Christianity, Culture, Vocation

So now the Federal Reserve joins with world banks to create a fund to bail out all the banks and the grateful stock market soars. But the German periodical Der Spiegel offers a sobering conclusion:

In fact, it really does look as if the foundations of US capitalism have shattered. Since 1864, American banking has been split into commercial banks and investment banks. But now that’s changing. Bear Stearns, Lehman Brothers, Merrill Lynch — overnight, some of the biggest names on Wall Street have disappeared into thin air. Goldman Sachs and Morgan Stanley are the only giants left standing. Despite tolerable quarterly results, even they have been hurt by mysterious slumps in prices and — at least in Morgan Stanley’s case — have prepared themselves for the end.

“Nothing will be like it was before,” said James Allroy, a broker who was brooding over his chai latte at a Starbucks on Wall Street. “The world as we know it is going down.” . . .

The only thing that is certain is that the era of the unbridled free-market economy in the US has passed — at least for now. The near nationalization of AIG, America’s largest insurance company, with an $85 billion cash infusion — a bill footed by taxpayers — was a staggering move. The sum is three times as high as the guarantee provided by the Federal Reserve when Bear Stearns was sold to JPMorgan Chase in March.

The most breathtaking aspect about this week’s crisis, though, is that the life raft — which Washington had only previously used to bail out the mortgage giants Fannie Mae and Freddie Mac — is being handed out by a government whose party usually fights against any form of government intervention. The policy is anchored in its party platform.

“I fear the government has passed the point of no return,” financial historian Ron Chernow told the New York Times. “We have the irony of a free-market administration doing things that the most liberal Democratic administration would never have been doing in its wildest dreams.”

Friends, this is President Bush doing this! The Republicans! The conservatives! Barack Obama isn’t president yet, but the current administration may be outdoing him. Or, looked at another way, if the Republicans are so little committed to free market capitalism, what will the Democrats do?

Meanwhile, there are signs that the free market actually is working as it’s supposed to. Now that the price of houses in California has plunged, ordinary people can afford to buy their own homes again, so the housing market is booming. Now that the stock market has plummeted, cagy investors such as Warren Buffett are buying up companies at bargain rates. The market destroys but it also builds out of the rubble.

A state agency of Communist China may buy 49% of the running-dog capitalist investment firm Morgan Stanley!

It turns out that, contrary to what Democrats are saying–to the point of accusing the Republican ticket of lying–Sarah Palin DID kill the Bridge to Nowhere. Here is the whole story.

Yes, she once supported it. But so what, if she was willing to change her mind? Yes, she used the money for something else, but these were federal highway funds that all states get and are dependent on. Yes, she built a bridge to Wasilla, Alaska’s fifth largest city, but so what? It isn’t wrong to build bridges that go somewhere, that are needed. But did she kill the Bridge to Nowhere? Yes, she did.

Furthermore, contrary to Democratic charges that the Republicans are “lying,” Barack Obama DID push a bill mandating comprehensive sex education for kindergartners. It wasn’t just to teach children to report sexual abuse. The bill mandated specifically that kindergarten children be taught about AIDS.

Moshing Finnish Lutherans.

Growing numbers of people converting to Christianity has sparked a wave of persecution in parts of India, with mobs destroying homes and churches and in some cases murdering Christians. From Christians Face Hindus’ Wrath:

Babita Nayak was cooking lunch for her pregnant sister when a mob of Hindu extremists wielding swords, hammers and long sticks rampaged through their village, chanting “India is for Hindus! Convert or leave!”

The men, wearing saffron headbands, ransacked dozens of huts, searching for cash and looting bicycles and livestock. They torched the village church, leaving behind burned Bibles in the local Kui language and torn-down posters of Jesus. “Christianity is a foreign religion,” they shouted over bullhorns, according to eyewitness and police reports. . . .

A six-hour drive from Bhubaneswar, the capital of Orissa, into the isolated and winding jungle-lined roads showed remnants of fatal attacks and arson directed at Indian Christians in recent weeks: razed churches, scorched orphanages and homes, and roads blocked by downed trees, boulders and stick-waving mobs. Saffron flags (saffron is the color several Hindu right-wing organizations use for self-representation) flew over Hindu-owned tea shops and homes to protect them from attack.

All told, as many as 4,000 Christian homes and 115 churches were destroyed in the region. Amid the lush corn and rice farms of Kandhamal district, more than 35 people were killed for their faith, the All India Christian Council reported; government officials estimate 18 deaths.

There are increasing reports that women were sexually abused, but victims are slow to come forward because of the stigma attached to rape.

About 20,000 people have been displaced, most of them huddled into 14 squalid government-run camps across Kandhamal. About 5,000 have left their homes in Ganjam district, media reports say.

So the U.S. government bailed out the insurance giant AIG. But we did not just bail it out by giving it a loan or guaranteeing its solvency. We bought 80% of its equity. So the U.S. government now essentially owns it. The government also “seized” ownership of Fannie Mae, which I admit was a strange sort of public/private hybrid. But when the state owns companies, isn’t that socialism? (Someone please correct me if I’m interpreting all of this incorrectly.)

That is a great phrase from a demolition of the “Jesus was a community organizer; Pilate was a governor” line.

This article from USA TODAY, Palin ‘governed from the center,’ went after big oil, describes Sarah Palin’s biggest accomplishment as governor, dismantling the oil industry’s control of Alaskan politics, forcing the oil companies to pay the state and its citizens a bigger royalty, and taking away a pipeline deal from Exxon to give it to a Canadian company at better terms for Alaska.

Will the Democrats who keep maintaining that the Republicans are in the control of the big oil companies at least give her credit for this?

Thanks to Mollie Z. Hemingway at Get Religion for alerting us to this moving story about Thomas S. Vander Woude, who died to save the life of his son:

When Joseph, 20, who has Down syndrome, fell into a septic tank Monday in his back yard, Vander Woude jumped in after him. He saved him. And he died where he spent so much time living: at his son’s side.

“That’s how he lived,” Vander Woude’s daughter-in-law and neighbor, Maryan Vander Woude, said yesterday. “He lived sacrificing his life, everything, for his family.”

Vander Woude, 66, had gone to Mass at Holy Trinity Catholic Church in Gainesville on Monday, just as he did every day, and then worked in the yard with Joseph, the youngest of his seven sons, affectionately known as Josie. Joseph apparently fell through a piece of metal that covered a 2-by-2-foot opening in the septic tank, according to Prince William County police and family members.

Vander Woude rushed to the tank; a workman at the house saw what was happening and told Vander Woude’s wife, Mary Ellen, police said. They called 911 about 12 p.m. and tried to help the father and son in the meantime.

At some point, Vander Woude jumped in the tank, submerging himself in sewage so he could push his son up from below and keep his head above the muck, while Joseph’s mom and the workman pulled from above.

When rescue workers arrived, they pulled the two out, police said. Vander Woude, who had been in the tank for 15 to 20 minutes, was unconscious. Efforts to revive him were unsuccessful, and he was taken to a hospital, where he was pronounced dead, police said. . . .

Vander Woude was a pilot in Vietnam, a daughter-in-law said. After the war, he worked as a commercial airline pilot and in the early 1980s moved his family to Prince William from Georgia. In the years to come, he would wear many hats: farmer, athletic director, volunteer coach, parishioner, handy neighbor, grandfather of 24, husband for 43 years. . . .

But loved ones said his favorite job was the one he did last: being a good dad.

“They always considered Joseph a wonderful blessing to the family,” said Francis Peffley, pastor at Holy Trinity, where Vander Woude served as a sacristan and also trained altar servers. “His whole life was spent serving people and sacrificing himself. . . . He gave the ultimate sacrifice. . . . Giving his life to save his son.”

Barack Obama, who apparently considers himself president-in-waiting, has been conducting negotiations with Iraq designed to DELAY the agreement for our troop withdrawal! So reports the New York Post:

WHILE campaigning in public for a speedy withdrawal of US troops from Iraq, Sen. Barack Obama has tried in private to persuade Iraqi leaders to delay an agreement on a draw-down of the American military presence.

According to Iraqi Foreign Minister Hoshyar Zebari, Obama made his demand for delay a key theme of his discussions with Iraqi leaders in Baghdad in July.

“He asked why we were not prepared to delay an agreement until after the US elections and the formation of a new administration in Washington,” Zebari said in an interview.

Obama insisted that Congress should be involved in negotiations on the status of US troops - and that it was in the interests of both sides not to have an agreement negotiated by the Bush administration in its “state of weakness and political confusion.”

“However, as an Iraqi, I prefer to have a security agreement that regulates the activities of foreign troops, rather than keeping the matter open.” Zebari says.

Is there ANY WAY this is appropriate?

The Obama campaign denounced the story:

Obama’s national security spokeswoman Wendy Morigi said Taheri’s article bore “as much resemblance to the truth as a McCain campaign commercial.”

In fact, Obama had told the Iraqis that they should not rush through a “Strategic Framework Agreement” governing the future of US forces until after President George W. Bush leaves office, she said.

I KNOW. THAT’S WHAT WE ARE TALKING ABOUT! Foreign policy and the conduct of our nation’s wars are the responsibility of the President. It is just wrong for a Senator to inject himself into these important negotiations and try to block them even if he is running for president.

HT and for commentary: Power Line

Economics columnist Robert J. Samuelson says that what we are witnessing is the collapse of Wall Street’s entire business model, as developed since the 1980’s:

First, financial firms have moved beyond their traditional roles as advisers and intermediaries. Once, major investment banks such as Goldman Sachs and Lehman worked mainly for their clients. They traded stocks and bonds for major institutional investors (insurance companies, pension funds, mutual funds). They raised capital for companies by underwriting — selling — new stocks and bonds for the firms. They provided advice to corporate clients on mergers, acquisitions and spinoffs. All these services earned fees.

Now, most financial firms also invest for themselves. They use partners’ or shareholders’ money to place bets on stocks, bonds and other securities — so-called “principal transactions.” Merrill and other retail brokers, which once served individual clients, have ventured into investment banking. So have some commercial banks that were barred from doing so until the repeal in 1999 of the Glass-Steagall Act of 1933.

Second, Wall Street’s compensation is heavily skewed toward annual bonuses, reflecting the profits traders and managers earned in the year. Despite lavish base salaries, bonuses dominate. Managing directors with 15 years’ experience can receive bonuses five to 10 times their base salaries of $200,000 to $300,000.

Finally, investment banks rely heavily on borrowed money, called “leverage” in financial lingo. Lehman was typical. In late 2007, it held almost $700 billion in stocks, bonds and other securities. Meanwhile, its shareholders’ investment (equity) was about $23 billion. All the rest was supported by borrowings. The “leverage ratio” was 30 to 1.

Leverage can create huge windfalls. Suppose you buy a stock for $100. It goes to $110. You made 10 percent, a decent return. Now suppose you borrowed $90 of the $100. If the price rises to $101, you’ve made 10 percent on your $10 investment. (Technically, the price has to exceed $101 slightly to cover interest payments.) If it goes to $110, you’ve doubled your money. Wow.

Once assembled, these components created a manic machine for gambling. Traders and money managers had huge incentives to do whatever would increase short-term profits. Dubious mortgages were packaged into bonds, sold and traded. Investment houses had huge incentives to increase leverage. While the boom continued, government remained aloof. Congress resisted tougher regulation for Fannie and Freddie and permitted them to run leverage ratios that, by plausible calculations, exceeded 60 to 1.

It wasn’t that Wall Street’s leaders deceived customers or lenders into taking risks that were known to be hazardous. Instead, they concluded that risks were low or nonexistent. They fooled themselves, because the short-term rewards blinded them to the long-term dangers. Inevitably, these surfaced.

The Brewers have their best season in years, leading the wildcard race and headed for the playoffs with just 12 games remaining. So what do they do? Fire their manager.

Yes, the team was slumping, frittering away their lead. But why fire Ned Yost, the man who brought them to their prominence? There has got to be more to the story than I know. Wisconsinites, please explain.

In the meantime, interim manager Dale Sveum–whom I like–having brought back Robin Yount as bench coach managed the team to superstar pitcher C. C. Sabathia’s first loss and the Brewers lost the lead in the wildcard race.