The main reason the $700 billion bailout bill failed in the House is that the Republican leaders, who were working with the Democratic leaders to pass the bill, could not count. They did not round up enough of their comrades for the bill; one hundred and thirty-three House GOPers said nyet to what some of them considered to be socialism. But the bill also failed because 95 House Dems would not go along with Hank Paulson's Billions-for-Bad-Paper plan, when alternative approaches were worth considering. (I refer to some of those options here.) And a leader of a subset of these Democrats--dubbed the Skeptics Caucus--has been Representative Brad Sherman.

Sherman attracted several dozen members to a series of meetings and briefings this past weekend, as the bill was being negotiated by others. As he left Congress after the vote on Monday, he told me that the most effective argument he made was that the bailout bill was darn weak when it came to recouping the taxpayers' $700 billion. He cited a memo he circulated among colleagues that pointed out that taxpayers were not likely to see that money--either in profits from a future selloff of the bad assets the Treasury would buy from Big Finance Firms or in a revenue bill (meaning some sort of tax on the finance industry). In other words, he challenged Paulson and his own party leaders on a fundamental of the bill: this is not a handout, but a timely investment.

What's going to happen now? The safe bet is that the D and R leaders in the House will tweak the bill or offer enough inducements to individual members (a bridge, anyone?) to win over 13 members to insure passage of the legislation. That is, there won't be a wholesale revision of the basics. So the revenue issue may remain hot. And Sherman expects to come back to Washington later this week to keep the battle going. Here's the memo he disseminated:

TAXPAYERS HIGHLY UNLIKELY TO RECOUP ANY OF THE COSTS -- Brad Sherman 9/29/08

We know that the Bailout Bill allows million-dollar-a-month salaries to executives of bailed-out firms, and it allows hundreds of billions to be used to buy toxic assets currently held by foreign investors. But we are told: "don't worry, this $700 billion bill won't cost us anything. We will get it all back next decade through a revenue bill."

I. Section 134 of the Bailout Bill merely says that the President must submit a revenue bill to Congress in 2013 that recoups from the financial industry the taxpayers' net losses.

a. If the President has any revenue ideas he actually likes, he would submit them to us anyway.
b. If the President submits revenue ideas only because he is forced to by Section 134, he will send it to us with a note saying that he believes they are bad for the country, and reserves the right to veto.
c. The Bailout Bill does not automatically enact any revenue increases, nor protect a revenue bill from filibuster or veto.

II. Congress is unlikely to pass a tax increase bill of hundreds of billions of dollars in 2013.

a. Tax increase bills are anathema to many.
b. 41 Senators can block the plan. We're giving Wall Street enough money to hire 4100 lobbyists.
c. In recent years, Wall Street has easily defeated every attempt to close every loophole that they exploit, no matter how pernicious-even the abusive use of Cayman Island tax havens by hedge fund managers, who thereby pay zero tax.

III. Any tax on the financial industry would make the good banks pay a huge tax so we can recoup what we gave to the bad banks.

a. Section 134 says the tax will be on "the financial industry." It does not provide for a tax on just those firms that received bailout payments.
b. A bank that doesn't get a bailout payment still pays the tax.
c. Community banks and perhaps credit unions will also be subject to the tax, so we can recoup what we gave to Wall Street.

IV. It is impossible to draft a tax that hits only those firms that received bailout payments, and even more impossible to draft one that taxes each bank in proportion to how much money we lost on its toxic assets.

a. There are no provisions to even keep track of losses on each asset purchased as it is managed over the years. Assets purchased from several
banks will be pooled, managed, and sold together, and we can never know how much we lost on assets purchased from any one bank.
b. If three banks in the year 2013 have the same income and size and operations, they will all pay the same tax-even if one got no bailout payments, a second got a million dollars, and a third got a billion dollars.
c. Many bailed-out firms won't exist in 2013.

1. Some will go under.
2. Some bailed-out firms are only shell companies. Example: Assume the Bank of Shanghai has $30 billion in toxic assets. It will sell these to the tiny subsidiary it has incorporated in California. The subsidiary will then sell these to the Treasury in 2009, and will be dissolved long before 2013.
3. Many bailed-out firms will still be unprofitable in 2013.
4. Some bailed-out firms will move offshore before 2013.

d. The whole purpose of the bill is to improve the balance sheets of the bailed-out firms. If particular bailed-out firms owe us the money they receive, they would have to list this as a liability, and the bill would fail to improve their balance sheets.

In 2013 we will not pass a tax bill that imposes hundreds of billions of dollars of taxes on the financial services industry, including those banks that got no bailouts, community banks, and credit unions. A tax bill imposed only on those entities that got bailout payments is impossible to draft, and contrary to the purposes of the Bill.

If it were easy to pass a bill to recoup hundreds of billions of dollars through taxes to be imposed in 2013 and thereafter, then provisions imposing such taxes would be in today's bill.

Wall Street gets their money now, and we get it back never.

The below item was posted shortly before the House voted against the $700 billion Big Finance bailout 228 to 225. Ninety-five Democrats joined 133 Republicans to bring down the bill. And Representative Brad Sherman was one of those Democrats.....

For my money, the $700 billion bailout plan is being rushed through Congress with too much haste. There's been little debate of the plan's basics and not much consideration of alternative approaches to the administration's preferred choice: buying up the bad paper of Big Finance firms that screwed up royally. Yet few in Washington--including John McCain and Barack Obama--want to go out on a limb. Any politician who stands up to Wall Street and opposes this thing has to fear being blamed should the plan not go through and the financial meltdown worsen. In politics, there's safety in numbers. So if everyone jumps aboard and this plan doesn't work out, nobody stands to lose politically. It's the safe political play: get on the train with everyone else.

But there are some legislators who are saying, slow down. House Republicans tried to put on the brakes last week. But their alternative--cut taxes--was a non sequitur. On the Democratic side, Representative Brad Sherman has pulled together a Skeptics Caucus. He drew 30 or so House Democrats to meetings on the weekend. Not enough to block the Paulson Express. But not an insignificant number. And Sherman released a memo detailing his objections to the bailout.

Since there's not much media coverage of the Slow-Down crowd, allow me--as a public service--to post the full document right here, The taxpayers need more, not less, of a debate, before allowing the Bush Administration to start a $700 billion spree.

From Rep. Sherman:

A review of the first Obama-McCain debate, originally posted at Mother Jones....

No memorable exchanges. No historic zingers. No gotchas. The much-anticipated first face-off between Barack Obama and John McCain resolved little. Neither candidate strayed from their usual briefing books. The talking points were recycled. McCain blasted Obama for being a rookie in the ways of national security. Obama questioned McCain's judgment, notably his initial support for the Iraq war.

They both played it safe. Especially when it came to the hot topic of the night: the $700 billion bailout plan for Wall Street. It was no surprise that moderator Jim Lehrer would lead off with the issue, even though the focus of this debate was supposed to be foreign policy. And in his first question, Lehrer asked each candidate to state where he stands on the "financial recovery plan." Neither would get specific. Obama cited the need to move "swiftly" and "wisely." He called for effective oversight of the plan, taxpayer protections, and guarantees the money spent would not reach the pockets of CEOs. He pointed to the current meltdown as evidence of the failure of economic policies supported these past eight years by George W. Bush and McCain. It was standard fare.

McCain noted he was heartened by the bipartisan negotiations under way in Washington. He, too, cited the need for accountability. He mentioned the possibility of adding a provision to the package that would allow the federal government to offer loans to troubled institutions rather than buy their bad paper. Neither one, though, fully endorsed the plan--or raised any objections. Asked if he would vote for it, McCain said, "I hope so." It was a strong signal he would not be mounting any from-the-right populist crusade against the proposal.

But each candidate exploited the bailout queries. Obama tried to tie McCain to Bushonomics. McCain hailed his own efforts to curtail pork-barrel spending on Capitol Hill. Obama slapped him for focusing on $18 billion in earmarks while supporting $300 billion in tax breaks for corporations and wealthy individuals. McCain accused Obama of being a tax-hiker. Obama countered--correctly--that his tax plan provides far more relief for taxpayers making less than $250,000 a year than does McCain's proposal.

It was as if they were eager to talk about any economic issue other than the details of a gargantuan bailout that may or may not work and that may or may not be popular come Election Day.

On foreign policy, the candidates dished out the expected lines. McCain touted the surge in Iraq and slammed Obama for having ever doubted the wisdom of the wonderful General David Petraeus. Asked for the lesson of Iraq, McCain said, rather inelegantly, "You cannot have a failed strategy that will then cause you to nearly lose a conflict." Obama assailed McCain for supporting Bush's grand distraction and having failed to recognize that the job in Afghanistan ought to have been finished first. He connected the ongoing Iraq war bill--$10 billion a month--to the nation's current economic woes.

On Iran, McCain derided Obama for wanting to hold talks with President Ahmadinejad (whose name he mispronounced a few times before getting it right), claiming such a move would practically send a signal that the United States approves of a second Holocaust. Obama defended his policy of engagement, noting that there were other Iranians to speak to besides Ahmadinejad and that the Bush administration has recently broadened its diplomatic approach when it comes to the ol' Axis of Evil. McCain claimed Obama had been indecisive at first in reacting to the conflict in Georgia. Obama echoed McCain's tough stance against Russia, but cautioned that the United States could not revive a Cold War approach because it still has to deal with Russia on the pressing matter of loose nukes.

In talking policy, both men came across as knowledgeable. McCain truly perked up when he got the chance to discuss the strategic importance (as he sees it) of the Caucasus region. Obama demonstrated confidence in his ability to challenge McCain on the strategic importance of the Iraq war. But, indubitably, many viewers of the debate would score these exchanges in accordance with their preexisting opinions of the two candidates. As for those knotty undecideds, there was no specific assertion that an analyst could point to and say, "This is going to stir them."

Once the debate ended, the television commentators immediately tried to assess the impression each conveyed. McCain did come across as somewhat condescending. He barely looked at Obama and almost seemed annoyed to have to be talking foreign policy with that other guy. He tried to put Obama down by charging that Obama did not know the difference between a tactic and a strategy. He slapped him for not supporting funding for the troops. (Obama voted against an Iraq war funding bill that did not have a timetable for withdrawal--just as McCain voted against a funding bill that did.) And McCain sent one straight shot at Obama, saying, "I don't believe that Senator Obama has the knowledge or the experience" to be commander in chief.

That was no knockout punch. And Obama kept his now-famous cool. He did not swing too hard at McCain. Several times during the debate, Obama said that McCain was "absolutely right" about the point under discussion. Obama did question McCain's temperament, noting that McCain had threatened extinction for North Korea and had once jokingly sung a song about bombing Iran. But McCain, in response, pointed to his opposition to Ronald Reagan's deployment of Marines in Lebanon as proof he can be trusted to make prudent decisions about war. (That is, he's no warmonger.) McCain noted he wears a bracelet honoring a U.S. soldier killed in Iraq as a reminder of his pledge to that soldier's mother to do all he can to insure her son's death was not for naught. Obama replied that he, too, wears a bracelet--given to him by the mother of another fallen soldier who asked him to make sure no other parent loses a son in vain. He was calm; McCain was pugnacious. How that plays is hard to assess. It's truly a matter of taste.

There was much buildup for this debate. For weeks, members of the politerati looked forward to it as a defining moment in the campaign. The big question: would Obama be able to display commander-in-chief cred? Then McCain's shenanigans--pulling out, jumping back in--added to the drama. The big question: would he be prepared? And would Obama be able to take advantage of the last-minute shift to economic matters? But the debate ended up a straightforward affair, with no twists, no turns. Commentators could score it any way they wanted. Obama held his own on national security affairs, so give him the nod. McCain did the same on economic matters, so maybe he won over the 27 American voters who have yet to decide. You can look at it this way: given that Obama has been ahead in the recent polls, McCain lost by failing to beat him to a bloody pulp. Or this way: McCain survived what many analysts considered to be a bad week for him.

In any event, it's on to the next main attraction: the Biden-Palin duel on Thursday. Then there will be two more Obama-McCain debates. But who knows what other crises will hit between now and November 4 that will force the candidates to react to the real world? In fact, this past week demonstrates that the candidates' responses to events beyond their control may be more important in determining the outcome of this election than the debates. Fancy that: reality trumping political theater. It happened this past week. And in the next six weeks, it could do so again.

Once McCain said game on, I posted this item:

We must meet as Americans, not as Democrats or Republicans, and we must meet until this crisis is resolved," John McCain said on Wednesday, explaining his decision to suspend his campaign and not participate in the first presidential debate. A McCain aide told Reuters, "If the package is reached and the country is saved, there will be a debate. But if there's no deal, how can you get on a plane...for a debate?"

On Friday morning, McCain's campaign released this statement:

"He is optimistic that there has been significant progress toward a bipartisan agreement now that there is a framework for all parties to be represented in negotiations, including Representative Blunt as a designated negotiator for House Republicans. The McCain campaign is resuming all activities and the Senator will travel to the debate this afternoon."

Note the adjustment in standards. First, the McCain camp said deal or no debate. Two days later, the position was, negotiations are under way so let's debate. Was this change an act of decisive leadership or a necessary political flip-flop? Maybe Jim Lehrer, the moderator of Friday night's debate, can ask him that."

What's kinda amazing--okay, it's not really amazing--is that the McCain camp thinks it can get away with this. Or with
this. Or with its falsehood-ridden attack ads. Or with McCain's new Osama-like stance toward holding press conferences. Or with its claims that Sarah Palin is ready-to-go on Day One. The John McCain of 2000 used to deride the usual BS of politics: spin, stunts, and sleaze. Now he bathes in it. There seems no bottom yet to his descent into situational politics. Forget the debates, I want to see him back on The View defending himself and the campaign he heads.

Driving to work (late) this morning, I was listening to The Diane Rehm Show on NPR (plug: I'll be on Friday morning), and I heard a comment that almost caused me to strike a pothole. The topic of the day was the financial crisis and the under-construction bailout, and Simon Johnson, a senior fellow at the Peterson Institute for International Economics and former IMF economic counselor, commenting on the $700 billion package being thrown together on Capitol Hill, said, We're more in the realm of "chaos theory than economic theory."

Wow. And whoa. This rush to save Wall Street's backside is not only unseemly but perhaps perilous. Yesterday, Peter Orszag, the director of the Congressional Budget Office, testifed that the bailout could worsen the ongoing economic crisis. And even if the Democrats succeed in crafting a package that includes necessary provisions regarding accountability and transparency, CEO compensation, bankruptcy reform, and mortgage protection for homeowners, there are still plenty of questions about the overall approach of this bailout: the feds using taxpayer dollars to buy lousy assets from poorly-run companies to keep these poorly-run companies afloat. There are alternatives. The federal government could lend money to needy financial institutions instead of buying their crappy assets. Or it could buy better assets and pump money into the financial system that way. My Bloggingheads.tv sparring partner Jim Pinkerton advocates restructuring the entire financial sector to make sure none of its major players get too big to fail. Economist James Galbraith (a regular Mother Jones contributor) proposes pouring half a trillion dollars into the Federal Deposit Insurance Corporation (to preserve depositors' confidence in banks and prevent a run), putting $200 billion in reserve so the Treasury, if necessary, can buy preferred stock in banks to recapitalize these institutions, and waiting to see what happens. That is, let the folks who screwed up do what they can with their bad paper. Galbraith notes that serious economic problems will remain, but the threat of systemic collapse would be abated.

The point is that the Paulson path is not the only one. In fact, it may be the wrong one. Certainly, a few days--or a week or two--of debate and discussion before committing $700 billion would not be unwarranted. "We need more than three days to sort this out," Simon Johnson said. And he's right. The Democrats in Congress ought not be force to quick, decisive and misguided action by the we-must-act-today pronouncements from George W. Bush and others in his administration. On Thursday, John McCain said "time is short" and that a deal must be completed before the financial markets open on Monday. Barack Obama should reply: not if it's a bad deal.

Obama certainly wants to--and needs to--come across responsibly. (Who wants to be blamed for the crash of an entire sector?) But this train is probably moving too fast for the public. Slowing it down to get the response right could be a twofer: good policy and good politics.

There's no crying in baseball. And there's no time-outs in presidential campaigns. Yet John McCain is asking for that. On Tuesday afternoon, he called for putting off the first scheduled presidential debate this Friday so he can suspend campaigning, head to Washington, and work on the financial bailout package.

This is a guy who's missed a ton of votes in the Senate throughout his presidential campaign and who just days ago called for shoving the current mess on to the lap of a commission. Actually, given that the world doesn't stop for crises--and that sometimes there's more than two or three items on a president's radar screen--this week would be a pretty good test for a candidate. He has to prep for a debate and participate in bailout deliberations.

In a brief--very brief--statement, McCain said the nation must "set politics aside." He invoked 9/11 and the coming together that occurred following that attack. "We must show that kind of patriotism now," he declared. But why is postponing the debate patriotic? And how long should the delay be? If Congress is going to get this package right, it could take weeks. Is McCain suggesting no debates transpire for that period of time?

And how about this for an idea? If McCain is too busy to show up on Friday night, perhaps he could send Sarah Palin. And Obama could dispatch Joe Biden. That would at least be a true test of their ability to fill in.

By the way, after McCain made his announcement, the Obama campaign sent out this note:

At 8:30 this morning, Senator Obama called Senator McCain to ask him if he would join in issuing a joint statement outlining their shared principles and conditions for the Treasury proposal and urging Congress and the White House to act in a bipartisan manner to pass such a proposal. At 2:30 this afternoon, Senator McCain returned Senator Obama's call and agreed to join him in issuing such a statement. The two campaigns are currently working together on the details.

That's a mature way to handle this situation. In a subsequent appearance before reporters, Obama said that when he and McCain talked at 2:30 on Wednesday afternoon, McCain told him he was considering whether they ought to delay the debate. Obama informed the reporters that he thought McCain was "mulling" it over. But after the call, McCain, without any further discussion with Obama, went public with his proposed time-out. How patriotic.

"I think we should continue to have the debate," Obama said. "....We've both got big planes...They can get us from Washington to Mississippi pretty quickly."

In reaction to the financial crisis, here's what the Democrats who control Congress ought to do:

1. Work vigorously on the bailout proposal submitted by Treasury Secretary Hank Paulson but add the populist provisions that Robert Reich and others are suggesting.

2. Point fingers.

Assigning blame ought to be a key component of the Democratic response to the current meltdown. And that ought not be hard to do. House Speaker Nancy Pelosi and Senator Harry Reid could set up a joint select committee to investigate the causes of the financial crisis. This committee then could start holding hearings immediately and haul before it the heads of the companies that have screwed up and imperiled the economy. This will not be a short list. Call in top officials from Lehman Brothers, Merrill Lynch, AIG, Bear Stearns, Countrywide Financial, Fannie Mae, Freddie Mac. Demand explanations from them. Explore how much money they pocketed personally while overseeing their institutions.

That's just a start. The committee should bring in experts who can explain (clearly!) how these players and others abused credit default swaps, subprime loans, mortgage-backed securities, and other hanky-panky financial products.

And there's more: the political side. Invite (or subpoena) lobbyists to appear and reveal what they did to win favorable treatment (that is, less regulation) for their Big Finance clients. Phil Gramm, the former Senate banking committee chairman, should be asked to explain what he was thinking when he used a sly legislative maneuver in late 2000 to win approval of a bill that kept swaps from being regulated. And he ought to be asked what role financial industry lobbyists played in drafting that bill. Ditto for the 1999 legislation that tore down the firewall between commercial and investment banks.

Sure, this won't be easy. Members of Congress--Democratic and Republican--are complicit; many of them went along with the rush to deregulate. They will be reluctant to scrutinize their own actions and those of lobbyists who have donates to their campaigns. But self-examination is not too large a price to pay for putting $700 billion of taxpayer money on the line. Actually, anything less would be rather irresponsible.

From a market perspective, it would be quite useful to (a) learn who messed up and how they did so (so others can avoid similar mistakes) and (b) shame those who did (so they are driven out of the market and others fear similar sanction). If markets work, they should operate better with more accountability and transparency. The bottom line: blame is good.

Crisis sometimes brings out the worst in Washington. There's a rush to judgment and solution. And the parties already with much say in Washington end up with much say in what happens--even if they were partly to blame for the crisis. So it's no surprise that now the Big Bailout Bill is rolling like a rockslide in Washington. How many legislators--either Ds or Rs--are going to throw themselves in front of it and ask the right questions and, if need be, stop a bailout that may not be a good deal for taxpayers?

One of the best set of proposals for making this bailout work for Main Street and Wall Street comes from former Labor Secretary Robert Reich. On his own blog, he writes (and it's worth quoting at length):

Treasury Secretary Hank Paulson, presumably representing the Bush administration but indirectly representing Wall Street, and Fed Chief Ben Bernanke, want a blank check from Congress for $700 billion or possibly a trillion dollars or more to take bad debt off Wall Street's balance sheets. Never before in the history of American capitalism has so much been asked of so many for (at least in the first instance) so few.

Put yourself in the shoes of a member of Congress, including our two presidential candidates. The Treasury Secretary and Fed Chair have told you this is necessary to save the economy. If you don't agree, you risk a meltdown of the entire global financial system. Your own constituents' savings could go down with it. An election is six weeks away. Besides, in the last two days of trading, since rumors spread that the Treasury and the Fed were planning something of this sort, stock prices revived.

Now - quick -- what do you do? You have no choice but to say yes.

But you might also set some conditions on Wall Street.

The public doesn't like a blank check. They think this whole bailout idea is nuts. They see fat cats on Wall Street who have raked in zillions for years, now extorting in effect $2,000 to $5,000 from every American family to make up for their own nonfeasance, malfeasance, greed, and just plain stupidity. Wall Street's request for a blank check comes at the same time most of the public is worried about their jobs and declining wages, and having enough money to pay for gas and food and health insurance, meet their car payments and mortgage payments, and save for their retirement and childrens' college education. And so the public is asking: Why should Wall Street get bailed out by me when I'm getting screwed?

So if you are a member of Congress, you just might be in a position to demand from Wall Street certain conditions in return for the blank check.

My five nominees:

1. The government (i.e., taxpayers) gets an equity stake in every Wall Street financial company proportional to the amount of bad debt that company shoves onto the public. So when and if Wall Street shares rise, taxpayers are rewarded for accepting so much risk.

2. Wall Street executives and directors of Wall Street firms relinquish their current stock options and this year's other forms of compensation, and agree to future compensation linked to a rolling five-year average of firm profitability. Why should taxpayers feather their already amply-feathered nests?

3. All Wall Street executives immediately cease making campaign contributions to any candidate for public office in this election cycle or next, all Wall Street PACs be closed, and Wall Street lobbyists curtail their activities unless specifically asked for information by policymakers. Why should taxpayers finance Wall Street's outsized political power - especially when that power is being exercised to get favorable terms from taxpayers?

4. Wall Street firms agree to comply with new regulations over disclosure, capital requirements, conflicts of interest, and market manipulation. The regulations will emerge in ninety days from a bi-partisan working group, to be convened immediately. After all, inadequate regulation and lack of oversight got us into this mess.

5. Wall Street agrees to give bankruptcy judges the authority to modify the terms of primary mortgages, so homeowners have a fighting chance to keep their homes. Why should distressed homeowners lose their homes when Wall Streeters receive taxpayer money that helps them keep their fancy ones?

Wall Streeters may not like these conditions. Well, you should tell them that the public doesn't like the idea of bailing out Wall Street. So if Wall Street doesn't accept these conditions, it doesn't get the blank check.

I hope that Reich gets all over the cable networks in the next few days, providing a counterforce to the conventional, let's-get-this-done-now approach of many players in Washington. For a deal this big, there needs to be a big and transparent debate. Members of Congress want to adjourn this week and head home to hit the campaign trail. Sorry, there's some taking care of business that needs doing first. Speed is not the top priority. Getting it right is.

If the "fundamentals" of this economy are strong, why then is President Bush proposing a $500 billion bailout of financial firms?

Even though John McCain cannot answer that question, he still bangs his fist and decries Wall Street greed-meisters and Washington influence peddlers (the same sort of people who are working for his campaign). And, as I wrote elsewhere, he may be out-populisting Barack Obama.

The economic crisis under way surely is scaring voters and pissing off many of them. How dare these Wall Streeters and their lobbyist pals game the system and put our economy in peril? How many of them will be losing their second homes (with heated pools)? At this stage, McCain is expressing some of that anger, though he goes back and forth on the substance. (First, don't take over AIG; then, hooray for the take-over of AIG.) Obama has reacted more coolly. And he better watch out. Many voters freaked out by the economic meltdown do not want only calmly-delivered policy proposals. They want to see someone voice their own worries and feelings--as in outrage. In fact, I would bet that many of those still-undecided voters care more about how a candidate reacts than what a candidate proposes.

Democrats usually have the edge over Republicans when it comes to voters' perceptions of who would best deal with economic matters. But in a crisis, many voters are going to look for leadership, not policy details. So McCain may not have to answer the above question. He just has to stop making stupid comments and come on strong, decisive and mad. And Obama should ponder how to prevent himself from winding up on the wrong end of an anger gap.

After all, Americans have a right to be livid with the screw-ups of Big Finance, the deregulators of Washington, and the game-riggers of K Street. And they are entitled to a president who feels not only their pain, but their anger.

What's that old saying? To know where someone's going, take a look at where he's been? In recent days, John McCain, responding to economic meltdown under way, has at campaign rallies declared that he will knock heads together and go after the greed-mongers of Wall Street and their enablers in Washington. On Wednesday, he issued this statement:

We should never again allow the United States to be in this position. We need strong and effective regulation, a return to job-creating growth and a restoration of ethics and the social contract between businesses and America.

Note his reference to regulation. Now let's rewind to a speech McCain delivered in April 2007 to the Economic Club of Memphis:

When I came to Congress, Democrats were in the majority and they used government to make our choices for us. They took from us an ever greater share of our freedom and property to do the things American families and communities are better able to do for ourselves. They grew government for the sake of their own power, and used the American economy, the wonder of the world, to serve their ends not ours. They taxed it, regulated it, and injured it for the sake of partisan and parochial interests rather than liberate it, incentivize it and put it to work for all Americans.

So 17 months ago, McCain had this sophisticated position:

Regulation is bad.

Now that McCain needs to show he's not out of touch with the economy, he is calling for strong regulation. Which McCain should voters believe?

As regular readers can tell from the past few days, I've been fixated on a point: as mega-finance firms fail, it's absurd for McCain to beat on Wall Street when his campaign is chockfull of corporate lobbyists (past and present) who have been paid lots of money to rig the system for Big Finance firms. And that includes UBS executive and McCain adviser Phil Gramm, who, as chairman of the Senate Banking Committee, pulled a backroom legislative stunt in 2000 to make sure that credit default swaps--a certain financial instrument that helped pave the way to the subprime meltdown--would remain completely unregulated.

The nice thing about having an obsession and being head of a Washington bureau is that you can assign reporters to stories. So I asked Jonathan Stein and Nick Baumann, two colleagues of mine at Mother Jones, to go through a list of 177 lobbyists working for the McCain campaign and find those who have been influence-peddlers for financial firms. They did and discovered that over 80 of these lobbyists have been game-riggers for financial corporations. Consequently, we had a story to post:

In the past few days, as the economic crisis has deepened, Senator John McCain has been decrying the excesses of Wall Street. At a campaign rally in Tampa on Tuesday, he vowed that he and Alaska Governor Sarah Palin, if elected, "are going to put an end to the reckless conduct, corruption, and unbridled greed that have caused a crisis on Wall Street." He noted that the "foundation of our economy...has been put at risk by the greed and mismanagement of Wall Street and Washington."

He blasted CEOs who "seem to escape the consequences." He denounced Wall Streeters who "dreamed up investment schemes that they themselves don't even understand" and who used "derivatives, credit default swaps, and mortgage-backed securities" to try "to make their own rules." He excoriated Fannie Mae and Freddie Mac for gaming the system. And he slammed financial industry lobbyists for misguiding members of Congress. "I can promise you the days of dealing and special favors will soon be over in Washington." On Wednesday morning, after the federal government committed $85 billion to prevent the collapse of the American International Group (AIG) insurance conglomerate, McCain again assailed irresponsible corporate executives. "We need to change the way Washington and Wall Street does business," he proclaimed.

McCain has been quick with fiery, populist-tinged speeches. But one thing has been missing: any acknowledgment that McCain's own campaign has been loaded with the type of people he's been denouncing. As Mother Jones previously reported, former Senator Phil Gramm, McCain's onetime campaign chairman, used a backroom maneuver in late 2000 to slip into law a bill that kept credit default swaps unregulated. These financial instruments greased the way to the subprime meltdown that has led to today's economic crisis. Several of McCain's most senior campaign aides have lobbied for Fannie Mae and Freddie Mac. And the Democratic National Committee, using publicly available records, has identified 177 lobbyists working for the McCain campaign as either aides, policy advisers, or fundraisers.

Of those 177 lobbyists, according to a Mother Jones review of Senate and House records, at least 83 have in recent years lobbied for the financial industry McCain now attacks. These are high-paid influence-peddlers who have been working the corridors of the nation's capital to win favors and special treatment for investment banks, securities firms, hedge funds, accounting outfits, and insurance companies. Their clients have included AIG, the newest symbol of corporate excess; Lehman Brothers, which filed for bankruptcy on Monday sending the stock market into a tailspin; Merrill Lynch, which was bought out by Bank of America this week; and Washington Mutual, the banking giant that could be the next to fall. Among these 83 lobbyists are McCain's chief political adviser, Charlie Black (JP Morgan, Washington Mutual Bank,, Freddie Mac, Mortgage Bankers Association of America); McCain's national finance co-chairman, Wayne Berman (AIG, Blackstone, Credit Suisse, Fannie Mae, Freddie Mac); the campaign's congressional liaison, John Green (Carlyle Group, Citigroup, Icahn Associates, Fannie Mae); McCain's veep vetter, Arthur Culvahouse (Fannie Mae); and McCain's transition planning chief, William Timmons Sr. (Citigroup, Freddie Mac, Vanguard Group).

When cable news shows air footage of McCain railing against greedy execs and the lobbyists who rig the rules for the benefit of Wall Street dealmakers, there ought to be a crawl beneath him listing these lobbyists. (Talk about a fair and balanced presentation.) Short of that, here's the list of the McCain aides and bundlers who have worked for the high-finance greed-mongers McCain has pledged to take on. So far, it seems, none of them have been cast out of the campaign. If McCain were serious about his outrage, he might throw these money-changers out of his own temple.

To see that list, click here.

It is almost literally unbelievable.

John McCain, responding to the current economic troubles, says that "Wall Street has betrayed us." He calls the current mess the "result of excess and greed and corruption." He adds,

We've got to make sure that people like Fannie and Freddie, organizations such as Fannie and Freddie, never have the influence again that they had in Washington. You saw it, Joe. The old boy network -- Republicans, Democrats, they had influence with everybody. So therefore, we didn't act to have the sufficient oversight while these organizations grew and grew and became the corrupt institutions that they are today."

Old boy network? Influence? Can't McCain smell the stench of old-boy influence-peddling every time he enters his campaign headquarters? As I noted yesterday, several of McCain's top campaign aides lobbied for Fannie and Freddie. His campaign overall has at least 177 lobbyists working for his campaign. These are people who get paid large amounts of money to win special treatment for corporate interests, public interest be damned.

Then there's Phil Gramm, the onetime chairman of McCain's campaign. As I explained elsewhere, when Gramm chaired the Senate banking committee in 2000, he slipped into a massive must-pass spending bill a piece of legislation totally deregulating the the market for credit default swaps, a little-understood financial instrument. The swaps market then exploded, and the rampant use of unregulated swaps--which function kind of like insurance policies for big financial institutions--helped grease the way for the subprime meltdown.

So whose greed and excess is McCain now decrying? It is the greed and excess of some of the people who have helped run his campaign. His denunciation of influence peddlers, asleep-at-the-switch regulators, and me-first CEOs is absurd, given his own ties to these folks. His most prominent economic policy surrogate is Carly Fiorina, who pocketed $42 million in severance pay and other goodies when she was forced out as CEO of Hewlett-Packard. The question is, how long can McCain get away with this?

Obama has a slight but narrowing edge in the polls when voters are asked who's best able to handle the economy. It's certainly obvious that voters don't review the details of each presidential candidate's economic policy before deciding whom they want in the driver's seat when the economy heads into a ditch. Many voters pick a favorite based on impressions. Right now, McCain is sounding a more populist tone than Obama, whose strategy seems to be to portray McCain as too tied to George W. Bush and too out of touch to be trusted with this hurting economy. So even with McCain stumbling (by declaring the "fundamentals" are strong), McCain looks more like the fighter, the guy who's ready to knock heads together--the heads of the greedy SOBs responsible for this mess--and get things going again with a healthy dose of reform. It's phony populism. It's like the head of a Mafia family decrying a crime wave caused by his own lieutenants. But that doesn't mean it cannot work politically.

In politics, being right doesn't always count. You have to show you can fight. McCain is ignoring reality to position himself as a populist reformer. Obama better burst that bubble.

In response to the news of the latest Wall Street meltdown, John McCain put out a statement that in part said:

Major reform must be made in Washington and on Wall Street. We cannot tolerate a system that handicaps our markets and our banks and places at risk the savings of hardworking Americans and investors. The McCain-Palin Administration will replace the outdated and ineffective patchwork quilt of regulatory oversight in Washington and bring transparency and accountability to Wall Street. We will rebuild confidence in our markets and restore our leadership in the financial world."

Perhaps he could start at McCain Campaign HQ. At least four of McCain's senior campaign aides--including Charlie Black, Rick Davis, and Wayne Berman have lobbied for Freddie Mac and Fannie Mae. And at least 20 of McCain's fundraisers have also lobbied for Freddie and Fannie. These folks were gaming the system for these now-discredited institutions. And now they are handing McCain his speech lines

McCain is surrounded by lobbyists. One hundred and seventy-seven, according to a report put out by the Democratic National Congress this past weekend. (Yeah, that's a biased source. But the paper trail is well documented.) Does McCain not understand that these lobbyists spend their days doing what they can to avoid making the legislative and regulatory processes in Washington more accountable and transparent. If McCain wants an open system, perhaps he would ask all those lobbyists helping his campaign to fill out reports explaining all their contacts with legislators, staff, and regulators--noting precisely what legislative changes, decisions and favors they are seeking.

In a new add, his campaign says, "Our economy in crisis Only proven reformers John McCain and Sarah Palin can fix it....No special interest giveaways." The guys and gals running McCain's campaign specialize in special interest giveaways. There is a whopping disconnect between what McCain says and what his top people do. If he doesn't see that, then he is, as the Obama crew says, out of touch.

It's as close as it gets to the most MS of MSM outfits declaring, McCain's lying!

I'm referring to a news article on the front-page of Saturday's New York Times that starts:

Harsh advertisements and negative attacks are a staple of presidential campaigns, but Senator John McCain has drawn an avalanche of criticism this week from Democrats, independent groups and even some Republicans for regularly stretching the truth in attacking Senator Barack Obama's record and positions.

Though the piece uses the usual framework of he said/he said--that is, others are saying that McCain is lying--it does present the evidence that McCain's recent assertions about Obama are outrageously false. It also quotes prominent Republicans saying that McCain and running mate Sarah Palin have vigorously mugged the truth in recent days. Though the article was, no doubt, in the works for a day or two, it seems as if comic Joy Behar of The View has pushed the media along. At least, she can claim credit for beating the Times to an obvious point.

Meanwhile, the "Factchecker" column of The Washington Post has awarded McCain four Pinocchios--that's as high as its lying scale goes--for claiming Friday on The View that Palin, as governor of Alaska, did not seek federal earmarks. That's an outright falsehood. But the column felt compelled to go a step further:

Some readers have complained that I have been soft on the Democrats over the last week, while awarding a string of Pinocchios to the McCain campaign. I would like to think that this simply reflects the current state of the campaign: the McCainites have been on the offensive over the last week, tearing into Obama with a series of questionable TV ads. If you think it reflects bias on my part, there is a simple remedy: send in specific examples of Pinocchio-esque statements by Obama and the Dems, and I will check them out.

Both newspapers are essentially saying that at this stage McCain is the liar in the race. (The Post's "Factchecker" gave Palin a pass on her first week--and did not score several of her facts-challenged assertions.) No wonder the Republicans and the McCain campaign are trying to whip up a war against the so-called "Eastern media elite"--for a campaign narrative is close to being born: the fall of the Straight Talker. For the Obama camp, the question is, how best can it exploit this twist-in-the-making?

Much chatter on the Internet about John McCain's appearance on The View on Friday morning. This guy won't do a press conference, but he'll do daytime talk. Nevertheless, it was quite instructive, for McCain lied to the ladies.

He told them that Alaska Governor Sarah Palin, his running mate, did not accept federal earmark funds. But Barbara Walters and Joy Behar had it correct when they declared she had. As the Anchorage Daily News has reported, Palin in 2007 sought "52 earmarks valued at $256 million in Palin's first year. This year, the governor's office asked the delegation to help them land 31 earmarks valued at $197 million." (When I appeared on NPR's Diane Rehm Show on Friday morning, even conservative writer Stephen Hayes had to acknowledge that Palin is exaggerating when she claims she opposed the infamous Bridge to Nowhere.)

Palin's earmark record has been widely reported. Is McCain clueless? Maybe he's out of the loop because he does not know how to use the Internet on his own. Or is he deceitful?

In a way, the View gals let him off easy. Referring to two recent McCain ads--one falsely accusing Barack Obama of sexism by using the "lipstick on the pig" phrase, the other falsely accusing Obama of having supported teaching "comprehensive sex education" to kindergartners--Joy Behar said to McCain, "Now we know that those two ads are untrue, they are lies. And yet, you at the end of it say you approve these messages. Do you really approve these?"

McCain replied, "Actually they are not lies. And if you see some of the ads running against me." He then hammered on the "lipstick" point, saying that Obama should not have used that old expression. (See the exchange here.)

The "lipstick" battle is an easy one for McCain to win--or play to a disingenuous draw. He looks as if he is defending the honor of his running mate, even if there is no truth to the fundamental charge that Obama was maligning Palin. But the sex ed ad is utterly indefensible. Behar missed her chance. She ought to have said to McCain, "Can you prove that Obama advocated teaching comprehensive sex-ed to kindergartners? I will donate $10,000 to your favorite charity, if you can. If not, you will have to come back on this show and admit your campaign lied. Deal or no deal, Senator?"

Behar was so close to what colud have been a game changer. At least, a media game changer. (Real life is another thing.)

But United States democracy ought not to depend on Joy Behar pressing John McCain. The bigfoots of the news media should be prepping to give McCain this sort of treatment. It's no wonder McCain has been ducking press conferences of late. He cannot back up what he and his campaign have been saying about either Obama or Palin. But eventually McCain will have to come out of his cave and face some reporters somewhere. And they ought to be ready with tough questions. If this does not come to pass, then the moderators of the debates should step in and serve up the difficult queries. It shouldn't take a stand-up comic to get a presidential candidate running a dishonorable campaign to face the music.

Meanwhile, an advocacy group has taken on McCain regarding his campaign's phony sex-ed ad, noting that McCain was actually denouncing Obama for supporting a bill that sought to protect children from sexual predators. Any parent of small kids ought to cheer the group's effort...and remember how McCain has crassly exploited the issue of sexual abuse for political gain.

If you want to see why John McCain and his spinners might get away with their ramped-up sleaze attacks on Barack Obama, turn to page four of Thursday's Washington Post. There you will find an article headlined "McCain Camp Hits Obama On More Than One Front.". The piece begins:

Sen. John McCain's presidential campaign launched a broadside against Sen. Barack Obama yesterday, accusing him of a sexist smear, comparing his campaign to a pack of wolves on the prowl against the GOP vice presidential pick, charging that the Democratic nominee favored sex education for kindergartners, and resurrecting the comments of the Rev. Jeremiah A. Wright Jr.

And the next several paragraphs go on to describe these attacks and the consequent back-and-forth between the Obama and McCain campaigns. The piece reports,

The attacks over the first three days of this week have come at a sometimes dizzying pace. Within 24 hours, the McCain campaign released a television advertisement saying Obama favored "comprehensive sex education" for kindergartners, produced an Internet ad charging that the Democrat had referred to Palin as a pig, then concluded with another ad saying, "Obama's politics of hope? Empty words."

....McCain allies think they have succeeded in knocking Obama on his heels since he accepted his party's nomination in Denver two weeks ago.
"They really are in a meltdown," said Sen. Lindsey O. Graham (S.C.), a McCain adviser.

Only after describing the gleeful GOPers and upset Dems does the article evaluate the ads, essentially noting they were, well, crap. For instance: "The sex education ad referred to legislation Obama voted for -- but did not sponsor -- in the Illinois Senate that allowed school boards to develop "age-appropriate" sex education courses at all levels. Kindergarten teachers were given the approval to teach about appropriate and inappropriate touching to combat molestation." The piece suggests--but does not spell out--that it was a complete lie for the McCain camp to say that Obama wanted to teach kindergarteners "comprehensive sex education."

Next to the article on the hard copy of the Post was indeed an analysis of the sex education ad, noting the ad had misrepresented Obama's record and awarding it three Pinocchios (out of a possible high of four).

But here's the perennial problem: the campaign story of the day was not that McCain was lying about his opponent; it was the fight between the two candidates. Whenever the media report false charges in an evenhanded manner--A said X about B; B said X was not true--the party hurling the mud wins. And wins big. Sure, the Post's "Factchecker," Factcheck,com, and Politifact.com each rate political accusations for accuracy and fairness--and often slam a campaign for peddling falsehoods. But, it seems, campaigns dependent on sleaze can all-too-easily survive the negative reviews from these outfits.

The issue then is whether a campaign's reliance on such tactics becomes a key component of the overall media account of the election--and whether a candidate has to answer for such actions. So far McCain has not.

The current issue of Mother Jones has an essay I wrote along similar lines about how the media handle presidential prevarications. You can read it here.

This campaign is becoming ridiculous. And let's be honest: it is John McCain's fault.

Yesterday, his aides went bonkers over Barack Obama's remark that John McCain and Sarah Palin by campaigning for "change" are putting "lipstick on a pig." The McCain camp quickly arranged a conference call for reporters, during which former Massachusetts Governor Jane Swift, a Republican, accused Obama of mounting a sexist attack on Sarah Palin. (It was not an attack on McCain, because apparently he does not use lipstick.) Obama's comment, as many have pointed out, was not a chauvinist jab at Palin. He was using an expression that, again as many others have pointed out, McCain has also used on occasion.

Yet today, the McCain campaign released a web ad that quotes CBS News anchor Katie Couric ("one of the great lessons of that campaign is the continued and accepted role of sexism in American life") and that accuses Obama of mounting a sexist "smear" against Palin. (A lipstick smear?) Of course, Couric was not referring to Obama's remark. Talk about taking a statement out of context. And the ad maliciously plays Obama's lipstick comment over a headline that reads, "Barack Obama on Sarah Palin." This is nothing but deceitful.

Worse, while the McCainiacs were falsely charging Obama with sexism (playing the gender card?), they were putting out a recklessly false television ad that claimed Obama had backed legislation in Illinois to teach "comprehensive sex education" to kindergartners. A McClatchey fact-check of the ad noted this charge was without merit and absurd. The legislation had allowed local school boards to teach "age-appropriate" sex education and had provided schools the ability to warn kids about sexual predators and inappropriate touching. That is, it was designed to protect children. Yet McCain was trying to turn it into anti-Obama ammo. (Joe Klein is really upset about this.)

The McCain Mafia seems committed at throwing whatever it can at Obama: from falsehoods about taxes and earmarks (example: Palin opposed the Bridge to Nowhere) to silly and unsupported charges about sexism and sex-ed. Their strategic goal, obviously, is to keep Obama pinned down. Should the Obama campaign waste time knocking down these purposeful errors and excessive spin? That would be letting McCain shape the debate to his advantage. But if the campaign allows this stuff to hit the wall--and maybe stick--the McCain mob wins. Should it sling crap back at them? Perhaps Team Obama ought to stick to the ground game campaign manager David Plouffe has designed and not be distracted by the cable news noise. But at some point does that noise affect the ground reality? I suppose the only answer is, the Obama camp has to do it all: swat the flies, make its own case (for Obama and against McCain), and keep moving ahead.

But so much for an honorable campaign from an honorable man. Then again, given that McCain has already explicitly accused Obama of traitorous conduct (opposing a war to win an election), nothing should come as a shock. Not even abusing sex education to score points. The fortunate thing for McCain is that presidential campaigns have no true referees. Some in the media try, but the McCain camp is doing all it can to turn the election into a battle between its side and the media, a naked attempt at delegitimizing media criticism of the Palin pick and other McCain campaign moves. There is no power that can slap McCain with what he truly deserves: a time-out in a corner.

Number of times John McCain mentioned Afghanistan in his acceptance speech: 0

Number of U.S. troops in Afghanistan: 33,000

On Tuesday, Bush announced he would withdraw about 8000 troops from Iraq, which would bring troop levels there to about 137,000, roughly the same amount stationed in Iraq prior to the so-called surge. Meanwhile, Bush said a "quiet surge" is occurring in Afghanistan. A Marine battalion of 1000 soldiers that had been heading to Iraq will be sent to Afghanistan instead, and an Army combat brigade of 3500 will also be deployed to Afghanistan. Two years ago, the number of U.S. troops in Afghanistan was 21,000. So this all represents a significant buildup in Afghanistan. Still, the increase of troops Bush is ordering for Afghanistan falls far short of what U.S. commanders have asked for: 12,000 additional troops. This number of troops cannot be poured into Afghanistan due to the U.S. military's continuing obligations in Iraq.

Whatever is happening in Iraq, Afghanistan has become more of a challenge. The Taliban and its allies are resurgent. The drug trade is expanding. Al Qaeda remains at large in the mountainous tribal regions between Afghanistan and Pakistan. Afghans--including their leaders--are fed up with U.S. attacks that lead to civilian casualties. (A pattern has been repeated too many times in the past seven years: the U.S. mounts a bombing raid, people on the ground claim that many civilians were killed, the U.S. military maintains that the raid was precisely targeted and denies the charge of excessive collateral damage, evidence and eyewitness accounts emerge that persuasively challenge the U.S. military claims.)

Yet as Afghanistan becomes more dicey and a more daunting policy and military matter, McCain had nothing to say about it in the most important speech of his career. (By the way, did you know that McCain was a POW during the Vietnam war?) He did refer to Iran (one sentence) and Russia (four sentences), and he mentioned Iraq briefly. Nothing on China. Nothing on Israel. Where was the national security beef? McCain once again retold his POW story. But he had zippo to say about Americans serving in Afghanistan.

Imagine what Republicans and conservatives would have said if Obama had essentially blown off the Afghanistan war and other national security concerns in his acceptance speech. McCain seems more eager to push confrontation with Iran and Russia than to deal with a war already under way. How's that for change?

Imagine if Barack Obama ran an ad touting his vice president pick like this:

And Joe Biden was against the war in Iraq

There would be far-and-wide condemnation because such a statement would be a lie. (Biden voted for the blank-check Iraq war resolution in 2002 after trying mightily--but failing--to win approval for a more restrictive alternative he crafted with two Republican senators.) But look at McCain's latest ad, which celebrates McCain and running-mate Sarah Palin:

The original mavericks. He fights pork barrel spending. She stopped the Bridge to Nowhere.

Okay, how many times does it have to be pointed out? Governor Sarah Palin supported the Bridge to Nowhere at first. This is how the Anchorage Daily News put it:

When John McCain introduced Gov. Sarah Palin as his running mate Friday, her reputation as a tough-minded budget-cutter was front and center.

"I told Congress, thanks but no thanks on that bridge to nowhere," Palin told the cheering McCain crowd, referring to Ketchikan's Gravina Island bridge.

But Palin was for the Bridge to Nowhere before she was against it.

The Alaska governor campaigned in 2006 on a build-the-bridge platform, telling Ketchikan residents she felt their pain when politicians called them "nowhere."

...In September, 2006, Palin showed up in Ketchikan on her gubernatorial campaign and said the bridge was essential for the town's prosperity.

She said she could feel the town's pain at being derided as a "nowhere" by prominent politicians, noting that her home town, Wasilla, had recently been insulted by the state Senate president, Ben Stevens. "OK, you've got Valley trash standing here in the middle of nowhere," Palin said, according to an account in the Ketchikan Daily News. "I think we're going to make a good team as we progress that bridge project."

One year later, Ketchikan's Republican leaders said they were blindsided by Palin's decision to pull the plug.

That is, she flip-flopped on the Bridge to Nowhere.

Do "original mavericks" rely on outrageous spin? Apparently so. It used to be that McCain--to a degree--was the sort of politician who would snort at such political shenanigans. Now he relies on them.

SARAH PALIN'S SECRET EMAILS.The Palin administration won't release about 1100 emails from her governor's office--many written or sent by Governor Palin or CC'ed to her--claiming these communications cover confidential policy matters. Then why do the subject lines for some of these emails refer to a political foe, a journalist, and non-policy topics? And how can the governor's office claim many of the withheld emails are covered by "executive" privilege when some were CC'ed to her husband Todd Palin (a.k.a. the First Dude), who is a private citizen? See my new and exclusive report on Palin's secret emails here.

My friends, I am not here tonight to talk about the past. You know my past. You know my story. You know how it has shaped me. Many others this week have graciously reminded you of what I've been through and what I have tried to do to serve my country. And, yes, it's true that the past is prologue. But I am here to talk about the future--about how we together can strengthen our nation and improve our great land for all of its citizens, especially those who confront difficult challenges or face hard times. So let me tell you what I'd like to do--for you and with you--should I be fortunate enough to be your next president....

That was not the speech John McCain delivered on Thursday night. Instead, he offered an unexciting mix of GOP orthodoxy and declarations of personal maverickness--which was capped by yet one more long and detailed recounting of his POW days of forty years ago. Enough already. A video introduction prior to his speech had covered the same ground--as had many other speakers this week. McCain was pulling a Kerry, relying too heavily on his past heroics and exploiting them in a manner that could devalue an authentic experience. Democrats who were worried after Sarah Palin's speech on Wednesday night could breathe a sigh of relief once McCain was done. The guy had managed to move the ball back to where it had been before Sarah-mania struck.

Here's how I assessed the speech at MotherJones.com:

Number of sentences in John McCain's acceptance speech about his experience as a POW in Vietnam: 43.

Number of sentences about his 25 years in the House and Senate: 8.

The convention ended as it began: a commemoration of McCain's hellish years in a Hanoi prison cell four decades ago. The political equation was a simple one: POW equals patriotic hero equals a fighting president. Before McCain walked down the long runway at St. Paul's Xcel Center, a baritone voice declared over the P.A., "When you've lived in a box....you put your people first." Case closed.

But there was a speech to get through. And before McCain arrived at the climactic I-was-a-POW finale, he delivered, in wooden style, a no-better-than-par speech that was mostly a series of traditional GOP buzz phrases: lower taxes, cut spending, open markets. He noted, "We believe in a strong defense, work, faith, service, a culture of life, personal responsibility, the rule of law, and judges who dispense justice impartially and don't legislate from the bench. We believe in the values of families, neighborhoods and communities." (Just not community organizers.) Was the speechwriter who penned Sarah Palin's acceptance speech too busy to work on McCain's?

Unlike most speakers at the convention, McCain acknowledged that some Americans are facing tough times. "I fight for Bill and Sue Nebe from Farmington Hills, Michigan, who lost their real estate investments in the bad housing market," he said. "Bill got a temporary job after he was out of work for seven months. Sue works three jobs to help pay the bills." And he said he would fight for Jake and Toni Wimmer of Franklin County, Pennsylvania. "Jake," he explained, "works on a loading dock; coaches Little League, and raises money for the mentally and physically disabled. Toni is a schoolteacher, working toward her Master's Degree. They have two sons, the youngest, Luke, has been diagnosed with autism." But how would McCain help these folks? Moments later, he offered a dumbed-down version of his economic plan: " I will keep taxes low and cut them where I can. My opponent will raise them. I will open new markets to our goods and services. My opponent will close them. I will cut government spending. He will increase it." (By the way, many analysts and journalists have repeatedly noted that Obama's economic plan would cut income taxes far more than McCain for Americans below the top 1 percent.)

Over and over, McCain cited his love of country and his dedication to the nation that "saved" him. He tried to present himself as the candidate of change, who wants to transform "almost everything: from the way we protect our security to the way we compete in the world economy; from the way we respond to disasters to the way we fuel our transportation network; from the way we train our workers to the way we educate our children." (He did not explain why after eight years of a Republican administration the country needs so much change.) McCain reminded the GOP delegates that he has on occasion challenged his own party. His domestic policy ideas, the few he offered, did not rouse the crowd--except when he called for more oil and gas drilling. In response, the delegates once again enthusiastically chanted, "Drill, baby, drill!" It was one of the biggest shout-outs of the night. The audience was notably silent when McCain called for boosting alternative energy sources.

Maverick, fighter, fixer--McCain said he was all of that. But, above all, he was McCain the warrior who had returned home. He had fought for the country once before--and he had suffered. He will fight for it again. "I have the record and the scars to prove it," he declared. "Senator Obama does not." Wave the bloody shirt....

You can read the rest here.

After the speech, I attended the swanky Vanity Fair/Google party. It was jammed with Republican politicos, and a smattering of journalists. The mood among the GOPers was not as joyous as it had been after Palin's star-turn on Wednesday night. As I was leaving at 2:00 am, I noticed that McCain campaign manager Rick Davis was at the party. (How many GOP convention speakers had derided the liberal media and Hollywood? Yet Davis--and hundreds of other GOPers--did not mind drinking and dining with VF. Hypocrites or schnorrers--you decide.) "He's really putting country first," I quipped to a McCain aide. "He has to work the bloviators about the speech," the aide replied. If so, he had a helluva job to do. And too bad for him--the bar had closed an hour earlier.

Sarah Palin's speech deserved rave reviews (for her performance) and scathing rebuttals (for her mugging of facts). Regarding the latter, see AP's brutal run-down and the Anchorage Daily News's fact-checking of her speech.

Her speech was laden with falsehoods. Still, the Hypocrite of the Night award has to go to Rudy Giuliani. He preceded Palin and fired off a slash-and-burn assault on Barack Obama. He blasted Obama as inexperienced and the candidate of Hollywood celebrities and the "left-wing media." He derided Obama for having once been a community organizer, as if that's not a real job. (The GOP delegates, most of them looking rather well-heeled, laughed along.) Giuliani, the former mayor of New York City, also slammed Obama for supposedly thinking that Palin's hometown is "not cosmopolitan enough."

Whoa. Giuliani, the onetime wife-cheater, slapping anyone else for being "cosmopolitan" was absurd. After all, Giuliani used to live with a gay couple in a fancy Upper East Side apartment while he was in the middle of a divorce. It don't get much more "cosmopolitan" than that. He also has dressed in drag more than your average failed presidential candidate.

Giuliani's speech was the pander of the night and a hateful exercise in faux populism. But he sure got into it. Perhaps he wants to be Palin's veep running-mate in 2012.

Here's a review of Sarah Palin's speech I posted at MotherJones.com.

The speech was the easy part. But she did it well.

Delivering the most anticipated vice presidential acceptance speech in modern political history, Alaska Governor Sarah Palin accomplished the mission. She talked family, biography, policy, and John McCain. Especially John McCain the POW. And--Democrats beware--she demonstrated she's handy with a rhetorical stiletto and can slice Barack Obama and Joe Biden, while flashing a stylish smile.

The 44-year-old Palin did not wipe out questions about her experience. She did address allegations she had abused her office while serving as a small-town mayor and as a governor. She did not defend her more extreme social positions, such as her support for teaching creationism. But in politics, performance counts for much. And for a little-known politician who had been hunkered down for days, as negative stories and rumors flew about, she had a helluva opening night. Next, Palin will have to face the media--one of the targets of her speech--fielding presumably tough queries about her actions (and life) in Alaska and her foreign policy experience (or lack thereof). But for the night, she held her own--and showed that she has the potential to be a fierce and effective critic of the Obama-Biden ticket.

Palin came on right after former New York City Mayor Rudy Giuliani had trash-talked Obama, and she began with an obligatory maneuver: praising John McCain as a hero, and doing so multiple times. She quickly dealt with the, uh, family issue, noting that "No family ever seems typical...our family has the same ups and downs of any other." Not quite. But it sounded good.

After comparing herself to Harry S Truman and hailing small-town Americans (like herself), she lit into Obama. "A small-town mayor," she said, "is sort of like a community organizer except that you have actual responsibilities." (When Giuliani earlier referred to Obama's days as a community organizer, he drew laughs and hoots from the delegates.) Palin claimed that Obama had written memoirs but not laws, that he has given speeches on the Iraq war but has never used the word "victory"--except when "talking about his own campaign." Obama, she said, was more worried about the rights of terrorists than defeating terrorists. And what will Obama do once he has finished "turning back the waters and healing the waters"? Raise taxes, reduce the strength of America, and do nothing to increase drilling. (The delegates repeated their favorite chant of the evening: "Drill, Baby, Drill"). "The American presidency," Palin said, in another dig at Obama, "is not supposed to be a journey of personal discovery." She grinned the grin of a smooth put-down artist.

Palin, a self-described "hockey mom," laid on the populism--the Republican version of populism--noting how she had confronted entrenched interests in Juneau (she got rid of the governor's jet and chef), praising factory workers and small farmers, citing her husband's membership in the steelworkers' union, bashing the elite Eastern media, and denouncing the "permanent political establishment" of Washington, many of whom were in the hall as McCain supporters, donors, and aides. (After the speech, Republican pollster Frank Luntz said he believed Palin has the potential to connect with working-class voters.)

Decrying the Democrats as tax-hikers and national security weaklings, while blasting Washington, is the usual fare for Republicans. But Palin read her lines with flair and confidence. And--can we be frank?--she looked darn good doing so. She was with the program: this election is not as much about change, hope, or issues as it is about the measure of one man. "Biden and Obama," she said toward the end of her speech, "say they are fighting for you....There is only one man in this election who has ever really fought for you...in places where winning means survival and where defeat means death." He is, she continued, "the kind of fellow whose names you will find on war memorials in small towns across America--except he came home." And, she noted, he possess "the special confidence of those who have seen evil and have seen how evil is overcome....That is the kind of man America needs." It's some ticket: a made-in-small-town-America working mom and the man who goes off to war to protect her way of life.

Palin's case for McCain was as effective a pitch for the GOP candidate as any made at the convention. And her attack on Obama was drenched with panache. After she was done, her family--including her pregnant teenage daughter's fiancé--joined her on the stage, and then McCain walked out. "Don't you think we made the right choice for the next vice president of the Untied States?" McCain exclaimed with glee. McCain and his aides were entitled to conclude that Palin had been misunderestimated by her critics and foes.

They also were entitled to believe that Palin would be something of a babe-magnet for the party's base. Days ago, Tom DeLay, the former House majority leader, told me that by picking Palin, McCain had electrified social conservatives, who had not been jazzed by the prospect of voting for McCain in November. But at his church, this past Sunday, DeLay's parishioners told him they now were excited about the ticket. Palin's performance on Wednesday night can be expected to reinforce and boost social conservatives' enthusiasm for the McCain-Palin ticket. The social cons have a new champion.

Political experts say that veep picks ultimately do not determine outcomes in presidential elections. And that's probably true. Yet on Wednesday night, Palin displayed plenty of potential. (Joe Biden had reason to say to himself, "This debate's gonna be a challenge.") Though rumors still swirl and unanswered questions about her official actions in Alaska remain, Palin might end up an asset, not a liability, for McCain. She has to meet the press and withstand the ongoing and intense media scrutiny that only began a few days ago. She has to handle that debate with Biden. She has to prove her mettle on the harsh campaign trail. But while pundits before the speech were pondering how the McCain campaign could put lipstick on this (seemingly) pig of a choice, after the speech was over, it was clear, for at least the moment, that with Palin there's more lipstick than pig.

On the first night of the GOP convention, Fred Thompson, the actor-senator who flopped as a presidential candidate, was given the role of a lifetime. This grumpy old guy was asked to play Marie Antoinette. And he nailed it.

As soon as Thompson hit the podium to give one of the two centerpiece speeches of the night (his co-star was Joe Lieberman), he derided the Democrats for harping on the current economic difficulties, poking fun at them for acting as if the country was in the middle of another "great depression." He didn't accuse them of whining, but he came close, as he hailed the United States as a "prosperous" country. His performance garnered applauds from the delegates, many of whom, playing to type, looked as if they spend more time at the country club fretting about tee times than at the kitchen table worrying about bills.

There are two Americas, it seems. One with concerns about the nation's economy, the other in happy denial. And the latter was in full view at the Xcel Energy Center in St. Paul. Through opening night, there were hardly any references to the troubles at hand. The convention spent more time celebrating former military heroes and POWs than addressing worries voters might have about the economy, health care, education, climate change or any other issue other than national security. On these fronts, it was as if the Republicans had nothing to say. Thompson tried to get the crowd stirred up over taxes and abortion, but that was so 1980s. Voters viewing the proceedings could be forgiven for wondering, what are these guys going do for me and my neighbors?

That was odd, given that the slogan of the convention is "Country First." What was being placed first by McCain's convention planners was McCain--specifically McCain the POW. This night was not about country; it was not about what can be done to make this country better and stronger; it was not about offering policy proposals that would improve the lives of Americans; it was about promoting a brand: Hero McCain.

After the first night was over, I strolled over to a hotel bar and met up with several journalists and pollster Frank Luntz. Luntz mentioned that in Michigan only 9 percent of the voters believe the country is on the right track. Nine percent? What do the McCainites think the other 91 percent in Michigan are looking to the GOP for? Heroic tales of McCain from 40 years ago? Hagiography?

It was a vapid start to a convention, which will probably end up being dominated by Sarah Palin's acceptance speech, not John McCain's. (Soap opera usually trumps politics.) But Tuesday evening was an example of hollow patriotism. Country First? No, it was McCain First. And a true patriot might consider placing the needs of his fellow countrymen ahead of his own political needs.