Oh dear God, I hate admitting it when anyone over at the Corner is right about something but... AAAAAAAARRRRRRRRGGGGGHHHH... Nicole Gelinas is right:

The financial system's failures made themselves obvious starting in 2007 in part because legislators and regulators thought that they could conjure up on command not only wisdom and competence but omniscience.

In the years leading up to the financial crisis, regulators allowed financial firms such as AIG to create derivatives that evaded the old-fashioned limits on borrowing and trading. The people in charge figured that the financial guys had figured out every angle and made these things perfectly safe.

Regulators, too, allowed banks to borrow far more than old-fashioned rules would have allowed on mortgage-related securities and other instruments rated AAA — because competent people had determined that such securities could never fail.

Finally, regulators allowed people to buy houses with no money down — even though we learned in the 1920s that it's not a good idea to let people borrow limitlessly to speculate that the price of something will continue to rise.

The lesson to be learned here is that we need borrowing and trading rules that apply to everyone and everything for those times when bankers, regulators, and tens of millions of ordinary Americans aren't right.

The bill offers no evidence that anyone in Congress has learned this lesson.

The essential problem with the financial reform package the Democrats have put together is that it relies far too much on the discrepancy of regulators and not enough on hard law. So instead of breaking up banks whose assets exceed a certain level of GDP, we have merely given regulators the ability to break up banks if and when they pose grave risks to the economy. As anyone who has followed the wacky hijinks of our government during the Bush years knows, regulators often suck, especially when they're sleeping with the people they're supposed to be regulating.

So here's how it's going to play out: At some point in the future, we will have a Republican president who will appoint Levi Johnston to head up the SEC or Treasury or the Fed. Levi will have all kinds of powers at his disposal, whether it's breaking up big banks, raising interest rates to curtail asset bubbles or enforcing strict leverage requirements. But instead of utilizing any of the vast powers at his disposal, Levi smokes dope and pleasures himself while watching porn all day long. Five days after taking office, the economy crashes again and Levi is trotted out in front of the cameras to tell us that "nobody could have predicted" this sort of thing would ever happen.

This is the sort of thing that happens when you put your faith in the competence of regulators rather than creating hard law. A real financial reform package would have held the banks to strict leverage requirements, would have forced them to stop prop trading if they wanted to retain access to the Fed's discount window and would have broken up the largest financial institutions. Instead we have a large complex nightmare that is riddled with loopholes that will allow the banks to behave just as irresponsibly as they've done in the past.

So take comfort, America. The only thing now saving us from another financial crisis is the wisdom and competence of Federal Reserve Chairman Levi Johnston. Huzzah!

You'd think this was common sense, right? An ATM shouldn't give you money you don't actually have, and you shouldn't be able to use your debit card when you don't have enough money in the account to cover it. Now even Bank of America admits it, and has decided to take the lead as the good guy. (Although I don't think this is completely altruistic. If memory serves me, there's already a class action suit out there over this - even though it's not mentioned in the story.)

In a move that could bring an end to the $40 cup of coffee, Bank of America said on Tuesday that it was doing away with overdraft fees on purchases made with debit cards, a decision that could cost the bank tens of millions a year in revenue and put pressure on other banks to do the same.

Bank officials said that effective this summer, customers who try to make purchases with their debit cards without enough money in their checking accounts will simply be declined. Debit purchases account for roughly 60 percent of overdrafts at Bank of America, the nation’s largest issuer of debit cards.

Banks are bracing for a new federal rule that will require them to get permission from account holders before providing overdraft services for debit purchases and A.T.M. withdrawals. That change was already expected to wipe out billions of dollars in overdraft revenue for the banks.

“What our customers kept telling me is ‘just don’t let me spend money that I don’t have,’" said Susan Faulkner, the bank’s deposit and card product executive, who said the overdraft changes were part of a broader push to build trust among its customers. “We wanted to help them avoid those unexpected overdraft fees.”

Elizabeth Warren is one of the few public figures who understands and acknowledges the enormous economic stress placed on the middle class, and actually cares what happens to them:

While the middle class has been caught in an economic vise, the financial industry that was supposed to serve them has prospered at their expense. Consumer banking -- selling debt to middle class families -- has been a gold mine. Boring banking has given way to creative banking, and the industry has generated tens of billions of dollars annually in fees made possible by deceptive and dangerous terms buried in the fine print of opaque, incomprehensible, and largely unregulated contracts.

And when various forms of this creative banking triggered economic crisis, the banks went to Washington for a handout. All the while, top executives kept their jobs and retained their bonuses. Even though the tax dollars that supported the bailout came largely from middle class families -- from people already working hard to make ends meet -- the beneficiaries of those tax dollars are now lobbying Congress to preserve the rules that had let those huge banks feast off the middle class.

Pundits talk about "populist rage" as a way to trivialize the anger and fear coursing through the middle class. But they have it wrong. Families understand with crystalline clarity that the rules they have played by are not the same rules that govern Wall Street. They understand that no American family is "too big to fail." They recognize that business models have shifted and that big banks are pulling out all the stops to squeeze families and boost revenues. They understand that their economic security is under assault and that leaving consumer debt effectively unregulated does not work.

Families are ready for change. According to polls, large majorities of Americans have welcomed the Obama Administration's proposal for a new Consumer Financial Protection Agency (CFPA). The CFPA would be answerable to consumers -- not to banks and not to Wall Street. The agency would have the power to end tricks-and-traps pricing and to start leveling the playing field so that consumers have the tools they need to compare prices and manage their money. The response of the big banks has been to swing into action against the Agency, fighting with all their lobbying might to keep business-as-usual. They are pulling out all the stops to kill the agency before it is born. And if those practices crush millions more families, who cares -- so long as the profits stay high and the bonuses keep coming.

America today has plenty of rich and super-rich. But it has far more families who did all the right things, but who still have no real security. Going to college and finding a good job no longer guarantee economic safety. Paying for a child's education and setting aside enough for a decent retirement have become distant dreams. Tens of millions of once-secure middle class families now live paycheck to paycheck, watching as their debts pile up and worrying about whether a pink slip or a bad diagnosis will send them hurtling over an economic cliff.

America without a strong middle class? Unthinkable, but the once-solid foundation is shaking.

Our friend Rick Perlstein had an interesting interview on Big Think that is a good morning starter. He opens up with a really important point:

Question: Has Obama succeeded on his promise of being a “post-partisan” President?

Rick Perlstein: Well, the problem with Obama’s post-partisan agenda is that he came into it. He came into his presidency at a time when millions of Americans, perhaps even tens of millions of Americans don’t consider a Democrat president legitimate. Don’t consider liberalism legitimate. Don’t consider the idea of the state forming new programs to help people legitimate. So, he’s in a situation a lot like, you know, Abraham Lincoln faced in 1860 when you had millions of Americans who didn’t even consider what was going in Washington to have anything to do with them.

Yep. And the mainstream right-wing media is explicitly promoting the view that Obama is not a legitimate president.

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The Times is obviously trying to jump-start the political process that makes our elected representatives so reluctant to go back and ask for more badly-need stimulus spending from the federal government:

The unemployment rate includes only jobless people who have looked for work in the past four weeks. The underemployment rate — which also includes jobless workers who have not recently looked for work and part-timers who need full-time work — reached 17.5 percent in October. And the long-term unemployment rate — the share of the unemployed population out of work for more than six months — also continues to set records. It is now 35.6 percent.

The official job-loss data also fail to take note of 2.8 million additional jobs needed to absorb new workers who have joined the labor force during the recession. When those missing jobs are added to the official total, the economy comes up short by 10.1 million jobs.

Taken together, the numbers paint this stark picture: At no time in post-World War II America has it been more difficult to find a job, to plan for the future, or — for tens of millions of Americans — to merely get by.

At a recent meeting at the White House to discuss job creation, President Obama said that “bold, innovative action,” would be needed — from the administration, Congress and the private sector — to undo the devastation in the labor market. Americans are waiting for Mr. Obama to lead the way.

There were good ideas floated at the White House meeting, including bolstered federal support for efforts to retrofit and weatherize homes and public buildings. There was also talk of using government money to establishing a so-called infrastructure bank that would issue bonds to help finance big construction projects.

The country also needs a program that would create jobs for teenagers — ages 16 to 19 — whose unemployment rate is currently a record 27.6 percent. Deep and prolonged unemployment among the young is especially worrisome. It means they do not have a chance, and may never get the chance, to acquire needed skills, permanently hobbling their earnings potential.

We know that more stimulus spending and government programs are a fraught topic. But they are exactly what the country needs. It may be the only way to prevent a renewed downturn. And the only way to create the jobs needed to put Americans back to work. Those are the essential — and missing — ingredients of a sustained recovery.

How patriotic of these wealthy Americans, to hide their money offshore so it was available when their country finally needed it.

Not only did they get the tax code and every law slanted in their favor over the past 30 years, they've also earned more than ever. And yet, they still feel compelled to steal even more. What's wrong with these people?

Many Americans dread April 15, the deadline for filing their income tax returns. But some well-heeled people are trembling over another looming tax day: Oct. 15.

Thursday is the deadline for Americans to come clean about the money they have hidden offshore, in places like Swiss bank accounts. No one can say with certainty how much money is out there — the accounts are secret — but the hoard may be tens of billions of dollars.

Several thousand wealthy people have come forward, hoping to avoid large fines or possibly even prison. But many others are still weighing their options. The choice is stark: They can confess and pay the penalties, or gamble that they will not get caught. With the deadline only days away, tax lawyers say they are being inundated by anxious clients.

“We’re seeing a flood of people,” said Scott D. Michel, a tax lawyer in Washington. His firm, Caplin & Drysdale, has 350 clients who are preparing to report their offshore accounts to the Internal Revenue Service. The firm has 14 lawyers handling their cases, one of which involves a tax bill of hundreds of millions of dollars.

The deadline is part of a broad crackdown on Americans who use offshore accounts to evade federal taxes. As part of the effort, United States authorities have challenged the long tradition of banking secrecy in Switzerland, and, in particular at UBS, that nation’s largest bank.

The I.R.S. is offering tax dodgers some leniency. Penalties will be reduced for people who come forward by Oct. 15. They will be assessed fines equal to 5 to 20 percent of their tax bills, rather than the usual 50 percent. They also will pay that penalty once, based on the highest balance in their offshore accounts over the last six years, rather than for each of those six years.

At least 4,000 clients of UBS and other private banks have come forward in recent months, a government official who had been briefed on the matter said.

Thanks to John Cole for the comedy gold of yesterday. The folks at Red State noticed that convention-going Democrats didn't walk around waving their cheap flags on sticks all the time like good nationalist zealots Republicans do. So they set out to find all those tens of thousands of flags that had been evident in pictures of the hall but not upon the persons of Democratic attendees having lunch, shopping at the mall or going to the restroom.

Did they ask the convention organizers where the flags had gone - maybe for re-use at Invesco Field last night where there were also tens of thousands of the little beauties in evidence? No. Did they look under seats where they might have been stashed for safekeeping? No. Did they... you know, this one seemed a no-brainer for any intrepid investigator to me ... did they ask the delegates and attendees themselves? No.

They followed their own inner voices, like Bush looking for WMD in the wilderness, and headed straight for the trash.

There they found - ZOMG! - a dozen or less of those abused tens of thousands of flags, all broken and stuff from wildly being waved, in an entire dumpster of trashbags. Which must surely prove that Obama hate America. Or something.

And Obama would have gotten away with it if it wasn't for those pesky kids!

Meanwhile, on the other side of the uppitty zealot patriot fence, the GOP knows how to wave a flag with style.

This is the concept for their convention hall:

Yes, that's a massive video screen. I can't figure out whether they want to show Obama how to stage a real Reichstag Nuremberg Rally (ok, but you got the gist) or intentionally wanted a look reminiscent of the Norsefire Party out of V for Vendetta.

Rachel Maddow appeared on"Countdown" last night to talk about John McCain's joke(?) about entering his wife in a topless beauty contest, and hit on an important point: in order to compete with Barack Obama's rock star appeal, the McCain camp has decided to find places where large people gather for other reasons and bask in the unwarranted limelight.

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OLBERMANN: Also, maybe a somewhat serious point contained in all this malarkey; on stage at Sturgis, he referred to the—preferring the roar of the 50,000 Harleys to 200,000 Germans cheering in Berlin. But in doing that, did he not underscore the fact that those 200,000 Germans in Berlin actually showed up to hear Barack Obama speak, but the 50,000 bikers on the roar of their Harleys, they had shown up at Sturgis not to see John McCain, but to see Kid Rock, Kelly Pickler and a bunch of female wrestlers and other women not wearing tops?

MADDOW: This is a critical and basic difference between the John McCain campaign for president and the Barack Obama campaign. Barack Obama creates large crowds when he gives speeches. John McCain‘s campaign has just figured out to find out where there‘s going to be a large crowd for another reason and to hope to slip their candidate in between other acts.

I guess you can't really blame McCain. When your opponent draws tens of thousands of people who genuinely want to hear him speak, and you have trouble filling the dining room of a Sausage restaurant, you have to find ways to compensate. It's just ironic that they attack Obama's celebrity appeal yet try to emulate it any way they can.

Move over Denver Broncos. This looks like a good idea if it happens. Republicans always play the media game the best and this is something that will be a media sensation.

Barack Obama's campaign is considering moving his nomination acceptance speech at the Democratic National Convention from the Pepsi Center to Invesco Field at Mile High to allow tens of thousands to witness the historic moment, sources say.

The move would mark a major departure from tradition, but would be in keeping with the candidate's desire to build a large grass-roots campaign focused on "change."

Invesco Field, home of the Denver Broncos, seats 76,125 and presumably several thousand more could fit on the field. The Pepsi Center holds less than 20,000 and is to be restricted to delegates, media, high-dollar donors and guests of the Democratic Party

How many people do you think would come to see McCain at an event like this?