Mitch McConnell, bank-shrinker?

Ezra Klein has beat me to it again.  Today Mitch McConnell came out against Dodd's bank reform bill,  claiming that by setting up and funding a resolution authority that enables regulators to liquidate the largest financial institutions in an orderly fashion if they become insolvent, it is enabling and in fact guaranteeing future "bailouts." "“This bill not only allows for taxpayer-funded bailouts of Wall Street banks;  it institutionalizes them,” McConnell pronounced.

Klein points out that McDonnell is equating a liquidation that wipes out shareholders and management with a bailout -- and further notes that McDonnell is following to the letter a political strategy laid out by GOP pollster Frank Luntz in February: to equate any Democratic bank reform bill with the hated bailouts of 2008-09.

Cynical indeed. As Klein suggests, if you don't want to give regulators resolution authority over banks currently considered too big too fail, it would seem you would have to be in favor of not allowing banks to grow, or stay, too big to fail.   I would add that the only intellectually consistent, if insane, alternative to  breaking up, shrinking, or reining in today's behemoths or making provisions for their orderly liquidation is to take the position taken by many of the most ignorant and extremist Republicans in fall 2008: let 'em all fail and let the chips fall where they may. Pull down the whole temple of global finance around our ears.

But McConnell is not that crazy. He acknowledged last October that TARP “succeeded in stabilizing the banking system.” It seems fair to assume that he believes that the Federal government can't simply step back and let too-big-to-fail banks enter bankruptcy. That brings us back to Klein's question:  what steps would McConnell favor to make the behemoths smaller, or otherwise enable them to fail without systemic risk?

Rolling over for Rove?

Watching a Jan. 16 speech by Karl Rove to a Republican group on C-Span tonight, I got a sense of why the Dems keep rolling over for Bush on the FISA bill. Rove said that the leading Democratic candidates, Hillary and Obama, were in favor of preventing US intelligence from listening in on the conversations of terrorists if their phone calls passed through the US. That is of course a gross distortion of the position of those who are trying to maintain a modicum of FISA oversight over unchecked monitoring of Americans' phone and Internet communication. But the way it was framed - they want to keep those who are trying to keep us safe from tuning in on those who are trying to kill us -- seems to make the Democrats quake in their boots. Here's one more 'nod to Dodd,' who's vowing again to filibuster any bill that guts FISA and grants telecom immunity.

On the whole, Rove's criticisms of Hillary and Obama were so limp and familiar that I began to wonder if the Republican attack machine might be as tired as the party's policy precepts. But I wouldn't count on it.

Nod to Dodd

Those of us who consider the rollback of unchecked executive power essential to the survival of democracy in America owe a nod to Dodd, the only candidate to put 'restoring the Constitution' at the center of his campaign. Last night, his farewell email to supporters included this pledge:

The fight to restore the Constitution and stop retroactive immunity does not end with my Presidential campaign. FISA will come back in a few weeks and my pledge to filibuster ANY bill that includes retroactive immunity remains operative.

Neither Obama nor Clinton nor Edwards has devoted enough attention to ending torture, indefinite detention, warrantless spying, and the Bush Administration's insanely expansive 'interpretation' of the 'unitary executive' theory, which boils down to a free pass to the President to violate any law at his discretion.

I watched Obama's "closer" speech before the Iowa caucuses, and it included a couple of brief gestures toward the importance of restoring "American values" and our place in the world, i.e. ending torture and unlawful imprisonment. Those were the largest applause lines in the speech. He needs to do more on this front.