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Category: July 2008

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Bombay Hummer bummer

July 31, 2008 |  4:18 pm

General Motors is in talks to sell its Hummer brand to auto makers in India, China and Russia. Too bad for Planet Earth. The Times was ahead of its time three years ago, when an editorial predicting the imminent demise of the SUV included a list of useful suggestions on what people could do with the gas-guzzling behemoths now that nobody wanted to drive them anymore (sample: Sink them offshore as artificial reefs). Reports of the SUV's demise were premature, but then gas prices started their astonishing climb. If the SUV hasn't quite flatlined, it's got a roomful of worried auto makers gathered around its bed while their stock analysts are calling for a priest. Unfortunately, though, the steel-and-rubber corpses aren't going to get a decent burial as artificial reefs. They're going to end up spreading pollution and inflating gasoline prices in the developing world.

Reuters is reporting that General Motors is in talks with Indian auto maker Mahindra & Mahindra, as well as other companies in Russia and China, about unloading its disastrous Hummer brand. In places like China where gasoline is subsidized, it's not unreasonable to think the nouveau riche might appreciate a tank-sized symbol of excess like the Hummer. But what happens to carbon emissions and oil prices when a big percentage of the 2.45 billion people in China and India start driving? Especially if they're driving 15-mile-per-gallon monstrosities? It's little wonder that speculators are excited about oil futures, because even as high prices prompt Americans to conserve gas and reduce demand, newly wealthy populations in Russia and China are shielded from rising prices by the government and have less reason to cut back. Hence GM might find a buyer for a brand that nobody in the industrialized world would touch.

There may have once been a time when what was good for GM was good for the country. But if selling Hummer to China or an Indian manufacturer is good for GM, it's bad for everybody on Earth. Better to turn those old Hummers into planter boxes, or, as The Times suggested in 2005, make them into "hot tubs with comfortable seating."

*Photo: Carolyn Kaster / Associated Press


In today's pages: Schwarzenegger and Feinstein make a watery appeal

July 31, 2008 |  1:28 pm

Gov. Arnold Schwarzenegger and Sen. Dianne Feinstein prod state lawmakers today to act on their proposal for a comprehensive (read: $9.3 billion) bond issue to modernize and expand the state's water supplies. You won't find many specifics in their piece, but it offers plenty of reasons for the Legislature to pick up the pace on this issue:

Put simply, our water supply is in jeopardy. We are experiencing the second year of drought, and 2008 had the driest spring ever recorded in the northern Sierra and other parts of Northern California. If the dry conditions continue into next year, we could be facing the worst drought in California history.

Columnist Rosa Brooks opines, with evident dismay, that the chance of prosecuting Bush administration officials for possible war crimes and other misdeeds is pretty much nil.

As far back as 2001, administration lawyers were crafting legal opinions designed to shelter their bosses from any future criminal liability, and much evidence has since been hidden and destroyed. Then in 2006, the GOP-dominated Congress amended the War Crimes Act -- with retroactive effect -- to make future prosecutions almost impossible.

Yeah, that one's going to generate some comments. Elsewhere on the Op-Ed page, another of the Bush administration's, umm, greatest admirers, the New Republic's Jonathan Chait, urges Barack Obama to go negative on John McCain (because heaven knows, the Obama campaign would never do so on its own accord). And KFI host Joe Hicks, vice president of Community Associates Inc., berates the Los Angeles City Council for trying to micromanage diets in selected L.A. neighborhoods by temporarily banning new fast-food restaurants.

It is not the role of government to intervene in the personal food choices of individuals, and it is not appropriate for city officials to manage what businesses can serve L.A.'s communities. Unlike the argument made against the proliferation of liquor stores some years ago, fast-food restaurants do not produce the kind of harmful side effects, such as crime and public drunkenness, that might justify City Council action.

The Times' editorial board takes a page from the Sammy Hagar songbook and blasts a proposal for lower highway speed limits. It also welcomes reports that the FCC will tell Comcast -- and other broadband ISPs -- not to use discriminatory and surreptitious techniques to battle congestion online.


Garamendi makes it official for 2010. Who else?

July 31, 2008 | 12:40 pm

John Garamendi, California perpetual gubernatorial candidateNovember 2008 election? That is so last month. March 2009 city election? Boring! Let’s move directly to 2010 and the race to be the next governor. In a shocking surprise to no one, Arnold Schwarzenegger’s understudy, Lt. Gov. John Garamendi, makes it official today: He wants the job. Still.

Garamendi is instantly the most experienced candidate, meaning he has more experience running for the office than anyone else. He tried in 1982 and 1994, but until today he had yet to log in for the 2000s, unless you count his ever-so-brief candidacy in the 2003 Gray Davis recall. That puts him ahead of even Jerry Brown, although Brown actually won the two times he ran (so far).

Garamendi has been defeated by a who’s-who of California’s Democratic political establishment: Tom Bradley aced him out of the 1982 gubernatorial primary, Davis beat him for controller in 1986, Kathleen Brown (Jerry's sister) beat him for governor in the 1994 primary.

But he was a strong, consumer-oriented insurance commissioner twice – the state’s first elected commissioner in 1991 and, restoring order after the rocky and abbreviated tenure of Chuck Quackenbush, in 2003. He’s widely considered a hero to consumer advocates and the bane of the auto insurance industry.

He’s a vigorous Californian in the old-school image – born in the Mother Lode country. Cattle rancher. Environmentalist. He was deputy U.S. secretary of the interior. He has famous barbecues at his Sacramento delta spread. He’s got a Vise-Grips handshake and a flashing smile that are simultaneously comforting and intimidating. But with all that, is he just a little too, well, you know – boring – when stacked next to the likes of colorful mayors, current and ex, like Brown, Gavin Newsom and Antonio Villaraigosa?

By the way, everyone knows that Villaraigosa and Brown have filed to run – except they haven’t. Not yet, anyway.

On this last day of July, here's a recap of the month's developments in the 2010 race to succeed Schwarzenegger. Democrats first, since we're already on their case.

Continue reading »

Fanning the Fannie/Freddie flames

July 30, 2008 |  6:26 pm

Bailing out Fannie Mae and Freddie Mac? Noting the housing bill that House and Senate negotiators were rushing to complete last week, my colleague and intellectual superior Tim Cavanaugh asked in a recent post why taxpayers should foot the bill for bailing out Fannie Mae and Freddie Mac. President Bush signed the measure this morning, so there's no turning back now. But I thought I'd try to answer Tim by saying he asked the wrong question.

Fannie and Freddie were created by Washington to serve a mission dictated by Washington with policies largely dictated by Washington. They operated with the implicit backing of the federal government. It's wildly unrealistic to think that either institution could run into financial trouble without the feds rushing to the rescue. So when Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke announced their proposal to extend bigger credit lines to the companies and possibly buy some of their shares, they were merely making explicit a promise long understood by investors (and policymakers).

Rather than debating the merits of propping up Fannie and Freddie, we're better off figuring out how to get them through the downturn intact. Then we can debate what role they should play, if any, in the future. The panicky run on their shares reflect investors' fear of dilution (as Fannie and Freddie sell huge numbers of shares to raise capital) or nationalization (in the event of a government rescue) more than any worries about insolvency. Yes, their capital reserves are low in comparison to their exposure. Yet it would take a huge wave of foreclosures to burn through those funds. By stopping the run on the companies' stocks, the actions by Treasury, the Fed and Congress should make it easier for them to raise more capital and gird against larger losses. Oh and yes, the bill includes important and overdue improvements in the feds' oversight of Fannie and Freddie.

So, Tim, as much as I'd like your every wish to come true, I don't think we're watching "the U.S. government commit collective suicide." Well, not on this issue, at least. But the housing mess hasn't hit bottom yet, and Congress just raised the FHA's potential exposure by hundreds of billions of dollars. So don't give up hope.

Photo courtesy of AP/Manuel Balce Ceneta


In today's pages: Sagging buildings, SAG and the AG

July 30, 2008 | 11:17 am

Earthquakes, SAG, California budget issues and Tim Rutten, all in today's pagesA wobbled editorial board hopes that yesterday's quake will shake local officials and residents out of their complacency about emergency preparedness. It also wonders how much of the $4 billion that Congress approved for local groups to purchase repossessed properties will actually be used to combat blight in the hardest-hit neighborhoods. And if state lawmakers solve this year's budget problems by diverting money earmarked for city and county governments, the board says, there's this consolation: Unlike the previous go-arounds, the state would have to pay the locals back.

A state money grab would throw the city off its schedule for resurfacing streets, and that's a big deal -- but not as big a deal as slashing school funding, healthcare reimbursements or any of the other state programs needed by the same people who want their streets paved.

On the Op-Ed page, environmental attorney Al Meyerhoff worries that lax pesticide controls will endanger honeybees and threaten California's farm industry. Meanwhile, Variety critic (and former LA Times TV scribe) Brian Lowry writes about the debilitating splits within the community of film and TV actors, which he warns are likely to prolong the stalemate in contract talks between the Screen Actors Guild and the Hollywood studios.

Much like in professional sports, stars draw mind-boggling salaries and journeymen fill out rosters. This widening gap among the haves, have-nots and have-nothing-to-lose has complicated the Screen Actors Guild's protracted efforts to settle on a new contract with the major Hollywood studios.

Times Columnist Tim Rutten opines about the internal Justice Department report that, shockingly, found casino gambling improprieties in the appointments of prosecutors and other employees, as well as new writings by New Yorker scribe Jane Mayer about the Bush administration's approach to interrogating and prosecuting suspected terrorists. These dispatches did not make Rutten any more fond of the current denizens of the White House:

When the next administration and Congress begin the urgent work of sorting out precisely how and why the Bush-Cheney regime systematically undermined the rule of law, there are a couple of things that ought to be kept in mind.  One is that their efforts were essentially ideological rather than partisan.

Our readers weigh in about the presidential campaign (and in particular, Barack Obama's recent jaunt overseas), gender's influence on math skills, and the public service performed by those bearing the honorary badge of the Orange County Sheriff Department's professional service responder team.

*Cartoon: Nick Anderson / Houston Chronicle


Has Virginia Gov. Tim Kaine made Obama's final cut?

July 29, 2008 | 10:12 am

Virginia Gov. Tim Kaine is being considered for vice president alongside presumptive Democratic nominee Barack Obama, sources say That's the buzz in the blogosphere today. Politico reports:

Kaine, an early Obama supporter whose biography nicely dovetails with the Illinois senator’s, "ranks very, very high on the short list," said a source who has spoken recently to senior Obama aides about Kaine.

Kaine "is getting a critical examination," the source said.

Kaine, however, isn't talking:

It's "flattering to be mentioned" as a potential vice presidential candidate, Kaine said. "My mom loves it. She calls when she sees it. But that's for the campaign to decide. And the campaign has made very good decisions thus far and I think, however they decide, they are going to make a very good decision."

Want to see how the VP hopeful stacks up against other Democratic contenders, including Hillary Clinton and Al Gore? Check out our Obama Veepstakes chart, and then take our poll:

Post your own Dem veepstakes suggestions below, and check out the GOP race here.

-- Amina Khan


Monica Goodling's killer questions

July 28, 2008 |  5:43 pm

Monica Goodling, former Justice Department appointee, is responsible for politicization, says Inspector General reportWas former Attorney General Alberto Gonzales unfairly blamed for destroying the image of the Department of Justice and riddling its hallways with political holes? Or was it all the work of dulcet-toned blondie Monica Goodling, former Justice Department appointee?

The department's inspector general seems to think so. Gonzales certainly came off as a bit of a bumbling idiot at his hearing last year in front of the Senate Judiciary Committee — and hey, given that she was certainly smart enough to get herself immunity, Goodling may well have masterminded Operation EvilJustice.

Then again, she did ask the following questions of candidates, according to TPMMuckraker:

Tell us about your political philosophy. There are different groups of conservatives, by way of example: Social Conservative, Fiscal Conservative, Law & Order Republican.

[W]hat is it about George W. Bush that makes you want to serve him?

Aside from the President, give us an example of someone currently or recently in public service who you admire.

And, on occasion — in case the subtext hadn't been hammered home yet:

Why are you a Republican?

Okay, I've got to ask:

Post your own question suggestions below.

-- Amina Khan


Former Timesman finally makes good

July 26, 2008 |  7:08 am

At the L.A. Times it often seems that the only kind of colleagues we have are former colleagues, so it's nice to see them turn up in the legitimate media. I couldn't decide whether the most accurate news story of the past month was The Onion's "Recession-Plagued Nation Demands New Bubble To Invest In" or The Onion's "'Time' Publishes Definitive Obama Puff Piece." But I've got to give the nod to the Obama media-crit article, because its roundup of journalistic talking heads includes one of our many former editors:

"The sheer breadth of fluff in this story is something to be marveled at," New York Times Washington bureau chief Dean Baquet said. "It's all here. Favorite books, movies, meals, and seasons of the year ranked one through four. Sure, we asked Obama what his favorite ice cream was, but Time did us one better and asked, 'What's your favorite ice cream, really?'"

Whole article. The Onion is a satirical newspaper, even though it is all true.


Why should you pay for Fannie and Freddie?

July 25, 2008 |  6:14 pm

Former House majority leader Dick Armey has an Op/Ed in the Wall Street Journal asking why the responsible majority has been pushed aside in the rush to "do something" about the misbehavior of Fannie Mae, Freddie Mac, the lenders they guaranteed and the borrowers who are now defaulting. Armey notes, as did I, that a substantial majority of Americans are opposed to the bailout plan that is about to become law, and highlights a fun wrinkle: A veto-sustaining bloc of House Republicans "voted against the bill on the very same day that the Bush administration caved." But he holds out hope that the House-Senate reconciliation process could still turn into a fight. The play-by-play:

Actions by Fannie and Freddie management and their regulators this year precipitated the current crisis. Under pressure from the Democrat-controlled Congress, the Bush administration lifted Fannie and Freddie's portfolio caps in February and reduced their capital reserve requirements in March. In this year's stimulus bill, Congress went further and nearly doubled the size of the loans that Fannie and Freddie can purchase or guarantee.

As a result of this reckless expansion, the government-sponsored enterprises (GSEs) now touch nearly 70% of all new mortgages. At the same time, they are insolvent by most measures. The ostensible purpose of Fannie and Freddie is to provide liquidity to America's housing markets. In practice, they are the source of systemic risk and instability in a time of need.

What is needed now is an orderly restructuring that protects taxpayers from such financial exposure in the future, such as the plan proposed by Rep. Jeb Hensarling (R., Texas). Mr. Hensarling's legislation would phase out the charter of either GSE over a five-year period if they access credit lines from the Federal Reserve or Treasury. It also provides a receivership option if the GSEs continue to stumble. Instead, Treasury Secretary Henry Paulson offered the beleaguered GSEs and their patrons in Congress a blank check signed by the taxpayers, promising potentially unlimited funds to backstop the lenders. Not surprisingly, House Financial Services Committee Chairman Barney Frank and Senate Banking Committee Chairman Christopher Dodd accepted.

Whole article. All I can say is people must have a lot of confidence in Hank Paulson. That federal guarantee is potentially ruinous, not least for the Foundation question that informs so many public policy crises: Aren't we better off not trying to prevent the collapse, and instead just getting it over with as fast as possible?

Suppose all the doomsaying on Fannie and Freddie is right, that the GSEs will take the rest of us down with them when they sink. Interest rates will soar, real estate will plummet, blah blah blah. Why would this not happen anyway with a guarantee from a heavily indebted government? Does Uncle Sam have $5 trillion lying around that nobody knows about? Aren't the worst-case scenarios about the death of the dollar and irreperable damage to the government's good faith and credit more rather than less likely to come true under the bailout plan?

This kind of thing makes me sad, but more in a no-more-worlds-to-conquer way than a there-goes-my-money way. Most of my adult life I've longed to see the U.S. government commit collective suicide. Now that it's actually happening I feel strangely empty.


Barack Obama's prayer at Western Wall intercepted en route to God

July 25, 2008 | 12:56 pm

Jerusalem - Obama Western Wall prayer is published by Israeli newspaper, and everyone elsePoliticians lose certain (read: most) rights to privacy when they aspire to public office, but this particular breach makes me shudder a little. From the Guardian:

The rabbi of Jerusalem's Western Wall criticised an Israeli newspaper today after it published a private prayer written by Barack Obama and taken from the sacred site after he visited the city earlier this week.

It is a tradition for the millions of visitors to the Western Wall, one of the holiest locations in Judaism, to place inside the cracks in the stone written prayers or requests to God. The rabbi in charge of the wall collects the notes periodically and buries them on the Mount of Olives.

Yes, the underbelly of journalism involves chasing politicians out of seedy hotels in the dark of night, taping conversations and nosing through quasi-personal records, but it should most definitely not involve stealing personal appeals to higher powers. Political Machine even refuses to publish Obama's prayer, opting for its own rendition: "Dad, things are great here. Please send more money. Love, Barack":

It may seem paradoxical to make a joke about the prayer, then refuse to reprint, but there are two principles at work here. In comedy, nothing is sacred. In a democracy, privacy is sacred.

But, because you'll ask, and because I don't have such high standards:

"Lord—Protect my family and me. Forgive me my sins, and help me guard against pride and despair. Give me the wisdom to do what is right and just. And make me an instrument of your will."   

Beliefnet submits its line-by-line breakdown, and commenters wonder if Obama expected it to be made public. Reason, which calls the prayer pilfering "warrantless wiretapping on a phone call to God," raises this question:

What if the same note had come from George Bush's pen? One can only imagine the headlines: President Sees Self as "Instrument" of God's Will! 

To which I respond: private prayer, people! What he writes to his maker is his business and — in an ideal world — should be inadmissable in the court of public scrutiny. Besides, I'm willing to bet everyone secretly thinks they're at the center of the universe. Obama at least has the evidence on his side. 

-- Amina Khan



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