"U.S. Oil Fund Finds itself at the Mercy of Traders"

WHITECOLLAR REDNECK
My employer has an unwritten policy - they'd rather not see anyone's name in the newspaper. There are exceptions for a couple of people who serve as ambassadors for the firm, but in general, you're encouraged to keep your mouth shut and not make an ass of yourself. I think most investment firms are the same. That's why I was shocked to read this article in Friday's Wall Street Journal, with the following priceless quotes from traders, whose names I have removed but which are present in the article:

"It's like taking candy from a baby," said [name removed] senior vice president at Macquarie Futures

"They are asking to be robbed," said [name removed] managing director of Petromatrix

Look, it may well be true that this U.S. Oil Fund is structured in such a way that sophisticated traders can rip it off, but in this environment, do you want to be the guy quoted in the paper talking about how easy it is to shaft a bunch of mom & pop investors?

Hope over Fear?

MITHRIDATES
Bradley Schiller expresses his worries in the Wall Street Journal about Obama's fear-mongering. He's right in that the over-the-top rhetoric can't be good for confidence, but where was the WSJ over the last eight years of real fear-mongering, when Bush told us we were in for catastrophic attacks unless we passed every single one of his measures and continued to mock American justice by holding people in perpetuity without trial?
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And it's pretty rich to single out Obama for calling this the worst crisis since the Great Depression without noting that people of all stripes in both political parties have been saying that for quite some time. Moreover, some of Schiller's points are just nonsensical. Yeah, there were far more bank failures in the Depression, but banks are much bigger now (or has the WSJ not noticed the consolidation in the financial industry it's been championing for years?). There are fewer bank failures now, but those that do happen are devastating. It takes a facile and petty mind to compare the failure of say, Jimmy's Corner Bank in 1931 to the collapse of Lehman Brothers in 2008.

But the entire argument is nuts. He writes "as [Obama] tells it, today's economy is the worst since the Great Depression." And then he goes on to note how he thinks the Great Depression was worse. Well, it was worse. That's why this is the worst economy since the Great Depression, and not the worst economy ever.

Schiller almost actually tries to counter Obama's claim by suggesting that the 1982 recession might be as bad as this one, but he uses very selective statistics. He compares peak unemployment from the 1982 recession to current unemployment figures, even though we don't know if we've bottomed out yet in this one. But this crisis features massive bank failures as well (Schiller fails to mention that this didn't happen in 1982). In 1982 the entire financial system wasn't at risk. It seems to me that this recession is much worse than the 1982 crisis, and Schiller's really grasping at straws if his argument is that Obama shouldn't say this is the worst since the Depression because the 1982 recession might, by some metrics, be just as bad. The current situation might be closer to 1982 than 1932 — that's fair to postulate — but that wouldn't refute Obama's claim.

To say that Obama's claim was way out of line, you'd have to provide very convincing proof — far more convincing than the trite argument Schiller makes here — that 1982 was worse. Or, show somewhere in your article a quote where Obama says this is as bad as the Great Depression. As is often the case with journalists on the left and right, the headlines and paraphrases usually exaggerate the statements of the politician. See headlines about John McCain, Sarah Palin, and Barack Obama on the Great Depression.

But Schiller does have a valid point in there. One worth making. It's not so noticeable amid WSJ's hypocrisy about fear-mongering, his selective statistics about 1982, his willful ignorance about the fact that most people are saying the same thing, and his embarrassing misunderstanding of the word "since." So I'll restate my own modified version of it here:

Talking about impending financial disaster will not boost confidence in a way that's needed to get people spending and lending again (nor, of course, will burying our heads in the sand and pretending nothing's wrong). Getting quick passage of a controversial bill with huge ramifications by threatening disaster is something we all hoped we were finished with, as well as loading up said bill with partisan policy and then calling the other body "obstructionist" for opposing it.

Now that the bill has passed, can we get back to Hope? Now that the bill has passed, can we get back to working with the John McCains of the world again?

"Unwarranted," Part II: Journal Back at It Today

PHUTATORIUS
It would be petty, on a day this mo[nu]mentous, to take on the nuance-proof editorial board at the Wall Street Journal. And petty I am. So here goes:
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Building on last week's endeavor to misread the import of a judicial decision to defend Bush's secret program of warrantless wiretapping, the Journal runs an editorial today about Att'y General nominee Eric Holder's position on the question, quoting a confirmation hearing exchange between Holder and Senator Orrin Hatch:

Mr. HATCH: "Back to my prior point, the President's inherent authority under the Constitution. Can that be limited by a statute? You're relying on a statute as though that's binding on Article II of the Constitution."

Mr. HOLDER: "Well, the President obviously has powers under the Constitution that cannot be infringed by the legislative branch. That's what I was saying earlier. There are powers that the President has delegated to him — that he has — and Congress does not have the ability to say, with regard to those powers, you cannot exercise them. There's always a tension in trying to decide where that balance is struck. And I think we see the best result when we see Congress interacting with the President, the executive branch interacting with the legislative branch and coming up with solutions . . ."

Mr. HATCH: "That still doesn't negate the fact that the President may have inherent powers under Article II that even a statute cannot vary."

Mr. HOLDER: "Sure."

From here the editorial jumps to its logically untenable "Gotcha!" conclusion:

So let's see. Mr. Holder now concedes that Presidents have inherent powers that even a statute can't abridge, notwithstanding his campaign speeches. . . . [H]is concession is further evidence that the liberal accusations about "breaking the law" and "illegal wiretaps" of the last several years were mostly about naked partisanship. Mr. Holder's objection turns out to be merely the tactical political one that the Bush Administration would have been better off negotiating with Congress for wiretap approval, not that it was breaking the law. Now he tells us.

Uh, no, Journal. No — you're wrong, because Eric Holder did not tell you that. Nothing Holder said about the Article II war powers generally (to wit, that they exist) is inconsistent with his position on whether bulk warrantless wiretapping in secret is one of them (to wit, that it's not).

At this point, it's just laughable. At least last week the Journal did the good journalist's work of obfuscating the truth, by conveniently leaving out any discussion of what the FISA review court decision actually held. Here they quote an actual transcript, then — with the evidence right there in the column — try to make triumphal hay on a premise that Holder said something different.

The Journal's Celebration of the FISA Review Court Ruling: "Unwarranted"

PHUTATORIUS
An August 2008 decision of the Foreign Intelligence Surveillance Court of Review, disclosed only yesterday, held that the Bush Administration's warrantless-wiretapping program does not violate the Fourth Amendment.

Cue editorial triumphalism from the Wall Street Journal:
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Ever since the Bush Administration's warrantless wiretapping program was exposed in 2005, critics have denounced it as illegal and unconstitutional. Those allegations rested solely on the fact that the Administration did not first get permission from the special court created by the 1978 Foreign Intelligence Surveillance Act. Well, as it happens, the same FISA court would beg to differ.

* * *

For all the political hysteria and media dishonesty about George W. Bush "spying on Americans," this fight was never about anything other than staging an ideological raid on the President's war powers. Barack Obama ought to be thankful that the FISA court has knocked the bottom out of this gambit, just in time for him to take office.

But all this hoo-hah from the Journal is unwarranted (ba-dum-bum). Here's the thing: there are two warrantless-wiretapping programs. There's the first program, which the Administration took up in secret after 9/11 without approval from Congress and concealed from all of us until word of it was leaked in 2005. And there's the program to which Congress gave temporary assent in 2007's Protect America Act, and its final approval last July.

The FISA Review Court's ruling had to do with the second program, and it only held that the Fourth Amendment did not require warrants in these circumstances, and that any constitutional privacy concerns were alleviated by the Administration's scrupulous compliance with certain safeguards that Congress, and the Administration itself by executive order (to its credit), had impressed upon the process — including a requirement that the Administration "reasonably believe" that the surveillance targets are "located outside the United States."

The FISA Review Court had nothing to say about the first program, which I think we can assume contained none of the procedural safeguards that made the difference to the court here (I say "assume" because the Administration refused to tell us how the program worked). At a minimum, the first program was undertaken in clear violation of the wiretap and FISA laws, which required individual approval of each and every wiretap.

And I'd venture to say it was exactly the uproar over the secrecy and intrusiveness of the first program — as the Journal puts it, the "political hysteria and media dishonesty about George W. Bush 'spying on Americans'" — that resulted in Congress and the Administration writing the program-saving safeguards into law.

Hate on the "liberal media" all you want, Wall Street Journal, but this is democracy at its finest: the press ferrets out secret abuses of power, and the law corrects them.

Enough Already about Hillary and the Clinton Foundation

PHUTATORIUS
The Wall Street Journal's editors want to know why more hasn't been made of the potential conflicts of interest between Hillary's business as Secretary of State and Bill's as fundraiser for the Clinton Foundation:
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Here is the spectacle of a former President circling the globe to raise at least $492 million over 10 years for his foundation — much of it from assorted rogues, dictators and favor-seekers. We are supposed to believe that none of this — and none of his future fund-raising — will have any influence on Mrs. Clinton's conduct as Secretary of State.

The silence over this is . . . remarkable.

Oh, Wall Street Journalists — is this the best you can do? Think through the problem here, people. The Clinton Foundation isn't a for-profit operation. It's a voluntary, charitable undertaking by Bill Clinton. I might be concerned if the tens of millions of dollars from the Saudis (among others) were going directly into Bill's pocket, but he doesn't keep the money.

The conflicts question reduces to this: is it at all likely that Hillary Clinton will trade U.S. foreign policy favors to foreign interests as gratuity/in exchange for past/future contributions they have made to her husband's charitable foundation? There is a short answer to this. It's no. And as to even "the appearance of impropriety" that is so often the preoccupation of lawyers — again, no.

Think, Journal, think! You're coming off like a bunch of AM radio hacks.

MITHRIDATES
Of course I went to the first mainstream media source I could find and found The Boston Globe's silence on the matter to be "remarkable" as the front page of their website screamed:

CLINTON FOUNDATION DONATIONS QUESTIONED

PHUTATORIUS
There's that, and there's the fact that no less a left-wing media sop than The New York Times complained on Saturday that the proposed annual disclosure of Clinton Foundation donors would be too infrequent to protect the American People against these apocalyptic conflicts. Whatever.

I know these newspapers have to find whatever controversies they can, and the Obama-Blagojevich connection has pretty much tapped out. So they set up their base camps around molehills like this. I suppose it says something about the relative calm we're experiencing in our national politics.

Still, you half-wish the papers would do what we do when there's nothing to write about: go buy some LPs, chill out, maybe slap something together about Duran Duran.