Sunday, December 20, 2009

Lumps of Coal

Christmas lumps of coal came early for some this year:

Bernie Madoff, who will spend the rest of his life in prison.

GM’s former management. Rick Wagoner, Fritz Henderson, and other old timers in the executive ranks lost their jobs after many years at GM. It’s hard to say they didn’t deserve it, especially Wagoner for betting GM and its employees’ prosperity on the price of oil. It’s one thing if you take all of your personal savings and put it on a single roll of the dice. But if you’re responsible to millions of shareholders and employees, a touch of prudence and at least the first draft of Plan B are good management strategies. Let's hope the telephone guy now in charge at GM has some good ideas.

Sovereign debt holders. It began with Dubai and its grandiose ambitions, which ultimately rested on wishful hoping. Now the illness has spread to Greece, Lithuania, Iceland, Latvia and other small European nations. Some of these troubled countries are members of the Euro Zone, and the wealthier members of the European Union are imitating Alphonse and Gaston as they try to figure out how to pass the hot tamale. They talk about IMF assistance to the beleaguered. Look for quiet increases in support for the IMF from the bigger Euro bloc nations. They know some sort of bailout is likely, but would want a circumspect way of funding it.

The Republican Party, which finds itself riven by tea parties and inquisitional undercurrents. Its struggle to redefine itself is understandable in light of the drubbing it took in the 2008 presidential election. The internecine nature of the feuding could cripple the party for years to come.

Tiger Woods. By all indications, he’s an intelligent guy whose story seems more like Eliot Spitzer’s than the typical celebrity-cheating-on-his-wife tabloid fodder. As with Spitzer, you have to wonder how Tiger could have figured he wouldn’t be caught. Tiger’s evidently taken a page from Spitzer’s playbook, disappearing until things cool off. Then, like Spitzer, Tiger will try to rehabilitate himself. Given his tremendous athletic ability and pro golf’s need for television revenues, chances are he’ll succeed. But Tiger’s done us all a favor by re-affirming, however unintentionally and indirectly, that integrity matters. With American culture having morphed from its pioneer, yeoman farmer roots to a social networking frenzy of marketing, image and popularity, it’s reassuring that integrity, along with thrift and prudence, still mean something. In spite of all the economic wreckage, there’s hope for America.

Tarek and Michaele Salahi, the White House party-crashing self-promoters whose notoriety seems to have hurt them more than it helped. If so, that would be a rare instance of 15 minutes of fame turning out badly in a celebrity-obsessed nation.

Let’s hope Santa has some extra lumps, because just deserts remain to be given to:

Bernie Madoff, because what he did deserves much worse than life in prison. At a minimum, his only prison jobs should be cleaning bathrooms with a toothbrush and collecting trash with a 1-quart plastic bag.

Senator Chris Dodd, for his lousy financial regulatory reform proposal. It would put way too much power in one place—a new super regulator for banks—while seriously weakening the FDIC, the one federal regulator that spotted the iceberg before the economy smacked into it. We are again reminded that Washington’s guiding principle is no good deed will go unpunished. Senator Dodd may be rethinking his proposal, and we hope he does.

Big taxpayer-subsidized mega-bonus-paying banks that don’t make new loans. The highest living welfare queens in American history, the big banks pay stupendous bonuses while pulling credit lines from consumers and small businesses. They prosper at public expense as unemployment reaches the highest levels in over 25 years. Yet they need serious parenting to learn the concept of gratitude. Most 2-year olds can be taught to say “thank you," but not, it seems, the best paid bankers.

Obstructionist Republicans in Congress. The Republicans’ only “strategy,” if you will, is to obstruct whatever the Democrats are trying to do. This may be in keeping with their special talent for going negative in political campaigns. But the American people won’t ultimately be won over by the Calvin Coolidge take-a-nap-every-afternoon style of governance, not in a time of privation and crisis. There’s a reason why FDR was elected to the White House four times in a row: he was a doer, not a naysayer.

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