? Republicans?

PW: The Senate. Yeah, Republicans.

JD: Democrats and Republicans, or mostly Republicans?

PW: Mostly Republicans, mostly the Senate. We couldn't get it through the Senate. Obama says he's for the bankruptcy provision. That'll make a big difference.

The second thing that I thought was really important that we didn't get, but I fought for, I mean, I was really a leader on this, was the stabilization fund. And I proposed to have a transaction fee on every stock transaction, .25 cents (note from JD – that's .25 of a cent, not 25 cents), that would raise 150 billion a year,and I was told they couldn't get that thought the Senate.

JD: What did you think of the Sanders amendment?

PW: I was fine with Bernie's bill, but I don't even think he got a recorded vote on it.

JD: No, it was a voice vote.

PW: Frankly, I prefer my approach on this, as I think we're going to have to have a tax increase on the high income folks who've gotten the break, to use that for health care and rebuilding our roads and bridges. What I wanted to do is much like deposit insurance at the local bank. If you have money there, it's insured. But that's paid for by a premium, a small premium on your deposit. Well, I wanted to fo a similar thing on the financial services industry, and have that be available to offset any taxpayer cost.

Now, I'm going to go back and fight for that again. Obama tells me that he's for it.

JD: Okay, it's a flawed bill. Do you think this is some sort of victory? A defeat? Neither?

PW: For me, it was a necessary step to begin the process.

JD: You don't feel good about it?

PW: I feel terrible about what's happening to our economy, and I don't make any claim that there's a magic bullet here. Just think about it. We're ten years into a system of deregulation and laissez-faire. It was wildly abused by Wall Street and the financial services industry, and no one believes that you can pass a single law that would suddenly unwind this mess.

But what we have to do is, number one, reassert the responsibility of government to work on behalf of the consumer and the average person.

JD: Okay, what ideas do you have in terms of going about that?

PW: Number one, we start reregulating again. And there were a lot of Democrats who went along with this, so I'm not here defending the party. Not at all. One thing was the refusal of Alan Greenspan and Robert Rubin to regulate derivatives. No one even knows what the heck they are, even Warren Buffett. Literally. But what they are is this huge web of debt relationships that are so obscure that no one knows who owes what to whom – the total amount of them is at least 62 trillion dollars.

There was a woman who was the head of the Commodity Futures Trading Commission in the 90's that tried to regulate 'em. Ed Markey in '92 tried to start regulating them. And bothe were solidly rebuffed by Alan Greenspan and Robert Rubin. They were wrong. Dead wrong.

Second was the decision by Christopher Cox of the SEC, a former Republican member of Congress, a big friend of the securities industry, and he was appointed by Bush to be the head of the SEC. He allowed these investment companies like Lehman to increase their ability to borrow from a ratio of 12 to 1 to 35-40 to 1. So what you had were these investment houses that were literally betting the house. For every dollar they'd put in a deal, they were borrowing 35. When the market was going up, they were really making a killing, but once it went down, they got clobbered.

JD: Okay, now, let's talk about Bob Rubin for a second. He's part of Obama's economic advisory team right now.

PW: Yeah, and that worries me. He did two things, you know. He opposed regulating derivatives. Wrong. Number two, at Citibank, he was on their investment committee, and Citibank lost billions of dollars in bad investments in these mortgage-backed securities,and it's astonishing to me.

JD: Have you talked to Obama about that at all?

PW: No, but if asked, I'd say that. I just think that somebody who was on the wrong side of this regulatory obligation we have is not somebody I'd give a lot of credibility to in working our way out of it.

****

Next up, the future of “free markets” and I ask Peter why the Dems cave in so often.