John McCain, echoes of Herbert Hoover (Updated)

Posted by AzBlueMeanie:

It’s beginning to look a lot like 1932 – Bear Stearns, Fannie, Freddie, Lehman Brothers, Merrill Lynch, AIG, Washington Mutual, and well over a 100 other financial institutions on the government’s watch list for under capitalization or insolvency.  This is not a locally owned corner bank that will have only a local economic impact.  These are Wall Street behemoths with a storied history and billions of dollars in bad debt exposure that will impact not only the U.S. economy, but the world economy as well.

In December 1929, President Herbert Hoover declared that economic "conditions are fundamentally sound."  Three months later he said the worst would be over in sixty days. In May 1930, he said the economy would be back to normal by the fall. In June of 1930, he actually announced that "the Depression is over." Again in December 1930, Hoover told the Congress "the fundamental stength of the economy is unimpaired."

"Prosperity is just around the corner" is what President Herbert Hoover told businessmen in 1932 when things were just about at their worst during the Great Depression.

John McCain said today "You know, that there’s been tremendous turmoil in our financial markets and Wall Street and it is — people are frightened by these events. Our economy, I think, still the fundamentals of our economy are strong. But these are very, very difficult times."

Maybe McCain should have a talk with his "economic guru" and chief economics adviser, Foreclosure Phil Gramm, who was the author of legislation in 1999 that repealed the New Deal era firewalls that protected Americans for more than 60 years from the cross-ownership of banking/investment/insurance companies into financial behemoths.  Gramm also established the "shadow banking system" and unregulated investment markets, which gave rise to the "sub-prime mortgage" bubble used to finance the Bush administration’s "ownership society."

Well, Bush and his Republican rubber-stamp enablers in the Congress like John McCain can now take "ownership" of this financial and economic catastrophe that they have created. 

This is the culmination of 28 years of failed conservative economic theory based upon blind faith in "free market" ideology and no government regulation, from Milton Friedman to Arthur Laffer and the supply-side trickle-down "voo doo economics" of Reaganomics, to the supply-side trickle-down "Reaganomics on steroids" under George W. Bush’s administration. Conservatives permitted a gigantic Ponzi Scheme to be built out of paper not backed by hard assets, and that gigantic Ponzi Scheme is now crashing down under its own fraudulent weight.  It was all fun and games while the people at the top were getting fabulously wealthy, but now the people at the bottom are losing real money – as well as their homes and jobs – while the U.S. and world economy are seriously threatened.

Barack Obama responded today to the out of touch McCain:

This morning we woke up to some very serious and troubling news from Wall Street.

The situation with Lehman Brothers and other financial institutions is the latest in a wave of crises that are generating enormous uncertainty about the future of our financial markets. This turmoil is a major threat to our economy and its ability to create good-paying jobs and help working Americans pay their bills, save for their future, and make their mortgage payments.

Today offers more evidence that too many folks in Washington and on Wall Street weren’t minding the store. For eight years, we’ve had policies that have shredded consumer protections, loosened oversight and regulation, and encouraged outsized bonuses to CEOs while ignoring middle-class Americans. The result is the most serious financial crisis since the Great Depression.

I certainly don’t fault Senator McCain for these problems. But I do fault the economic philosophy he subscribes to. It’s the same philosophy we’ve had for the last eight years – one that says we should give more and more to those with the most and hope that prosperity trickles down to everyone else. It’s a philosophy that says even common-sense regulations are unnecessary and unwise; one that says we should just stick our heads in the sand and ignore economic problems until they spiral into crises.

Well now, instead of prosperity trickling down, the pain has trickled up – from the struggles of hardworking Americans on Main Street to the largest firms of Wall Street.

This country can’t afford another four years of this failed philosophy. For years, I have called for modernizing the rules of the road to suit a 21st century market – rules that would protect American investors and consumers. And I’ve called for policies that grow our economy and our middle-class together.

[…]

It’s not that I think John McCain doesn’t care what’s going on in the lives of most Americans. I just think doesn’t know. He doesn’t get what’s happening between the mountain in Sedona where he lives and the corridors of Washington where he works. Why else would he say that we’ve made great progress economically under George Bush? Why else would he say that the economy isn’t something he understands as well as he should? Why else would he say, today, of all days – just a few hours ago – that the fundamentals of the economy are still strong?

Senator – what economy are you talking about?

What’s more fundamental than the ability to find a job that pays the bills and can raise a family? What’s more fundamental than knowing that your life savings is secure, and that you can retire with dignity? What’s more fundamental than knowing that you’ll have a roof over your head at the end of the day? What’s more fundamental than that?

The fundamentals we use to measure economic strength are whether we are living up to that fundamental promise that has made this country great – that promise that America is the place where you can make it if you try – a promise that is the only reason that we are standing here today.

Joe Biden also responded to the out of touch McCain:

Take a hard look at the positions John has taken for the past 26 years, on the economy, on health care, on foreign policy, and you’ll see why I say that John McCain is just four more years of George Bush. On the issues that you talk about around the kitchen table, Mary’s college tuition, the cost of the MRI for mom, heating our home this winter — John McCain is profoundly out of touch.

Senator McCain has confessed, quote, "It’s easy for me to go to Washington and frankly, be somewhat divorced from the day-to-day challenges people have." And he’s right, if all you do is walk the halls of power, all you hear are the wants of the powerful.

I believe that’s why Senator McCain could say with a straight face, as recently as this morning, and I quote "the fundamentals of our economy are strong." That, "We’ve made great progress economically" during the Bush years. But friends, I could walk from here to Lansing, and I wouldn’t run into a single person who thought our economy was doing well, unless I ran into John McCain.

John McCain just doesn’t seem to understand what middle class people are going through today. I don’t doubt that he cares. He just doesn’t think that we have any responsibility to help people who are hurting.

My dad used to have an expression: "Don’t tell me what you value. Show me your budget, and I’ll tell you what you value."

By that measure, John McCain doesn’t stand with the middle class. He stands with George Bush firmly in the corner of the wealthy and well-connected. He stands with the CEO of Exxon-Mobil, who, while testifying before my Senate judiciary committee swore to me under oath that Exxon-Mobil didn’t need the tax breaks they’d been given to explore for oil.

John McCain is so firmly in their corner he thinks the Exxon-Mobils of the world should get an additional $4 billion dollars a year in tax cuts.

He stands in the corner of the wealthiest Americans by extending tax cuts for people making over a quarter million dollars a year, and then adding more than $300 billion on top of that for corporations and the wealthy.

There is simply no daylight – at least none I can see — between John McCain and George Bush.

On every major challenge we face, from the economy, to health care, to education and Iraq, you can barely tell them apart.

* * *

John McCain recently said: "the issue of economics is not something I’ve understood as well as I should." Then he proved it by the advisers he chose to surround him – advisers who have further cocooned him from the reality facing the rest of us. People like Phil Gramm. The man who wrote John McCain’s economic plan actually said, repeatedly, that we’re not going through an economic recession. Phil Gramm says it’s just a mental recession. That we’re a nation of whiners.

Don’t take my word for it, look at the record. Ninety percent of the time, John McCain votes with George Bush.

* * *

What is John’s response to the state of the economy? Let me quote him: "A lot of this is psychological." Let me tell you something: Losing your job is more than a state of mind.

It means staring at the ceiling at night thinking that you may lose your house because you can’t get next month’s mortgage payment. It means looking at your pregnant wife and not knowing how you’re going to come up with the money to pay for the delivery of your child, since you don’t have health care anymore. It means looking at your child when they come home from college at Christmas and saying "Honey, I’m sorry, we’re not going to be able to send you back next semester." It’s not a state of mind. It’s a loss of dignity.

When you and your economic advisers are so out of touch, it’s no surprise that your economic policies ignore the challenges that normal families face.

John McCain must agree with his economic guru "Foreclosure" Phil Gramm that this is only a "mental recession" and we’re "a nation of whiners."  Another of his economic advisers, Donald Luskin, echoed Phil Gramm’s comments in the Washington Post just this past Sunday. Quit Doling Out That Bad-Economy Line These guys are totally clueless and out of touch.

UPDATE: Hours after channeling Herbert Hoover and taking a beating from both the media and his opponents, John McCain concocted the fabulist claim that he meant "workers" by "the fundamentals," and that his opponents were criticizing working people by criticizing him.  Proof once again that this dishonest and dishonorable man will say anything and lie like a rug.  On Tuesday, Chris Matthews at Hardball documented 22 times that McCain has used "the fundamentals of the economy are strong" line during this campaign – and it has never meant "workers."  Here are some examples: