Bailout Talks Collapse. Will Carmakers be Next?

To almost no one's surprise, the Senate couldn't agree on a compromise plan to provide $14 billion dollars in loans to GM and Chrysler. The Upper House voted 52-35 to bring the measure for a vote, but that was 8 short of the 60 needed to move the bill forward. As was the case in the financial bailout, it was Republicans turning on their own president that doomed this bill. Bush managed a compromise with Senate Democrats, but in the end, the GOP wouldn't go for it.

At issue was the demand by Republicans that the United Auto Workers agree to what's called "parity pay" with non union plants operated by foreign carmakers. The UAW agree, but by no means should the blame for not getting this done be put on them. From the very beginning there were Republican senators who balked at help Detroit because they had foreign car plants in their states. Don't think for a moment those carmakers didn't have lobbyists on Capitol Hill fighting for their interests.

Now the question is, how bad will the fallout from not getting this done be? Even though it's still possible negotiations could get jump started somehow, it's not likely. GM in particular says it doesn't have the cash to operate much longer. Even if you oppose the bailout on principle, the collapse of one or two of the Big Three can't be an appetizing prospect.

It's almost as if members of the current lame duck Congress want to leave as large a mess as possible for the next one to clean up. Of course, the new president will also have that task. On top of all the other bad economic news, bankruptcy for GM and Chrysler could well turn a recession into something no one wants to contemplate.

Could we be using the "D" word sometime in 2009? You tell me.

Still at Work?

With all the unemployed Americans facing tough times, it's just galling to know that Illinois Governor Rod Blagojevich went back to work yesterday, and shows no sign that he's thinking of quitting. As the details of the case against him come into sharper focus, it's also obvious why he's staying. It's his only leverage against what looks now like a long stretch in prison stripes. Again, the man is innocent until proven guilty, but it's his own words that are damning him.

There is more information about the depth and breadth of both Blagojevich's greed, and the efforts to take him down. We now know that Rep. Jesse Jackson Jr. is the potential senate appointee identified as "Candidate #5" in the criminal complaint. That would be the one whose "associate" allegedly offered a half million dollars for the appointment.

The congressman held a press conference to angrily denounce Blagojevich, and to deny he ever authorized anyone to make that kind of offer on his behalf. If he's lying, he ought to remember that the prosecutor in this case if one Patrick Fitzgerald, who nailed ex-Cheney chief of staff Scooter Libby for doing the same thing.

Also exposed yesterday was the identity of "Individual A", a central figure in the complaint. He's lobbyist John Wyma, a close adviser to Blagojevich. He's also apparently the guy who ratted him out, not about the senate seat, but a different shakedown scheme the governor had concocted. It seems there was no government allocation too small, no appointment too big, no matter too trivial for Blagojevich not to attempt to profit from.

And in the end, that's why he was still in his office yesterday. Despite calls to quit from just about every politician in the state of Illinois and President-Elect Obama, Rod Blagojevich remains defiant, and by all accounts unrepentant. Short of calling a special election the Democrats might lose, there seems to be no way to force him to give up the only bargaining chip he still has....that senate appointment.

However, he won't hold that for long. The Illinois political apparatus that Rod Blagojevich was elected to reform will find a way to snatch the appointment right out from under his nose. Either that, or he's actually going to try and bargain with the feds for a lighter sentence in exchange for a quick exit.

If he thinks he can pull that off, he doesn't know Patrick Fitzgerald. What do you think? How long does Rod Blagojevich last?

Arrogance, Idiocy, or Both?

Now that Illinois Governor Rod Blagojevich has made himself the poster boy for political greed, avarice, and just plain stupidity, it may be time to sit back and contemplate just what kind of people we elect to public office in this country. To do that properly, we have to take a look at just what this "reform" governor from Illinois has allegedly done. For sheer gall, it makes NFL miscreants like Plaxico Burress and Pac Man Jones look like mere amateurs.

Perhaps we should preface all this by saying Rod Blagojevich is innocent until proven guilty, as are all Americans accused of crimes. Yet there are some things we do know, based on federal wiretaps of his phone. To take the sports analogy one step further, the governor himself likened the selection of someone to take Barack Obama's place in the US Senate to a sports agent shopping a free agent at the highest price possible. Such was his arrogance, prosecutors say, that he even thought about naming himself to Obama's old job.

Then there are the profanity laden rants that have been released to the public. No need to detail them here, but suffice to say this guy could give the late John Gotti a run for his money for most expletives caught on a wiretap. Even his wife Patrti got into the act, telling her husband to go after the now bankrupt Tribune Company, whose newspaper the Chicago Tribune, has suggested he be impeached. They've no doubt been proven right about that one.

As Illinois politicians try to figure out how to snatch the power to name Obama's successor from the unrepentant Blagojevich, (his lawyer says he won't quit, and as long as he's in office he gets to choose) the question on a lot of minds in Washington is whether or not any of this mess will blow back on the president-elect. The immediate answer might be no, since Blagojevich was taped fuming that the Obama people weren't about any quid pro quo when it came to naming the new senator. Yet Republicans love a scandal that doesn't involve one of their number, so expect them to make the attempt to link Obama to all this.

Maybe the irony in all this aside from providing much fodder for late night tv shows, is that Rod Blagojevich's lawyer says all these charges will come to nothing because it just politics. If he's right, we're all in deep, deep trouble.

What do you think? Will Blagojevich fold and leave the Illinois Governor's office, or will he stick it out and actually try to name Barack Obama's successor? You tell me.

Old Story, New Twist

We've been seeing and hearing about shuttered factories, businesses, and laid off workers with frightening frequency lately. And so the closing of Republic Doors and Windows on Chicago's North Side might have escaped our attention, except for one thing. Workers there decided to occupy the factory. In doing so, they've become national news, even earning praise from Chicago's favorite son, Barack Obama. Their beef is legitimate, their cause is peaceful. They've met with Illinois Governor Rod Blagojevich, who took action on their concerns.

The 300 workers were due vacation and severance pay, as are many (but not all ) workers who are losing their livelihoods on the cusp of the holiday season. Trouble is, the company shut down abruptly last Friday because Bank of America canceled Republic's line of credit due to a downturn in the firm's business. That would be the same Bank of America that received billions in taxpayer dollars as part of the great financial bailout of 2008.

The best the bank could come up with is they're not responsible for the company's obligations to their workers. Yet they are responsible to the American people. What exactly did they think the $25 billion dollars they got in the bailout was for, anyway? In the face of this arrogance, Governor Blagojevich has ordered the state to stop doing business with BoA. Score one small one for the workers.

What the employees of Republic Doors and Windows are experiencing is being felt by businesses, big and small, all over America. This factory occupation could well be a template for other workers who find a bunch of high rolling bankers have their foot on their necks. Imagine a taxpayer revolt against banks that take government money yet refuse to use it to keep otherwise profitable businesses alive.

The Rev. Jesse Jackson understands the stakes here. That's why his Rainbow-PUSH Coalition handed out free turkeys and bags of food to the workers inside Republic Windows and Doors. And the empathy shown by our president-elect can't be underestimated either. It's not often we see people taking direct action to protest their circumstances.

Let's hope it spreads, don't you think?

Liberals Worried about Obama?

The issue has been on the down low, and the concern has been incremental. Does Barack Obama really represent the change he talked about during the campaign? For some liberals/progressives, the answer is at best hazy, and at worst no. The president-elect's cabinet choices, and his switch on reversing tax cuts for people making more than $250,000 a year are giving some folks pause. For his part, Obama and some of his supporters say it's way too early to judge. Is it?

His backers in the labor movement point out that when he introduced his economic team, he didn't appoint a labor secretary. Some think that omission signals a lesser role for a constituency that backed him with votes and money. Then there's the appointment of Hillary Clinton as secretary of state, and the retention of Robert Gates at the Pentagon. The grumbling here is that Obama could be waffling on his pledge to start ending the Iraq war on his first day in office.

Of course, he hasn't had a first day in office yet. And no matter what his economic and national security teams look like, it will be Barack Obama setting policy. Still, the man who promised change as a candidate doesn't seem so committed to change as president. Then there's the question of what change was promised, and what was expected. If the change is from the Bush years, a case can be made he's setting about that, even with the retention of Gates. After all, does anyone think a massive economic stimulus package would be on the current president's agenda?

However, if people interpret Obama's promise of change to be something more fundamental, it should come as no surprise that some people find him lacking. Right now, every appointment and utterance from this president-elect is going to be heavily scrutinized. The nation's economy has fallen down a deep hole, and in the end, that's the change people will most want to see. Last month, the number of people losing their jobs jumped to 533,000. Change may best be measured not in cabinet appointments, but in putting people back to work.

What do you think?

Keep the Tax, Dump the Tolls?

The transit commission empaneled by Gov. David Paterson here in New York has come back with a report that, while promising bus and subway riders a break, is being met with skepticism by that same public. The plan would drastically cut the amount of a fare increase, from 23% to 8%. Plugging the Metropolitan Transportation Authority's yawning budget gap would fall to two major revenue generators. One is a payroll tax on employers in the region. The other is tolls on on East and Harlem River bridges that are now free to cross.

You can imagine the reception the latter got. Lawmakers from Brooklyn, Queens, and the Bronx screamed bloody murder. This they've done every time the notion of tolls on those bridges has come up. That's precisely why they' re still free. Yet we live in different times. Although a New York Times analysis says the payroll tax alone would plug the budget gap, the tolls would serve another useful purpose. It's proposed to use that money to fund an expansion of existing bus service, from the creation of new depots to the creation of dedicated bus corridors that would be separate from other traffic.

This proposal is intriguing, and worth a look of its own. Many cities already have these corridors, and they reportedly make bus travel a faster and more efficient experience. As it stands now, vehicular traffic over the East River has no rhyme or reason. The RFK Triboro Bridge, Battery and Midtown Tunnels already charge to cross into Manhattan. The 59th St., Williamsburg, Manhattan and Brooklyn Bridges don't. There is, of course, no feasible way to install toll booths at these crossings without creating perpetual gridlock. Technology being what it is, however, that problem can likely be overcome.

In the interest of fairness and the future of the city's transit system, this plan should be implemented, but with modifications. All bridges and tunnels over the East River should cost no more to cross than it does to come into Manhattan from New Jersey. That's not currently the case. This means they should all cost no more than $8 dollars round trip. The Harlem River crossings should be nominal, since the bridge spans are much shorter, no more than $5 dollars round trip.

Yes, it's going to hurt, but a 23% increase in the subway and bus fare would hurt more. What do you think?

Keep the Tax, Dump the Tolls

Hardball in the Senate? Nah!!!

We saw an item recently about Hardball's Chris Matthews thinking about running in 2010 for the Pennsylvania seat in the US Senate now held by Arlen Specter. Didn't think much about it at the time. Now it seems he's serious. He's reportedly shopping for a house in the state where he was born. It's also true that he's harbored a boyhood dream to be a senator. I've always wanted to be a subway motorman. That doesn't mean I'm looking to take the test.

Chris Matthews wouldn't be the first tv personality to run for political office. Gee, there's the late Sonny Bono, Fred Grandy from the Love Boat, and Jesse "The Body" Ventura. And they all won! But seriously, Chris Matthews would have a hard road to Capitol Hill. For one, he's been hosting a political talk show, which means he's got friends for sure, but also enemies in Washington. Also, despite having been born in Pennsylvania, he's most closely associated with DC.

Then there's his ill advised slam of Hillary Clinton during the presidential primary. You may remember he said she got where she was because "her husband messed around". Chris Matthews may find out that the Clintons have a long reach, and long memories. Then there are those who view the noise about a Matthews senate run as merely a negotiating ploy to get more money from NBC when his contract expires next June. Don't laugh. It's been done before.

Matthews doesn't face an open road even to the Democratic nomination for the job he covets. Should he get past potential challengers in his own party, he faces a venerable opponent in Arlen Specter. True, the incumbent will be 80 years old in 2010, but Frank Lautenberg just got re-elected in New Jersey, and he's 84. Would Chris Matthews dare bring up the issue of age?

The MSNBC host has always been an acquired taste, but one who has a following despite being pilloried on occasion by the right. He should stay where he is, and do what he does best. Boyhood dreams don't always work out.

What do you think? Should Chris Matthews run for the Senate?

Mo Money Mo Money Mo Money!

The Big Three came back to Washington Tuesday, and this time they seem to have gotten the message about those corporate jets. Now the only question is whether Congress will buy their plea for a bailout before one or more of them goes broke. Instead of the $25 billion they were asking for just two weeks ago, GM, Ford, and Chrysler want $34 billion. But hey, what's $9 billion among friends?

Detroit came to the table this time with plans. GM's seems to be the most detailed, probably because they're in the most trouble. They say they'll cut as many as 30,000 jobs by 2012, close 11 factories, trim about 1700 odd dealers, and sell off Hummer and Saab, while shrinking Pontiac and getting rid of it;'s its Saturn brand completely. And like the other two CEOS, GM's would take a $1 dollar annual salary. Chrysler is in similar straits but is asking for $7 billion rather than the $18 billion sought by GM.

Ford says it can be profitable by 2011, and only needs $9 billion to use if necessary. Ford is in an interesting position here. While all three automakers say they'll focus on making more fuel efficient cars to sell here in the US, Ford already sells a number of such vehicles in other parts of the world. In fact, two Ford cars get better than 40 miles per gallon, with one getting an astonishing 63.6! Sadly, both are diesels, and neither is available here in the US.

Yet as we ponder whether the Big Three's commitment to more fuel efficient cars and leaner operations is real, consider this. The average fuel consumption figure for US cars, minivans, and SUVs stands at 22.6. In Europe the figure is 40.3, and in Japan it's 40.6. Maybe Detroit ought to come up with plans to raise the US number. For years, they've been resisting such calls, arguing the cost is prohibitive. Maybe the need to borrow $4 billion dollars from US taxpayers to survive the rest of the year ought to change that attitude.

One attitude has changed, for sure. The Big Three CEOs will all be driving hybrid vehicles fro Detroit to DC later this week. No more corporate jets, not after people noticed.

So, the question is, did the automakers make their case? You tell me.

Burress Shoots Himself- Career in Critical?

By now most people know that New York Giants star wide receiver Plaxico Burress shot himself with a gun he was carrying in a New York nightclub in the wee hours of last Saturday morning. The media frenzy that followed as entirely predictable. Burress has had trouble follow throughout his pro career, but nothing quite like this. On Monday, he was arraigned on a pair of felony weapons charges that could land him in prison for a mandatory minimum of 3 1/2 years. That would be on each count.

The reaction of the sporting press was outrage, the kind of outrage reserved for athletes they consider pampered who do something inarguably stupid. Sports journalists all too often ignore the presumption of innocence that is the foundation of our country's legal system. In the case of Plaxico Burress, no less a personage than the Mayor of New York, Mike Bloomberg, weighed in. He says Burress should be prosecuted "to the fullest extent of the law". For Bloomberg, that means three and a half years in prison. After all, he was the one who successfully lobbied the state to increase the punishment for illegal weapons possession from a year.

You can argue all day whether Burress deserves jail time or counseling, but a few things need to be established here. Athletes and celebrities often walk around armed, and don't get caught. That's because they fear being robbed, as several have been leaving clubs or even in front of their own homes. Why Burress didn't simply hire a legally armed bodyguard is anybody's guess. It's a delicious irony that Plaxico Burress, a man who makes a really good living catching a football, couldn't manage to hang on to a gun in his own pants.

The central question here, whether you're outraged by what he did or just think he's an idiot (or both) is whether he's offered a plea bargain or if he actually goes to trial. in the case of the latter, a mandatory minimum sentence wouldn't likely be imposed. Perhaps proper punishment for Plaxico Burress is a trip out of town. The New York Giants won this past weekend without him. For all his skills, he is in fact expendable. Voiding his contract for misconduct would cost him the better part of $35 million dollars.

Then let Plaxico Burress go out and make a living like the rest of us.

Will Fine Tuning be Enough?

As President-Elect Obama rolls out his national security team Monday, the Big Three automakers are preparing for their second plea to Congress for money. You may remember their first trip to DC didn't turn out so well. Not only did they come to then nation's capital in private jets, they came without a plan about how they'd spend the money if they got it. The money in this case is $25 billion dollars.

Reports say GM, Ford, and Chrysler all worked feverishly through the weekend to come up with plans to restructure the way they do business. At the top of their list ought to be how to create a quantum leap in fuel efficiency for their vehicles. A recent online article made the point that miles per gallon figures in Europe and Japan far surpass even the best projections of Detroit. What's ironic is several of the cars mentioned in that article are made by Ford yet are unavailable here in the US.

One silver lining in Detroit's cloud is the willingness of he United Auto Workers to offer concessions in an effort to convince the Congress to come up with the money. UAW president Ron Gettelfinger says the union will do its part if they see sacrifices on the part of management. One can hardly see how the bigwigs can say no to that. After all, a cap on executive compensation is something Democratic members of Congress will demand.

The down side is that the carmakers will be coming to Capitol Hill on the same day sales results for last month will come out. They expected to only be marginally better than October, when sales were at a 25 year low. The crucial question is whether the plans, which vary somewhat among the three automakers contain enough detail to sway those members of Congress who thus far have been less than inclined to help. There are still some lawmakers who see Detroit's problems as being of their own making, which, to be blunt, they are.

However, if Ford, Chrysler, and GM come to the table Tuesday with a plan that makes sense, they should get the money they are looking for. What do you think?

Who is Responsible for Mumbai?

The chaos in India's commercial capital of Mumbai continues, and although reports say police are making progress against the terrorists, it's not over after three days of violence. Reports of casualties fluctuate as more are discovered. And the looming question on the minds of people across the globe is who bears responsibility for this carnage. The answer to that question could create an entirely new area of instability that President-Elect Obama's soon to be unveiled national security team may have to deal with as a first priority.

Maybe it should come as no surprise that US media has been speculating throughout this horror that the attacks were somehow linked to al-Qaeda. After all, it's the terrorist group we're most familiar with. Plus, it's easy for an analyst sitting in a New York studio to take the fact of the complexity of the attacks and spin that into a series of questions about al-Qaeda's involvement. It's certainly true that militant groups inside India have never pulled off the series of coordinated attacks on hotels, the main railway station, and a Jewish center before. Yet does this mean the well equipped and armed young men who did this were acting on orders of Osama bin Laden?

Right now, the correct answer is nobody knows. The Indian government has begun pointing the finger of blame at Pakistan. Media reports have some of the gunmen arriving on a ship from Karachi. If this is true, or if most Indians believe it is, a new and potentially dangerous round of tensions between these two countries could follow. There have been six decades of conflict between India and Pakistan over the disputed territory of Kashmir.

One thing is for sure. No matter where these gun men come from or what cause they espouse, they were extremely well organized and well trained. That they held Americans and Britons hostage, and attacked a Jewish community center must make intelligence agencies in Washington, London, and Tel Aviv more than a little nervous. However, if there's one lesson to be learned by media from this conflict that isn't over yet, it is this.

Don't oversimplify.

Is Keeping Gates Wrong?

He's a yes man and a panderer, who backed Bush when it suited his purpose and will do the same with Obama. He's on the same page as Obama on a number of broad policy issues, and is the best person to maintain continuity. Yes, both the previous sentences are talking about the same man, Defense Secretary Robert Gates. Make that the once and future defense secretary. Gates will stay on in his current job, confirming numbers of earlier reports that this was what Team Obama wanted.

It's not, however, what many of his supporters on the left wanted. Some feel betrayed, not just by this decision, but by the seeming "business as usual" look to the team working for the man who promised change. In Gates' case, they point to his slavish advocacy of the surge in Iraq as proof his agenda isn't the same as that of the new commander in chief. Gates, while certainly not the polarizing figure his predecessor Donald Rumsfeld was, needs to clarify his stance on things like torture, eavesdropping on innocent Americans, and the like.

When word first leaked that Gates would stay on, the conventional wisdom was that Obama wanted to maintain good relations with Gen. David Petraeus. Why Petraeus rates such consideration is a good question, but no matter. Gates doesn't need to be reconfirmed, and unless media reports are totally messed up (and they have been lately), this is Obama's choice. Quite frankly, I don't think it was his best choice.

If Obama wanted both change at the Pentagon and to show he'd pick a Republican for a powerful job in his cabinet, the choice should have been Chuck Hagel. Unlike Gates, Hagel is as vocal an opponent of the Iraq war as Obama himself is. His knowledge of issues pertaining to the military is widely respected. He also obviously isn't afraid to take a stand at odds with his own party.

Barack Obama has with this decision, as the British put it, "put a foot wrong". Keeping Robert Gates on sends the wrong signal to those millions of Americans who bought into his mantra of change and hope. One doesn't have to feel betrayed to call this a mistake. What do you think?

Profiling Nixed?

A federal judge here in New York City has issued a ruling that's sure to be a topic of discussion in law enforcement and civil liberties circles. The ruling said the government can't use ethnicity as justification for detaining two Arab men questioned for four hours following a cross country flight. The pair sued the government, alleging the detention was unjustified. The judge apparently agreed.

Black people have understood for years the injustice of racial profiling. The term "driving while black" has become a cruel joke, one that unfortunately is all too real. The ruling in this case, which involves a pair of Egyptian born men, centers on the government's contention that they acted strangely during the flight from San Diego to New York. Uncle Sam's undoing, however, was in asserting that the men's ethnicity was a factor in deciding to detain them, and that it was an acceptable factor.

As it turns out, one of the men held was a former New York City police officer, the other employed by GE in Egypt. At no time during their detention were they charged with any crime. Civil libertarians are hoping this means the beginning of the end of the ethnic profiling that began in the wake of 9-11.

I wouldn't count on it. Besides the possibility of an appeal, the fact is that law enforcement has shown an amazing elasticity when it comes to profiling. The fall back position will likely be a simple denial that ethnicity has anything to do with the decision to detain someone.

That leads, of course, to the preferred rationale for stopping someone, black or Arab. It's the famous "acting suspiciously". Whether in a car or on foot, it works for cops in black communities. My guess is they'll tell counterterrorism agents to drop any verbalizing of ethnic profiling, and simply say a detainee was speaking in Arabic, or changing seats, both of which raised red flags in the case of the two Egyptian men.

The fact is, most Americans don't have a problem with ethnic profiling. We've been lead to believe it keeps us all safer. I don't think so. What do you think?

Too Big to Fail?

America wakes Monday morning to the news that one of it's biggest banks, Citigroup, is to be bailed out by the federal government. It's almost as if Treasury Secretary Paulson and Federal Reserve Chair Bernanke are operating a pinball machine. First, Uncle Sam was going to buy troubled assets from banks. Then they began putting money directly into these financial institutions. It seems neither strategy has helped Citigroup, whose stock has declined from $30 a share one year ago to $3.77 this past Friday.




It's said this financial behemoth is too big and too international to be allowed to die. Maybe so. Yet the government is guaranteeing about $306 billion dollars worth of toxic loans Citigroup put on its books. A legitimate question might be, how did that happen? After all, Citigroup always marketed itself as a pillar of the American banking system. As was the case with the first two bailout efforts, the taxpayers underpinning this government largesse will learn little or nothing about how all this came to be.

It's ironic in a way that Citigroup's headquarters is right here in New York. While a consensus has been reached that a bank is too big to be allowed to fail, our city's transit system has been calling for help. Those call have fallen on deaf ears. So while government can underwrite $306 billion dollars for a bank, when it comes to plugging a $1.2 billion dollar budget gap for New York's transit system, there's no money.

Well, not really. In this case, the money will be coming from the city's taxpayers in the form of a fare increase (maybe two). New Yorkers will also have to put up with more crowded trains due to decreased service, and severe cuts in bus service, in many cases to already underserved neighborhoods in Brooklyn, Queens, and the Bronx.

I'm sure there are financial experts who can explain why a bank gets so much sympathy while transit users in the nation's largest city are left to fend for themselves. To me, it's inexplicable.

And unacceptable. What do you think?

I've Got a Really Bad Feeling About This

I've written blog items before warning about the perilous state of the US economy. However, Paul Krugman in the New York Times writes a piece that really scares me. He talks specifically about the period we're now in, that is, the time between the exit of Bush and the entrance of Obama. if we stand back and look at things objectively, Bush has done little more than thrown obstacles in the way of help for hard working Americans (the unemployment benefit extension notwithstanding).

Congress has thrown the ball for bailing out the auto industry right back in Detroit's court. They've got until December 2nd to come up with their own rescue plan. Hopefully they're asking themselves whether it made sense to fly to DC in private jets. Yet this is just the tip of the iceberg. Most forecasters have already predicted a bleak holiday shopping season. That means fewer retailers will hire fewer people. Jobless claims skyrocketed last month, and it looks like there's more to come.

Then, contemplate this. The $250 to $300 billion dollars already spent from the $700 billion dollar bailout package hasn't had the desired effect. Credit markets have yet to thaw, and financial stocks in particular have been hammered all this week. That means, put simply, the banks still don't trust each other, no matter how much money you throw at them. And speaking of banks, we have seen over the past few months a staggering series of events that have shaken the confidence Americans have had in our financial institutions.

I've said before that 2009 looks anything but appetizing. Now we hear forecasts of an 8% unemployment rate, a spiral of possible home foreclosures, bank failures, and the very real possibility of one or more carmakers going belly up, and laying off all their workers. Those people who thought the markets were tanking because of Barack Obama's election ought to be feeling like fools about now. He's in fact the one who the nation will look to in order to get us out of this mess, a mess not of his creation.

The only question is how severe will the pain be before we see light at the end of this tunnel?

Three Private Jets? No Bet!

Maybe we shouldn't be surprised anymore that corporate America is clueless. First there was AIG, with it's lavish conferences, and now the Big Three automakers all fly from Detroit to DC by private jet. For the record, their names are Alan Mulally of Ford, Rick Wagoner of GM, and Robert Nardelli of Chrysler. They want $25 billion dollars of taxpayer money or, as Nardelli told Congress, national security could be compromised. Okay, they either need the government to fork over or their companies will go broke. So what's the logic in flying by private jet at a cost of around $20,000, when a commercial flight costs anywhere fro $228 coach to $837 first class?

Some members of the House Financial Services Committee had legitimate questions about this. Especially since the carmaker CEOs were talking about coming out of their near death experience leaner and more cost efficient. Rep. Gary Ackerman of New York said, "It's almost like seeing a guy show up at the soup kitchen in high hat and tuxedo". The automakers, of course, had a defense to all this. They say like many corporations, GM, Ford, and Chrysler require their top executives to fly private for safety reasons. If that's true, why didn't all three fly in one private jet? After all, hat in hand is hat in hand.

GM even had the guts to go on the offensive. "Making a big to do about this when issues vital to the jobs of millions of Americans, blah blah blah blah....." In other words, ignore our free spending, just give us the money. They may not get it, at least not now. Congress goes home today for the Thanksgiving holiday. There's a compromise in the works, but getting it done in one day is way beyond the capacity of lame ducks.

Besides, if the Big Three really had any empathy with the workers they employ, they'd stop trying to quietly scapegoat them as the source of the current car crisis. Labor agreements may need to be reworked, but job one for Detroit is to make vehicles that are more road reliable and get better gas mileage.

So we've got Congress eyeing the exit, carmakers still bleeding green, and the fate of 5 million American workers still on shaky ground. And all three CEOs flew their private jets back to an economically devastated region, no doubt pondering that to do next.
Nice.

Hillary's Hamlet

What is going on here? First Rahm Emanuel gets offered the chief of staff job in the new Obama Administration, and he hesitates before accepting it. Now, after rampant speculation that Senator Hillary Clinton was the odds on choice for secretary of state, she too is hedging her bets. The story was first reported by Politico Tuesday, and it characterizes Senator Clinton as agonizing over whether to take the job.

There are a number of reasons given for her hesitation, but the Clinton camp doesn't want anyone to think it has to do with her husband's financial dealings. Better to think it's because in the Senate she'd remain her own boss, or even that it's some type of bargaining tactic. Political skeptics, and I count myself as one, look at former President Clinton's finances as the primary reason for Hillary Clinton's agony no matter what her people say. Despite reports of progress in the vetting process, there could be a stumbling block. After all, much of the former president's finances aren't a matter of public record.

There's also the little problem of the senator's campaign debt from the '08 presidential run. She still owes $7.6 million dollars, not counting what she lent herself. As secretary of state, a federal employee, she'd be prohibited from personally soliciting money to retire it. Keep in mind the Clinton camp has reportedly been less than thrilled with efforts by the president-elect to help her in this regard. Could this be the bargaining tactic people are talking about?

No matter how you slice it, Hillary Clinton's Hamlet-like behavior has got to be a major embarrassment to the incoming president. I'm not sure how much longer he'll twist in the wind, or if he should at all. He's got several other people, most notably New Mexico Gov. Bill Richardson, who would jump at the job. His credentials are as strong as Senator Clinton's, maybe stronger. After all the one area Clinton and Obama disagreed about most during their bruising primary battle was foreign policy.

If I were Barack Obama, I'd punt on Hillary Clinton now. Somebody on his transition team must have Bill Richardson's phone number. What do you think?

Who Gets Helped?

While the parlor game about whether Hillary Clinton becomes Secretary of State continues, Congress and the Bush Administration play a dangerous game of chicken on two fronts. The emergency bailout for Detroit's Big Three automakers is one, the other is an economic stimulus package. It looks like the latter will have to wait until President-Elect Obama is in office. That's sad, since there is a bill on the table, introduced Monday by Senate Democrats. In the case of help for the auto industry, it's a test of wills between the White House and Congress about where the money will come from. Let's take the cars first, since it will most likely be acted on before the stimulus bill.

Ironically, there appears to be bipartisan support for some sort of action by year's end. GM in particular says it's burning through cash so fast it might be forced into bankruptcy before President-Elect Obama is inaugurated. The difference isn't over whether to help, it's over thew form the help takes. Democrats want the money, $25 billion in all, to be taken from funds not yet spent in Treasury's $700 billion dollar financial rescue package. The White House and some Republicans want an existing Energy Dept. loan program to be the source of funding. That money was originally supposed to be used for long term investments in producing more energy efficient vehicles.

If it sounds complicated, it is. The core question is whether this money will come with enough strings to make Detroit change the way it does business, and the types of cars it produces. That's much more likely under the Democrats' plan. However, there's no guarantee compromise will be reached in this lame duck session of Congress.

a compromise agreement is even less likely in the case of the economic stimulus package. Republicans in Congress and the White House don't like the price tag, and Democrats resent President Bush's attempt to tie help for American jobseekers to a trade pact with Colombia. It seems both sides are adopting a "leave it for Obama" stance, which means lawmakers risk a further decline in the nation's economic fortunes in the interim.

This is precisely the kind of DC gridlock that Obama was elected to end. Can he? You tell me.

Hillary to State?

Of all the subjects covered during the Obama's interview on 60 Minutes, the most fascinating for political junkies had to be whether he'd name Senator Hillary Clinton to his cabinet, specifically Secretary of State. The president-elect was coy, neither confirming nor denying the possibility. The Clinton camp has also not said much. If you look across the arc of the presidential campaign, you'd see Senator Clinton denying several times she was interested in a cabinet post. That was then, this is now.

Certainly she's got the chops for the job. There would be no worries about on the job training. The only problem for Barack Obama is the fact that there appears to be a crowded field of hopefuls. Senator John Kerry, an early supporter, has reportedly lobbied for the job. Latino groups are lobbying for New Mexico Gov. Bill Richardson. Still others are being touted as dark horses for the job.

Hillary Clinton, if she really wants it, will probably be Obama's choice. What better way to end all those media reports about lingering tension from the campaign trail? Despite all that, there's ample evidence Senator Clinton and the president-elect share similar views on foreign policy matters. She'd have no problem articulating his agenda. If offered, the job would be too tempting for her to resist, despite all the talk about wanting to remain in the Senate.

Should she be appointed, there would be an interesting scramble here in New York to succeed her. The choice would be up to Gov. David Paterson, and already there's speculation he'd name Cong. Nydia Velasquez to Clinton's seat. The Latino community in New York has been unhappy about what they feel is insufficient representation in top state positions. What better way to mollify Latino elected officials than to name one of their number to the Senate? It doesn't hurt that Cong. Velasquez was a vocal Clinton supporter during the primaries.

But all that is down the road. The question now is, should President Elect Obama name Hillary Clinton Secretary of State?
You tell me.