Bernard Madoff should be exhibit A in why the dark world of totally unregulated private money managers and hedge funds should be opened to the light of systematic government supervision. Instead, he is being treated as an aberrant menace.
The Bush-Obama strategy of throwing trillions at the banks to solve the mortgage crisis is a huge bust. The financial moguls, while tickled pink to have $1.25 trillion in toxic assets covered by the feds, along with hundreds of billions in direct handouts, are not using that money to turn around the free fall in housing foreclosures.
On Monday, two men with considerable responsibility for enabling the banking meltdown confronted the error of their ways. Hopefully Timothy Geithner and Lawrence Summers’ sudden conversion to common sense indicates the seriousness of the banking regulation plan that their boss, President Obama, will present to Congress today.
You probably don’t know much about Sheila Bair, but she is looking out for you, and that is why the big guys on Wall Street and their allies in the Obama administration are out to get her.
It would be nice to blame Ronald Reagan for the economic meltdown, as Paul Krugman did recently, but the facts don’t support it. Unfortunately, the real villains are closer at hand.
I expected a federal government that has spent trillions salvaging the banks that got us into this mess to find the relatively minor sums needed to bail out California and other states that have been the victims of Wall Street’s dangerous games. But I didn’t count on the tough-love steeliness of the Obama administration.
How much do you know about BlackRock and the hedge funds they manage? Better bone up fast, now that the folks at BlackRock are calling the shots in the government’s trillion-dollar bailout program. BlackRock execs are now directing key elements of the government program at a time when they stand to reap great profits from the fallout of a problem they helped create.
If the ranking Democrat on the House Intelligence Committee, and later House Democratic leader, lacked the authority to publicly question a policy of torture, then how can we condemn, indeed imprison, ordinary soldiers who thought it their duty to follow orders?
We are so inured to tales of business corruption that even a devastating exposé in The Wall Street Journal no longer shocks us. The fact that the chairman of the New York Federal Reserve Bank made millions off his secret purchase of Goldman Sachs stock has barely registered a blip of outrage.
Has Timothy Geithner ever had lunch with a non-megamillionaire who has lost his job or home because of the banking meltdown? I ask that question after reading the list of the treasury secretary’s luncheon dates when he was head of the New York Federal Reserve, a list that the government was forced to provide in response to a lawsuit.
We are being robbed big-time, but you can’t say we haven’t been warned. Not after the release Tuesday of a scathing report by the Treasury Department’s special inspector general, who charged that the aptly named Troubled Asset Relief Program is rife with mismanagement and potential for fraud.
One wonders if Phil Gramm has been made just a tad nervous by the news on Tuesday that one of UBS’ super-wealthy private clients has pleaded guilty to tax evasion.
Not surprisingly, Lawrence Summers is convinced that he deserved every penny of the $8 million that Wall Street firms paid him last year. And why shouldn’t he be cut in on the loot from the loopholes in the toxic derivatives market that he pushed into law when he was Bill Clinton’s treasury secretary?
The good news on the government’s “No Banker Left Behind” program is that, according to the special inspector general’s report on Tuesday, the total handout to date is still less than 3 trillion dollars. It’s only $2.98 trillion, to be precise, an amount six times greater than will be spent by federal, state and local governments this year on educating the 50 million American children in elementary and secondary schools.
Bernie Sanders, the senator from Vermont who is independent in spirit as well as party label, has placed a hold on President Obama’s nomination of Gary Gensler to head the Commodity Futures Trading Commission. Sounds like a minor issue to get worked up about, but I see this appointment as further evidence that the president has entrusted his economic policy to the wrong people.
There must be a criminal investigation of the AIG debacle, and it looks as if New York’s top lawman is on the case. The collusion to save this toxic company in order to salvage the rogue financiers who conspired to enrich themselves by impoverishing millions is being revealed as the greatest financial scandal in U.S. history.
We’ve already given AIG a total of $170 billion—an amount that dwarfs the $75 billion allocated to helping those millions of homeowners facing foreclosures. And more will be thrown down the AIG rat hole because President Barack Obama is blindly following the misguided advice of his top economic advisers, who insist that AIG is too big to fail.
We are lucky to have Barack Obama as president. I write that even though I believe the content of his Tuesday evening speech deserved no more than a B+ / A-, for its failure to seriously address the origins of the banking crisis and for only hinting at the severe military budget cuts required to get close to his goal of reducing the federal deficit by the end of his first term.
Congressional Republicans, with the exception of that embarrassingly shrunken contingent of three moderates, will rue their legacy of deep indifference at a time of true national emergency, one that makes George W. Bush’s far more costly war on terror now seem an absurdly irrelevant exercise.
What an insipid anticlimax! Rising to “a challenge more complex than our financial system has ever faced,” Treasury Secretary Timothy Geithner promised on Tuesday to give trillions more to the very folks who profited from that malignant complexity.
It is instructional that only one of the three tax-challenged Obama appointees has survived public scorn to claim a high position in the new administration. Oddly enough, it is Treasury Secretary Timothy Geithner, the man who will collect our taxes, whose career has not been stunted by his failure to pay them.
He is making trillion-dollar decisions that will cast the die for the rest of his promising agenda. Unfortunately, while he has already proved to be a brilliant agent of change in so many ways, in economic policy he has relied on the financial “experts” who helped get America into this mess.
Why rush to throw another $350 billion of taxpayer money at the Wall Street bandits and their political cronies who created the biggest financial mess since the Great Depression? And why should we taxpayers be expected to double our debt exposure when the 10 still-secret bailout contracts made in the first round are being kept from the public?
Why is it that there is such widespread acceptance, beginning with the apologetic arguments of President Bush, that whatever Israel does is always justified as necessary to the survival of the Jewish state? It is not.
The Age of Paine
