Henry Paulson

When a Democrat or leftist makes an ill-advised remark, it seems that there's a three-stage process at the Associated Press, and perhaps in most other establishment press outlets, for handling it. It goes roughly like this:

• Stage 1 - Ignore it as long as you can. If there isn't much outcry, keep ignoring it.
• Stage 2 - If there ends up being enough of an outcry from conservatives or Republicans to warrant coverage, make sure that the story is about the criticism at least as much as the remark.
• Stage 3 - In the ensuing coverage, leave out what was originally said.

The Associated Press is currently and grudgingly at Stage 2 with Harry Reid's remark that "but for me, we'd be in a worldwide depression," as seen below (reproduced in full for fair use and discussion purposes):

CNN's Fareed Zakaria on Sunday demonstrated just how ignorant most media members are of how the federal budget works.

During the most recent installment of "Fareed Zakaria GPS," the host actually said, "[T]he Bush tax cuts are the single largest part of the black hole that is the federal budget deficit."

Before we examine the staggering stupidity on display here, let's first look at exactly what Zakaria said (video embedded below the fold with transcript):

A rather shocking thing happened on Sunday's "Meet the Press": host David Gregory asked Alan Greenspan and Henry Paulson if it would be a mistake to let the Bush tax cuts expire.

Chatting with the former Federal Reserve Chairman and former Treasury Secretary, Gregory referenced Tuesday's Wall Street Journal article about what the impact of allowing these tax cuts to expire would be on the budget and the economy.

Gregory first asked Paulson and then Greenspan, "Is that a bad idea?" (video embedded below the fold with transcript, relevant section at 6:48):

If you needed an alarm to go off signaling President Obama's honeymoon with the press being over, you got it Thursday when former CBS "Evening News" anchor Dan Rather severely chastised the new administration for not doing enough to solve today's economic problems.

Writing for the Daily Beast, the man who once used a forged document in an attempt to bring down former President George W. Bush wondered why more people aren't outraged about how little has been done by Obama and Company to right what he believes is a sinking ship.

Caution -- you're about to enter a no kidding zone:

The Associated Press can't even get it right in a three-paragraph item about a White House ceremonial event.

In a story Monday afternoon about President Bush's meeting with two Nobel Prize-winning scientists and Nobel Economics winner Paul Krugman, the unbylined AP writer claimed that Krugman opposed the government's financial bailout. Evidence abounds that this is not only not the case, but that Krugman wants the bailouts to be bigger, and to involve more direct government ownership.

Here are the first and third paragraphs from the story (link probably will not work after about a week):

Three 2008 Nobel laureates from the United States lined up with President George W. Bush on Monday for an Oval Office photograph to mark their achievements.

..... The third laureate at the White House was Paul Krugman of New York, who won the Nobel Memorial Prize in Economic Sciences for his work on international trade patterns. Krugman, a frequent critic of the Bush administration who opposed the recent $700 billion financial bailout, is a Princeton University professor and New York Times columnist.

Since Krugman's supposed opposition may become folklore shortly, it's best to take a cruise through Krugman's blog posts to show that the claim is terribly outdated and currently flat-out wrong:

Are the good folks at the New York Times breaking ranks and actually criticizing a decision by president-elect Barack Obama?

Such seemed to be the case Tuesday when the Gray Lady published, on the front page of the business section no less, an article highly critical of proposed Treasury Secretary Timothy Geithner.

Entitled "Where Was Geithner in Turmoil?", Andrew Ross Sorkin's piece actually pointed fingers at Obama's choice to head the Treasury department for his potential involvement in the nation's current financial crisis (emphasis added throughout):

So what exactly is the government doing with your money? Fox Business Network's Alexis Glick would like to know.

Treasury Secretary Henry Paulson announced Nov. 12 he would be redirecting the $700 billion bailout to focus on propping up financial institutions instead of buying troubled mortgage assets, which was the original intent of the rescue plan.

Glick, the host of FBN's "Money for Breakfast," told the CBS's "The Early Show" Nov 13 that the Treasury Department's move away from the original plan to buy up troubled mortgages "does not make sense" and was "actually pretty outrageous":

[T]he markets responded to that yesterday ... Look, the original intent of this Troubled Asset Relief Program was to purchase troubled assets. And I think the marketplace started to adjust several weeks ago when we started to see the size and magnitude of the capital injections.

Gee, and I thought I might be pushing the envelope on September 28 when I expressed concern that the "bailout" with the made-up $700 billion price tag that turned into the pork-loaded "bailout" with the made-up $850 billion price tag "blackmail" (though "extortion" may be the more appropriate word).

It is clear that this is indeed the case, at least twice over. First, there were the threats made by the Treasury Secretary, the President, and the Fed Chairman warning of a banking Armageddon if Congress didn't pass the bill.

Now there's clear evidence, reported with stunning casualness by CNBC, that Paulson & Co. threatened the big banks in some way to force them to "accept" Uncle Sam's preferred equity investments:

As a result of the stock market collapse in the last four weeks, the economy has become the most important issue on the minds of voters.

Yet, as Barack Obama has clearly benefitted in the polls during this period, the media have refused to examine the records of the two presidential candidates as it pertains to policy proposals they have recommended or supported that might have averted this crisis.

Is this because John McCain has clearly been more out in front of this issue than Obama, and if the press actually did their job and told the American people this it might negatively impact the junior senator from Illinois's campaign?

Consider what McCain said during Tuesday's debate after being asked a question by Tom Brokaw concerning the condition of the economy (photo courtesy ABCNews.com):

UPDATED BELOW THE FOLD

Why is the mainstream media --which keeps lecturing Americans that Treasury Secretary Henry Paulson's Bailout Package Version 2.0 must be passed immediately-- ignoring what might be the most earth-shattering provisions in Paulson's package?

The media needs to start asking hard questions. Here is where they need to start. If you look at page 180 of the 451-page monster bailout bill that easily passed the Senate yesterday (PDF here), you will see that it includes at Section 116 language about the tax treatment of "industrial source carbon dioxide." It also provides, at Section 117, for a "carbon audit of the tax code."

What could a provision about the tax treatment of "industrial source carbon dioxide" and another provision about doing a "carbon audit" of the tax code possibly have to do with restoring confidence in Wall Street's troubled credit markets?

The answer: NOTHING.

This appears to be an attempt by global warming fanatics to lay the foundation for an economy-killing carbon tax just like the "cap-and-tax" system that is now destroying European industry.

Before Monday's House vote on the largest government bailout in American history, Speaker Nancy Pelosi (D-Cali.), in potentially one of the most poorly-timed displays of partisanship in recent memory, blamed President Bush and Republicans for the turmoil in the financial services industry (video embedded right).

Such ill-advised finger pointing seemed to surprise press members of all shapes and sizes as some prominent print media outlets including the Washington Post and the New York Times quickly published articles quoting Republicans who blamed the bill's failure on Pelosi's hyper-partisan speech.

On the television side, CNN aired Republican reaction to the Speaker's comments moments after the votes were counted (partial transcript and embedded video follow):

The Associated Press's Charles Babington, the journalist Keith Olbermann attacked in August for having the nerve to criticize Barack Obama's speech at the Democratic National Convention, wrote a McCain-bashing article Thursday evening that should get a standing ovation from the "Countdown" host.

The piece entitled "Dems, Some in GOP Question McCain's Intervention" probably evoked so much applause from the Obama campaign and Congressional Democrats Thursday night that they must have wondered if their operatives wrote it.

In fact, when you look at the first eight paragraphs of this article, you'll also likely think someone in either the Obama campaign or Howard Dean's office was responsible (emphasis added, photo courtesy AP):

So much for a "stunt."

John McCain got involved in the bailout negotiations after Treasury Secretary Henry Paulson told Sen. Lindsey Graham yesterday that the bailout plan would fail unless McCain came in and brought balky Republicans aboard.  That's what Bob Schieffer reported on this morning's Early Show.  Schieffer's account stands in stark contrast with the allegation by Dems like Barney Frank and their MSM cohorts that McCain's moves of yesterday were nothing more than a political "stunt."

Here was Schieffer speaking with the Early Show's Maggie Rodriguez at 7:05 AM EDT today:

BOB SCHIEFFER: I am told, Maggie, that the way McCain got involved in this in the first place, the Treasury Secretary was briefing Republicans in the House yesterday, the Republican conference, asked how many were ready to support the bailout plan. Only four of them held up their hands.  Paulson then called, according to my sources, Senator Lindsey Graham, who is very close to John McCain, and told him: you've got to get the people in the McCain campaign, you've got to convince John McCain to give these Republicans some political cover. If you don't do that, this whole bailout plan is going to fail. So that's how, McCain, apparently, became involved.

Continued Schieffer . . . 

"Good Morning America" economic reporter Bianna Golodryga narrated a segment on Tuesday's show that featured grainy black and white footage from the 1930s and two references to the Great Depression. The ABC journalist also featured clips from Democratic presidential contenders Barack Obama and Hillary Clinton to amplify the warnings of impending economic doom.

While discussing the collapse of investment bank Bear Stearns, grainy footage of panicked '30s bankers appeared onscreen as Golodryga intoned, "The problems are so massive that the Fed is taking measures not seen since the Great Depression..." And while President Bush was briefly highlighted, assuring Americans that the United States will rebound, Paul McCulley, the managing director of the investment company Pimco, continued the comparison to the worst economic crisis the United States ever faced. Referencing impending action by the Federal Reserve, he asserted, "...You could have the Fed with great intentions but still a downward spiral in property prices that would give you a modern day depression." For comparison's sake, during the Great Depression, almost 25 percent of Americans were unemployed.

For more than a week, NewsBusters has been pointing out that media seem to be adopting the 1992 Bill Clinton playbook of presenting the economy as being in much worse shape than it really is.

On Sunday, former Clinton administration adviser George Stephanopoulos took this doom and gloom posture by repeatedly depicting the nation as already being in a recession.

In fact, he began the most recent installment of ABC's "This Week":

Class warfare seeped into the January 18 edition of "Today." Upon interviewing Treasury Secretary Henry Paulson on the Bush administration’s proposed economic stimulus package and rebates, Matt Lauer pitched the liberal "tax cuts for the rich" line inquiring "you're not going to give rebates to the rich here, correct?"Secretary Paulson declined to answer the question saying he does not "want to get ahead of the president."

Just as he did yesterday, Matt Lauer asked again if the media’s gloomy economic news is a "self fulfilling prophecy."

"Do you ever worry that the media, we get the ‘r’ word on our lips, recession and we chant it and that eventually it becomes a self-fulfilling prophecy, the consumers of TV and the media hear it and they are also consumers of the economy and they spend themselves into a recession or don't spend themselves?"