The "Joe the Plumber" Story Hits an Amazing New Low

Ed. Note: So.. Joe the Plumber doesn't have a plumbers' license, and has tax liens on his business. He only makes $40,000/year and would benefit from Obama's tax plan much more than McCain's.. was already on right wing talk radio, and... although not related.. has the same name as Charles Keating's son-in-law. And he didn't want to buy the business... which was not worth $250,000, the magical mark, but much less.

Now perhaps Senator McCain didn't know that... but you'd think a Presidential candidate would check. Or maybe he did. And how opportune of Joe to show up at an Obama rally before going on the record for McCain. Ya think?

FROM THE HUFFINGTON POST

Just when you didn't think things could get worse for John McCain -- they go in the toilet.

Literally.

So, you remember Joe the Plumber, who John McCain kept relentlessly bringing up. And up. The apparently undecided plumber who had complained to Barack Obama that he couldn't buy his own plumbing company because he'd have to pay 3% more in taxes. The plumber who John McCain lauded as an Everyman while oddly proclaiming "Congratulations! You're rich!" in the midst of a disastrous recession. The fellow who said that Barack Obama "tap dances better than Sammy Davis Jr."

That guy.

Well, it turns out he's the one gliding around the dance floor so much, you should expect to see him soon on "Dancing with the Stars."

You see, Joe Wurzelbacher is apparently related to Robert Wurzelbacher. Who is the son-in-law of (are you ready...?) Charles Keating!

Yes, that Charles Keating. The Charles Keating of the Keating 5 Scandal. For which John McCain was reprimanded by the United States Senate, for his involvement in attempting to illegally influence government regulators. The Charles Keating who John McCain has been trying to avoid have mentioned. So, he basically mentioned it 24 times.

(By the way, lost in all the attention paid to John McCain not getting the same career-ending censure by the Senate, as did the other four defendants - the reason for that is because he'd been in the House of Representatives at the time of his transgression. The Senate decided that they didn't have jurisdiction over him to give the same penalty. So, his career was saved.)

Anyway, back to Robert Wurzelbacher, Joe the Plumber's father. You see, Robert Wurzelbacher was an executive of American Continental Corporation, the parent company of Charles Keating's Lincoln Savings. That's the bank which caused citizens to lose their life savings and cost U.S. taxpayers $3.4 billion. As part of that scandal, Robert Wurzelbacher pleaded guilty to three counts of misapplying $14 million and served 40 months in prison.

And now, Lincoln Savings, Robert Wurzelbacher and Joe the Plumber are back with John McCain.

"Congratulations! You're rich!," indeed.

Never mind that Joe the Plumber has state tax liens files against him. As the court representative says, Joe the Plumber might not even be aware of the lien.

Never mind that Joe the Plumber says he wasn't convinced by Sen. Obama's argument. Given his background, why should he be?

Never mind that Joe the Plumber is concerned about a tax increase if his business makes over $250,000. After all, since any business has an estimated value of five times its annual profit - that means Joe's hoped-for business is valued at $1.25 million. So, either he has that in the bank or can get a loan for its value. (Assuming he can get a loan today, of course...). Though, now you see why John McCain gave Joe the Plumber a shout out, "Congratulations! You're rich!"

But then, maybe John McCain gave Joe the Plumber a shout-out because he wanted to give a boost to a friend's relative. Nice touch.

So, apparently these are the people who John McCain seems to keep palling around with.

Mind you, I thought it odd when John McCain first brought up Joe Wurzelbacher's but then never referred to his last name again. I thought perhaps he'd forgotten it. Or it was too hard to pronounce. Apparently though there was a better reason for him to quit saying the name "Wurzelbacher" 24 times. If only Sen. McCain (R-AZ) had remembered the pesky Tivo, where you can rewind.

Now, in fairness, John McCain might not have known than Joe Wurzelbacher was from that same Wurzelbacher family. He might have thought it was just some regular Wurzelbacher. And who knows, maybe they're not even related?

But never mind all of that. This is an election, and what matters is the votes. And in the end, if John McCain wants the vote of Joe the Plumber, then he'll likely get it. That was his point all night, after all. Of course, he might not getting the votes of many other plumbers.

The United Association of Plumbers and Pipefitters has endorsed Barack Obama.

"Obama will help us keep existing jobs and work to develop new, higher paying jobs here in America, reform our health care system, fix our ailing schools and make sure that the pensions of our retirees are safe," the UAPP said.

By the way, as long as we're on the matter of John McCain forgetting the name of Joe Wurzelbacher and who he's related to. There's one other name he forgot at the debate.

Barack Obama.

At the end of the evening, Mr. Obama began his final statement by thanking Sen. McCain and "Bob for moderating." When it was John McCain's time, he too thanked Bob Schieffer by name, then turned to Sen. Obama, looked at him, hesitated briefly, and then sayd, "And you."

At least he didn't say "Joe Wurzelbacher."

For the 25th time.

John McCain and the Making of the Financial Crisis

A Pal Around McCain

By Harold Meyerson, Washington Post.com
Monday, October 6, 2008; A15

"There's no question that we have to change the subject here," a senior Republican operative told The Post's Michael D. Shear in a story published Saturday.

The "subject" in question is the economy and how to fix it. As Americans have taken their eye off the ball -- that is, off John McCain's sterling qualities of character and command -- by focusing on the economy, Barack Obama has surged into the lead nationally and in many key battleground states.

So long as the candidates talk about that pesky economy, McCain's handlers have realized, McCain will continue to swoon. Thus the campaign has announced that it will go on the attack again on the momentous topics of Obama's ties to the Rev. Jeremiah Wright and Bill Ayers, the onetime Weatherman who has been a University of Illinois education professor for nearly two decades.

Campaigning on Saturday in Colorado, Sarah Palin accused Obama of "palling around with terrorists" by associating with Ayers, citing as her source a New York Times story from that morning. In fact, the story concluded that the Obama-Ayers "relationship" consisted of both men attending the board meetings of two Chicago organizations and that there had been no contact between the men, other than bumping into each other on the sidewalk (they live in the same neighborhood), since Obama went to the U.S. Senate in January 2005.

The story of Obama's interaction with Ayers is drenched in irony, since it is basically a tale of Obama being co-opted into Chicago's civic establishment. In 1995, Obama, then a young lawyer with political ambitions but as yet no office, was recruited to chair the board of a school reform organization funded and established by the Annenberg Foundation -- a group that distributes the wealth of the estate of Walter Annenberg, Richard Nixon's ambassador to Britain. It was only then that Obama met Ayers, who already was a board member and a figure in Chicago's education-policy elite. (Mayor Richard Daley, that known radical, told the Times that he had consulted Ayers on education issues for years.)

Go join your city's establishment, and see what it gets you.

But if the McCain people want to rummage through presidential candidates' associations, real or imagined, to turn up figures who threaten to pull down this proud republic, they should begin in-house. Chief among those to whom responsibility attaches for the financial crisis that is plunging the nation into recession is former Texas senator Phil Gramm, McCain's own economic guru.

Gramm was always Wall Street's man in the Senate. As chairman of the Senate Banking Committee during the Clinton administration, he consistently underfunded the Securities and Exchange Commission and kept it from stopping accounting firms from auditing corporations with which they had conflicts of interest. Gramm's piece de resistance came on Dec. 15, 2000, when he slipped into an omnibus spending bill a provision called the Commodity Futures Modernization Act (CFMA), which prohibited any governmental regulation of credit default swaps, those insurance policies covering losses on securities in the event they went belly up. As the housing bubble ballooned, the face value of those swaps rose to a tidy $62 trillion. And as the housing bubble burst, those swaps became a massive pile of worthless paper, because no government agency had required the banks to set aside money to back them up.

The CFMA also prohibited government regulation of the energy-trading market, which enabled Enron to nearly bankrupt the state of California before bankrupting itself.

The problem with this exercise, of course, is that Gramm's relationship to McCain is not comparable to the relationships that Ayers or Wright have with Obama. The idea that either Ayers or Wright would have any impact on the workings of an Obama administration is nonsensical. But Gramm and McCain do have an enduring political and economic alliance. McCain chaired Gramm's short-lived presidential campaign in 1996; Gramm is co-chair of McCain's current effort. McCain has not repudiated reports that Gramm is on the shortlist to become Treasury secretary if McCain is elected, even after Gramm labeled America "a nation of whiners."

If we are to believe his managers, McCain will charge into tomorrow night's debate seeking to "change the subject" from the economy to Obama's dangerous liaisons. It's not, however, likely to be a winning tactic. Obama will argue that in a time of deepening economic crisis, the public deserves a debate in which the candidates focus on their ideas for recovery rather than tendentious attacks on their rival's presumed associates. If pressed, though, he can mention that it is McCain's senior economic adviser who has diminished American solvency and power beyond the wildest dreams of anti-American terrorists.

meyersonh@washpost.com

Cash for Trash

Hby Paul Krugman, NY Times
Sept. 22, 2008

Some skeptics are calling Henry Paulson’s $700 billion rescue plan for the U.S. financial system “cash for trash.” Others are calling the proposed legislation the Authorization for Use of Financial Force, after the Authorization for Use of Military Force, the infamous bill that gave the Bush administration the green light to invade Iraq.

There’s justice in the gibes. Everyone agrees that something major must be done. But Mr. Paulson is demanding extraordinary power for himself — and for his successor — to deploy taxpayers’ money on behalf of a plan that, as far as I can see, doesn’t make sense.

Some are saying that we should simply trust Mr. Paulson, because he’s a smart guy who knows what he’s doing. But that’s only half true: he is a smart guy, but what, exactly, in the experience of the past year and a half — a period during which Mr. Paulson repeatedly declared the financial crisis “contained,” and then offered a series of unsuccessful fixes — justifies the belief that he knows what he’s doing? He’s making it up as he goes along, just like the rest of us.

So let’s try to think this through for ourselves. I have a four-step view of the financial crisis:

1. The bursting of the housing bubble has led to a surge in defaults and foreclosures, which in turn has led to a plunge in the prices of mortgage-backed securities — assets whose value ultimately comes from mortgage payments.

2. These financial losses have left many financial institutions with too little capital — too few assets compared with their debt. This problem is especially severe because everyone took on so much debt during the bubble years.

3. Because financial institutions have too little capital relative to their debt, they haven’t been able or willing to provide the credit the economy needs.

4. Financial institutions have been trying to pay down their debt by selling assets, including those mortgage-backed securities, but this drives asset prices down and makes their financial position even worse. This vicious circle is what some call the “paradox of deleveraging.”

The Paulson plan calls for the federal government to buy up $700 billion worth of troubled assets, mainly mortgage-backed securities. How does this resolve the crisis?

Well, it might — might — break the vicious circle of deleveraging, step 4 in my capsule description. Even that isn’t clear: the prices of many assets, not just those the Treasury proposes to buy, are under pressure. And even if the vicious circle is limited, the financial system will still be crippled by inadequate capital.

Or rather, it will be crippled by inadequate capital unless the federal government hugely overpays for the assets it buys, giving financial firms — and their stockholders and executives — a giant windfall at taxpayer expense. Did I mention that I’m not happy with this plan?

The logic of the crisis seems to call for an intervention, not at step 4, but at step 2: the financial system needs more capital. And if the government is going to provide capital to financial firms, it should get what people who provide capital are entitled to — a share in ownership, so that all the gains if the rescue plan works don’t go to the people who made the mess in the first place.

That’s what happened in the savings and loan crisis: the feds took over ownership of the bad banks, not just their bad assets. It’s also what happened with Fannie and Freddie. (And by the way, that rescue has done what it was supposed to. Mortgage interest rates have come down sharply since the federal takeover.)

But Mr. Paulson insists that he wants a “clean” plan. “Clean,” in this context, means a taxpayer-financed bailout with no strings attached — no quid pro quo on the part of those being bailed out. Why is that a good thing? Add to this the fact that Mr. Paulson is also demanding dictatorial authority, plus immunity from review “by any court of law or any administrative agency,” and this adds up to an unacceptable proposal.

I’m aware that Congress is under enormous pressure to agree to the Paulson plan in the next few days, with at most a few modifications that make it slightly less bad. Basically, after having spent a year and a half telling everyone that things were under control, the Bush administration says that the sky is falling, and that to save the world we have to do exactly what it says now now now.

But I’d urge Congress to pause for a minute, take a deep breath, and try to seriously rework the structure of the plan, making it a plan that addresses the real problem. Don’t let yourself be railroaded — if this plan goes through in anything like its current form, we’ll all be very sorry in the not-too-distant future.