I say with sadness because I thought and still think that True/Slant is a great organization, one that is innovative and well-run and and whose founders have been a genuine pleasure to work with. Folks like Coates Bateman, Michael Roston and Lewis Dvorkin have taught me a lot about how the internet business works and have convinced me that there may actually be a future universe in which writers will be able to carve out some sort of dignified employment amid the wreckage of the print journalism business, and will not have to hook or boost cars for food. I think they have a great idea with this site and I’m sure they will continue their success.

I have a story on the Financial Regulatory Reform bill coming out in this week’s Rolling Stone and will be posting on the new RS site for about a week after that; then I will be going away on vacation until late June. Thanks to everyone who has visited this site since its inception, and I hope to see you at my new blog on RS.com soon.

Then, saying she was proud of being labeled a “redneck,” she regaled them with a string of one-liners defining the term:

“You’re a redneck if you’ve ever had dinner on a ping pong table.”

Laughs.

“You’re a redneck if you’ve ever had a custody fight over a hunting dog. Well, Todd and I haven’t, but we’ve got friends who have!”

via Sarah Palin at National Rifle Association lobs laughing crowd with ‘redneck’ jokes.

Can I get a vote here? What’s the consensus on politicians who use internet joke lists as speech material?

I’m actually sort of divided on this issue. Clearly, Sarah Palin doesn’t have time to write new and original speeches for her myriad appearances. If I were as famous and as busy as Palin is, I could definitely see culling a few yukster lines from the net for speeches. But she ripped off like six or seven of these asinine “You know you’re a redneck if!” lines in a row from sites like Aha! Jokes, and that seems like a few too many to me. Sometimes the number matters — just like I think the maximum number of cats a single adult can have is three before it gets weird, I don’t think you can steal more than four or maybe five jokes before some kind of line is crossed, even when the venue is an NRA convention.

Palin by the way seems to have settled in on a new rhetorical strategy, which is basically to run out one or another version of her “pit bull” line over and over again and not say anything else at all. She’s tuned in to the fact that her audiences literally can’t get enough of having their lunatic self-images massaged (“I’m a violent, illiterate pig who eats with her mouth open just like all you outstanding Americans!”) and aren’t really interested in much else beyond that — issues are really secondary.

Sure, she’ll talk about immigration, or health care, or gun rights, but all that boring stuff is really secondary to the more important business of reassuring her audiences that that it’s okay to be a slob who does nothing but shoot cute animals and watch TV. Most of all,  Americans — the same Americans who buy everything TV tells them to buy and vote for the same shysters year after year, swallowing one lie after another whole — love to be told how tough and fearsome and independent they are. She was massaging this spot in a speech to a coalition of women against abortion group in Washington the other day:

Palin, a potential 2012 presidential candidate, delivered calls to action to an audience dominated by women. “The mama grizzlies, they rise up,” she said, to laughter. “You thought pit bulls are tough. You don’t want to mess with the mama grizzlies. And I think there are a whole lot of those in this room.”

The crowd went nuts at this. Palin has figured out that this is really all you have to do to win elections in this country — flatter middle Americans’ moronic fantasies about themselves. The great thing about flattery is a) you can’t overdo it as hard as you try, and b) it doesn’t pin you down to messy political positions, controversies, things you can be harassed about by Chris Matthews and other press weasels.

It’s basically a risk-free strategy. You get up on stage and you say, “I’m just like all you idiots. And you idiots rock!” People will fall for this stuff. The ingenious part in Sarah Palin’s case is that she probably genuinely believes it.

She one-ups even George Bush in this respect. Bush was sincere in his respect for the citizen’s right to craft important opinions about the world while drinking beer and watching baseball, and that came across in his speeches — it was a big reason for his success.

But Bush couldn’t have spent more than ten minutes in a dirty trailer in Arkansas before signaling for the helicopter. The guy was just too used to being around rich people, nice houses, cigarette boats full of sheiks and oil executives, etc. Sarah Palin on the other hand really is the kind of person who you can picture eating egg salad off a ping-pong table. That and her utterly genuine stupidity and meanness can take her a long way — all by themselves, I think these things can win the White House for her — and it seems like she senses this on an animal/reptilian level. Hence the renewed emphasis on jacking off her audiences of late.

It’ll be interesting to see if this works for her. Bear in mind there’s no shortage of hokey-ass internet joke lists for her to mine. Someone should keep a count of how many of these bits she uses…

Vilks’ cartoon depicting Mohammed came on the heels of Muslim outrage about cartoons originally published in Denmark in 2005. The republication of the cartoons several months later sparked violent protests in the Muslim world and prompted death threats against the cartoonist.

Vilks’ cartoon, which was published in August 2007 by the Swedish newspaper Nerikes Allehanda, did not provoke that level of global protest, although it has stoked outrage.

via Police: Swedish cartoonist object of attempted attack – CNN.com.

Just out of curiosity — exactly how much of a wuss does your God have to be, do you think, if he can’t take being picked on by a Swedish cartoonist?

I almost can’t wait to see which fringe/attention-hungry satirist decides to make himself a Canal Plus documentary subject by publishing the next image of The Prophet. Can we all take bets on this? I’m lobbying hard for the next Rob Schneider movie — maybe a supernatural-themed sequel, like Deuce Bigalow 3: Gigolo of the Eternal Afterlife or something – to include a bi-curious Mohammed scene.

Is that the most offensive thing imaginable? I’m straining hard but can’t think of anything worse. A Gilbert Gottfried routine also has possibilities, I guess. By the way, has anyone seen that new Gottfried-narrated ad for the “ShoeDini” shoe-horn? It’s the best film I’ve seen this year.

Okay, excuse the digression, I’m going back to work now…

WASHINGTON — The Obama administration said Sunday it would seek a law allowing investigators to interrogate terrorism suspects without informing them of their rights, as Attorney General Eric H. Holder Jr. flatly asserted that the defendant in the Times Square bombing attempt was trained by the Taliban in Pakistan.

via Attorney General Backs Miranda Limit for Terror Suspects – NYTimes.com.

Memo to those Tea Party activists out there who’ve been howling about those liberal wusses in the Obama Justice Department who read Faisal Shahzad his Miranda rights: congratulations. You’ve just opened the door for a major new expansion of government power.

Having followed the Tea Party around on and off for a few months now it’s been hard not to notice some of the contradictory messages emanating from the movement. You’ll hear the same people who want to abolish the EPA complaining about the slow federal response to the Gulf oil spill, or the same people who are stocking up on guns to ward off the inevitable government assault on their property cheering for beefed-up drug enforcement laws and the no-knock search warrant.

The reason I really respect the Ron Paul people is that they’re consistent on all of these things. If they don’t want the government telling you you can’t buy a gun, they also don’t want the federal government telling you not to smoke weed or patronize a prostitute. Paul understands that you can’t make appeals on general principle unless you actually believe in that principle across the board.

It seems to me that a huge problem that Americans on both sides of the aisle have is that they believe in personal freedom, but only for themselves; for the other guy they seem always to want a powerful and intrusive federal government. Red staters and blue staters are both equally guilty of this in my experience. You get conservatives asking for a federal ban on gay marriage and then in the same breath screaming that abortion should be a states-rights issue. And you get progressives who want to pass their own state-by-state medical marijuana laws clamoring for federal bans on handguns.

And… well, I’m digressing. The point is that this gesture by Eric Holder to drop to his knees and pray at the altar of Rush Limbaugh, Sean Hannity and Sarah Palin is one of those things that both sides are going to end up seriously regretting.

For the Democrats, it will surely end up being one of the darker moments of the Obama presidency — not because it’s necessarily so terribly meaningful (at least compared to ending Too-Big-to-Fail), but because it represents a new low on the utter-lack-of-balls front. The only reason we’re even talking about this Miranda issue is because a bunch of morons on talk radio made a big fuss about it, and if our president is going to go sticking his thumbs into the constitution every time he can’t take a few days of getting reamed by a bunch of overpaid media shills whose job it is to hate him no matter what he does, then we’re all in a lot of trouble.

For the conservatives/Tea Partiers/Republicans (note that I have to make separate notations for each, since they’re not all necessarily the same people anymore), this Miranda furor is yet another one of those humorously contradictory political campaigns  of the “Keep the Guv’mint off my Medicare” variety that they’re becoming known for. I’m beginning to think that if the Tea Party had a symbol, it shouldn’t be the snake from that “Don’t Tread on Me” flag, it should be a drooling yutz sticking a pencil in his own ear.

The reason for that is that the Tea Party angle on this Miranda business is that they want to strip terrorist suspects of liberal/civil rights-era protections, and they think that foregoing their Miranda rights is a good way to get there. What they don’t get is that the inevitable consequence in this sort of meddling in constitutional theory is that we’re going to carve out exceptions to constitutional applicability for certain classes of people. We’re obviously not going to repeal the 5th amendment granting protection to American citizens against self-incrimination; and if we’re not going to tinker with that basic right we all enjoy, then the only other way around it is to start tinkering with the concept of who’s a citizen and who isn’t.

We’ve already seen a more than unusually ridiculous illustration of this instinct, with all-century blowhard Joe Lieberman coming up with a wacko plan to strip terrorist suspects of their citizenship, a completely useless idea that wouldn’t speed up interrogations one whit and in fact add nothing but another layer of bureaucracy to prosecutions of terrorism cases. This is an idea that has no practical application, but has a very broad theoretical consequence.

Basically we’ve opened the door for a discussion on whether or not it makes sense to selectively suspend the constitutional rights of Americans on a case-by-case basis. I’d like to see how the Tea Party responds to this concept the next time the ATF drives a tank into the compound of some group like the Michigan Militia. Given that they’re part of a movement that is driven almost entirely by a paranoid fear of the exploding powers of government, it’s bizarre to see these people signing on for the corruption of the 5th Amendment. But then again, no one ever accused these people of being smart.

Lawmakers from both parties have been eager to excoriate Wall Street. But industry lobbyists warn that populist proposals to shrink, break up or otherwise shackle some of the giants of the financial world could do more harm than good to the economy. These advocates say that stiff regulation could stifle the flow of credit, undermine American competitiveness in global markets and cost jobs.

Among the terms that lobbyists used to describe elements of the legislation: “Draconian.” “Crazy.” “Insanely unproductive.”

via Lobbyists fret over legislation to reshape financial system.

Not sure if anyone saw this piece, but the Washington Post’s Brady Dennis fired off one of the weirder pieces of journalism I’ve seen of late in a news daily on the financial crisis.

The essence of his piece was that Wall Street lobbyists had been banking on the Financial Regulatory Reform bill getting pared down behind closed doors as it got closer to a vote. Over the course of 900 words or so Dennis quoted one lobbyist after another talking about how politicians were getting too emotional about this whole ruined-economy thing, and were proceeding with “crazy” and “insanely unproductive” proposals.

Dennis does this, but he never explains what’s so “crazy” about any of these proposals, and in fact only vaguely even hints at what they are. We get that proposals to cap the size of banks and limit prop trading desks are among the things he’s talking about, but we’re apparently supposed to assume automatically that we understand why those things are “crazy” and “unproductive,” which is very odd given the events of the last two years.

The other thing he doesn’t do is ask anyone on the other side of the deal to comment on the rank silliness of these lobbyists’ claims. Maybe that’s because he couldn’t find anyone on the other side. There are about 1800 financial lobbyists wandering DC these days — I was physically bumping into these guys in DC this week in the halls of Hart and Dirksen — while the leading reform groups (like Americans for Financial Reform) have few if any. (AFR, as far as I understand, has no paid lobbyists and just a few dozen volunteers).

This kind of rhetoric is something you normally see a lot of in campaign journalism. You’ll see whole pieces about how X or Y candidate is “strong on immigration” or “has a good record on defense issues” or “frightens voters with his radical stance on the environment,” but the writer won’t elaborate on what those positions actually are/were. You’re supposed to move straight past the details and just swallow the reporter’s characterizations. It makes it easier to cartoonize stories, which is a big plus especially during campaign season and is also proving useful during a detail-laden behemoth of a story like this FinReg bill.

I suppose there’s a way to read this piece that’s just a bust on all these overpaid lobbyists whining about how much harder than usual it suddenly is to bribe the congress away from real action — that was my first reaction to it — but to a reader who doesn’t know the particulars of this story it still comes across like the Post is saying that the politicians proposing reforms might be out of control and getting carried away by emotion. Which is odd. In general, the amount of rhetoric against this bill that sidesteps its actual content is growing to the point of absurdity.

So the Senate voted yesterday evening. It went down by 61-33. That is frankly a crushing defeat.

The roll call has its interesting moments, notably that Alabama Republican Richard Shelby voted for it. Shelby is the leading GOP negotiator on the bill. Two other GOPers also backed it.

The Democrats split 30 for, and 27 against. Looking at those groupings will give you a pretty good idea of the nature of the divide within the Senate Democratic caucus.

via Michael Tomasky: The limits of liberalism in the Senate | Comment is free | guardian.co.uk.

As recently as last night I still had some hopes that this Financial Regulatory Reform bill might turn into something real. I was in DC watching the debate on the Senate floor yesterday and aside from being amused by the utterly schizophrenic Republican strategy for attacking the bill (several Republican Senators yesterday veered into discussions of how the new Consumer Financial Protection Agency would harm, of all people, orthodontists) there was little to the naked eye that suggested the whole thing was a farce.

In general I got the sense that many of the members on both sides of the aisle were genuinely freaked out by the snowballing corruption on Wall Street and wanted to sink at least one real fang or two into the problem, though they differed on how to get there.

This is different than the health care debate, which throughout to me felt like a gigantic mountain of posturing and back-room money-dealing smothering the genuinely passionate advocacy of a tiny legislative minority that really wanted to fix the health care problem. In the FinReg business I talked to more members and aides who believed there was real room for something genuine to happen, if only because the political/financial situation in Europe (and the serendipitous timing of the Goldman case) is putting wind at the back of previously dead or dormant reform proposals.

Then last night came to pass, or not pass, as it were.

To me there are three really big parts of the bill. There’s resolution authority/Too-Big-To-Fail, addressing how to deal with systemically ginormous companies like AIG when they go belly up and threaten the survival of the planet.

There’s the derivatives portion, which covers a more or less completely unregulated $600 trillion market.

And there’s the Volcker Rule stuff, trying to bring back Glass-Steagall, preventing banks from turbo-gambling on their prop trading desks while simultaneously acting as ostensibly safe depository institutions. An amendment by Carl Levin and Jeff Merkley is the route for dealing with that last part.

A bill that included strong reform on one of those three counts would be at least passably significant. Two out of three would still be woefully inadequate, but a good start. And none out of three would officially reduce all this to a dog-and-pony show.

Well, the count is 0 and 1. Last night the Too-Big-To-Fail amendment, a strong proposal put forward by Delaware’s Ted Kaufman and Ohio’s Sherrod Brown, got pulverized in a late-night vote. An amazing 27 Democrats voted against the bill, which would have put hard caps on the size and risk profiles of financial companies.

In a wittily insulting footnote to this massacre, Alabaman Obfuscation King Richard Shelby, the guy who has been leading the transparently lobbyist-driven and shockingly (even by DC standards) cynical Republican filibusters of this bill,  actually voted for the Brown/Kaufman amendment. I have no idea if this was Shelby’s idea of a joke or what, but somehow seeing this bloated old hack cast a quixotic Yea for this urgently necessary measure while 27 Democrats slithered back into the lobbyist camp to cast Nay votes was the most obnoxious part of this whole sordid affair.

That Brown/Kaufman got beat even worse than Shelby’s own pathetic substitute amendment on the Consumer Financial Protection stuff — the Shelby amendment that got 38 Yeas to Brown/Kaufman’s 31 was a proposal to surgically excise the Consumer Protection aspect of the bill — pretty much tells you everything you need to know about how hard it is to get real reforms passed in this Senate.

Brown/Kaufman was an obvious and logical response to the great cancer of our financial system, the rapid consolidation of power and market share in the hands of a few banks. The measure would have mandated the breakup of companies that grew beyond strictly prescribed limits, and it seems to me that it failed precisely because was a real law with no loopholes.

The Shelby amendment, on the other hand, was an open proposal to do nothing. And again, it got beat, too, but it didn’t get beat as badly as Brown/Kaufman, especially when one considers that the Democrats could have carried Brown/Kaufman all by themselves.

There’s a lot of ugly legislative backstory to all these maneuvers and if Levin/Merkley and some of the other key measures suffer the same fate as Brown/Kaufman, the Democrats and the Republicans will both come out of this wearing a lot of shame. More on this later — I also have a piece on the bill coming out in Rolling Stone in a few weeks.

Note that the interview is from last year.

Goldman Sachs Group Inc’s GS.N market-making unit has been censured and fined $450,000 after U.S. regulators found hundreds of violations over how it processed customer trades involving short sales of stocks.

via UPDATE 2-US fines Goldman unit over short-sale violations | Reuters.

Apologize for being absent from the blog of late, have been in transit and much consumed with this ballooning Goldman business.

In an interesting side note to the much more publicized businesses involving John Paulson, Greece, and whatever else Goldman is currently getting tarred and feathered for, the bank was quietly slapped on the wrist by the SEC for violations related to naked short-selling.

I wrote about this last year. The story was that Goldman (and others) had extremely lax standards for locating the securities it lent out to short-sellers. When you lend securities to someone without locating the stock first, that makes it possible for that person to sell the stock without actually possessing it or intending to possess it. That’s called naked short-selling and it’s a kind of counterfeiting that pretty much everyone admits is fairly common on Wall Street, although there is wide disagreement over how harmful it is to the market.

The current story reports that the SEC fined Goldman for failing to prevent crappy locates in late 2008. They’re describing the violations as a “bookkeeping error,” probably because a systematic effort at profiteering via the enabling of naked short-sellers is not a simple thing to prove. To quote Reuters:

Regulators said that because of a bookkeeping error, the Goldman unit between Dec. 9, 2008, and Jan. 22, 2009, accepted about 385 orders to short stocks where it had not first borrowed or arranged to borrow the securities as collateral.

They also said the Goldman unit failed about 68 times over that period to timely close out market-making positions in stocks or notify customers about such lapses.

In a piece I wrote about naked short-selling last year I published transcripts of Goldman officials discussing their shoddy locate systems at a conference of SIFMA, the Securities Industry and Financial Markets Association:

In a conference held at the JW Marriott Desert Ridge Resort in Phoenix in May 2008… a compliance officer for Goldman Sachs named Jonathan Breckenridge talks with his colleagues about how the firm’s customers use an automated program to report where they borrowed their stock from. The problem, he says, is the system allows short-sellers to enter anything they want in the text field, no matter how nonsensical – or even leave the field blank. “You can enter ABC, you can enter Go, you can enter Locate Goldman, you can enter whatever you want,” he says. “ Three dots – I’ve actually seen that.”

On the list of crimes perpetrated by the big banks during the crisis period, naked short-selling probably isn’t near the top. But it definitely exists and it was almost certainly a tool that contributed to the mammoth-killing of firms like Bear and Lehman Brothers. The big banks like Goldman enabled this game by closing their eyes to shoddy locates in order to make sure they kept their prime brokerage clients. They’ve been caught at it before and now they’re being caught at it again. But you can add this to the list of offenses that the banks will get off for with a mild fine ($450,000? Are you joking) and the usual facsimile of legal consequence. From Reuters again:

Half the penalty will go to NYSE Regulation, a unit of NYSE Euronext… and the rest to the federal government. Goldman agreed to settle without admitting wrongdoing.

When was the last time there was a settlement with one of the big banks without that phrase attached? Just once I’d like to see an SEC settlement that included a transcript (plus a photo) of a bank official on his hands and knees, weeping into his tie, shouting, “I did it! You got me! I did it!” I suppose that’s a little too much to ask, however…

So that’s what this is about. For a moment I was totally speechless and had to dig into my Harvard trained PhD brain to figure out what the hell he meant by “cuddling”! What can I say; once a teetotaling math geek, always a bit slow to pick up on signals from the menfolk. So the former Treasury Secretary had a “crush” on me! And not long afterward the former Treasury Secretary had his tongue down my throat and hands everywhere sort of like an octopus. But as soon as the thought entered my mind — the former Treasury Secretary has his tongue down my throat?! — I came to my senses a bit and awkwardly went back home before we both got too carried away. This is to say, I said to myself that there would be no other former Treasury Secretary appendages entering any other of my orifices.

via Iris Mack: Bob Rubin Just Wants to Be Cuddled.

No man’s behavior looks attractive when he’s cheating on his wife, but this little tell-all by a woman who had a sort-of fling with former Goldman chief and Treasury Secretary Bob Rubin is more than unusually embarrassing. It’s all coming out now — Goldman is officially the new Tiger Woods. The next revelation has to be something involving Gary Cohn and Ted Haggard.

The most disgusting (and revealing) part of the story is, to me, this part of Iris Mack’s narrative:

Things were much more relaxed by the time I walked him back to the Ritz – which was along the way to my South Beach condo. When we passed a homeless man along the way he made a bit of a show of opening up his fat leather billfold and producing a dollar — “There but for the grace of God…” he remarked melodramatically — and I gave him a lot of heat for that, because who exactly did he think he was kidding? I said give the man a job. Heck, you’re the head of a bank!

A multi-multi-millionaire giving a homeless guy a dollar on the way to the Ritz… if that isn’t the perfect metaphor for the modern “Third Way” Democratic Party, I don’t know what is. And Jesus, is there any area of human interaction where these guys aren’t complete and utter culturally tone-deaf buffoons? Even during the hearings, every last one of these Goldman guys, it was like they had no idea how awful they sounded, and how much the whole world wanted to reach through the TV and pull their tongues out every time they opened their mouths. It’s amazing.

An even creepier side note about that above passage: what if it’s true? What if a Bob Rubin really does, a hundred million dollars later, still retain some ingrained fear of being broke and forced to live on the street? That would really be telling, and go pretty far toward explaining the pathology, I think. Or maybe not. But it’s interesting.

Then there’s this part:

But none of this seemed to require Bob Rubin to actually do very much. On November 1 he called me four times as I was leaving for a conference in Raleigh; first while I was packing, then in the cab to the airport, then again before I went through security, then again when I was supposed to land. When I had to put the phone away he acted like a little kid who’d been told it was bedtime, and said he would call me again when I got to my destination.

“Don’t you have work to do, Mr. Chairman?” I joked during our third call.

“I’m the chairman of the executive committee,” he specified.

“What the hell does that mean?” By then I was confused.

“It means the word ‘chairman’ is in the title and I get paid very handsomely, but I don’t have any actual managerial responsibilities.” He seemed pleased.

“Well excuse moi,” I shot back. “Nice work if you can get it!”

A couple of things here. One, this seems to suggest to me that Bob Rubin’s main job at Citi was to hang around and be available for his political connections. His job, as I understand it, was a sort of permanent, ongoing bribe.

Two, this is another thing that is going to drive people absolutely up a wall when they hear more about it — the fact that contrary to what David Brooks and the rest of those types say, I’m not sure exactly how many hours some of these guys worked. In general there seem to be quite a number of upper-management types who make their money according to the crack-dealing model of corporate hierarchy, i.e. the many levels of worker bees underneath do the actual deals and shed the actual blood, while up top a thin layer of entitled, essentially tenured assholedom collects the huge money.

We may get to see some of that reality fleshed out in the Abacus case. It’ll be interesting to watch. In the meantime, it’s just delicious seeing all of this horrible stuff about Goldman pouring out now. It’s so rare to see someone who actually deserves it get the full-blown media turbo-fragging in this country.