Facing Congressional subpoenas, Karl Rove to resign as President Bush’s top advisor on August 31. Meanwhile the world’s economic system appears to be on the verge of a crisis because of the U.S. subprime mortgage scandal. Schechter discusses his new article "Subprime or Subcrime? Time To Investigate and Prosecute." [includes rush transcript]
President Bush’s top adviser Karl Rove has announced he will step down as White House deputy chief of staff on August 31.
Rove’s resignation comes while he is at the center of several Congressional investigations. Last month Senate Judiciary Chair Patrick Leahy subpoenaed Rove to testify about his role in the politicization of the Justice Department and the firing of nine U.S. attorneys. So far Rove has ignored the subpoena and has refused to testify, citing executive privilege. In addition, two weeks ago Rove skipped a Congressional hearing on the allegedly improper use by White House aides of Republican National Committee email accounts.
Rove told the Wall Street Journal that he is resigning in order to spend more time with his family.
For the past 19 years Rove worked as George W. Bush’s closest political advisor, first in Texas, then in Washington. During that time he earned the nickname of Bush’s Brain.
- Danny Schechter, veteran journalist, media critic and co-founder of mediachannel.org, one of the largest online media issues networks. His latest film is "In Debt We Trust: America Before the Bubble Burst." His blog is NewsDissector.org
Plummeting stocks on Wall Street have forced the mainstream media and economists to finally take notice of the housing bubble and the related dangers of the sub-prime lending industry. The New York Times laments what it calls the "spiraling credit crisis" and The Wall Street Journal points to the "debt bomb."
The Center for Economic and Policy Research notes that many journalists and economists have long ignored the facts. The housing market has been seriously overvalued for the past 10 years and its collapse will cause a severe recession with grave consequences for millions of families. The sub-prime loan industry has emerged as a major, and controversial, player in the housing market. A recent study by the Center for Responsible Lending indicates that sub-prime loans have led to one million American families losing their homes in the past decade.
- Danny Schechter
This is a rush transcript. Copy may not be in its final form.
AMY GOODMAN: President Bush’s top adviser, Karl Rove, has announced he is stepping down as White House deputy chief of staff on August 31st. Rove’s resignation comes while he is at the center of several congressional investigations. Last month, Senate Judiciary Chair Patrick Leahy subpoenaed Rove to testify about his role in the politicization of the Justice Department and the firing of the nine US attorneys. So far, Rove has ignored the subpoena and has refused to testify, citing executive privilege. In addition, two weeks ago Rove skipped a Congressional hearing on the allegedly improper use by White House aides of Republican National Committee email accounts.
Rove told the Wall Street Journal he is resigning in order to spend more time with his family.
For the past nineteen years, Rove worked as George W. Bush’s closest political adviser, first in Texas, then Washington. During that time, he earned the nickname of Bush’s Brain.
Danny Schechter, the News Dissector, joins us right now. Danny, your response?
DANNY SCHECHTER: Well, with his brain gone, what’s left? I mean, this is rats deserting a ship. You know, the ship is sinking, clearly. His comment — President Bush’s comment the other day — he doesn’t speak English — is indicative of an administration that doesn’t know what it’s doing or where it’s going. Bush’s top adviser leaving is certainly not going to make it any easier for him. We’re going to see more and more crises.
And a lot of this is also tied to the collapse of the so-called opportunity society, which is the central domestic commitment of the Bush administration, to get people into homeownership and the like. And that leads us to this subprime or what I call the "subcrime" crisis right now, where two million Americans face foreclosure on their homes, most of them or many of them people of color. So this crisis is coming home in a big way. The administration’s agendas of various kinds are unraveling overseas and here. And Bush losing Rove at this point is just going to make him, in my view, sort of more unable really to follow through on watching his ship of states slowly sinking.
AMY GOODMAN: Do you think he’ll be going off to work for another candidate?
DANNY SCHECHTER: It’s possible. I mean, Karl Rove is obviously a very clever man, not to be underestimated. He’s very smart, he’s very devious. We know that he is the person that has orchestrated a lot of the Republican gains and Republican victories. So I wouldn’t know what he’s going to do, but whatever it is, it’s probably not going to be good, unless somehow there’s a jail cell at the end of the rainbow. Wouldn’t you like to see that?
AMY GOODMAN: Do you think it suggests something about what will happen to Alberto Gonzales?
DANNY SCHECHTER: Well, you know, Gonzales is holding on barely here. And, you know, I think he’s been able to obscure the issues enough in a congress which is very specialized in obscuring issues, including the Democrats, who don’t seem to have the guts or the focus to really bring these people down. So, you know, we will likely continue to see a continued stalemate, I think, but who knows?
AMY GOODMAN: Well, let’s talk about the subprime crisis. Plummeting stocks on Wall Street have forced the mainstream media and economists to finally take notice of the housing bubble and the related dangers of the subprime lending industry. The New York Times laments what it calls the "spiraling credit crisis." The Wall Street Journal points to the "debt bomb." The Center for Economic and Policy Research says many journalists and economists have long ignored the facts. The housing market has been seriously overvalued for the past ten years. Its collapse will cause a severe recession with grave consequences for millions of families. The subprime loan industry has emerged as a major and controversial player in the housing market. A recent study by the Center for Responsible Lending indicates subprime loans have led to one million American families losing their homes in the past decade. Danny, you’ve been writing extensively about this.
DANNY SCHECHTER: I’ve been writing about it, and I also made the film In Debt We Trust, and we have a website, stopthesqueeze.org, to try to organize a campaign for debt relief in America. In other words, Bono has called for debt relief in Africa. We have to start fighting for debt relief in America. A moratorium on these foreclosures would be a first step, and also an investigation into the profiteers on Wall Street. We’re talking about literally billions of dollars that have just been spent by the Federal Reserve and by central banks around the world to try to prop up the system. A lot of that is really benefiting the people who created the problem in the first place: the hedge funds, the financial analysts who went ahead with this effort.
This subprime thing is really serious. I don’t know if your viewers are all clear of it, or your listeners, but basically people who didn’t have adequate credit to get homes were told, "No problem. Just pay us a little bit more, and we will give you the mortgage." Then they took the mortgage. They resold the mortgage back into Wall Street into what are called securitization trusts. These trusts then not only financed more acquisitions and buyouts and the like, but they also basically made incredible amounts of money for these people.
So we’re now facing a situation, the New York Times — I love this phrase — just the other day talked about a "moral hazard," meaning that the risk takers who brought on this panic would feel bailed out again. And they are being bailed out again. And the problem is the opposition is not saying much about it. The Democrats are not talking about it. Activists are ignoring it, maybe because economics is the dismal science.
But we have been getting a lot of response to our film, In Debt We Trust, and to this issue, because it’s an issue that brings together people across the partisan lines, across class lines, across racial lines. It could be the issue that could lead to a fight for economic justice in this country.
AMY GOODMAN: You talk about the hedge funds, for example, and how they’re connected to this. Do you think that it’s not a major issue in the presidential race, because the very moneyed class that these politicians are both coming from, some of them, but also appealing to for money are those that are a part of this?
DANNY SCHECHTER: Yeah, well, we saw this, and I document this in my film, In Debt We Trust, about the bankruptcy reform bill, where tremendous amounts of money were spent on lobbyists, $151 million to try to get this "reform" passed, and Democrats supported it, as well as Republicans. So it wasn’t just, you know, the big bad Bushies here, but it was sort of the Democrats, as well, who were implicated. And part of the reason was, is because their campaign donors include these very wealthy companies and financial institutions and real estate developers. So it’s very much a part of the deeper corruption of our financial and economic system.
AMY GOODMAN: How do you think it has to be dealt with right now?
DANNY SCHECHTER: Well, it has to be dealt with — first of all, we have to become more aware of it and put this issue more on our agenda. I mean, the military has just tried to spur reenlistments to Iraq by saying, "We’ll help you pay off your debts. If you have college loans, we’ll help you pay them off." So debt is central and part of that crisis, as well. So what we need to do, it seems to me, is (a) inform ourselves — screenings of In Debt We Trust might help in that process — secondly, we need to push for regulation. We need an investigation. We need to have prosecution of these big corporate guys who have been making so much money off the misery of so many Americans and to try to put an end to these processes. So it’s a — you have to stop talking about subprime, you have to start talking about subcrime, which is an article that I wrote on mediachannel.org the other day, and it’s gotten a tremendous response. We have to criminalize these practices, not just nod at them and bail out the people who have put us in the situation.
AMY GOODMAN: Danny, I want to end on an entirely different issue, but you take on issues of the world every day in your blog.
DANNY SCHECHTER: Keep ’em coming, Amy.
AMY GOODMAN: The rock band Pearl Jam has accused AT&T of censorship, after the company removed comments the band made about President Bush during a recent concert that AT&T aired in an online webcast. During the concert, the band’s singer Eddie Vedder said, "George Bush, leave this world alone," and "George Bush, find yourself another home." For viewers watching the concert via AT&T, the remarks were edited out. This is an uncensored clip of the concert.
EDDIE VETTER: [singing] George Bush, leave this world alone. George Bush, leave this world alone. George Bush, find yourself another home.
AMY GOODMAN: That was the unedited version.
DANNY SCHECHTER: Amy, that is so great. And, you know, the thing about this is, of course, AT&T is saying, no, it was one of our contractors that did this in an unauthorized way. We’re working with the band to get this song out online. You know, they’re basically not boasting that they did it. They’re basically trying to, you know, cover up the fact that they were involved or implicated in it.
But, you know, this is only part of a much deeper problem. I spent ten years in rock and roll radio, and, you know, I was just back up in Boston. WBCN was the station I worked for. And the radio there is terrible. It’s all controlled by big corporate media outlets. There’s very little of the diversity on the airwaves that we really need. So this is a problem, and a serious one, of censorship. But the real censorship seems to be the manipulation by big telecom companies and radio companies and media companies, basically, of our airwaves. So it comes back to that once again.
AMY GOODMAN: It’s interesting. A reader to the — emailed the Chicago Sun-Times saying AT&T’s Blue Room Webcast had also silenced comments during two performances — I may be pronouncing this wrong — at the Bonnaroo Festival in Tennessee last June, cutting remarks by the John Butler Trio bemoaning the lack of federal response to Hurricane Katrina and comments about Bush and the war in Iraq by singer Wayne Coyne of the Flaming Lips. The article from the Chicago Sun-Times saying it’s not the first time AT&T has done these edits. AT&T did confirm that other unspecified political comments had been cut from its webcasts.
DANNY SCHECHTER: Yeah, nor will it be the last time, unless we take on this issue and begin to speak up for democracy on the airwaves, not just Democracy Now!, but broader, more diversity on the airwaves and more support for artists who are speaking out on important issues. And, you know, this just brings that issue back in front of our faces again.
AMY GOODMAN: How does net neutrality tie into this? And explain what that is.
DANNY SCHECHTER: Well, the idea here is — the idea — the term is not a great term, but it’s basically a free internet, which is not controlled by the big developers and big companies that run it now. And, in fact, you know, this has been a fight to not get good content on the air, but also to stop people from suppressing it and censoring it. One positive note, for me, anyway, was that, of all people, AOL came to us and said they want to run our film WMD: Weapons of Mass Deception and In Debt We Trust. And I think they are only doing that because there’s such a demand for uncensored information online and on the airwaves.
AMY GOODMAN: Could you foresee a time where the kind of information people put up, you just can’t hear it or see it? I mean, it’s just blocked on the internet?
DANNY SCHECHTER: Yeah, it’s blocked. But it’s also tough, as you know, you know, to keep funding independent media, to keep websites like mediachannel.org alive, to try to keep the voices of dissent and the voices of criticism of our media system in front of people’s faces. And it’s harder and harder to do that, especially with a big political campaign sucking up all the progressive money into the coffers of these candidates.
AMY GOODMAN: And then into the coffers of the big media conglomerates —
DANNY SCHECHTER: There you go.
AMY GOODMAN: — as they’re paying for the ad time.
DANNY SCHECHTER: There you go.
AMY GOODMAN: Well, Danny Schechter, I want to thank you for being with us, veteran journalist, his latest film, In Debt We Trust: America Before the Bubble Burst, his blog, newsdissector.org.