Crap

The Commodities Futures Trading Commission could have instituted real and effective rules on swaps trades by doing nothing, but they caved to the banks, because the banks refused to prepare for the deadline:

I’m going to be brief, in part because the CFTC’s probable demonstration of lack of gumption is still in play, while the SEC’s was expected but nevertheless appalling. But the bottom line is that even though we seem some intermittent signs of the officialdom recognizing that big banks remain a menace to the health and well-being to the general public*, the measures to constrain them continue to be inadequate.

As readers may recall, CFTC chairman Gary Gensler was in a position to stare down bank efforts to water down critical provisions of Dodd Frank on derivatives (see here for details of the issues at stake). The short version is that Gensler did not have the votes among his commissioners to support his position since the Administration had managed to appoint a bank stooge as one of the Democrats. However, Gensler controlled the agenda. That meant he had the option of not putting the matter to a vote of his fellow commissioners at all, which meant Dodd Frank would become effective as written (mind you, normally legislation does legitimately require some tweaking since the legislative language may be imprecise or not mesh well with existing rules).

What appears to have forced Gensler to relent was not the CFTC politics, but bank refusal to prepare, which meant they could stamp their feet and say if Gensler did not back down, the markets would blow up and it would all be his fault.

Read the rest, and you will not just be disgusted by the CFTC, you will want to replace the SEC with a trained monkey as well.

Barack Obama Gets a Warning from Dianne Feinstein*

If there is one constant in the US Senate, it is that Dianne Feinstein is friendly to an expansive and intrusive state security apparatus.

Thus her signing onto letter to Obama suggesting that his allowing the force feeding of prisoners at Guantanamo is illegal is a big deal:

Dianne Feinstein and Dick Durbin sent Obama a letter yesterday, using Kessler’s [The Federal Judge who condemned the force feeding, but said that she had no standing to rule] ruling to connect the two explicitly.

U.S. District Court for the District of Columbia Judge Gladys Kessler also expressed concern about the force-feeding of Guantanamo Bay detainees. The Court denied detainee Jihad Dhiab’s motion for a preliminary injunction to stop force-feeding due to lack of jurisdiction, but in her order, Judge Kessler noted that Dhiab has set out in great detail in his court filings “what appears to be a consensus that force-feeding of prisoners violates Article 7 of the International Covenant on Civil and Political Rights (ICCPR) which prohibits torture or cruel, inhumane, and degrading treatment.” The United States has ratified the ICCPR and is obligated to comply with its provisions. Judge Kessler also wrote, “it is perfectly clear from the statements of detainees, as well as the statements from the [medical] organizations just cited, that force-feeding is a painful, humiliating, and degrading process.” (emphasis added).

The judge concluded by correctly pointing out that you, as Commander in Chief, have the authority to intercede on behalf of Dhiab, and other similarly-situated detainees at Guantanamo. The court wrote: “Article II, Section 2 of the Constitution provides that ‘[t]he President shall be the Commander in Chief of the Army and Navy of the United States. …’ It would seem to follow, therefore, that the President of the United States, as Commander-in-Chief, has the authority—and power—to directly address the issue of force-feeding of the detainees at Guantanamo Bay.”

Feinstein only by association makes the next part of her argument. We comply with these treaties by complying with our Eighth Amendment prohibition on cruel or unusual punishment. And the government has long said that if we can do something elsewhere in a our gulag system, we can do it in Gitmo.

………

Say what you will about DiFi (lord knows I’ve often said the same, where I thought it appropriate), but she has just told a President from her own party that he’s breaking the law.

This is what you call a, "statement against interests."

When DiFi is implying that your intelligence activities are over the top, you have jumped the shark.

I would also note that the Snowden matter might very have something to do with this, she also sent a letter expressing concerns to SecDef Hagel about a month ago (about a week and a half after the Snowden revelations).

The US state security apparatus still thinks that this will blow over, but even DiFi realizes that something has changed.

^*Full disclosure, her grandfather, Sam Goldman, and my great-grandfather, Harry Goldman, were brothers.

Back Loaded Bribery

If you play ball with the monied people who want law and regulation structured to ensure that their wealth increases even more, then they reward you with lucrative jobs, like a high paid lobbyist, or, as in the case of Timothy "Eddie Haskell" Geithner, an absurdly lucrative speaking gig:

During his tenure as Treasury secretary, Timothy Geithner was constantly dogged by the belief that he was spawned from Wall Street. This thinking was false: If you need a refresher, Geithner had actually spent most of his career in government, and none of it at a bank. When he left office this year, Geithner said that it would be "extremely unlikely" for that to change.

But as it turns out, Geithner is now being paid hundreds of thousands of dollars by massive financial organizations. It's just that he isn't being paid to work on Wall Street; he's just being paid to talk every now and then.

The Financial Times reports that Geithner, like countless former public servants before him, has hit the highly lucrative speaking circuit. He's already made about $400,000 in just three engagements. And that tab is being footed by financial institutions such as Deutsche Bank and Blackstone, which paid him about $200,000 and up to $100,000, respectively.

No one ever explicitly told Geithner that if he protected the banksters, he woud get a payoff, but this is explicit in Washington, DC's revolving door.

He knew that he would get rewarded, and he has not been disabused of this belief.

H/t Gaius Publius.

Bummer of a Birthmark, Boeing

A Boeing 787 caught fire at Heathrow, though there are no indications that batteries are involved:

Investigators classified the fire that broke out on a Boeing 787 Dreamliner parked at London's Heathrow airport as a "serious incident" but have found no evidence it was caused by the plane's batteries, Britain's Air Accidents Investigation Branch (AAIB) said on Saturday.

The question of whether the fire was connected to the batteries is crucial because the entire global fleet of Dreamliners, Boeing's groundbreaking new flagship jet, was grounded for three months this year due to battery-related problems.

The AAIB designation fell just short of a full-blown "accident" on the scale it uses to describe investigations. The agency's preliminary probe is expected to take several days, opening up Boeing to more questions about its top-selling plane.

When Boeing decided that it would be a good idea to outsource most of its expertise to "risk sharing partners", it was pretty much inevitable.

As I noted 2 years ago in the case of Dell Computer, this is penny wise and pound foolish:

So the decline of manufacturing in a region sets off a chain reaction. Once manufacturing is outsourced, process-engineering expertise can’t be maintained, since it depends on daily interactions with manufacturing. Without process-engineering capabilities, companies find it increasingly difficult to conduct advanced research on next-generation process technologies. Without the ability to develop such new processes, they find they can no longer develop new products. In the long term, then, an economy that lacks an infrastructure for advanced process engineering and manufacturing will lose its ability to innovate.

Boeing's problems are further complicated by the fact that its partners did not have the time to develop the expertise to do the job right, so now we have a troubled airliner where the sum of the parts is less than the whole.

F%$# Florida

George Zimmerman was acquitted of the murder of Trayvon Martin.

The problem here is that the law, and quite honestly the whole governmental apparatus, of Florida is broken.

Between stand your ground, and half-assed Sanford cops, my guess is that this was inevitable.

Expect more people to be shot for being black in "stand your ground" states now.

51 Years Ago Today

The rolling stones played their first gig in public.

Feel old? I do.

Well Duh!

The Washington Post notes that, "Lawmakers say administration’s lack of candor on surveillance weakens oversight."

Gee, you think?

Lawmakers tasked with overseeing national security policy say a pattern of misleading testimony by senior Obama administration officials has weakened Congress’s ability to rein in government surveillance.

Members of Congress say officials have either denied the existence of a broad program that collects data on millions of Americans or, more commonly, made statements that left some lawmakers with the impression that the government was conducting only narrow, targeted surveillance operations.

The most recent example came on March 12, when James R. Clapper, director of national intelligence, told the Senate Intelligence Committee that the government was not collecting information about millions of Americans. He later acknowledged that the statement was “erroneous” and apologized, citing a misunderstanding.

"Misunderstanding," my ass.

Clapper was given a day's notice that the question was going to be asked, and he was given an opportunity to further clarify immediately after the fact.

He simply lied, because he knew that he could.