Wednesday, June 4, 2008
Emailer Z, who knows business and politics--and isn't a liberal (or even a Democrat)--writes to usefully amplify David Corn's Mother Jones piece, which blamed Sen. Phil Gramm for engineering an ill-fated non-regulation of financial services that contribuled to the sub-prime meltdown:
The non-regulation of the not banking system has been a team effort in Washington. Major financial services firms, hedge funds and private equity groups set out in the 1990s to own Washington and they have succeeded completely. 80% of banking activity used to be regulated. Today, 20% of "banking activity" falls under regulatory guidance. (See Charles Morris's The Trillion Dollar Meltdown). Capital networks own the Democratic and Republican parties. Barney Frank didn't even bother to try to get the tax on "carried interest" increased after the Ds recaptured control of Congress in 2006 ... the members understood that such a tax would make their fund-raising lives a LOT harder.
This is the part of Kevin Phillips' analysis of Washington that is exactly accurate. The power of private capital sources hasn't been as overwhelming since the days of JP Morgan. [E.A.]
Update: Maguire elaborates. ... 10:40 P.M.
Bob Wright and I discussObama's cosmopolitanism. ... 10:01 P.M.