Inmate To Run Asylum?

I know it’s only been a week since the last one, but I can’t resist running another picture of Phil Gramm. I’m looking at an article by Jonathan Weisman of The Washington Post about John McCain’s economic team.

Weisman gives some history of how in 1999, as Chairman of the Senate Banking Committee, Gramm lead the repeal of the Depression-era Glass-Steagall law that separated regulated commercial banks from unregulated investment banks, setting the stage for investment banks, such as the now infamous Bear Stearns, to take over 70% of the US lending market.

And for Gramm to resign from Congress and become a Vice-Chairman of UBS.

This is what I was talking about when I wrote about smart business guys talking like they had re-invented the wheel, when it was really a case of public officials re-discovering “the world’s oldest profession.”

Another shoe dropped this week when Gramm’s employer, Swiss bank UBS revealed that it had lost $37 billion in the US housing market. I wonder if the Fed’s bail-out will include Swiss banks.

The article quotes UT economist James Galbraith, (son of the late Harvard economist John Kenneth Galbraith, who worked in the Kennedy White House)

"Phil Gramm's career was as the most aggressive advocate of every predatory and rapacious element that the financial sector has," Galbraith said. "He's a sorcerer's apprentice of instability and disaster in the financial system."

Here’s another bit about Gramm from the late, great Molly Ivans:
When he ran for president in 1996 and finished fifth in Iowa, all the profiles written of him included the line “Even his friends don’t like him.” Self-righteous and strident, Gramm demonized his opponents and used bitter, polarizing rhetoric. During a Senate debate over Social Security, a member pointed out that the proposal under consideration would hurt 80-year-old retirees. “Most people don’t have the luxury of living to be 80 years old,” Gramm scoffed, “so it’s hard for me to feel sorry for them.” Well, there is that.

You can be sure that should you lose your home under a McCain administration, it will be due to some lack of personal responsibility or moral failure. However, should the bank holding your mortgage become insolvent, it will be a direct result of high taxes and onerous regulations; grounds for a rescue by taxpayers.