Bush's Class Warfare

Friends -

Just a week before Christmas, President Bush gave corporate America two big presents. On Tuesday, his Federal Communications Commission changed the rules to allow the nation's giant conglomerates to further consolidate their grip on the media by permitting them to purchase TV and radio stations in the same local markets where they already own daily newspapers. The following day, as a gift to the country's automobile industry, Bush's Environmental Protection Agency ruled, over the objections of the agency's staff, that California, the nation's largest and most polluted state, and 16 other states, can't impose regulations to limit greenhouse gases from cars and trucks that are stronger than the federal government's own weak standards. So far, no major politicians or editorial writers have labeled Bush's actions "class warfare," although this is precisely what he is engaged in. My piece in today's Huffington Post asks why is it that, to the mainstream media, "top-down" class warfare seems to be OK, but "bottom-up" class warfare -- waged by the burgeoning progressive movement of unions, community organizing groups, environmental activists, immigrant rights organizations, and others -- seems to be a no-no?  If you don't want to read another litany of Bush's crimes and misdeeds, don't fret; my article has a happy ending. 

On a separate but not unrelated topic, we have a winner in my "Can you translate Alan Greenspan into plain English?" contest.  As you may recall, in my email last Tuesday, I challenged folks to try to summarize Greenspan's recent Wall Street Journal column, "The Roots of the Mortgage Crisis"-- an incredible example of Greenspanian BS -- in two sentences and in plain English understandable to, say, the typical voter in Iowa. I promised to look at each of the submissions, select the winner, and send her/him either $5 or a brand-new copy of Greenspan's new semi-autobiography, "The Age of Turbulence," which sells in stores for $35 and on Amazon for $20.99.   Four hardy souls responded:

Bart Harvey came up with the following:  1)  It's not my fault, just in case anyone thought it was. 2)  There is nothing anyone could have done about the housing bubble (particularly the Feds) but banking institutions and Wall Street have set up a brilliant system of slicing and dicing mortgages and spreading credit risk all over the financial system (brilliant!), and as housing prices decline, the market will be restored (too bad about the 2 million households that will be "displaced" and shouldn't have borrowed so much money).

My Oxy colleague Woody Studenmund, an esteemed economist himself, came up with this: Over the last five years, interest rates have been too low, and housing prices have been too high (in part because of the low interest rates).  The resulting "housing price bubble" now has burst, and, since bubbles cannot be cured by monetary policy alone, the current credit crisis won't end until housing prices bottom out.

Dan Immergluck contributed the following: The root of the current crisis, as I see it, lies back in the Franco-Prussian War, which the French still call the 1870 war, when Prussia’s effective use of railroads and superior Krupp artillery was subsequently followed by a shortage of flaxseed and bulgur, disrupting commodities markets throughout southeastern Austria-Hungary. The crisis has absolutely no connection to the fact that the Federal Reserve, under my leadership, openly championed high-risk, high-cost lending practices that targeted minority communities and avoided, at every turn, proposals to apply stronger consumer and fair lending protections to the exploding sector.

Roz Greenstein needed three sentences: We wished for the fall of the Soviet Union and the globalization of all markets. Instead, we got the powerlessness of central bankers to moderate the negative effects of this now global economy. My best advice is to wait it out.

Roz and Woody seriously tried to summarize Greenspan's prose, and did a good job, which I admire. Bart and Dan did likewise, but added a bit of sarcasm and political spin to the effort, which I also appreciate. As the official arbiter of this contest, I'm going with Dan, just for knowing something about the Franco-Prussian War while kicking Greenspan in the groin. Dan - do you want the five bucks or the book?

Peter