Weekly Roundup 5/21/2012

Thomas E. Mann and Norman J. Ornstein, The Washington Post, May 17, 2012 (print edition: May 20)
Synopsis: Veteran politics experts Mann (Brookings Institution) and Ornstein (American Enterprise Institute) have stirred debate with the thesis of their forthcoming book “It’s Even Worse Than It Looks: How the American Constitutional System Collided With the New Politics of Extremism.” In this Sunday opinion-section piece, they discount five supposed remedies offered by others: a third party, term limits, a balanced budget amendment, public campaign financing and “stay calm—things will get back to normal eventually.” But they say four possible steps could help: “realistic” campaign finance reform; reducing partisan redistricting; curbing Senate filibusters; and expanding the electorate.

Takeaway: The recommended steps amount to a “sensible” reform agenda “focused on fixing the party system and addressing the roots and the weapons of political partisanship.”
For CQ Researcher coverage, see Peter Katel, “Voter Rights,” May 18, 2012;   Kenneth Jost, “Redistricting Debates,” Feb. 25, 2011; Marcia Clemmitt, “Lies and Politics,” Feb. 18, 2011; Kenneth Jost, “Campaign Finance Debates,” May 28, 2010; Peter Katel, “Tea Party Movement,” March 19, 2010, updated May 23, 2011; and Alan Greenblatt, “Changing U.S. Electorate,” May 30, 2008, updated Aug. 9, 2010.

--Kenneth Jost, Associate Editor

Phil Angelides, Huffington Post, May 21, 2012
Matt Taibbi, Rolling Stone Taibbi Blog, May 15, 2012

Synopsis: Evidence keeps emerging that shows big banks engaged -- and continue to engage – in much riskier business than they acknowledge, according to longtime finance-industry critic Taibbi and Angelides, former chair of the government’s Financial Crisis Inquiry Commission.

Takeaway: “All of the five behemoth banks rely on sophisticated financial models to gauge their trading risk,” writes Angelides. “However, time and time again, these models have proven to be woefully inadequate in modeling human behavior, recognizing that the marketplace often defies neat statistical patterns, and predicting the black swan events that inevitably shake the financial markets. When Paul Volcker spoke to the Financial Crisis Inquiry Commission of ‘the hubris of financial engineers,’ he undoubtedly had in the mind these models, which bankers construct to rationalize the risky behavior that led to the financial crisis and that evidently persists today.”

For background and related material, see, Kenneth Jost, “Financial Misconduct,” Jan. 20, 2012; Marcia Clemmitt, “Financial Industry Overhaul,” July 30, 2010; and Thomas J. Billitteri, Financial Bailout, Oct. 24, 2008, updated July 30, 2010.

--Marcia Clemmitt, Staff Writer