The Anti-Government Government and Its Fundie Enablers

There can be economies of scale even in blogging; for example, suppose I post a comment to Paul Krugman's column in the New York Times and then quote myself:

"Mr. Krugman's column strikes me as a very limited view of what Paulson's bailout is really all about. The reason the stockholders of Fannie & Freddie have been sacrificed is to conserve as much of the available assets of the two GSEs as possible in order to make timely payments to the foreign holders of the MBS bonds issued by these two companies under the implied assurance that the bonds were, in effect, backed by the full faith and credit of the USA, just as T-bills and bonds are. The Chinese in particular have voiced ominous warnings about the consequences of default. It was thus a no-brainer for the no-brain crowd of the Bush Administration. They've got to keep the house of cards intact at least through January 2009."

This post was recommended by 157 readers of the intelligent readership of the New York Times, more than anyone else on the first page of comments.  I didn't look farther than the first page to avoid finding a comment with a bigger readership.

Am I mad as hell and disinclined to take it anymore?  That's silly; we're all going to take a great deal more.  I console myself with the canard that the Bush Administration is the "no-brain" crowd; actually, they're smart as hell and they're going to take as much as they can on their way out the door.  What I hate to see is the house Liberal, Paul Krugman, running cover for the Bushies.  How can he write an entire column about the Paulson bailout of Fannie & Freddie and never once mention its true purpose?  Krugman is the kind of overrated analyst writing in mainstream publications who assuages the mostly unconscious and yet highly accurate suspicion among ordinary Americans that they're being taken for a royal ride by their own government.  The Treasury Department did not engineer a socialization of America's two biggest mortgage companies, which together hold about $5 trillion in mortgage and mortgage-related paper, so that Americans could once again "afford housing."  This idea is, you know, a sick joke.  In a sense, housing in America is becoming more affordable all the time.  The price declines in the real estate market are the largest since the Great Depresssion, and they're far from over.  Adjustable mortgage resets, declining wages and rising unemployment ensure that more and more foreclosed houses will continue to swamp the market at least through all of 2009.  Propping up Fannie & Freddie is not going to do anything for that problem.

Paul Krugman often has the right idea; he sees the Bush Administration, in line with every Republican Administration since Reagan, as the anti-government government.  It is government by sabotage, a species of "vandalism," as Thomas Frank writes in his brilliant new book on Conservative rule called "The Wrecking Crew." It's just that Krugman, as a writer for a mainstream publication, just can't hold that (accurate) view steady.  He wants to believe that even this crew in power occasionally does something which you might call "altruistic," that is, designed to help the majority of the great masses of people they govern.  But:  they never, ever do. That is never, ever the function of an oligarchic government.  Every move they make is designed to benefit the Big Business Class, period, end of story.  The purpose of the Medicare Prescription Bill?  To prevent mass purchases of pharmaceuticals by Medicare itself, thus driving the price of drugs down (it's in the law, folks; is that for you?)  The Bankruptcy Reform Bill?  To make it more difficult for ordinary Americans to discharge credit card debt in bankruptcy.  The bill was written by banking industry lobbyists, with the assistance of Joe Biden (thanks, Joe!  Well, corruption is also bipartisan).  FISA reform?  To exonerate Big Telecom from felonious spying at the behest of the government.  Bush's tax cuts?  Okay, he couldn't help it if it also reduced average income taxes a little, but it was a huge break for the plutocrat class because it capped the high marginal rate at 35% (down 4% from Clinton) and brought capital gains to 15%, allowing hedge fund managers like John Paulson, who earned $4 billion last year to pay at a lower "marginal" rate (he pays capital gains rates) than his secretary.

The mania for deregulation, privatization and the unleashing of greed on the broadest possible basis has led us to this pretty pass, where the entire economic structure of the United States is teetering on the brink of implosion.  While the Fundamentalist/Evangelical voting bloc is brought into the Republican tent with promises of a few baubles like outlawing abortion, stigmatizing gays in every way possible, making automatic weapons possession legal (if not mandatory) and installing Christianity as the State Religion (just as the Pilgrims wanted), that's not really what the Republicans are all about.  That's simply the bait-and-switch technique which Thomas Frank described in another brilliant book, "What's the Matter with Kansas?"  Their agenda is simpler: free markets completely untethered from any government regulation.

The Republicans share one habit of thinking in common with their Fundie enablers; a tendency toward what "secularists" call a priori reasoning.  It works like this: my theory is correct.  Now here is a real world problem.  It will be solved by means of my theory.  What is my theory?  My theory is that the all-seeing, all-knowing "invisible hand of the market" routs out all inefficiencies, makes everything transparent and results in a completely fair and level playing field.  That this is complete and utter nonsense does not matter.  Grover Norquist, Tom DeLay, Howard Phillips, Jack Abramoff, John McCain, George W. Bush, they all believe it to the depth of their beings.  And the Fundies have kept them in power for 20 or the last 28 years, long enough to change everything about our government and regulatory agencies.  The Bush Administration did not even believe that disaster response should be "regulated:" it should be left to the open market to decide whether saving New Orleans was or was not a sound business decision.  I guess it wasn't.

Now John McCain adds a secessionist, inexperienced, and vindictive person to his ticket, someone who believes that polar bears are not endangered in her state but that dinosaurs walked around in Alaska as recently as 5,000 years ago, and what happens?  McCain gets a 15 point bounce in the "Southern tier," those states that have always been part of Nixon's "Southern Strategy."  What used to work down South was anti-black rabble rousing.  Now the appeal is softer and gentler: a return to a Golden Era before the "humanist" predations of abortion and gay rights turned our country into Sodom.

John McCain's solution to the Fannie & Freddie crisis is to pump them up with taxpayer money and then re-privatize them.  (Palin thought they were public entities all along; oh man, we are in such trouble; between a Republican who thinks Iraq and Afghanistan are contiguous countries and one who believes Fannie & Freddie are public agencies, we're never going to make it.) Privatized gain, socialized loss.  See how it works?  

Is there a unifying theme to today's screed?  Maybe this: it's worse than you think.