Frontline: The Warning

If you have time (Tim), I'd recommend watching this week's Frontline.

It traces the story of a confrontation between Alan Greenspan's Laissez-Faire crowd and little-known bureaucrat Brooksley Born over the regulation of the over-the-counter derivatives market. Born essentially warned of the financial meltdown that we've been experiencing ten years before it actually happened. But she was defeated in her attempt to get any regulation (even after a near meltdown) by an economic junta of sorts led by Greenspan (not to mention I'm sure the financial lobby).

The story is pretty interesting but also pertinent to the ongoing debate in congress (though very little in the media these days). I can't claim to understand OTC derivatives at all, but the market apparently continues to be secretive with no government oversight, and a lot of the bad assets that led to the financial crash were derivatives. Greenspan has since admitted that his philosophy had been wrong, and there is a bill working its way through congress, but the financial lobby has been working hard to make it better suit their tastes.

It's pretty crazy that a bunch of companies just pushing around money can bring our entire economy to its knees and put so many people out of work. It's also surprising that after the economic collapse and resulting public anger they are still so reluctant to change. Anyway, I'm glad that Frontline did this piece, because it's pretty clear to both the Wizard and most of the American public that a certain amount of regulation is actually good for the economy. Hopefully our lawmakers are able to stand up to their financers and get something meaningful passed.

O-BA-MA on 60 minutes

Apparently it was all part of the CBS-Obama plan, but I got sucked into watching the Obama interview on 60 minutes after all of the NCAA tourney games. I don't know if anyone else saw it, but I thought Obama performed excellently. The link above has some excerpts and video; Politico also ran a pretty good article before it aired if that's too much.

I thought Obama's response to Cheney's critiques was excellent. Basically he just said that Guantanamo had done nothing to make us safer and that the Bush policies had damaged our place in the world, but delivered it convincingly with some good one liners.

I was a little less convinced that Obama has a solid plan to take on the economy and the whole AIG fiasco, but I think he was trying to connect to all of us "main-streeters" and show us that he understands how we feel about the economy and the Wall Street bonuses, which he did a pretty good job on. One thing he mentioned was that he had taken to reading ten of the thousands of letters that he recieved every day before going to bed each night, which does make it seem like he is at least trying to pay attention to us common folk.

It's interesting that this interview came out a day after Thomas Friedman blasted Obama's (and Congress's) handling of the AIG situation in his column. Friedman said that Obama should have gone on national TV for a fireside chat where he tells us:

exactly how deep the crisis we are in is, exactly how much sacrifice we’re all going to have to make to get out of it, and then calls on those A.I.G. brokers — and everyone else who, in our rush to heal our banking system, may have gotten bonuses they did not deserve — and tells them that their president is asking them to return their bonuses "for the sake of the country."

I think Obama took a step in that direction with his interview, but he is certainly capable (as he showed in the interview) of doing more to instill confidence in the American people. I think Friedman is right that Obama needs to be more of an inspirational style leader, after all, that is why he was elected.

Anyway, enough of my unsolicited political commentary. The U.S. is getting hammered in the WBC, I need to find something better to do.