Some scattered links I squirreled away during the previous week (with most of the S&P downgrade shunted off to a separate post):

• Steve Benen: Mitch McConnell, Hostage Taker: Starts with a quote from McConnell (R-KY, Senate Republican Leader) bragging about his role in the debt limit caper: "I think some of our members may have thought the default issue was a hostage you might take a chance at shooting. Most of us didn't think that. What we did learn is this -- it's a hostage that's worth ransoming." Benen unpacks:

  And third, note that McConnell was quite candid in his choice of words. It's not just Democrats talking about Republicans taking "hostages" and demanding "ransoms"; here's the leading Senate Republican using the exact same language. In other words, Mitch McConnell admitted, out loud and on the record, that his party took the full faith and credit of the United States hostage, demanded a ransom, and they fully intend to do it again.

  Given all of this, it's rather bizarre for Republicans to complain about being equated with terrorists. As Dave Weigel noted yesterday, "If you don't want your opponent to label you a hostage-taker, here's an idea: Don't take hostages."

  I'll just add that we've had a set of ideas endemic in popular culture that excuse McConnell's behavior, even his terminology. In particular, the notion that the end justifies the means. One can cite many historical examples, even way before the annihilation of Hiroshima, and many more since, highlights including the 1953 coup in Iran, the "destroy the village to save it" war in Vietnam, the whole Iran-Contra fiasco, the killing of Osama bin Laden. Still, those aren't the things that stick in popular memory. For that you need something like Vince Lombardi's "winning is the only thing." You need the long line of movies where we depend on more and more degraded and unscrupulous characters to do our bidding -- one can view The Dirty Dozen as a redemption tale, but actually it just cracked the door open. So now McConnell's brag touts his romance with criminality. And while some people may feign to find that shocking, they really haven't been paying close attention. The truth is all that and more.

• Steve Benen: Causing Calculated Contraction: Starts with a quote from Alex Castellanos ("a prominent Republican media consultant") on why "we can't borrow forever," and therfore why we can't borrow at all.

  When it comes to economic policy, Castellanos' case is wrong in just about every conceivable way. Indeed, his concerns reflect a reality that bears no resemblance to our own, since the United States is able to borrow money cheaply and easily, and should do just that to help create more demand in the domestic economy. For that matter, the Greece comparisons are gibberish. [ . . . ]

  I tend to think this is dangerously absurd, but putting that aside, Castellanos and I fully agree on the underlying point: the Republicans' economic agenda intends to make matters worse, on purpose, right now. With a weak economy and high unemployment, conservatives believe economic "contraction" is a worthwhile, short-term goal.

  Americans who endorse this Republican approach are arguing, in effect, that policymakers should deliberately undermine economic growth and job creation, in the hopes that conditions will eventually improve after the right's agenda has worked its magic.

  Even if you don't understand the economics (and clearly lots of people don't), one way you can tell the Republican line is bogus is to ask yourself: when has anyone purporting to represent American business in the last 30-40 years ever put long-term considerations ahead of short-term profits?

• Steve Benen: A Timeline of Events: Starts with Ronald Reagan running for president and promising a balanced budget, then adding $2 trillion debt during his two terms:

  • 2000: George W. Bush runs for president, promising to maintain a balanced budget.
  • 2001: CBO shows the United States is on track to pay off the entirety of its national debt within a decade.
  • 2001 - 2009: With support from congressional Republicans, Bush runs enormous deficits, adds nearly $5 trillion to the debt.
  • 2002: Dick Cheney declares, "Deficits don't matter." Congressional Republicans agree, approving tax cuts, two wars, and Medicare expansion without even trying to pay for them.
  • 2009: Barack Obama inherits $1.3 trillion deficit from Bush; Republicans immediately condemn Obama's fiscal irresponsibility.
  • 2009: Congressional Democrats unveil several domestic policy initiatives -- including health care reform, cap and trade, DREAM Act -- which would lower the deficit. GOP opposes all of them, while continuing to push for deficit reduction.
  • September 2010: In Obama's first fiscal year, the deficit shrinks by $122 billion. Republicans again condemn Obama's fiscal irresponsibility.
  • October 2010: S&P endorses the nation's AAA rating with a stable outlook, saying the United States looks to be in solid fiscal shape for the foreseeable future.
  • November 2010: Republicans win a U.S. House majority, citing the need for fiscal responsibility.
  • December 2010: Congressional Republicans demand extension of Bush tax cuts, relying entirely on deficit financing. GOP continues to accuse Obama of fiscal irresponsibility.
  • March 2011: Congressional Republicans declare intention to hold full faith and credit of the United States hostage -- a move without precedent in American history -- until massive debt-reduction plan is approved.
  • July 2011: Obama offers Republicans a $4 trillion debt-reduction deal. GOP refuses, pushes debt-ceiling standoff until the last possible day, rattling international markets.
  • August 2011: S&P downgrades U.S. debt, citing GOP refusal to consider new revenues. Republicans rejoice and blame Obama for fiscal irresponsibility.

  There have been several instances since the mid 1990s in which I genuinely believed Republican politics couldn't possibly get more blisteringly ridiculous. I was wrong; they just keep getting worse.

  Benen expands on this in a later post, The Worst Thing the GOP Has Ever Done?:

  Where would the GOP's hostage fiasco rank on the list of modern Republican misdeeds?

  The list, alas, isn't brief. We could go through Hoover's failures of the late 1920s, or perhaps Joe McCarthy's crusade in the 1950s. Nixon's crimes in the early 1970s are legendary, as are the many Reagan-era scandals -- Iran-Contra, criminal fiasco at H.U.D., the Savings & Loan debacle -- of the 1980s.

  The more contemporary offenses are no doubt fresher in everyone's minds: the Gingrich/Dole government shutdowns, the Clinton impeachment debacle, the Bush v. Gore scandal, the politicization of the Justice Department, the Plame scandal, the fiscal recklessness, the financial industry negligence that contributed to the 2008 crash, etc.

  And while I'm open to suggestion on this, I still think there's something unique about the Republicans holding the full faith and credit of the United States hostage, threatening to impose a catastrophe on all of us, on purpose, to achieve a specific (and unnecessary) policy goal. What's more, note that no elected GOP officials -- literally, not one -- ever stood up during this process to say, "Wait, this is wrong. We shouldn't do this." They all just went along.

• Andrew Leonard: The Next Horrible Budget Showdown: Actually, there's a whole menu of options for recapitupating the last few months of Republican extortion, and Leonard left out the FAA, which is already ongoing. The gas tax is a particularly juicy one: after all, who needs roads? Go read the piece if you want to know.

  And remember, September's skirmishes are only a prelude to 2012's showdown on defense and Medicare spending, with the added fun of an ongoing presidential campaign to make sure everyone's rhetorical muscles are in the finest possible fettle.

  Remember George Orwell's line from "1984"? Oceania has always been at war with Eastasia? Senate Minority Leader Mitch McConnell has already promised that there will never be a clean debt ceiling hike again; the new status quo is that everything that can be treated as an opportunity for extortion must be treated as an opportunity for extortion.

  It's the forever budget war.

• Andrew Leonard: Market Meltdown Deja Vu: Written before the end of Thursday's stock market crash (cites the drop as 271 points at 1 PM; the final drop was 512):

  And all of this is happening after a month in which Congress and the White House occupied themselves by hammering out a deficit reduction plan for which the best-case scenario is that, in the short-term, it will only slow U.S. economic growth down a little bit.

  The worst-case scenario? We're looking right at it. For very good reasons, the global investor community has concluded that the United States is either unwilling or powerless (or both) to take any aggressive steps to counteract a growing economic slump. Remember the fearsome bond vigilantes? Right now they are gibbering in fear in the basement, stocking up on bottled water. [ . . . ]

  But there's actually a big difference between now and three years ago. Three years ago, governments around the world took strong action to counteract financial panic and the slide toward a new Great Depression. We can and will debate the merits, design and implementation of those actions -- TARP and the Obama stimulus, the reliance on tax cuts at the expense of direct infrastructure spending, etc. -- but at the time, there was a majority consensus that government should attempt to do something.

  But now the game has changed. There will be no new fiscal stimulus. The European Union may be scrambling to figure out how to bail out its constituent members, but it is difficult to imagine the U.S. assisting in any major effort to stabilize markets, outside of another effort by the Fed to inject even more liquidity into the system. The critics who argued that the best solution to the crisis of 2008 was to let beleaguered financial institutions crash and burn may get their chance this time around. After the Budget Control Act of 2011, the U.S. government has essentially handcuffed itself to a chair.

  At day's end, Leonard followed up with: The Roots of Thursday's Market Meltdown:

  The failure of the U.S. political system to properly address a slowing economy is surely an important underlying factor propelling Thursday's sell-off. But let's not underestimate the extent to which Europe's ongoing sovereign debt crisis is responsible for the fear and panic spreading like wildfire throughout investor circles. Maybe it's just as simple as this: The resolution of the debt ceiling ridiculousness cleared space for the world to focus on what's going on in Europe. And now that we're paying attention, we really, really, don't like what we see. The parallels to the credit crunch of 2008 get stronger every day. Capitalism, having been denied the opportunity for utter self-immolation three years ago, is eating itself alive, again. [ . . . ]

  The same goes for Italy, the world's seventh largest economy. The big scary news this week is that "contagion" has spread from the little guy to the big. Bond investors are now questioning whether Italy and Spain can pay off their government debt. Rumors that Italy may be forced down the Greek path are flying through the markets. As a consequence, the yields that investors will accept for buying new Greek or Italian debt are rising sharply, which further raises government borrowing costs and makes Italy and Spain's fiscal situation that much more disastrous. To complicate matters even more, the biggest holders of government debt in Europe are big Europeans banks, who are watching their own balance sheets deteriorate by the day.

  The self-fulfilling and self-perpetuating aspects of this dynamic are obvious. Bond traders get nervous about government finances, and start pushing markets in directions that make government finances degrade further. And so on. When government leaders point this out, pledging their "sound economic fundamentals," their self-serving avowals just act as another message telling traders to sell!

• Alex Pareene: Pamela Geller and Robert Spencer Fundraise on Norway Attack:

  As a writer, it sure sucks when someone murders a bunch of people based on your ideas. (I mean, I assume that sucks. Weirdly, it's never happened to me.) So you can understand why right-wing anti-Islam bloggers are all being kind of defensive, these days.

  Anders Breivik, the anti-Islam terrorist who killed 77 people in Norway on July 22, read a lot of American anti-Islam bloggers, many of whom he cited in his lengthy manifesto. Breivik's favorites included Robert Spencer, a self-proclaimed expert on Islam whose "Jihad Watch" blog was quoted and cited in Breivik's manifesto, and Spencer's ally and collaborator Pam Geller, whose "Atlas Shrugs" was similarly recommended by the killer. [ . . . ]

  They are now actually fundraising on the fact that they helped inspire a massacre. Or more accurately, they're begging for money to protect them from the imaginary witch hunt that they claim the liberals will mount. (Is this part of the witch hunt? I am always confused about whether I'm witch-hunting or not, when I call people horrid hateful bigots.) Spencer also signed Geller's fundraising blog, and if you donate more than $500 to Atlas Shrugs, ThinkProgress reports, they will send you a signed copy of Geller's book, Stop the Islamization of America: A Practical Guide to the Resistance.

• Alex Pareene: The Baffling Paranoia of Rich Guys Who Resent Obama: Interview with Ken Langone, co-founder of Home Depot, former head of the New York Stock Exchange, and all-around rich guy:

  Ken Langone wants higher taxes on rich people. He wants the debt ceiling raised. And he wants his taxes raised. And he wants tax loopholes closed. And he wants government investment in education and job training. In other words, he is, in the current political environment, basically a liberal socialist Democrat? He is more or less aligned with Paul Krugman here. Obama wants all of these things, too!

  Except Langone has a big problem with the politician who shares all of his major economic policy goals: That politician is also mean to rich people. [ . . . ]

  OK, so . . . this is just pure cultural baggage with no relation to observable reality. Langone is upset that the president is not sufficiently "respectful" to John Boehner, he's outraged that the president appeared in shirt-sleeves in the Oval Office, and he's upset about a two-year-old reference to "fat cats." Langone wants his taxes raised and tax loopholes closed, but he's upset that the president briefly campaigned on . . . closing a private jet tax loophole.

  So, there is an extensive fact-check of the Reagan jacket thing, but it doesn't need a fact-checking, it needs psychoanalysis.

  Yes, Americans are all ideologically confused. Voters like liberal policies but vote for divided government. Thomas Friedman dreams of a technocratic center-left third party without realizing he's dreaming of the Democratic Party. But Langone crying about the president's lack of respect and then wishing for Chris Christie to run isn't just ideological confusion, it's the pathology of the ultra-wealthy under imaginary siege.

  Guys like Langone should be thankful there aren't mobs with pitchforks out there, but instead of recognizing that Obama's their best friend in the country, they're dreaming that there are mobs, and that this awful populist president is leading them. Imaginary president Black Huey Long haunts them. People like Jamie Dimon and Lloyd Blankfein, who should probably be in jail, are convinced the president who pissed away a significant chunk of his popularity by giving Wall Street all the money it needed to get back on its feet after crippling the world economy is a socialist bent on their destruction.

By the way, we saw Horrible Bosses yesterday. It has a slight warped universe effect, with job holders even more terrified of losing their jobs than in the present economy, but there have been many cases in US history where workers were as utterly owned by their bosses as the three protagonists here -- even if we skip over chattel slavery, although that's a pretty big one (and still seems to be much admired in parts of the country, as Michael Lind keeps pointing out). Some funny stuff; some ineptly stupid. My takeaway: we need more unions. Even if the sales exec and the floor manager weren't represented, the company's experience of having to deal with unions would curb such excesses and give workers options other than snuffing their bosses -- which in some ways would even proven to be win-win for the bosses, don't you think?

I'm also reminded of the evils of nepotism, and why I think estate taxes should approach confiscatory levels approaching the top. I had a similar experience long ago, when I worked in a printing company run successfully by a sensitive, thoughtful founder (like Donald Sutherland here), who wound up leaving the company to his idiot son (not nearly as vicious as Colin Farrell here, but nearly as self-centered and equally dim), who drove the business into the ground (a few years after I bailed out, so I don't know the gory details). Since then I've had plenty of opportunities to observe nepotism, especially in the Bush family, and it's pretty rare when it works out.

Of course, I wouldn't have such businesses confiscated by the government, either to be run or to be auctioned off. I'd like to see a system which transfers ownership to the employees who worked for and built up the business. You could give the business a moderate evaluation, give the employees stock with liens based on the evaluation (to be paid off when the stock was sold, or written off if the stock is sold at a loss), and let the business go on its merry way. And if the employees decide to keep the founder's son, well, maybe he's OK, or at least he'll be better behaved.