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Courage Award Honors Two Women Who Warned Us

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Posted on Mar 28, 2009
Bair
AP photo / Harry Hamburg

Don’t say she didn’t see it coming: FDIC Chair Sheila Bair testifies March 19 at a Senate Banking Committee hearing on bank supervision and regulation.

There has been much hand-wringing, not to mention finger-pointing, regarding who knew what, and when, about the financial calamities that have recently come to pass. However, Brooksley Born and Sheila Bair won’t be counted among the willfully or accidentally ignorant: They’ve been named this year’s winners of the JFK Profile in Courage Award for sounding the alarm far ahead of time.

Bloomberg.com:

Bair, chairman of the Federal Deposit Insurance Corp., and Born, chairman of the Commodity Futures Trading Commission until 1999, were honored for “political courage,” the John F. Kennedy Library Foundation announced yesterday [Wednesday] in a statement.

The policy makers “recognized that the financial security of all Americans was being put at risk by the greed, negligence and opposition of powerful and well-connected interests,” Caroline Kennedy, the foundation’s president and daughter of the late president, said in the statement.

Bair, 54, who took over the FDIC in 2006, was among the first regulators to prod the mortgage industry to modify loans at risk of foreclosure to help borrowers keep their homes as losses mounted after the collapse of subprime market. Born, 68, lost a fight to bring over-the-counter derivatives under the regulatory control of the CFTC [Commodity Futures Trading Commission], after warning in 1998 that the contracts “pose grave dangers to our economy.”

“The catastrophic events of recent months have proved them right,” Kennedy said.

Read more

Additional links:

Read a tribute to Brooksley Born by The Nation’s Katrina Vanden Heuvel here.

Born was vindicated, according to this Bloomberg story from last November, when her warnings finally started sinking in—a decade later—among those she most wanted to take action.

Around that same time last fall, Bair was locking horns with then-Treasury Secretary Henry Paulson over how to help homeowners who faced foreclosure, as this U.S. News & World Report article details.

Click here for Bair’s official FDIC profile.

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Anarcissie's avatar

By Anarcissie, March 31, 2009 at 8:18 am Link to this comment

cyrena:
‘The OBVIOUS is the fact that I’ve been questioning all of you on this forum, for well over 4 months, (since the complaints about Summers goes back to even before Obama won), and guess what, not a single solitary person, (you and Jackpine included) ever suggested that these women would be better selections. Funny you’d come up with this now, (but then I suspect that neither of you ever even heard of these women before now). ...’

As it happens I work in the financial “industry” so I knew about both of them, but that’s mostly by chance.  The media do not find such people glamorous enough to noise them about.  I did copy a long article about Born several months ago and posted it somewhere.  But you know, people like Bair and Born, people who do their jobs and do them well, are not going to be appointed to the kind of job Larry Summers or his friends will be given.  They’re not politicians.  In any case, suppose I did post an article here about Born or Bair?  What difference would it make?  Obama isn’t reading Truthdig to know who to appoint.  And by and large, I’ve found that no one reads anything longer than a paragraph unless there’s some money or other strong desirable connected to it.  (Which led to my humorous observation in the newspapers-are-dying topic, since borne out in subsequent responses.)  It would take three or four paragraphs to explain what was so great about Born or Bair, and by then I’d have lost most of my audience.  The rest would depart when they copped to the possibility that I might be tarnishing Mr. O’s halo.

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By cyrena, March 30, 2009 at 11:06 pm Link to this comment

By Anarcissie, March 28 at 11:17 pm #

These are the people Obama should have appointed to fix the financial system, not the blockheads Summers and Geithner, who were and are part of the problem.  But I suppose I’m merely stating the obvious.

~8~

Maybe not Anarcissie,(stating the obvious)

The OBVIOUS is the fact that I’ve been questioning all of you on this forum, for well over 4 months, (since the complaints about Summers goes back to even before Obama won), and guess what, not a single solitary person, (you and Jackpine included) ever suggested that these women would be better selections. Funny you’d come up with this now, (but then I suspect that neither of you ever even heard of these women before now).

The only other ‘obvious’ is the fact that for most of you, it wouldn’t have mattered a whit who Obama selected…you still would have bitched about it.

Obama could have selected god for the job, and Jackpine would have sworn that he was a democrat, and therefore unfit for the job.

The reality is that Geitner had nothing to do with the legislation that deregulated everything. Try Phil Gramm. Check into Tom DeLay. Just google them.

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By P, March 30, 2009 at 6:32 pm Link to this comment
(Unregistered commenter)

Please spread the word and help stop the Senate from passing this bill without any stipulation on the use of FDIC’s increased borrowing power up to $500 billion from $100 billion (if Im reading this corretly all FDIC needs are approvals from its board of directors, the Fed, and Geithner)-

“During the period beginning on the date of enactment of this paragraph and ending on December 31, 2010, if, upon the written recommendation of the Board of Directors (upon a vote of not less than two-thirds of the members of the Board of Directors) and the Board of Governors of the Federal Reserve System (upon a vote of not less than two-thirds of the members of such Board), the Secretary of the Treasury (in consultation with the President)...”

http://www.opencongress.org/bill/111-s541/text

This money needs to be used ONLY for deposit guarantee and bank failures (check out my previous post about how this credit line increase requested by the FDIC all started), not for bonds to help banks raise capital, not for Geithner’s “legacy” assets.  If Geithner wants taxpayers to contribute, go ask Congress directly.

DO NOT LET FDIC become AIG; AIG was selling CDS contracts without adequate reserve and this is EXACTLY what is happening with FDIC, when it breached its role to protect deposits and started backing bonds and now potentially toxic assets.

*imho*

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By mlb, March 30, 2009 at 8:00 am Link to this comment

Larry Summers is the guy who was forced out of Harvard after making statements to the effect that women are inherently inferior to men at science.  Corroborating Wildflower’s point, it wouldn’t be a bit surprising that he’d resent the appointment of women to top positions.  And on a different track, given that blacks are even less well represented in science than women, I wouldn’t be a bit surprised if Larry Summers thinks blacks are inferior as well (or all goyim for that matter).

Taking that aspect of Summers persona along with the fact that he was one of the original engineers of the deregulation that enabled the destruction of the world economy, the glaring question is why in the world would Obama appoint a guy like that?  The only answer I can come up with is that his obsequiousness to the financial elite is total.

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Anarcissie's avatar

By Anarcissie, March 29, 2009 at 7:17 pm Link to this comment

jackpine savage:
’... Amen, Anarcissie.  These are the type of people that Obama could have nominated.  The question is why didn’t he?’

I don’t think he’s in a position to fight the most important sectors of the ruling class at this point.  In any case, his position papers as a candidate indicated that he was a cautious, conservative politician, and this is what we’ve been observing since he won the election.  Types like Summers and Geithner may be blockheads, but they are very well connected and Mr. O does not want to do a civil war, at least not this year.  He’s going to do things one patch at a time.

Wildflower’s idea that the bonus boys might have been uncomfortable with female overseers is one possible aspect of that conservatism.  The financial “industry” is still pretty male-dominated at the top.  Masters of the universe and all that, you know.

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Ed Harges's avatar

By Ed Harges, March 29, 2009 at 5:24 pm Link to this comment

What Caroline actually said was, “The, you know, catastrophic events of recent months have, you know, proved them right….”

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By jackpine savage, March 29, 2009 at 5:10 pm Link to this comment

What?  I thought nobody could have seen this coming…

Amen, Anarcissie.  These are the type of people that Obama could have nominated.  The question is why didn’t he?

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By wildflower, March 29, 2009 at 11:26 am Link to this comment

RE Anarcissie:  “These are the people Obama should have appointed to fix the financial system, not the blockheads Summers and Geithner, who were and are part of the problem.  But I suppose I’m merely stating the obvious.”

But the Wall Street “bonus baby boys” would have felt uncomfortable - maybe even upset - if such powerful appointments had gone to women.

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G.Anderson's avatar

By G.Anderson, March 29, 2009 at 10:19 am Link to this comment

I also believe that Elizabeth Warren deserves mention here, she has been a long advocate of consumer rights and protection from the predatory credit card companies.

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peterjkraus's avatar

By peterjkraus, March 29, 2009 at 7:25 am Link to this comment

There’s your answer to “Who knew?”

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Purple Girl's avatar

By Purple Girl, March 29, 2009 at 7:10 am Link to this comment

They not only know where the bodies are buried but Exactly Who is respsonsible for putting them there. I want to hear these two real- unhindered testimony about all the players in this Treasonous economoic conspiracy. I want them to expose not only the Wallstreeters, but every SOB who passed legislation enabling this Countries highest of Crimes to occur. In fact let those two woman sit at a table and perform an inquisition on the Various financial Commitees who are doing nothing but trying desperately to cover their own asses with this charade.
The antics of Wall Street would ahve been prosecuted immediately ahd it not been for both Houses and both sides of the Aisle granting Liberties Well beyond the Scope of what the Constitution was to allow.Waht part of the Founding Documents confused these “Public servants” about whom they were to protect and Defend. Waht part of ‘We the People’ and ‘for & by’ eluded your common sense.
No doubt Bachman considers herself operating behind enemy lines - she along with much of Congress have proven themselves to be Red Coats!Who couldn’t recongize the paralles between Trickle down and feudalism? Bachman knew exactly what she was saying when she was concerned the number of rich people (nobles) were dwindling. She is cognizant of the implication of her statement as much as Greenspan was of the ramifications of Trickle Down- could we get any more taped confessions of Treason? Frankly their attitudes reflect their fearless leader’s Cheney’s “So”.
I’m not just ready to start stringing up the Profitters for their part in this conspiracy against the US, I’m itching to hang a good number of Politicians too!Those who have proudly wore their Red Coats and those who have used a Blue overcoat to conceal them.

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By P, March 29, 2009 at 1:41 am Link to this comment
(Unregistered commenter)

Wake up people!

How ironic Sheila Bair is getting this award along with Brooksley Born who wanted to regulate derivatives!

“when Bair was the head of the CFTC, and
there was an intense debate over whether more regulation of
derivatives was needed, here’s what Bair had to say (from an October
1993 Bloomberg article): THE Commodity Futures Trading Commission
(CFTC) has given the US$ 4.8 trillion derivatives market a clean bill
of health, saying that fundamental changes in the way the market is
regulated are not needed…. “We have a strong affinity for
derivatives at this agency,” said acting CFTC chairman Sheila Bair.
“We like them.”“

http://209.85.173.132/search?q=cache:ELvanw-xrHgJ:economicsofcontempt...

FDIC is supposed to stabilize the financial system. Sheila Bair
herself said she was afraid of a Wamu bank run so she had to act
immediately. So why was she creating a panic by declaring FDIC could
be insolvent before the end the year and therefore it was necessary to
raise bank fees? What was so different about FDIC between now and last
year? Did she not realize her statement could have caused the biggest
bank run in US history? In fact, within just a few days Bair made
several contradictory statements regarding FDIC’s potential insolvency
and her concern for using taxpayers money as a solution to that
problem.

March 4, 2009
“No Taxpayer Funds Bair rejected arguments that the agency should use
government aid to rebuild the fund. The FDIC has authority to tap a
$30 billion line of credit at the Treasury Department and legislation
pending in Congress would boost the amount to $100 billion.“Banks, not
taxpayers, are expected to fund the system,” Bair said. Asking for
taxpayer support “could paint all banks with the ‘bailout’ brush.” “

http://www.bloomberg.com/apps/news?pid=20601103&sid=alsJZqIFuN3k&refe;...

March 6. 2009
“The Federal Deposit Insurance Corp. may reduce an emergency fee on
banks to bolster reserves if Congress expands the agency’s borrowing
authority with the Treasury Department to $100 billion, Chairman
Sheila Bair said”

http://www.bloomberg.com/apps/news?pid=20601103&sid=aGewvZuHR3dk&refe;...

March 9, 2009
“Bair said the FDIC had enough money in its industry-funded reserves
and was fully backed by the U.S. government. “The money will always be
there,” she said. “We can’t run out of money.”“

http://www.reuters.com/article/GCA-CreditCrisis/idUSTRE5282OL20090309

So is this the same $500 billion for Geithner’s legacy asset plan?  Shouldnt the Congress stipulate this money only to be used to protect deposit and process bank failures?

*imho*

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By mill, March 29, 2009 at 12:14 am Link to this comment

Let’s hope their wisdom shapes policy going forward.  There’s still room for improvement in the federal approach.

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Anarcissie's avatar

By Anarcissie, March 28, 2009 at 8:17 pm Link to this comment

These are the people Obama should have appointed to fix the financial system, not the blockheads Summers and Geithner, who were and are part of the problem.  But I suppose I’m merely stating the obvious.

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