How It Works

This morning the progressive blogger Glenn Greenwald documents in detail a false statement by the respected New York Times columnist and television commentator, David Brooks.  Writing for that influential newspaper which uniformly supports those in power -- and so earns my sobriquet of "Pravda-on-the-Hudson" -- Brooks claimed

This year, for example, the United States Chamber of Commerce is spending $22 million for Republicans, while the Service Employees International Union is spending about $14 million for Democrats.

where in fact, publicly available documents show the Chamber spending 75 million dollars to the union's 14 million.  Emory University Professor David Cutler adds proof of a second misrepresentation, as well.

Usually, however, the misrepresentation of the circumstances of our political life are not quite so blatant.  They just fail to imagine that there can be any other point of view than that of the corporate elite.  I draw my illustrative example from a recent editorial in the other of our two most influential national newspapers, the Washington Post -- also known as "Izvestia-on-the-Potomac" .

We are in the midst of the revelation of a massive fraud perpetrated on the public by financial institutions which demand foreclosures for which they never had the legal documentation.

 (Incidentally, the bill to cover up this fraud passed the House of Representatives by voice vote, making it impossible to check how my opponent Earl Blumenauer voted.  We can say he did not object -- the Congressman hailed by Willamette Week as "about as progressive as one can be and still get things done in D.C.")

To proceed with my example -- pointed out by a couple of economists, Brad DeLong and Dean Baker -- the good people at Izvetia-on-the-Potomac responded to this growing scandal with an editorial, saying in part:

 

There are big lessons to be learned, especially about how mass securitization of poorly underwritten home loans may have swamped the states' antiquated, cumbersome property registration and foreclosure procedures. It is also true that the scandal underscores the failure of the Obama administration's efforts to prevent foreclosures....

The robo-signed affidavits at issue were part of a technical review of documents, not the actual determination of a borrower's delinquency. By the time robo-signers put pen to paper, default had been well established. An ironic consequence of diverting staff to fixing affidavits now is that it leaves fewer people to modify salvageable loans...

 

Please note that the reader is not advised that the financial institutions in question were violating the laws governing their activity.  But the most interesting part is the last sentence quoted, concerning which Baker, of the Center for Economic and Policy Research, comments:

 

The Washington Post apparently thinks that banks have a fixed number of employees. This is the only meaning that can be attached to their warning in an editorial arguing a foreclosure moratorium that: "An ironic consequence of diverting staff to fixing affidavits now is that it leaves fewer people to modify salvageable loans."

See, the way this would work is the banks would realize that they need more workers to handle the foreclosure process in a way that complies with the law. (You know, the law, what the rest of us have to obey.) The banks would run help wanted ads, maybe even in the Post, and employ some of the millions of people who have lost their jobs in the downturn. Hiring more workers would of course lower bank profits and dip into executive bonuses, but that is the way things are supposed to work in a market economy.

 

That's how it usually works.  Izvestia-on-the-Potomac cannot imagine the banks in question actually hiring new employees to ascertain that their foreclosure programs operate within the law.  Rather, the issue to be dealt with is how best to screw the homeowners out of "salvageable [home] loans."

Reading Pravda-on-the-Hudson or Izvetia-on-the-Potomac submerges you into a world where the protection of corporate interests is the only thing to be mentioned.