What motivates the Tea Partiers?
More than anything else, the conviction that individuals in Congress, state houses, governors’ mansions, and the White House have mishandled the people’s money. Tea Partiers attribute the mismanagement to a socio-political condition, that is, the separation of politicians over time into a political class with ties and alliances and obligations all its own.
A fair illustration appeared not long ago in an op-ed in the Wall Street Journal by Robert Wilmers. Under the title “What About Fan and Fred Reform?,” it asks why amidst all the financial-regulation discussion going on two of the leading players in the meltdown have gone untouched, Fannie Mae and Freddie Mac. The raw numbers are overwhelming:
“The public has focused more on taxpayer bailouts of banks, auto makers and insurance companies. But the scale of the rescue required in September 2008 when Fannie and Freddie were forced into conservatorship—their version of bankruptcy—was staggering. To date, the federal government has been forced to pump $126-billion into Fannie and Freddie. That’s far more than AIG, which absorbed $70-billion of government largess, and General Motors and Chrysler, which shared $77-billion. Banks received $205-billion, of which $136-billion has been repaid.”
With that kind of investment, one would think that the two organizations would be at the center of reform policies, but not so far. Furthermore, given the anger at CEO pay, the finances of each are infuriating:
“According to a 2004 Congressional Budget Office study, the two GSE’s enjoyed $23-billion in subsidies in 2003—primarily in the form of lower borrowing costs and exemption from state and local taxation. But they passed on only $13-billion to home buyers. Nevertheless, one former Fannie Mae CEO, Franklin Raines, received $91-million in compensation from 1998 through 2003. In 2006, the top five Fannie Mae executives shared $34-million in compensation, while their counterparts at Freddie Mac shared $35-million. In 2009, even after the financial crash and as these two GSE’s fell deeper into the red, the top five executives at Fannie Mae received $19-million in compensation and the CEO earned $6-million.”
How in the world did Raines and the others pull in that staggering amount at the same time that Fannie was getting “deeper into the red”?
A short conversation recounted by Wilmers explains how and why, and it bears directly upon the “political class” problem. Here it is:
“Changing this terrible situation will not be easy. The mortgage market has come to be structured around Fannie and Freddie and powerful interests are allied with the status quo. I recall a personal conversation with a member of Congress who, despite saying he understood my concerns about the two GSE’s, admitted he would never push for significant change because ‘they’ve done so much for me, my colleagues, and my staff.’”
One wonders what Fannie and Freddie “did” for this politician and his crowd. In any case, it smells. Don’t wait for the situation to improve as long as insiders like this one remain in power. Come November, look closely at your representatives. Do you see signs of obligation that run against responsible and responsive government? Vote ‘em out.
27 Responses to Vote ‘Em Out
mbelvadi - June 3, 2010 at 8:53 am
What you are missing is that a huge chunk of the money lost by Fannie and Freddie was in fact a further backdoor bailout to the banks, not just a matter of general public sector mismanagement.Economist Dean Baker explains this very well in a series of blog entries – here is one of them: http://www.prospect.org/csnc/blogs/beat_the_press_archive?month=12&year=2009&base_name=are_fannie_mae_and_freddie_macSo when you wonder what they “did” for the politicians, look back to the answer to what TARP and the rest of the bank bailout programs “did” – it is just more of the same, run through a legal money laundering scheme to disguise from the public just how much taxpayer money went to the banks.
charliemarlow - June 3, 2010 at 9:34 am
mbelvadi,So cynical. Me, I just want President Obama to give an angry speech. Then, things will start to get better.
cwinton - June 3, 2010 at 11:45 am
Incumbents will in most instances get back in, since money is usually the deciding factor in who gets elected and incumbents typically have the best developed pipelines to the special interests that provide it. The money interests will only go against an incumbent who doesn’t do enough of their bidding. With money, means become available to throw mud at one’s opponent until something sticks, a proven means for turning an election result in the direction the money interests desire. “Vote ‘em out” is nothing new and certainly has not worked in the past. While many of us may sympathize with one or more aspects of the so-called Tea Party movement, it is already plagued by political opportunists and money interests hoping to channel the anger to their own advantage. There are two ways to break the power of incumbency that I can think of:1. term limits [ineffective unless applied universally]2. require voting as the price of citizenship [now that's a radical idea - make voting a requirement to quality for government services]The “vote ‘em out” mantra is a simplistic waste of time.
dank48 - June 3, 2010 at 12:54 pm
The bottom line is that–amazingly enough–the votes are still counted. Of course there have been and continue to be lots of “irregularities,” but votes count. Only when enough people are outraged enough to toss out incumbents and at least give someone new a chance will we have a shot at change. It probably won’t (or wouldn’t) work, but it’s surely worth a try. Meanwhile, the Executive, Legislative, and Judiciary have figured out that merely by ignoring the Constitution, checks and balances can be negated quite handily, and they can slurp up all the money and power they like.The United States has the best government money can buy.
ossininglibrary - June 3, 2010 at 4:25 pm
I see a major flaw in this reasoning. In my opinion, anyone who is running for office, as an incumbent or not, has already been corrupted. In order to get a major party endorsement, a person must already be on the ‘inside’ and make lots of promises to lots of people. I think that is why things never seem to change, no matter which party is elected.
macheath - June 4, 2010 at 9:33 am
What motivates Mark Bauerlein? Not facts. Most of this “blog” is just warmed-over, and inaccurate, claims that the mortgage meltdown was due to the Community Reinvestment Act, Fannie Mae and Freddie Mac, driven by nefarious Democrats. This is a line the right wing has pushed for some time, but it is…simply…WRONG. There is plenty of analysis refuting it. Here are just two of many, many cites.First, Krugman (with graphs and data, Mark, hope that doesn’t throw your narrative off):http://krugman.blogs.nytimes.com/2010/06/03/things-everyone-in-chicago-knows/And, if you don’t trust Krugman, here’s the good old Minnesota Federal Reserve Bank, not a hotbed of liberalism:http://www.minneapolisfed.org/publications_papers/pub_display.cfm?id=4136Sure, send Frank Raines to jail. But don’t make up your own analysis. Mark, stick to the English texts, although maybe you’ve become infected by post-modernism, and just want to make up your own “narrative” in spite of the facts.
markbauerlein - June 4, 2010 at 11:52 am
Nothing to say about the central point of the piece, macheath, the resistance of the “political class” to reform?
willynilly - June 4, 2010 at 1:42 pm
Note to “macheath” Your Question: “What motivates Mark Bauerlein?” Answer: Anything that can permit him to advance the cause of his beloved extreme right wing of the Republican party and his Fox News Network buddies, Hannity, Limbaugh, and Crazy Beck, and his favorite female, Coulter. Bauerlein spends his days, not concentrating the slightest on serving his students at Emory, but rather diving into dumpsters and landfills seeking any and all combustible material for him to throw on the flames of the angry, the haters, the poor, and the under educated. That is his major work in life.
goxewu - June 4, 2010 at 4:01 pm
willynilly, in #8, above, has the kernel of something true about Prof. Bauerlein in his beak but, alas, he also ingests about a bale of jimson weed surrounding it and turns his apercu into a conjecture-laden (“…his favorite female, Coulter”) and possibly libelous (“not concentrating the slightest on serving his students at Emory”) rant. With supporters like willynilly, the likes of macheath don’t need enemies.The kernel of truth is simply that Prof. Bauerlein’s political posts present themselves as one thing, while they are in reality quite another. “Vote ‘em Out” is one of the more egregiously disguised, possessing as it does a thin outer shell of party-neutral anti-encumbancy (the academic’s equivalent of one of Jay Leno’s oh-those-wacky-politicians monologues), a middle layer of straight-from-the-unimpeachable Wall Street Journal “What About Fran and Fred Reform?,” and inside all that, a hard little core of truth: Prof. Bauerlein would like Republicans–the Tea Partier the better–to take control of both Houses of Congress in the general elections this November. (If every incumbent is voted out in November, that’s what’ll happen.)There is, of course, nothing wrong with Prof. Bauerlein professing his political beliefs. (Marc Bousquet and Teresa Ghilarducci certainly do.) They’d be a little easier to take, however, if he wouldn’t try to disguise his rightwing, pro-Republican, Tea Party sentiments as a nonpartisan thrust to reform what he calls the “resistance of the political class” to reform. Although there is a certain behavioral commonality with, say, Diane Feinstein and Mitch Connell, they don’t hang out together when they’re not in Washington; Feinstein settles in with her supporters and legislation beneficiaries and Connell with his. Those are their separate “political classes.” In general, I belong to Feinstein’s “political class” and am up front about it here, while Prof. Bauerlein belongs to Connell’s (pace anti-incumbency) and should likewise be up front about it. Also, ossininglibrary (in #5, above) makes a telling point: Since the most of the major-party candidates running against the incumbents, as well as most of the incumbents themselves, come from the same money-is-the-mother’s-milk-of-politics, lobbyist/big-donor system, it’s questionable to say the least what kind of “reform” the country will get by acting on a simplistic “Vote ‘em Out” mantra. The recent Supreme Court decision on corporate political “free speech” actually makes it almost certain that not only will nothing change, but that future incumbents, backed by zillions of corporate de facto campaign dollars, will make things even worse.On this blaming Freddie and Fannie for the economic meltdown (it’s the fallback position from the now-debunked idea that all those reckless minority homebuyers were the cause): Prof. Bauerlein should read the review by Jeff Madrick (an academic with at least the economic creds of Robert Wilmers–who’s the former CEO of a top-twenty bank with a vested interest in blaming Freddie and Fannie) of Michael Thomas’s (hardly a lefty) new book, “The Big Short,” in the The New York Review of Books. The review is mostly a synopsis of Thomas’s detailed but clear narration of the ever-more-devious derivatives the big brokers on Wall Street (uh, what’s the name again of that newspaper Prof. Bauerlein so fondly and frequently cites?) concocted to keep the foredoomed bubble going and growing. (Madrick’s newest book is “The Case for Big Government,” which Prof. Bauerlein should probably add to his reading list, accompanied by a bottle of Maalox.)Here’s the link: http://www.nybooks.com/articles/archives/2010/jun/10/heart-crash/?pagination=falseFinally, on the chastisement of macheath for not having anything to say (as yet) on Prof. Bauerlein’s semi-fictitious unified “political class”: On his previous post, “More Prose from Frank Rich,” Prof. Bauerlein challenged me to “select anything from George Will, Mark Steyn, and Krauthammer, goxewu, that you consider ‘fire-breathing’ and quote it here in the comment roster.” I did. It took me all of about 30 seconds to find a few dillies on the first column (the most recent) I found by the first of the three (Krauthammer) I looked up. I also said I thought I could come up with enough further stuff to overwhelm “Brainstorm’s” server. No response from Prof. Bauerlein. He skipped back, to paraphrase the traditional description of Wrigley Field, to the friendly confines of The Wall Street Journal, for this post. So, my unsolicited advice to macheath is to say something about the alleged “central point” of this post. Prof. Bauerlein will likely quickly pack his partisan bags, flee without going past the checkout desk, and move promptly on to his next pseudo-nonpartisan political post.
livefreeordie2 - June 4, 2010 at 4:39 pm
Face it, Gox. . . the chasm between liberals and conservatives grows every day. . . If Bush widened it for liberals, Obama is turning it into the Grand Canyon for conservatives. I agree that Bauerlein’s seemingly non-partisan “toss ‘em all out” position seems somewhat implausible. If his political leanings are like mine, he wants to see the broom sweep out the left. Obviously, you would like to see that broom clean out the right. But I think that it will play out in a bit of a non-partisan fashion. Why?I suspect that most independents are appalled by the spending in general and the health care plan, the bail outs, and all the other government intrusions into the private sector in particular. Lots and lots of people are feeling that they’ve been lied to. . . on the left and right as well as in the middle. There will be some incumbants that will survive (Pelosi, for example), but the people, I think, will be wielding the broom in November and they will be going after two types of politicians. Those perceived as disingenuous and those who have supported Obama’s big government agenda. Look for there to be lots of changes to the political class.By the way. . . who is Mitch Connell? Or do you mean Mitch McConnell?
markbauerlein - June 4, 2010 at 4:47 pm
I’m just as happy to see Bennett go as I am to see Specter go. And I never “challenged” goxewu to provide any quotations. I invited him to, and he has used the comment rolls to insert statements sometimes as lengthy as the original post. I regard the comment area as a place for people to have their complete say, whether I agree or not. They don’t always necessitate a reply, especially when they make attributions such as saying that I am “pro-Republican” or when they misconstrue terms such as “political class.”
goxewu - June 4, 2010 at 9:47 pm
“Please select anything from George Will, Mark Steyn, and Krauthammer, goxewu, that you consider ‘fire-breathing’ and quote it here in the comment roster.”Challenge. Invitation. Tomayto. Tomahto.And as long as we’re feinschmecking words: “…when they make attributions…” Assertions?Sorry for the length of #9. I should have just said that Prof. Bauerlein is a wee bit disingenuous in his political posts, and wrong about the cause of the meltdown (pls. see link); he seems to mean something by “political class” other than what “political class” seems to mean; and silly ol’ me thinks that a post that begins with “What motivates the Tea Partiers?” and contains as an approving answer the synopsis of a WSJ opinion piece written by a recently-former banker with every reason to put the blame on anybody but Wall Street, is “Republican” in op-ed gist. Whatever my prolixity and Prof. Bauerlein’s…let’s call it “elevated rhetorical faux-naivete,” he’s probably one of the better professors at Emory.
maa0162 - June 6, 2010 at 6:07 pm
It is interesting to see such a blog topic on an academic site.Intellectual progressives will never be able to see the damage wrought by the government’s influence in private lending. There are a coulple of reasons for this. The first reason is that intellectual progressives do not work towards political ends for the benifit of anyone but themselves; they try to “do good” because it makes them feel good about themselves and it gives them standing within their own social group.The second reason is that they do not understand that it is impossible to “spread wealth.” While it is possible to “spread money,” wealth is the resource that makes possible the renewal of money. As Hoffer has noted, true wealth resides with a free people who work as a means to self-worth in ones own eyes; its not connected to the government, the banks, or the fate of others.So, to come to the point of MB’s article, it’s ultimately up to the masses, through their votes, to select those who make the development and security of wealth possible. Right now, to say the least, this is not happening.While on the subject of Fan and Fred, what are they doing securing patents for “green” energy grid technology? What is their relationship with the Chicago Climate Exchange? How is it that unlimited funding to Fan and Fred, recently approved by Congress, and funding from the stimulus allows Washington to funnel tax payer money to into the CCX without the knowledge of the general public?How many people even know that other stimulus recieving finacial institutions, most notably Goldman, own a large share of the CCX? How many know that Obama and Shore Bank of Chicago are connected as well? Did anyone notice, amid the current plethora of bank closures, Shore Bank got bailed out by stimulus receiving institutions with tax payer money?These answers are only beginning to come out. When they do, massive change will come to government.
macheath - June 6, 2010 at 9:09 pm
Mark Bauerlien asks me:”Nothing to say about the central point of the piece, macheath, the resistance of the “political class” to reform?”Nothing to say? This is commenting on a blog! You bet I’ve got something to say! Hooray for the internet! :)First, Mark’s piece is almost exclusively about Fannie and Freddie, not about “the resistance of the ‘political class’ to reform.” And if by “reform” Mark means the Tea Party, they are simply standard right-wing Republicans–they are not, in the main, independents, even if they call themselves that. Here are the details:http://www.salon.com/news/the_numerologist/2010/03/27/tea_party_is_a_republican_movementA few nuggets: 74% percent of TPers identify as Republicans or Republican leaners; 77% voted for John McCain; they like Sarah Palin by 72-14, while the country as a whole dislikes her by 33-51. And so on.So the Tea Party is nothing more than a vocal effort to push the Republican party even farther to the right, with the curious mixture of libertarianism (no seat belts), state control of women’s bodies (no abortion), and incoherent conspiracy theories (pick one–Obama as a socialist, the need for “Austrian economics” and the evil conspiracies of the federal reserve, etc.) If that is political reform, I’d resist it too. But it isn’t reform in any meaningful sense, and enactment of much of their program would be a disaster for the country.I’m with gowexu here–a good debate could be had by both left and right on how money has corrupted our politics, and how lobbyists and narrow interests have taken too much control of government, so that the majority of citizens don’t get much benefit. I’d like to get a lot of money out of politics, which now means overturning a hard right Supreme Court majority. I’d like stronger regulation of business where the regulators aren’t bought and paid for by the sectors they are supposed to regulate, so the financial industry doesn’t risk the entire world economy, and bad actors in the oil industry don’t flood our shores and kill oil workers, and corrupt and dangerous mining companies can’t kill miners, etc. etc. But Mark’s invoking the Tea Party and warmed-over Fannie and Freddie b.s. aren’t an invitation to that serious discussion.
goxewu - June 6, 2010 at 10:38 pm
Oh, this is rich:”The first reason is that intellectual progressives do not work towards political ends for the benifit of anyone but themselves; they try to ‘do good’ because it makes them feel good about themselves and it gives them standing within their own social group.”And intellectual conservatives are predominantly altruistic? (Quick! Hide those copies of “The Fountainhead,” “Atlas Shrugged,” the collected works of Milton Friedman, and that Cato Insitute membership card!) And intellectual conservatives don’t try to “do [their version of] good” to get “standing within their own social group”? They don’t have ceremonial dinners and testimonials and awards for intellectual conservatives of the highest standing within that social group? (And if maa0162 is talking “social group” in the sense of little cocktail-party gatherings of the like-minded, nobody gets a slap on the back for being an especially active doer of conservative “good”?) Intellectual conservatives don’t feel “good about themselves” for doing what they perceive as the right [no pun] thing? Intellectual conservatives don’t care what other intellectual conservatives think of them, don’t have opinions about who’s got higher standing as an intellectual conservative than others?The only intellectual of any stripe who answers that description is R2D2.
markbauerlein - June 7, 2010 at 8:28 am
If Tea Partiers are just disguised Repubs, macheath, then why did they get rid of Bennett?
lexalexander - June 7, 2010 at 10:51 am
For a more nuanced look at the roles of Fannie and Freddie in the current disaster, I recommend this take from Barry Ritholtz, as well as his book Bailout Nation.That said, right at the end of last year, Congress quietly removed the caps on taxpayer liability for both Fannie and Freddie. The caps had been $200B per agency. Now the liability is theoretically unlimited. Why? So they can buy up the nonperforming assets of banks, probably for more than they’d actually be worth in the open market.So the taxpayers are now on the hook for theoretically unlimited bailouts to privately owned banks, with Fannie and Freddie as pass-throughs.The same measure that lifted the cap removed the two agencies’ previous acting inspector general. Why? Informed speculation has it that that gentleman, Ed Kelly, was close to proving that current White House Chief of Staff Rahm Emanuel had conspired with other members of Freddie’s board to misstate the agency’s earnings in 2000-01 so that board members could receive bonuses.
zeno6601 - June 7, 2010 at 11:00 am
Life is good when you can spend other peoples’ money.But eventually governments run out of other peoples’ money. The Fannie and Freddie money is actually borrowed from people who have money, or from taxpayers the government obligates to guarantee loans for other people. Some of the borrowers can repay loans. Others weren’t/aren’t good risks. On campus, the bubble continues (at least compared to off-campus) via easy money for student loans. But the bubble is losing air anyway. States can’t sustain their budget support for higher ed. We’re at a demographic peak of high-school graduates and are going into a decline. Paying parents are wary of taking on debt, especially if they realize that the government is putting them on the hook for paying for the government’s own debt, both yearly via deficit spending and cumulative via the national debt. Household share of the national debt is by some accounts $106,000, and the worker share is $80,000. Who, whom? Who’s profiting? Who’s getting screwed? I don’t have any confidence in Mark B’s hope of sweeping out the parasite politicians. There are more parasites waiting to feast. Consider the prospects of your students. Bush, Obama . . . it doesn’t matter. Everyone—politicians, rent-seekers, parents, unions, higher ed, seniors, dole-seekers, etc.—we’re all part of the problem, and we are sending the students out to an economic abattoir.
goxewu - June 7, 2010 at 11:12 am
The husband of the cousin of my brother’s barber said that he’d heard of a guy who said on “Blog on the Run” that informed speculation has it that that gentleman, Ed Kelly, was close to proving…
goxewu - June 7, 2010 at 11:29 am
Re #16:Tea Partiers didn’t get rid of Utah Republican Senator Bob Bennett in favor of a Democrat or an independent or a third-party member in the general election. They got rid of Bennett in the Utah Republican convention by voting against him in favor of a more conservative Republican candidate.Prof. Bauerlein might as well ask, “If Utah Republicans are really Republicans then why did they get rid of Bennett in favor of another Republican?”(Speculation, sure, but I guess that if Bennett had won the Republican nomination, Utah Tea Partiers would vote for him in the November general election, or not voted for Senator at all. I doubt to the point of certainty that Utah Tea Partiers would vote for someone more liberal than Bennett just to throw the incumbent out of office.)Even if there were some sense in Prof. Bauerlein’s nonsensical question, macheath’s “a few nuggets” carries a whole lot more weight in proving that the Tea Party movement is basically a movement within the Republcan ranks, with a sprinkling of Libertarians and other rightwing third-party member along for the ride, and the coattails.
markbauerlein - June 7, 2010 at 11:34 am
Because of his seniority, contacts, etc., Bennett not being on the Hill will cause pain to Utah Repubs even though a new Repub will replace him.
goxewu - June 7, 2010 at 11:49 am
Re #21:Which is relevant to Tea Partiers allegedly not being a predominantly Republican movement exactly how?As to the loss of seniority, contacts, etc., this proves only that the conservative wing of the Utah Republican party puts principles (or wrath) above politics (or practicalities). Unlike maa0162 vis-a-vis intellectual progressives, I’d give the conservative wing of the Utah Republican party (which must be the mirror-image of the left wing of the Berkeley, CA, city council) the benefit of the doubt and say that they voted out Bennett on principle.Again, what does #21 have to do with the Tea Party movement being a predominantly Republican movement?
goxewu - June 7, 2010 at 12:00 pm
Here’s an “invitation” for Prof. Bauerlein:Find me an instance of Tea Partiers working within the Democratic party ousting a Democratic incumbent in a primary or party convention in favor of another Democrat.
gplm2000 - June 7, 2010 at 12:07 pm
Hey posters, thanks for the laugh this Monday morning! I enjoy the academic heads posting about what they either do not know about or refuse to acknowledge. Academia is all about “kill the messenger” since they refuse to accept reality. In this case it is how Fannie and Freddie do not serve the public interest, are poorly managed and financially propted up by dunder-heads. All of us are in this finanical mess due to govt. pushing bad mortgages onto financial institutions. Academia can’t stand that they and other liberals caused the mess. Talk about their head-in-the-sand!
goxewu - June 7, 2010 at 12:33 pm
Re #24:A big private-enterprise corporation causes an environmental disaster, and it’s the Government’s fault for not preventing them from doing it.A bunch of big banks and Wall Street brokers cause an economic meltdown and it’s the liberals’ fault.http://www.nybooks.com/articles/archives/2010/jun/10/heart-crash/?pagination=falseI can guarantee that gplm2000 won’t laugh.
22113683 - June 7, 2010 at 2:48 pm
Many (but not all) of the negative responses to Mark Bauerlein’s blog entry are ad hominem, not factual. As such, they are merely screed. Just for variety, macheath proves a point by argumentum ad vericundium–citing that famously objective source salon.com. And of course we can always count on the indomitable gox for healthy doses of vitriolic reductio ad absurdum. Really, the intellectual level of these discussions make me cringe. They also further convince me of the intellectual bankruptcy of the Left. Truly, they live in a parallel universe of some sort.
goxewu - June 7, 2010 at 5:10 pm
Re #26:Actually, there are only two real instances of ad hominem other than willynilly’s flamer.In #6, macheath says, “What motivates Mark Bauerlein? Not facts.” But he then goes on in the rest of that comment, as well as in #14, to back up s backs up that statement to the point of overkill.And I, in #12, said, “Prof. Bauerlein is a wee bit disingenuous in his political posts,” which is, of course, a wee bit ad hominem. But I was only synopsizing what I was accused of taking too much space to say in #9.If someone offers the fact that the Tea Party wing of the Utah Republican party ousted an incumbent Republican Senator in favor of another, more conservative Republican as evidence, as per the OP, that the Tea Party movement is a non-partisan anti-incumbent movement, it seems to me that “not [motivated by] facts” and “a wee bit disingenuous” is fair, even lenient, criticism.As to the relative reliability of salon.com and an opinion piece in the WSJ, well, you pays yer money and you takes yer cherce.