Holding Their Noses

As Johnathan Bernstein pointed out in the Washington Post on Wednesday, if you've only been watching the cable "news" networks in the wake of Tuesday's elections, you may not have heard much about one of the most important political races of the year - especially from people who know what they're talking about in Nebraska politics.

What you may have heard about was the supposedly surprising upset by Nebraska state senator Deb Fischer, of both Attorney General John Bruning, and State Treasurer Don Stenberg, in the Nebraska Republican Primary race for U.S. Senate.

What you likely didn't hear about is an accurate accounting of how it happened - or what that race may mean in the greater context of the 2012 elections.

To start with, as any Nebraskan who pays attention to state politics knows, Deb Fischer is no Tea Party candidate. On more than a few occasions, Fischer has reached across the left-right political divide, in Nebraska's nominally non-partisan Legislature, to attempt to compromise on issues. For that reason alone, true Tea Party Republicans want nothing to do with Fischer. Everyone knows Tea Partiers don't compromise with anyone.

That didn't stop many less informed national media sources from jumping to the assumption that - because of the endorsement from Sarah Palin - Fischer was a Tea Party Republican. When it comes to Palin, reliable sources we know have made it clear: Palin's advisors saw the high likelihood of Fischer's win, due to the intra-party squabbling between Bruning and Stenberg, and Palin dropped her endorsement at the last minute, in a thinly-veiled attempt to prove the former half-term Alaska governor is still politically relevant. Any pundit who points to this race, and thinks Palin can still "pick 'em" is quite obviously a naive hack.

The Tea Party types have never been comfortable with Fischer - but Fischer hasn't always "played ball" the way the Nebraska Republican party elite have wanted her too, either. Their support for her, like their support for Mitt Romney, will likely be not truly heartfelt this year.

Before Tuesday's race, Matt K. Lewis, at the conservative Daily Caller, had a great example of who Fischer really is for the GOP - Nebraska's version of Mike Rounds, the former governor of South Dakota. Rounds got to the Governor's office when the major two factions of his party declared war on each other - and Rounds slipped into a victory.

For Republicans, the lesson of Fischer's win is simple; the internal civil war among the different factions of the party is going to cause them some serious headaches this election cycle. There are many other races around the country that are shaping up similar to the race Fischer won - and we think the GOP elite have yet to realize how vulnerable they really are.

For Democrats, the Nebraska primary is proof of a concept we've been pointing out for some time: There are serious fault lines in the Republican Party. If Democrats want to win, all they have to do is help Republicans to politically annihilate one another. In many cases, that just means Democrats should have the wisdom stay out of Republican intra-party battles, much as Bob Kerrey did in Nebraska.

For every American, the takeaway from Fischer's win should be about the money. If it wasn't for the last minute flood of outside funds that we pointed out earlier this week, it's highly likely Fischer would have lost. That fact became even more clear when looking at the county-by-county vote totals. Outside of winning the heavily rural areas of Central and Western Nebraska, the place Fischer cashed in is the Sioux City media market - where most of the late race cash was dumped.

Now, Fischer turns to face former Senator Bob Kerrey - and we have to admit we like Sen. Kerrey's chances against the untested Fischer. That said, we also acknowledge that - as our own Paul Fell has said for many years now - some Nebraskans will vote for anyone with an "R" next to their name, even the Devil himself.

Who Do These Clowns Think They Are?

Anyone who's been paying attention to the news over the last week is probably aware that, once again, some of the supposed experts on Wall Street really blew it again - especially at the massive Wall Street banking and investment firm of JP Morgan Chase.

What few Americans seem to understand is exactly what "it" these supposed finance wizards blew up - which is why we went directly to one of the people who understands the "it" of Wall Street finance, former Chief Economist to Vice President Joe Biden, Jared Bernstein.

As Mr. Bernstein explained it to us earlier this week, it helps to think of Wall Street as a giant casino - a concept we've used ourselves, previously. If you think of it that way, what Dimon and the clowns at JP Morgan did is both disgustingly simple and completely insane. In short, they made too many high risk bets - and stacked the deck against themselves.

To start with, Dimon and company made some giant bets on how corporate bonds were going to do, based on our recently improving economy. Then, to cover - or "hedge" - those bets, Dimon and company made another set of bets, in the opposite direction. So if the original bets they made were correct, JP Morgan Chase would win. But if the original bet went sour, the firm would still win, because of the hedged bets they'd made.

Think of it like betting on your favorite sports team. If your team wins, you win. Of course, if you also hedge your initial bets with secondary bets against your team, even if your team loses, you still win.

The initial problem JP Morgan had, as Mr. Bernstein explained it to us, is that after the first two series of bets, the idiots at JP Morgan set up one more level of bets - and that third set of bets, on top of the other two, is what cost them several billion dollars.

After all - if you've bet in both directions, you don't double down on only one of them. Which is, in an oversimplified way, what Dimon's company did.

The good - but somewhat scary - news is that even if JP Morgan Chase loses between two and four billion dollars, to them, it's not that much money. As several experts have pointed out, JP Morgan made $19 billion in profits in 2011. So if they lose a few billion here or there, to them, it's not that big a deal.

The big deal is that JP Morgan Chase isn't just an investment firm. It's also a bank - which means, as a bank, American taxpayers insure a massive amount of JP Morgan's money, through the FDIC. That is exactly the problem that Jared Bernstein, the Obama Administration, and Congressional Democrats tried to prevent by re-regulating Wall Street, through the Dodd-Frank reform law.

Not surprisingly, Wall Street's lobbyists have flooded Washington over the last two years, since Dodd-Frank was signed. They've overwhelmingly used Republican members of Congress to obstruct fully putting the law to work - which means that massive firms like JP Morgan are still putting American taxpayers at high risk of having to cover massively bad bets of these hybrid investment firms/banks.

There are those like Elizabeth Warren who have called for another version of the Depression-era Glass-Steagall law, which kept the regular deposit banks on one side of the law, and the Wall Street investment firms on the other. Under Glass-Steagall, the banks couldn't gamble with your money  - but the investment firms could. They had to use their own money - and they couldn't ask for a bailout.

Dodd-Frank, while not as strong as Glass-Steagall, would have nearly the same effect, if only Congressional Republicans and the Wall Street lobbyists would let the law take effect, like it's supposed to.

Right now, Dodd-Frank is like a manhole cover that isn't covering the hole. To blame the manhole cover for not doing its job would be dishonest and stupid - but that's exactly what the clowns on Wall Street, and their friends in the Republican Party, are doing.

As President Obama pointed out on The View yesterday, Dimon may be one of the smartest guys on Wall Street, but Dimon is still capable of making mistakes - including the big ones like we found out about this week. If we don't protect ourselves from the clowns on Wall Street, we can't be surprised at the outcome.

Boom, Like That

There are a whole host of subjects we'd like to focus on today - especially since it's Election Day in so many places. The recall in Wisconsin, and how the Democratic Party doesn't appear to be supporting it as strongly as they should, for example. Rep. Ron Paul kind of suspending his campaign is another example, as is the Euro Zone coming apart at the seems. Another is the insanity of Republicans blocking the full execution of the Dodd-Frank Wall Street reform law, so they can protect their corporate Wall Street friends - all while trying to say President Obama is the one who's really cozy with Wall Street.

We'd like to focus on any of those - and we may very well tackle the gambling exploits and failures of the Wall Street "masters of the universe" tomorrow.

That said, what so much of the media and America are still focused on is still, strangely, the announcement last week of President Obama's support for same-sex marriage.

We say "strangely" because as two major polls pointed out late Monday, a majority of those questioned support same-sex Americans having the same legal rights - including marriage - as their fellow American citizens. We pointed this out last week. Nate Silver and FiveThirtyEight.com also called attention to it last week. Many others did too.

Now, both Gallup and a CBS/New York Times poll confirm again, what the "common wisdom" already was thought to be on this issue. Fifty-four percent of Americans think same-sex marriage is morally acceptable. Sixty-two percent support same-sex legal recognition including civil unions.

These facts aren't surprising to us.

Some very logical governors and progressive state legislatures have already moved forward on implementing marriage equality, including former Republican - now turned Independent - Gov. Lincoln Chaffee of Rhode Island. Chaffee signed an order on Monday that will make it the law in Rhode Island to recognize same-sex marriages performed out of state, in the same way other states accept each other's driver's licenses now - equally.

We're also not surprised Chafee made such a move. He's not afraid of the Republican Party anymore, and especially not the tea bag far-right wing of the party.

Those tea bag types have insisted that President Obama's stand with equal rights for all Americans last week will certainly doom him in the fall election. Once again, though, the tea baggers don't seem to know what they're talking about. Those same polls we quoted earlier also proved that - if the President's action will have any effect on the fall election at all - it'll likely be a wash.

Sure, we've heard of a few pastors and other religious leaders who've said because of the President's stance, they now won't support him in the fall. For every extremist religious authority figure who says they're leaving the Obama camp, we've heard of someone else who says they'll now support the President for his principled stance.

What's more, the people who are coming out for Obama's coming out? Many are big money donors, who have funding they are yanking from Republicans and giving to Democrats, including the President. Strong African-American opinion leaders are also still standing with Obama, so claims that there is some kind of a serious wedge between the LGBT and African-American communities is little more than exaggerated hype.

All things considered, when you add up all the plusses and minuses, it's beginning to look like the "gift" of bigotry that the tea bag Republicans have brought to their party may actually blow up in the face of the GOP this fall.

If it does - and we think it will - we hope we won't have to address this issue again, once the election is over.

As we said last week, America is a first class country. We should not have second-class citizens. Period.