August 31, 2004

Dreyfus Affair II

A couple of months ago I would have said that the valid analogies of the politics of today to the Dreyfus Affair were limited to the fringe crazies on the right--the empire of the self-proclaimed God-King the Reverend Moon--like this piece by Kenneth Timmerman:

Will George Soros Panic the Market? - Insight on the News - Politics: Jan. 23, 2004 By Kenneth R. Timmerman: Wall Street sources... [Robert] Rubin... consummate insider... could be trying to talk the market down... Hungarian-born [George] Soros... fortune estimated at $7 billion... brazen assaults on world currency markets... political notoriety... technical market conditions that force other players "to take action triggered by what you did, independent of wanting to help you."... stock-market crash... panic selling. "Soros believes that if he can force the market down, he will have an effect in the real world," [Donald] Luskin says. "If it happens on Oct. 31, people might go into the voting booth with fear in their hearts."...

Should Soros decide to make a power play on the eve of the November 2004 elections, how would he do it? And what is the likelihood he would do so? Luskin believes Soros could choose to sell stock index-future contracts massively.... his early trades would make a profit... concerned investors should be watching for increased market volatility, starting in the futures pits, and for futures trading at a discount.... doomsday trading... self-fulfilling prophecy as U.S. financial markets collapse... leav[ing] Soros even richer.... "In the end, it could be a pure financial play, not a political play"...

But now we have Speaker of the House of Representatives Dennis Hastert in on the act, saying that George Soros gets his money from Drug Lords:

Lloyd Grove: Dennis Hastert... yesterday opened a second front. On "Fox News Sunday," the Illinois Republican insinuated that billionaire financier George Soros, who's funding an independent media campaign to dislodge President Bush, is getting his big bucks from shady sources. "You know, I don't know where George Soros gets his money. I don't know where - if it comes overseas or from drug groups or where it comes from," Hastert mused. An astonished Chris Wallace asked: "Excuse me?" The Speaker went on: "Well, that's what he's been for a number years - George Soros has been for legalizing drugs in this country. So, I mean, he's got a lot of ancillary interests out there." Wallace: "You think he may be getting money from the drug cartel?" Hastert: "I'm saying I don't know where groups - could be people who support this type of thing. I'm saying we don't know."

If you have any pretensions to libertarianism, you need to be working as hard as you can to destroy the modern Republican Party that produces things like this.

Posted by DeLong at August 31, 2004 08:49 AM | TrackBack

Wait a minute. Who's playing Dreyfus now? You're earlier post suggested Franklin. This one says Soros. Help me out here.

This analogy seems pretty dubious, in any case.

Posted by: JR at August 31, 2004 08:58 AM

Typo: "your" not "you're". Apologies to the sticklers.

Posted by: JR at August 31, 2004 09:00 AM

"Name-changing cosmopolitans putting money from unknown foreign sources into shadowy 527's....." [sinister music -- fade to shot of the Elders of Zion]....

Posted by: zizka / John Emerson at August 31, 2004 09:09 AM

The Russians say Soros is acting on behalf of US and CIA (in particular in Georgia), here the third guy in the line of succession says Soros is acting against US. Must be the space alien.

Posted by: a at August 31, 2004 09:10 AM

But, Brad, if you're a Republican, it's OK to invent wild, unsubstantiated, horrifying lies about ... anybody. (As long as they're not Republicans. If they're Republicans, you're only supposed to invent wild, unsubstantiated, reassuring lies.)

Didn't you get the memo?

Posted by: karl at August 31, 2004 09:12 AM

> "You know, I don't know where George Soros gets his money. I don't know where - if it comes overseas or from drug groups or where it comes from," Hastert mused.

It sounds like knee-jerk disbelief at the idea that a man espousing liberal values can game the market along with the best of them.

The double standard is enough to make me sick. If you're conservative, your wealth is a sign of merit. Otherwise, you must have obtained it illegally. I wonder how Denny manages to write off Warren Buffett.

Posted by: Paul Callahan at August 31, 2004 09:21 AM

Hoo boy, Donald Luskin again? How many times does this fool need to be proven an idiot before is permanently ignored? Our national tolerance for idiocy is through the roof. When did this occur?

Posted by: PigInZen at August 31, 2004 09:23 AM

What a despicable piece of crap. I feel bad for ever assuming that Hastert could be a good guy personally.

You know, they want to hang Tom Harkin by his balls for calling Dick Cheney a coward, yet when Hastert makes slanderous accusations, it's all good. The liberal media, my ass.

Posted by: Brian at August 31, 2004 09:26 AM


Look at the source. It's kind of like The Washington Times, if that helps you figure out why Luskin is quoted.

Posted by: Brian at August 31, 2004 09:28 AM

I've stopped paying attention to Luskin for some time now. The amount of salt needed for his declarations does nothing for my blood pressure.

Posted by: linnen at August 31, 2004 09:33 AM

Re: the Hastert comment, it is not obvious to me that the drug lords want a legalized drug market. Will they still continue to make as much money in a legal market where Pfizer and such can enter? I would counter that the drug lords, if anything, would pay Republicans like Hastert to keep the drug market illegal.

Posted by: venky at August 31, 2004 09:35 AM

> the Hastert comment, it is not obvious to me that the drug lords want a legalized drug market.

Of course they don't. Hastert is grasping at any connection. His insinuations are the modern equivalent of red-baiting. (Hastert: "I'm saying I don't know where groups - could be people who support this type of thing. I'm saying we don't know.")

Posted by: Paul Callahan at August 31, 2004 09:38 AM

If they're Republicans, you're only supposed to invent wild, unsubstantiated, reassuring lies.

Except, of course, in the primaries.

In other news, can somebody debunk, or provide appropriate context for this claim (from CBS Marketwatch. "Republicans turn to domestic issues...") "The unemployment rate in the United States right now, average rate around the U.S. is 5.5 percent, which is lower than it was in the '90s or the '80s or the '70s."

Posted by: some guy at August 31, 2004 09:47 AM

some guy,

If I am not mistaken, it's because people who normally would be looking for work have stopped.

Posted by: Brian at August 31, 2004 09:51 AM

It's interesting that Soros gets Republicans so unhinged. They really do believe in class warfare and can't get their heads around the notion that somebody with real money might be on the other side.

Posted by: Dan Ryan at August 31, 2004 09:52 AM


Balzac gives just the same sense of the Paris press from the Revolution on as Barbara Tuchman. Bloggers be aware, Balzac knew you 200 hundred years ago.

- I know the internet speeds things up, but beyond that, maybe it ain't so specially special, at least as regards its influence over political dialog. -

"Newspapers could be founded overnight by anyone with energy, financial support and a set of opinions to plead. Writing talent was hardly a special requirement, because everyone in the politico-literary world of Paris could write--and did, instantly, speedily, voluminously. Columns of opinion, criticism, controversy, poured out like water."

Posted by: anne at August 31, 2004 10:05 AM

Here it is:

Eric Margolis compares Captains James Yee and Alfred Dreyfus. He begins by saying "Hatred of Muslims has become the anti-semitism of our era."

Posted by: s9 at August 31, 2004 10:20 AM

Is our own political climate really akin to that of France in the 1880's or 1890's? Not even remotely so, and this should be studied with care. France, which had just come off the Franco-Prussian War and the Commune, was a remarkably fragile entity: not even the Great Depression compares with the climate of France at that time. How, then, to measure Hastert? Well, he's a worried man who always needs the sure thing--gerrymandered Republican districts, for instance--and he's also given to magical thinking (he thinks money can buy anything, for example, and so he thinks men of means, like Soros, are either angels or devils). What bothers him most, of course, is the Soros-backed fundraising success of Moveon.Org, Kos and other internet resources in the Congressional races. Hastert just hates to lose control; in this respect, he's really the twin of that other second-rate wrestler, Donald Rumsfeld. He's nothing to be afraid of--we just have to beat him into the ground like a wooden post.

Posted by: alabama at August 31, 2004 10:20 AM

oops. i meant to post that follow up to a previous thread.

Posted by: s9 at August 31, 2004 10:24 AM

Hey, where'd the content go? Sure there's a thoughtful argument to be made why the republican party is not a comfortable home for those who respect civil liberties and small government. But it's not one that most libertarians seem to buy yet.

Sure, we're all feeling shrill right now. And we will for at least the next two months (maybe longer, sigh).

But here's a vote for more macro-economics content, less channeling your democratic hack. I go elsewhere for my hackery. ;-)


Posted by: c w at August 31, 2004 10:29 AM

Hastert, Hastert, Has---aaaaaaaaagh!

Posted by: Randolph Fritz at August 31, 2004 10:39 AM

To put it another way: if George Soros were to write out a cheque to the Republican Party for $50,000, Dennis Hastert would think he's an angel (everything turning on money for Dennis Hastert). Things weren't nearly so labile with the Dreyfus Affair--i.e. mediums of exchange (like money) couldn't serve as mediums of positional change (once a Dreyfusard, always a Dreyfusard, right down to 2004). Whence the singular and unending violence of it all. However plausible, then, an analogy between Dreyfus and Soros may seem, what would be the grounds for its pertinence (really and truly, really and urgently)?

Posted by: alabama at August 31, 2004 11:00 AM

"if George Soros were to write out a cheque to the Republican Party for $50,000, Dennis Hastert would think he's an angel"

I'm not so sure; so far as I know Hastert is a religious man. He is also, very likely, an anti-Semite.

Posted by: Randolph Fritz at August 31, 2004 11:06 AM

The mortifying thing about Dennis Hastert (at least to a resident of Illinois like me) is that this demagogic buffoon actually represents our state. The shame is darned near unbearable.

Incidentally, cw, I would love to see more macroeconomic content. And we will, just as soon as the Republicans are willing to start discussing their past successes at macroeconomic policymaking and their plans for future macroeconomic policy. Are you willing to hold your breath for as long as it takes to see that?

Posted by: Uncle Jeffy at August 31, 2004 11:10 AM

People with pretensions to libertarianism who just Brad's post are probably too busy gagging or laughing to go about destroying the modern Republican party.

Lets see. Can we find a prominent Democrat who has said something outrageous or disgusting? Perhaps Al Sharpton. Maybe someone else. If we can should we conclude that anyone with pretensions to libertarianism should be working as hard as they can to destroy the modern Democratic party?

I mean why troll? Why not just do like every other blog and note that Dennis Hastert's comments where despicable and stupid.

Hit and Run had a nice post inviting users to talk about things we don't know about Dennis Hastert.

Maybe anyone with with pretensions to libertarianism should be over at Hit and Run.

Posted by: BigMacAttack at August 31, 2004 11:17 AM

BigMacAttack, c'mon--Hastert is the Republican House Leader, whereas Sharpton doesn't hold any office. Big difference.

Posted by: Randolph Fritz at August 31, 2004 11:48 AM

BigMac makes a rather fundamental error. Al Sharpton does not hold public office and has next to no influence over government. That won't change much if Kerry wins. Dennis Hastert is Speaker of the House, second only to the President in institutional power. We do not have divided government, and we have the closest thing to a disciplined party in many decades.

But I suspect he is mostly right about libertarians in general - I just returned from a Mt. Pelerin Society (classical liberals and libertarians, mostly) meeting where I was a guest. Most libertarians and others I met there were far more concerned that Kerry might support big government than that Bush was building it faster than any Democrat since FDR ever did. And at the same time building a corporatist machine to do an end run civil service laws so we can have a national political machine, while pushing for additional undermining of democratic liberties.

While there, I heard more claims that Rachel Carson was a mass murderer because she helped sway opinion against DDT, and that the Greens are the chief threat to freedom in the US, than I did criticisms of George Bush and the radical right. I do not exaggerate.

I admit that there are some noble examples to the contrary, but in general Libertarians are about as brain dead in politics and lacking in good sense, as any group of people I have ever met.

It was appalling.

Posted by: Gus diZerega at August 31, 2004 11:56 AM

Back to the topic of whether the Dreyfus affair is a proper analogy...
Where is anyone claiming that Soros has passed confidential information to foreign agents ?
Since Soros is Hungarian-American, what connection to DA is there other than slander by right-wing extremists ?
Since Dreyfus was falsely accused, shouldn't this be a condition satisfied in order to apply it to the Franklin investigation ?
Dreyfus' indictment was based on false documents whereas Franklin is cooperating with an investigation, how is Franklin a scapegoat ?

I see some parallels but they are rather disjointed and not at all convincing as an overall repeat (or rhyme) of history. Could someone please educate me on this historical episode and fill in the blanks ?

Posted by: self at August 31, 2004 12:03 PM

Those were 'right wing' libertarians. They vote Republican. They are dumb enough to go to Mt. Pelerin meetings. I have more sense than that. I am going to the World Science Fiction Convention in Boston tomorrow. It's fun hanging out with left wing libertarians at Worldcons.
Where else can you see Jaba the Hutt argue tariffs with Draco Malfoy, Frodo the Hobbit as moderator?

Posted by: walter willis at August 31, 2004 12:19 PM

It's analogy man and his new sidekick.

Yea my analogy is imperfect. Analogies tend to be that way.

Not a perfect analogy. But close enough.

Did I only imagine the Democratic party invited Sharpton to be one of it's key speakers?

Is there no chance I can find a statement in the same range of idiocy, meanness, and silliness as Hastert's statement, that was made by an elected Democratic official? Must that official have been speaker of the house?

This is just silly.

Posted by: BigMacAttack at August 31, 2004 12:23 PM

Randolph Fritz's final words were:
> Hastert, Hastert, Has---aaaaaaaaagh!
> I guess the GOP is really the "Grand 'Old Ones' party" after all. :-)

(Seriously, did nobody else find the original comment hysterically funny?)

Posted by: Jonathan W. King at August 31, 2004 12:45 PM

Didn't get the Chtulhu ref until you pointed it out.

Posted by: Matthew Saroff at August 31, 2004 01:07 PM

Hastert is too dumb for his own good. If Soros' money actually came from drug trafficking, why the hell would he or his supposed supporters want it legalized?

All the money that's in black market stuff like this is there precisely because it's illegal.

Posted by: C. at August 31, 2004 01:55 PM

Actually, a far more likely scenario given all the Iran sabre-rattling and recent revelations regarding US/Israel consultations re:Iran is that Bush will or already has given Israel permission to attack Iran's nuclear facilities as an "October Surprise" to swing the election his way.

"Bold" action like this would make him look "tough" on "terrorists" and put Kerry in the position of either having to compliment the president or disagree and look wimpy.

The fact that it would throw Iraq, and a lot of the rest of the Mideast into a frenzy is something to deal with after the election.

Anyone else agree with the likelihood of this scenario?

Posted by: quietpc3400 at August 31, 2004 02:25 PM

Brian, I realize it was from the Washington Times. I just think that Luskin's credibility (and by extension, the Times') is not worth two seconds of my media attention.

Posted by: PigInZen at August 31, 2004 02:33 PM

C. wrote, "All the money that's in black market stuff like this is there precisely because it's illegal." Exactly. So much for right-wingers understanding economics.

Posted by: liberal at August 31, 2004 02:49 PM

A characteristically inept piece of writing by Big Mac, followed by a self-pitying complaint that people are criticizing his bad writing. Who sends him here?

If you look at Soros' enemies, Democrats should be showcasing him and bragging about him rather than defending him. He played as big a role as any Western individual in the fall of Communism. His enemies tend to be semi-fascist nationalists, post-Communist dictators, Muslim heads of state, and LaRouchies. All of his business activities have been standard practice at the time he did them, except that he played the game better than others. Reforms may be needed, but Soros has admitted as much.

Compare the Koch brothers, Scaife, and Rev. Moon -- the Republican big money guys. Two of them are arguably mentally ill, and the Koch brothers are fanatics.

Posted by: zizka / John Emerson at August 31, 2004 03:22 PM

I always suspected that Hastert was a dishonest politician. But I did not think him to be as stupid and ignorant as he proved in the quoted interview. Legalization of the drug trafe would LOWER drug prices, not RAISE them. Also, any even halfway knowledgable person familiar with the history of the USA knows, that the gangsters were in favour of prohibition, because it kept rotgut prices high, and fought Roosevelt and the Democrats because the abolition of Prohibition would lower liquor prices. But as the saying goes: a crook thinks everybody is crooked. It does not even occur to Hastert that honest billionaires could also exist, who would work and vote for a candidate whose policies are in the PUBLIC interest.

Posted by: Thomas T. Schweitzer at August 31, 2004 04:30 PM

You'll remember a couple days ago we noted House Speaker Denny Hastert suggesting that George Soros may get his money from drug

I've talked to reporters who've asked Hastert this around the convention hall. And he's been aggressively restating the 'charge.' I'm told he even shoved his finger in the chest of one of them when repeating it.

Now Soros has written this letter to Hastert, asking him to put up or shut up, or, more specifically "either substantiate these claims -- which you canont do because they are false -- or publicly apologize for attempting to defame my character and damage my reputation."

Whatever you think of Soros, this is the sort of slur that only comes from a real pig. And to think that the author of it is the Speaker of the House of Representatives, and out in the light of day.

-- Josh Marshall

Posted by: anne at August 31, 2004 04:38 PM

zizka / John Emerson,

What on earth are you reading? Where do I complain that someone is criticizing my writing?

Self pity. Where?

I kinda of feel bad for you and Randolph. Appearently all you can do is whine about my writing and all Randolph can do is say that my analogies are imperfect. It is a little depressing.

Posted by: BigMacAttack at August 31, 2004 04:43 PM

" destroy the modern Republican Party..."

Brad, how I wish that I could find a way to think that you knew what you meant by this! Whoever discovers the correct value of "destroy" in that equation may save a hundred million lives. Somehow I suspect the discovery will prove exceedingly elusive.

Posted by: Frank Wilhoit at August 31, 2004 04:55 PM

Interesting that Luskin's proposed method of sinking the stock market is COMPLETELY LUDICROUS. If that method were plausible, Soros could make $7 billion a day, not over his entire (30+ year) career. The market in stock market futures is huge - Soros probably has enough money to influence trading for a short time, but not infinitely (certainly not without borrowing heavily which introduces both limits on Soros and greater information leak). On that scale, knowledge would get out that he was the single player betting against the market, which would completely negate the previously implied information value of the trades (i.e., that lots of puts are being bought because lots of seperate individuals are growing negative about the market). After people know that it's only Soros behind the trades, they're very likely to bet against him - Soros has been publically wrong on the direction of the US markets several times. Even more importantly, it will mean that one guy (Soros) is negative on the market, while if everybody else retains their old opinion - meaning overall (if everybody else was either collectively either ho-hum or positive on the prior market level), the market is growing progressively even cheaper and thus, more attractive to buy, rather than less. Especially so if Soros' reason is for political purposes (i.e. Soros' opinion on the stock market isn't actually being coded into his trades, so the trades only carry informational value about his political views but not his economic ones).

That may have been too technical, but things like this have been tried before. They can work for short times in small markets, but wouldn't work on anything of the size of the US equity markets. Not surprising that Luskin was a horribly bad money manager.

Posted by: burritoboy at August 31, 2004 05:00 PM

Geez, we're still on this Soros drug money slander thing ??? I never heard any right-wingers complain about Roberto Hernandez being on the Citibank board. Doesn't Citibank make some substantial contributions to Republican candidates ?
This whole discussion is a diversion !

Posted by: self at August 31, 2004 06:09 PM

I should expand on that before the tin-foil comments come in.
Hernandez was in charge at Banamex before Citigroup bought it in 2001. Hernandez sued Por Esto Publisher Mario Menendez in Mexico over claims of cocaine smuggling. When the courts found that Menendez's claims were valid Hernendez then tried to sue in NY to no avail. So, we have a known drug money launderer who relied on Goldman Sachs and Sullivan Cromwell to complete the deal with Citigroup ending up on the board at Citigroup.

Posted by: self at August 31, 2004 06:46 PM

When I first read about this latest Hastert antic, I just basically rolled my eyes. But then, when I actuallyI clicked on the link at "Talking Points Memo" that gave George Soros' letter in response, I almost got physically ill. So everybody should read this:

And then everybody should visit the website of his opponent:

And then anybody who thinks this fairly innocuous guy would nonetheless make a vastly superior congressman than the slandering fool they currently have, should donate lots of money to this opponent, and cross their fingers. Hastert would still be the prohibitive favorite in this race, but you have to start somewhere to get the real creeps out of Congress.

Posted by: Jonathan King at August 31, 2004 07:23 PM

Dennis Hastert taught gym

Posted by: Eli Rabett at August 31, 2004 07:31 PM

BigMacAttack --

Just ONCE write something worth responding to, and I'll respond to it. Everything I've seen be you is all gas and debater's tricks. I have trouble believing that you're older than 15. Anyone can hit the POST button, alas.

Posted by: zizka / John Emerson at August 31, 2004 09:11 PM

What Hastert did was a disgusting anti-Semitic slur: rich cosmopolitan foreigner with too much international money earned by obscure and probably illegitimate means, and all of this suspicious cosmopolitan's actions somehow connected with undermining the morals of right-thinking natives.

How many times have we heard that over the last 1000 years?

Why wasn't it coded better -why so bald? Maybe because the latest polls confirm that Bush has probably lost the Jewish vote? That is a cynical guess that I hope is wrong.

And how can this be compared to the silly charge that criticizing the neo-cons because they are too attentive to Likud (not Israeli or Jewish, but the Likud party) interests? I don't think it compares at all. And that was always a very minor side issue, not the main or principal objection to their policies at all. That may change with the FBI investigation, but heretofore it has been a minor issue.

Posted by: jml at September 1, 2004 11:41 PM