The Fighting 29th

All about New York's 29th Congressional District

Eric Massa and Steve Israel at GM
Eric Massa and Steve Israel [NY-2] toured the GM facility in Honeoye Falls today. Jeremy Moule at City Newspaper has a story on the visit. Photo courtesy Massa's office.

Update: WXXI has a story also.

This is the economic story of the day (and, probably, the year, and maybe of our lifetime). Yesterday, Ben Bernacke decided, in the words of one economist, to buy "everything in America that isn’t nailed down".

It's telling that this story has gotten little coverage amid all the fussing and fighting about AIG bonuses. The Fed is putting over a trillion dollars behind a massive and risky effort to force liquidity into our financial system. It could lead to hyper-inflation, and it will probably devalue our currency. Since the Fed is led by people who know the consequences of their actions, I can only assume that the alternative was much, much worse.

That said, everyone can feel free to continue complaining about AIG bonuses.

Yesterday, Eric Massa had an "emergency" press conference to discuss a Veterans' Administration proposal to have vets private health insurer pay for disability-related health care. Jeremy Moule at City Newspaper reports that Massa said the proposal is "dead on arrival" in Congress.

After the break: Eric Massa at a press conference explaining why he supports a 100% tax on AIG benefits.

Eric Massa has joined the chorus of those complaining about AIG bonuses. While I'm as angry as anyone about this, there are a few reasons to think that the ultimate result will be a lot of noise and not much action.

First, it looks like the derivative technicians at AIG made the delivery of their bonuses a condition of the derivative contracts themselves. Here's one explanation of how that works.

Second, the AIG derivative group is based in London. Taxing AIG trader bonuses at 100% sounds like a clever way to get around contractual obligations, but I wonder if those traders pay US taxes.

The final, and most important point is that the noise over bonuses obscures the real news about AIG: the release of their counterparties list. This is the group of institutions who AIG "insured" and who were paid billions when AIG's credit rating dropped. The list includes a number of foreign banks, and has huge ($12 bln) payments to Goldman Sachs and Merrill Lynch. The AIG bailout was more than just the rescue of a big insurer -- it was also indirect bailout of a list of national and international financial institutions.

Eric Massa was one of 10 Democratic Representatives who signed a letter to the state Democratic Party chair, telling her not to promote Senator Kirsten Gillibrand over other possible candidates.

The Buffalo News describes how Route 219, which runs through Cattaraugus County, lost funding because of a delay for an environmental study.

Douglas Turner, a News columnist, explains how the Employee Free Choice Act is "Marxist". At some point, there's going to be a corollary to Godwin's Law that covers Marxism and socialism.

Massa's reluctance to support the budget is the focus of this WETM story.

The Hill discusses 2010 strategy for both parties, noting that Massa is part of the Democrat's Frontline program, which is designed to defend tight races.

Eric Massa's disappointment with limits on farm funding in the budget is present in the Star-Gazette.

But, interestingly enough, he's absent from this D&C story about a Federal Trade Commission investigation of gas prices in Western New York.

The Corning Leader covers Eric Massa's decision to back increased funding for stem cell research.

Congressional Quarterly analyzes the "clout" of the upstate New York delegation, including Eric Massa.

Massa attended a protest in Washington, DC yesterday, outside a meeting of AHIP (America's Health Insurance Plans). The Huffington Post has the story, and video of the protest is embedded below.