Winner 2013 Webby Awards for Best Political Website
Top Banner, Site wide
Apr 17, 2014

 Choose a size
Text Size

Top Leaderboard, Site wide

Jeb Bush’s Optimism School
Climate Costs ‘May Prove Much Higher’




Paul Robeson: A Life


Truthdig Bazaar more items

 
Report

Perp Walks Instead of Bonuses

Email this item Email    Print this item Print    Share this item... Share

Posted on Mar 18, 2009
Cuomo and AIG
Composite: AP photo: Mike Groll, file, and Mark Lennihan

Laying down the law: New York Attorney General Andrew Cuomo is on AIG’s case.

By Robert Scheer

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. Instead of taking bonuses, the culprits should be taking perp walks. 

I’m not just referring to the swindlers in the Financial Products Subsidiary of AIG who devised and sold those insurance policies on derivatives that brought the world economy to its knees. They do seem deserving of a special place in hell, and presumably the same divine power that according to Scripture labeled usury a high moral crime and threw the money-changers out of the temple will consider that outcome.

However, the enablers are the AIG leaders who, as New York Attorney General Andrew Cuomo revealed Tuesday, signed those bonus contracts a year ago to reward the very people “principally responsible for the firm’s meltdown.” That’s a cool $44 million divided among the top 10 shysters, even though the depth of their chicanery was well known to top management. 

As Cuomo noted in a letter to Rep. Barney Frank: “The contracts shockingly contain a provision that required most individuals’ bonuses to be 100% of their 2007 bonuses. Thus, in the spring of last year, AIG chose to lock in bonuses for 2008 at 2007 levels despite obvious signs that 2008 performance would be disastrous in comparison to the year before.”

The lame argument that those bonus-baby employees needed to be retained in order to sort out the mess they had created was also shot down by Cuomo, who revealed after his office’s initial investigation had pierced AIG’s veil of secrecy that “[e]leven of the individuals who received `retention’ bonuses of $1 million or more are no longer working at AIG, including one who received $4.6 million.”

Advertisement

Square, Site wide
But the $165 million in taxpayer funds used to reward them is but a sideshow in a far larger drama of moral decay swirling around the banking bailout. It should not distract from the many billions, not paltry millions, of our dollars being diverted to reward the very folks who brought us such misery. Consider the $12.8 billion of the $170 billion that taxpayers gave AIG in bailout funds that AIG then secretly diverted to Goldman Sachs, a company that evidently has a lock on both the Treasury Department and the Federal Reserve no matter which political party is in power. It was the biggest payoff among those that AIG made to a score of foreign and domestic financial giants.

The bailout is a response to a banking crisis that resulted from the radical deregulation pushed by former Goldman Sachs honcho Robert Rubin when he was President Clinton’s treasury secretary. Another Goldman Sachs chairman-turned-treasury-secretary, Henry Paulson, in the Bush administration designed the trillion-dollar bank bailout that will go down as the greatest swindle in U.S. history.

It was because of Paulson that AIG was saved from bankruptcy hours after Goldman rival Lehman Brothers was allowed to go down the drain. Why that reversal of strategy in a top-secret meeting called by then New York Fed Chair Timothy Geithner, a Rubin protégé and now Barack Obama’s treasury secretary? Why was Goldman’s Lloyd Blankfein the only financial industry CEO in attendance? When that news leaked out, his role was defended as that of a noninvolved concerned citizen with expert knowledge, and whose firm had no direct monetary stake in the outcome.

That was a lie. 

Goldman Sachs was into AIG insurance policies for at least $20 billion, which is why the firm got that $12.8 billion while Paulson was in charge. It took six months for the embarrassing facts to finally come out. The bailout program was administered by Neel Kashkari, a former Goldman Sachs VP; why are we not surprised at that?

Another pretend innocent in all this is AIG’s CEO Edward M. Liddy, famed defender of the $440,000 AIG executive retreat in Monarch Beach, Calif., held on the heels of the taxpayer bailout. His actions now are defended as mistakes made by a well-intentioned outsider who decided to work for a dollar a year after Paulson appointed him head of AIG. That is just garbage. 

Liddy was complicit in Goldman Sachs’ role in creating this mess. As a director of Goldman Sachs, he was paid $685,770 in 2007 and would have come in for some questioning if the firm had gone down. Liddy even headed its audit committee during the five years before he resigned that seat to take over AIG in September 2008. As for his salary sacrifice, not to worry; in 2005, when he was still CEO of Allstate Insurance, he received $26.7 million in compensation.

What we have here is a rare glimpse into the workings of the billionaires’ club, that elite gang of perfectly legal loan sharks who, in only the most egregious cases, will be judged as criminals—Bernard Madoff, former chairman of NASDAQ, comes to mind. These other amoral sharks, who confiscated billions from shareholders and the 401(k) accounts of innocent victims, were rewarded handsomely, rarely needing to break the laws their lobbyists had purchased. 

Click here to check out Robert Scheer’s book,
“The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street.”


Keep up with Robert Scheer’s latest columns, interviews, tour dates and more at www.truthdig.com/robert_scheer.



TAGS:



Get truth delivered to
your inbox every week.

Previous item: Sarkozy’s Courtship of NATO Defies Rationality

Next item: If You’re a ‘Little Guy,’ a Contract Means Nothing



New and Improved Comments

If you have trouble leaving a comment, review this help page. Still having problems? Let us know. If you find yourself moderated, take a moment to review our comment policy.

By Michael Shaw, March 29, 2009 at 9:47 am Link to this comment
(Unregistered commenter)

I agree with Louise in this sense, it’s better then having Bush in there. We mustn’t forget though that those who empowered Bush and those whom Bush served are still out there weaving their deceitful webs. They also influence Obama (apparently) concerning some of these so called new sweeping laws that are supposed to save us. Empowering the FED with more power is cutting off his nose to spite his face. William Greider is the guy he ought to be listening too. Him and Paul Krugman. In fact we all should! That said, Obama to me is also a breath of fresh compared to the stale root cellar of the last 8 years. In fact it can be argued, at least in terms of the stimulus package(Also an end to torture and hopefully an end to the war in Iraq)that Obama has done more for this country in a few weeks then Bush did in 8 years! But the bottom line is when the president is about to blunder, it is our duty to steer him in the right(correct) direction. Regulate? Yes! Break up these too big to fail institutions? Absolutely! But we will never get this done by giving the FED even more sweeping powers. They set the stage for this crisis. In fact they were cheerleaders for it. That isn’t a move to change but rather a move to further consolidate power to a few grandiose corporations and perhaps leave it that way indefinitely.

http://www.truthout.org/032809A

Report this

By flow, March 25, 2009 at 10:38 am Link to this comment

AIG and the Big Takeover: Matt Taibbi on “How Wall Street Insiders Are Using the Bailout to Stage a Revolution”

In a new article in Rolling Stone Magazine, journalist Matt Tabbi takes an in-depth look at the story behind AIG. “The reality is that the worldwide economic meltdown and the bailout that followed were together a kind of revolution, a coup d’état,” writes Taibbi. “They cemented and formalized a political trend that has been snowballing for decades: the gradual takeover of the government by a small class of connected insiders, who used money to control elections, buy influence and systematically weaken financial regulations.”—Democracy Now!

For those that prefer watching or listening to reading, you can see Matt Tabbi discussing his Rolling Stone article with Amy Goodman.

Report this

By TAO Walker, March 23, 2009 at 1:05 pm Link to this comment

The questions asked below by 99jonny100, though doubtless sincere, are typical of ones plaguing and CONfusing those domesticated peoples caught-up in the zero-sum “game” of “civilization.”  Our Mother Earth and Life Herownself are not subject to such make-believe limitations.  Neither are those of their Children who abide in the integrity of their own given organic function within the Natural Living Arrangement.

So this Old Man has no “answers” for 99jonny100, since the CONundrums implied do not exist for us.  The Great Song ‘n’ Dance goes on.  ALL belong to it.  None are “LOST.”  Every virtual world-o’-hurt breaks-down under its own internal CONtradictions….as the crude “dominance” paradigm captivating so many of our tame Human Relations here is in the throes of doing even now.

What perverted “agency” insists that any “Quantum of Solace” must be offset by an at-least equal “Quantum of Suffering”?  These are the “calculations” of the criminally insane.  No Person or People is obliged to submit to them.  Those poor specimens who do, have only their own ignorant fear of “death” (however “honestly” come-by) to account for their misery.  Our tormentors are painfully aware of that fact….thus the death-worshipping cult they’ve established and aim to soon terminate here.

No wonder their “god” is so goddamned jealous.

HokaHey!

Report this

By christian96, March 23, 2009 at 1:36 am Link to this comment

For those of you searching for the truth among the
chaos.  You should have studied your Bibles.  Dust them off and read them.  Terrorism, global financial
turmoil, etc. are preparting the way for the ONE WORLD GOVERNMENT AND THE MARK OF THE BEAST!  When Big
Brother TELLS you to accept the mark for buying and
selling, DON’T TAKE IT!  Revelation 14:9 “And the third angel cried with a loud voice, If any person
worship the beast and his image, and receive his mark
in his forehead, or in his hand, THE SAME SHALL DRINK
OF THE WINE OF THE WRATH OF GOD….AND THEY SHALL BE
TORMENTED WITH FIRE AND BRIMSTONE IN THE PRESENCE OF
THE HOLY ANGELS AND IN THE PRESENCE OF THE LAMB: AND
THE SMOKE OF THEIR TORMENT ASCENDS UP FOR EVER AND
EVER: AND THEY HAVE NO REST DAY NOR NIGHT, WHO WORSHIP THE BEAST AND HIS IMAGE, AND WHOSOEVER RECEIVES THE MARK OF HIS NAME.  Want more truth?
Revelation 16:10, AND THE FIFTH ANGEL POURED OUT HIS
VIAL UPON THE SEAT OF THE BEAST; AND HIS KINGDOM WAS
FULL OF DARKNESS; AND THEY GNAWED THEIR TONGUES FOR
PAIN.  AND CURSED THE GOD OF HEAVEN BECAUSE OF THEIR
PAINS AND THEIR SORES, AND REPENTED NOT OF THEIR EVILS.  Just for a little icing on the cake, James
5:1 reads, GO TO NOW, YOU RICH PEOPLE, WEEP AND HOWL
FOR YOUR MISERIES THAT SHALL COME UPON YOU!  Are you
still breathing?  Then, it’s not too late.  REPENT!

Report this
Clash's avatar

By Clash, March 22, 2009 at 3:29 pm Link to this comment

flow;

The financial overlords have “clear cut” their way to impoverish us all.

Report this

By flow, March 22, 2009 at 3:04 pm Link to this comment

Clash, March 22 at 3:49

Truth is a clean drink of water, a clean breath of air,
food without poison in it.

Ain’t that the truth!

I think it was Thomas Friedman in his NYT op-ed column who was the most recent in the MSM to apply a financial metaphor to the ecological crisis when he said that “we have been living off of principal rather interest” (i.e. consuming the resources that produce the fruit rather than harvesting the fruit).

Perhaps we could come up with an ecological metaphor for the financial crisis? We have poisoned the well! Or maybe, we used to damn much fertilizer to grow our money supply? Any other suggestions?

Report this
Clash's avatar

By Clash, March 22, 2009 at 12:49 pm Link to this comment

Truth is a clean drink of water, a clean breath of air, food without poison in it. The rest just lie’s to keep the masses from the truth. Civilization is dying and we are just witnesses to the beginning of the end.
What matter that a few steal like they always have, that governance around the world is corrupted by greed in it’s headlong race to turn the living into the dead for profit. We can either go along or just simply walk away.
The government of occupation cares nothing for us as human beings , nor does it care for the non humans or the land that we need for our survival.This group of killer clowns is no different than the last.

Report this
Outraged's avatar

By Outraged, March 21, 2009 at 11:19 pm Link to this comment

Re: Louise

Your comment: “Shame on Obama! He should have been on top of that!”

It appears you misunderstand the sentiment of the nation.  It isn’t that Obama “should have been on top of that” at the time (although as a senator it isn’t impossible to make a case in this capacity), but that he should NOW BE on top of THIS.

He KNEW, (as we all did) as he took office, what had already transpired, yet he chose Geithner and Summers via Jamie Rubin’s endorsement (son of Robert Rubin) to follow this path.

So this “It’s not Obama’s fault” mantra is quite thin now, and wearing ever thinner and soon he’ll be as transparent as the GOP crooks or one of them.  Same shit, different pile.

Who is Obama considering as undersecretaries of the Treasury….?  A couple of Citibank crooks.

So yes.  SHAME ON OBAMA IS ACCURATE.

Report this

By wildflower, March 21, 2009 at 8:30 pm Link to this comment

Re:99jonny100

Wishing upon an imaginary “Brutus” to rescue you. . . I see. . . And the “regime” change you mentioned? . . . Will any old “regime” change do?

Report this

By dadofone, March 21, 2009 at 5:06 pm Link to this comment
(Unregistered commenter)

Sideline Geithner and bring up Spitzer from the farm league.  What was a little sex scandal compared to the scope of this racket.  He already found the culprits a year ago and was hung out to dry for it.

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html


http://www.alternet.org/blogs/peek/132547/was_eliot_spitzer_taken_out_because_he_was_going_to_bust_aig/


http://www.slate.com/id/2213942/  The Real Scandal at AIG

Report this

By christian96, March 21, 2009 at 3:22 pm Link to this comment

I was wrong in my previous comment.  The fellow begging for money was MICHAEL EVANS not Michael
Brown.  He wants to help Israel.  If he wants to
help Israel I suggest he follow the commantment of
God in Isaiah 58:1: “Lift up your voice, like a
trumpet, and SHOW ISRAEL THEIR SINS!”  He won’t be
very popular, old ladies won’t send him money, but
he will be following the COMMANDMENT OF GOD!

Report this

By 99jonny100, March 21, 2009 at 2:56 pm Link to this comment

to Tao walker:
Who wins,  in your lofty mythology of Mother Earth’s progress?—after the “two-legs” have suffocated in their own waste,
and self- destroyed in a final fiery blaze. There is still much human
suffering to be done, before that day comes.
Are you saying that the Earth is the ultimate survivor? Pls clarify.

Report this

By christian96, March 21, 2009 at 2:51 pm Link to this comment

I was just flipping through the channels looking for
something intellectually stimulating when I
encountered Michael Brown, a SO-CALLED born again
Christian.  Being a Christian, I thought I would
listen to him.  He was begging for money to protect
Israel from Jimmy Carter and the LEFT WING LIBERALS.
Of course he didn’t define “left wing liberals” so I
didn’t know what he was talking about.  But it sounds
good.  Especially when you are begging poor old ladies for money.  He reminded me of that great fat
cat bag of wind I heard on the radio several days ago, Russ Limpbaugh.  Throw out those terms loaded
with emotional connotation to stir up the masses.
Michael Brown had ugly hair dyed black and a black
moustache.  Obviously he did’nt read the words of
Jesus about “DENYING YOURSELF.”  Would someone please
inform these dececptive manipulative people that
according to the standards of his day, JESUS WAS A
LEFT WING LIBERAL(whatever that means)!

Report this

By 99jonny100, March 21, 2009 at 2:29 pm Link to this comment

to Wildflower:
  A historical reference—“Et tu, Brute?” (You too, Brutus?) the last words of the emperor
Julius Caesar as he was stabbed to death by the senator Brutus, on
the Roman senate floor.
(too obscure:  Apologies).

Report this

By TAO Walker, March 21, 2009 at 12:22 pm Link to this comment

If altlic had called it a “grand CONs’PIRACY,” this old Indian would agree with her/his suggestion that from here in The Wilderness we can plainly see such a “thing” at-work in the virtual world-o’-hurt entrapping our domesticated Human Relations.  “Civilization” itself is the CONtext in which it is occurring.

The Bilderbergers appear in-public BECAUSE they’re there to give that public some ‘smoke’ to fix-on.  As for the “Devil,” and “evil,” us surviving Savages don’t use these terms (as altlic would see if s/he reviewed this Old Man’s offerings here).  They and their many equivalents mean so many CONflicting things to so many people (in-CONflict) that they’re worse than merely worthless when describing events and circumstances.

There is loose in the Living Arrangement of our Mother Earth a retro-viral “agent” that aims to snuff-out Her Life, by systematically degrading Her Natural Vitality into various forms of the degenerate “energy” it is itself addicted-to.  It has “managed” to co-opt a substantial portion of the Human component of Her immune system, and uses these (now billions of) rogue “individuals” to MANipulate Her Natural processes to its wannabe parasitic purposes. 

It’s all just biology….not “morality.”  Our Mother needs Medicine….not “exorcism.”  She is getting it, too, and Her Two-legged Children are of course among the “active ingredients.”

HokaHey!

Report this

By wildflower, March 21, 2009 at 11:50 am Link to this comment

Re BobZ: “Perhaps it’s time we stopped picking our Treasury Secretaries from the ranks of Goldman Sachs.”

Believe you’re right this, BobZ. Any potential strength a selection from the “ranks of Goldman Sachs” might bring to the table is negated by the “potential” for a conflict of interest and/or “appearance” of conflict of interest.

Report this

By Louise, March 21, 2009 at 11:10 am Link to this comment

whyzowl1,

No, we are not doomed. Not if Obama has his way and NEW REGULATIONS with ENFORCEMENT powers are put in place! And to that end he and Congress are even now, creating those new rules. This may not overcome the damage already done by DE-ing the old rules, but it sure as heck might keep the greedy from stealing our money in the future. My previous comment was sorta tongue in cheek. Implying not being there was no excuse for not stopping it. Probably went over everybody’s heads.

No matter, he’s there now. And personally I think it feels good to have a President after eight years without one. And I’m really enjoying being out of the republican out-house.

Really smelled in there! smile

By the way, since we are the humans in society, we have a perfect right to be part of that body that creates rules. So maybe we need to stop typing and make contact with those who do. No further explanation should be necessary.

Report this

By whyzowl1, March 21, 2009 at 10:17 am Link to this comment

There’s another way of deciphering the word “deregulation” that I favor and believe is even more revealing, Louise. “Deregulation” is just another word for “decriminalization.” There it is. The answer to every gangster’s fondest dreams—no cops! But even better than that—no laws! So even the few overworked and under-resourced cops remaining in the SEC and etc., can’t do a damn thing to stop you. They’re forced to just sit there and watch your racket unfold before their eyes and there’s nothing they can do about it. We’re freaking doomed!

Report this

By wildflower, March 21, 2009 at 10:16 am Link to this comment

Re Michael Shaw: “it is the lack of regulations on Wall Street on top of the people Obama chose to solve this crisis who are all in the same boys club”

I think there should have been some kind of savvy “bailout cop” like Spitzer (I know, I know) appointed to oversee these bailouts from day one. Bush should have done it and Obama should have done it, especially when you consider the questionable track record of some of these financial corporations like AIG. 

Granted, there would have been lots and lots of political squawking from every direction, but it would have been the smartest and most responsible thing for the government to do, and still is for that matter.  It’s not too late for Obama to do this, and I think he should – the sooner, the better.

From my perspective,  putting these “Treasury Secretaries” in charge of these bailouts was just asking for trouble.  I don’t care how honest they may or may not be, there is still the “appearance” of a potential conflict of interest, which is problematic for a variety of obvious reasons.

Report this

By Louise, March 21, 2009 at 9:49 am Link to this comment

Regulation. A big word that means: An authoritative rule. Authoritative. A really big word that means: Having or arising from authority, as in “an important official” which must be why Bush said his memoires would be “authoritative” he being such an important official, and all. But I digress.

Rule. A small four letter word that means: A principle or condition that customarily governs behavior. Oh there we go again, big words! I can see this isn’t going anywhere. At least the any, where we find why regulation is important. So let’s just focus on rules.

We all have rules. Go to work naked and you break the rule that say’s you need to wear clothes to work. Shoot at your neighbor and you break the rule that says your neighbor has a right to not get shot at. Then what happens? Well for every rule broken, there’s supposed to be a punishment. Like you may lose your job, or your gun.

So rules work, right? Well unless you win a lawsuit that says being naked is practicing your religious rights, or you and the NRA prove, your right to shoot your gun is more important than your neighbors right to not get shot at.

But before the lawsuit, there’s the “important official” who has the obligation to “regulate” the “rule” alleged to be broken. Which is why we have those important officials, right? The office of proper dress. Or the department of who you can shoot. Their “authority” is backed up by Law. A short word that means: A collection of rules imposed by authority.

Imposed: Set forth authoritatively as obligatory, or rules imposed by society.

A-hah! A break-through! We all understand what society means, right? The totality of social relationships among humans. Humans who would self-destruct were it not for law, defining rules, enforced by regulation, administered by authorities in an official capacity - or something like that.

So what happens if you tack DE in front of REGULATION? Well, it pretty much cancels out all of the above, by eliminating the action and meaning of any word it gets attached too.

And what’s all this got to do with anything, anyway? Not much, except I want to point out what those corporate lobbyists BOUGHT from our politicians with campaign finance and the promise of high salaried positions when they leave office.

They bought two letters. D and E. And the Senator named Boehner, which rhymes with Boner, led the rally in Congress that blessed us with the “new rules” that “de”-ed the old rules! And that was - lets see - oh yeh, back in 2000!

Shame on Obama! He should have been on top of that!

Meanwhile Boner explains “de” regulation is not the problem, [de rhymes with pee] but offers no solution. Except, in the grand old tradition of the party of “pee on me,” NOTHING and NO, and “we didn’t do it - it’s not our fault!” [The Republicans are blameless, which rhymes with shameless.]

Now, Obama wants to get rid of DE? Well if he cares so much, why didn’t he stop it back in 2000? Oh I forgot. He wasn’t in DC in 2000!

Well, THAT’S no excuse! smile

Report this

By healnghanz, March 21, 2009 at 9:43 am Link to this comment

we should start preparing hangmans nooses right now. I am talking traditional knotted nooses which break the necks of these amoral financial nazis. what saddam hussein got is too good for these people. the knots should be placed offcenter so that when their necks break, the arent dead yet. they should slowly feel the agony of the life draining from them. and their families should be made to sttand in front of them to witness the disgrace which they allowed to take place and benefited from. we need to make ten thousand examples of these horrific scum. the sewers of manhatten should run red with the blood of these filthy bastards, living in manhattan penthouses, thinking that they can helicopter away from their guilt. well i say take surface to air missles and shoot every helicopter trying to leave a building in manhatten, storm these buildings and crucify them on the fascades of buildings

Report this
Outraged's avatar

By Outraged, March 20, 2009 at 9:02 pm Link to this comment

Re: Folktruther

Say what… I did spell that correctly, or are you just messin’ with me…. if you aren’t, I’m going to mess with you.  lol

No…see it was a play on words, so to speak.  I said Gunther because he was the “weird kid” according to Mr. Wilson on the “newer” (of course, there may be a “newer” one again, so bear with me) on the “Dennis the Menace” movie (Walter Matthau…etc.) oh….. if you haven’t seen it, check it out.  It probably rents for say $.50 for seven days NOW, of course I OWN it…..ha, ha, ha…

Either way, I did too spell “Greiter’s” name correctly.  I was only concerned that other’s might think I meant GEITHNER! So I was actually calling Geithner….“A GUNTHER”, so…. are we good?

Is this making any sense?  Well…it will, just go out and rent “Dennis the Menace” starring Walther Matthau and (even if they think your “weird” DON’T let it worry you, I get it all the time…..trust me) they get over it.  lol. 

Look, I have two sons and four daughters, and one time my older son (PURELY by accident) kicked a basketball from our lower yard (at the time I lived on a one acre property) from the “lower” yard to the “upper” yard (just to get the damn ball back to the “basketball court” by the driveway)  anyway, it hit my “decorative big rock” nearby the porch and sailed through the bay window.  (What are the FUCKIN’ ODDS!)

Another time as he got “older” and was learning to drive the “plow truck” he “ACCIDENTALLY” slammed it into the garage door (which thereby HAD to be replaced).... “I didn’t mean it”, “I WAS watching”..... and “it’s not “THAT BAD” were a couple of the comments”.

Of course, from my vantage point, there were also a couple of “comments”.  And I swear on a stack of bibles, no matter what anyone else tells ya’ to the contrary…. I cannot swear moreso than “a butcher” or a “drunken sailor”.  These people are just embellishing.  That’s my story and I’m stickin’ to it.

Report this

By Inherit The Wind, March 20, 2009 at 8:20 pm Link to this comment

Ispy:

Take your copy of “Dr. Stranglove” and snap the DVD in two!  You’ve been poisoning your “precious bodily fluids” by over-watching Kubrick’s masterpiece without realizing it was tongue in cheek.

Report this
Outraged's avatar

By Outraged, March 20, 2009 at 8:08 pm Link to this comment

Re: christian96

I have to agree with you there, since I feel in other areas we may not agree.  But to your post, I’d like to add what Jesus also said:

Luke: 43. “No good tree bears bad fruit, nor does a bad tree bear good fruit. 44. Each tree is recognized by its own fruit. People do not pick figs from thornbushes, or grapes from briers. 45. The good man brings good things out of the good stored up in his heart, and the evil man brings evil things out of the evil stored up in his heart. For out of the overflow of his heart his mouth speaks.

Consider each person individually, even outside of their religion as it is the best and only fair way to see things clearly.

Report this

By christian96, March 20, 2009 at 3:32 pm Link to this comment

Don’t expect the Democrats to prosecute the
Republicians.  What did Jesus say to the men who
brought the woman taken in adultery?  “Let you without sin do the prosecuting!”  So much for legal
matters!  THEY ARE ALL CORRUPT TO THE CORE!  Worshippers of money!  I heard Pat Robertson’s boy
on The 700 Club talking against unions today.  According to Pat Robertson’s version of Christianity, God is a Captialist Republician.  What
did Jesus say about “false teachers?”  Sorry, Pat!
Quit talking about news and politics and start talking about Christianity.  Tell them about the
story where Jesus told the man to sell all that he
has, give to the poor, and follow him.  Tell’em
Pat!

Report this

By Michael Shaw, March 20, 2009 at 12:42 pm Link to this comment
(Unregistered commenter)

The real problem is that corporate lobbyists have, with only a few exceptions, bought off our politicians(on both sides of the isle) with campaign finance and the promise of high salaried positions when they leave office. It is they who have in fact made these current activities we are seeing legal. And at the same time (IE the Bush cabal, Pelosi taking impeachment off the table etc) many see no reason why they shouldn’t either trash or ignore the constitution when it suits their ambitions. What Bush did after 9/11 comes right out of the Mussolini play book of Corporatism. And after the so called great move for change which began in 2006, the democrats in power were suddenly apologetic, refusing to investigate the wrongdoings of the last administration, using the lame excuse to simply move forward and forget the past! Well by not impeaching Bush and company we are not moving forward, we are remaining in the same mindset that allowed Bush to do what he did. We’ve been seeing this happen since the Nixon pardon by his handpicked successor or the non prosecution of Reagan and Bush senior for the Iran-Contra affair. Now here we are again with Wall Street, the perpetrators of all our misery are being treated with the same kit gloves by a system that will lock you up for stealing a loaf of bread! 

Honor corporate contracts, trash labor contracts and scoff the Bill of Rights. What to do indeed! Well for one thing people need to become more physically active and stand up for themselves and our constitution because we already know most of our elected officials won’t do it until they are made to do it. And anyone who thinks an election will solve all of our problems are delusional! So many of us, dare I say most of us for so many years have sat back and done nothing beyond watching the tube and swilling beer. We too are to blame for this current debacle.

I think the American mentality has become,“Well i can’t do anything about it!” or “what can I do about it?” or… “someone else will do it for me!” Not so great a legacy coming from the land of the free and the home of the brave. “Let someone else risk their necks for me!” Just imagine if the forefathers shared that kind of mentality! Well here we are at the crossroads and most of our necks are on the block and unless we wish to see a permanent militarized police state under the dome of corporate feudalism we had better damn well get off our asses and do something.

Report this

By Ted Swart, March 20, 2009 at 11:42 am Link to this comment

Let me openly reveal the fact that my wife and I were married in Rhodesia/Zimbabwe and all four of our children were born there.  So I have somewhat more knowledge than average about what has been going on in Zimbabwe.

Everyone knows of the endless printing of money, hyperinflation, massive corruption and pervasive incompetence and YES—let’s use the word—GRRED (on the part of those in positions of power).  And everyone looks down upon those in power in Zim as being guilty of dereliction of duty or worse.

What really frightens me is that what is goings on in the US does not seem all that different to what is going in in Zimbabwe. In all too many ways current uS policy seems to be following in the footsteps of that in Zim.  The only difference seems to be that the US behaviour is more sophisticated—which does not make it any less dangerous.

Report this

By wildflower, March 20, 2009 at 10:30 am Link to this comment

RE 99jonny100: “What we really need is a Brutus to “clean up this_mess” on a mass scale. or a complete “Regime Change”

And your illustrious Brutus, does he/she have a name? And pray forth, what political associations and/or philosophy does he/she advocate? Surely, it can’t be a secret? Every “public servant” should be willing to play show and tell?

Report this

By flow, March 20, 2009 at 10:00 am Link to this comment

Sorry, Henry Paulson was CEO Goldman Sachs not Morgan Stanley.

Report this

By 99jonny100, March 20, 2009 at 9:52 am Link to this comment

I actually pity Timothy Geithner. He works for Obama—his head is on the block,
yet his employer, in the usual American pattern, smells like a rose. I submit that
a responsble and answerable “Congress” should in fact be calling for our openly
mendacious President to step down—and not his chosen dupe.

Report this

By Folktruther, March 20, 2009 at 9:17 am Link to this comment

His name is spelled ‘Greider’, Outraged, although, God knows, I’m not an authority on spelling.  William Greider is a journalist who is an excellent economist, the author of ONE WORLD READY OR NOT, before globalization became publicized. 

He maintains that the people of the world are emerging from national and regional worldviews to view the world as a whole, a view he calls ‘global humanism.’  For what its worth, I think this a major insight.

Report this

By 99jonny100, March 20, 2009 at 9:00 am Link to this comment

to Wildfllower:

The “public servants” you mention are rotten from their TV persona down to their core; What could one accomplish
trusting the likes of Nancy Pelosi, Harry Reid and Chris Dodd, to name three?
They are self-serving, morally putrified entities from Hell.
It reminds me of the “SPQR” in Roman times: quite clearly analogous to the “accountable congress” you refer to…What we really need is a Brutus to “clean up this
mess” on a mass scale. or a complete “Regime Change” (to avoid the insinuation of violent revolution)

Report this

By richfam, March 20, 2009 at 8:49 am Link to this comment

Will you cheer if one the people from AIG commits suicide? We should all be ashamed…

Report this

By flow, March 20, 2009 at 8:25 am Link to this comment

Data: Interest Expense

2009 Year To Date Interest Expense on the National Debt: $  148,761,285,212 (148 billion)

Fiscal 2008 Interest Expense on National Debt: $  451,154,049,950 (451 billion)

http://www.treasurydirect.gov/govt/reports/ir/ir_expense.htm

============
Data: Budget Deficit

Projected 2009 Budget Deficit $  2,000,000,000,000 (2 Tillion)

============
Data: Military Spending

The Obama administration is reportedly capping the Pentagon’s budget for non-war spending at $527 billion.

http://thinkprogress.org/2009/02/02/pentagon-budget-increase/

============
Data: National Debt

http://www.brillig.com/debt_clock/

Current National Debt $11,038,367,797,517 (11 Trillion)

The National Debt has continued to increase an average of
$3.77 billion per day since September 28, 2007!

============
Data: Gross Domestic Product

US GDP 14,264,600,000,000 (14.2 Trillion)

http://www.bea.gov/
============
Question:

1. Given that military spending accounts for the largest portion of discretionary spending in the federal budget, how much will interest expense have to increase before interest paid on the national debt exceeds military spending?

2. How much would the national debt have to increase before it exceeds the value of every good and service produced in these United States of America?

3. Can we afford to spend our way out of this crisis?

Comment:

I suppose by now we all realize that if you have a job or business and pay tax to the federal government, every dollar you paid the IRS from January through May of 2008 was used to pay the interest on the national debt. And then we started paying for things like social security and national defense.

Report this

By flow, March 20, 2009 at 7:39 am Link to this comment

Can someone help me out here?

When the Federal Reserve, a private company, “decrees more money into existence” by making an entry in their books, how would the accounting look?

Debit cash and credit “owners equity”?

So, this means that someone is 2 trillion dollars richer now. Who is it? Who is now 2 trillion dollars richer? While at the same time making the dollars in your bank account worth less?

Of course, you can’t really blame these people, if the value of the dollar is going down, they are certainly going to need more of them.

Report this

By flow, March 20, 2009 at 7:25 am Link to this comment

So, let me get this straight. Henry Paulson, made a personal fortune worth hundreds-of-millions of dollars as CEO of Morgan Stanley by buying sub-prime mortgages, bundling them together, and then creating derivatives (a stock interest in the income produced by the several mortgages), and then selling the stocks to investors? Is this correct?

While at the same time, Morgan Stanley was buying Credit Default Swaps (CDS) insuring that if the mortgages underlying the stocks they were selling went into default, then AIG would have to pay Morgan Stanley billions more. Is this correct?

And then, Henry Paulson, as U.S. Treasury Secretary came to Congress demanding 700 billion dollars or the entire banking system would collapse within 3 days?

And then, Henry Paulson, made the decision to bailout AIG with taxpayer money so that AIG could afford to pay Morgan Stanely 13 billion dollars in CDS obligations?

Is this correct? If so, I nominate Henry Paulson for MVP.

Report this

By flow, March 20, 2009 at 6:55 am Link to this comment

Is it possible the bonuses paid to AIG executives are in effect “hush” money? Paid to insiders to keep a lid on “trade secrets” that would really blow the top off the populist pot?

Report this

By mlb, March 20, 2009 at 5:36 am Link to this comment

Robert Scheer was terrific on Democracy Now! yesterday (3/19/9):
http://www.democracynow.org/2009/3/19/the_great_american_stickup_veteran_journalist

Report this
Outraged's avatar

By Outraged, March 19, 2009 at 11:39 pm Link to this comment

Any scholars out there….? (lol)

A very interesting article in “The Nation” by William Greiter (not to be confused with Gunther…or rather, Geithner) regarding the situation.  It definitely sounds doable, but I’m not an expert. William Greiter certainly appears a knowledgeable and upfront journalist.  His article ends this way:

“But where does the Fed find the money to make all these transactions? Essentially, it creates the money. That is basically what occurs routinely whenever the central bank decides to inject new reserves into the banking system. It is accomplished with a computer keystroke crediting the money to the private bank’s account (and money is extinguished whenever the Fed withdraws reserves). The mystery of money creation defies common reason, but it works because people believe in the results. The money supply relies on the “full faith and credit” of the society at large—pure credit from the people who use the currency. The public’s faith can be enlisted in the national recovery, a far better option than spending the hard-earned money that comes from taxpayers.

D’Arista’s solution would create the scaffolding to impose many other regulations on the behavior of lending and borrowing. But it does not resolve the problem of what to do with zombie banks. Some of them deserve to die—right now—because they are “too big to save,” as the Levy Institute puts it. Other institutions in trouble can be tightly supervised by regulators for years to come, without relieving them of their rotten assets. This will require a kind of silent forbearance that lets the bankers slowly work off their losses, but it does not dump the losses on the public. D’Arista points out that the government has done this many times in the past. The closest comparison is the Third World debt crisis during the 1980s, when some of the same major banks were under water as Latin American nations threatened massive loan defaults. A lengthy, methodical workout was managed by the Fed under Paul Volcker. It wasn’t pretty, nor was it just, but the public was not really aware of the deal-making. This time, the deal is too big to hide. People see it happening and are rightly enraged.

The great virtue of D’Arista’s approach is that it’s forward-looking. Her focus is not on saving the largest and most culpable names at the pinnacle of the financial system but on creating the platform for a financial order composed of thousands of smaller, more deserving institutions that can serve the country more reliably. To achieve this, the Federal Reserve will have to submit to its own reckoning. By its very design, the cloistered central bank is an offense to democratic principles—and now the Fed’s secretive, unaccountable political power has failed democracy again. The question of how to democratize the temple or whether to tear it down has to be on the table too, the subject of future discussion.”

http://www.thenation.com/doc/20090330/greider

When the soup is boiling, it’s a good idea to stir up the pot…..  Could this be a workable solution?

Report this

By wildflower, March 19, 2009 at 11:34 pm Link to this comment

Re 99jonny100: “The stench rising from Obama’s lack of moral fibre. . .”

Has it slipped your mind that the U.S. has 100 U.S. Senators and 435 U.S. Representatives?  Granted we’ve just endured eight long years under the Bush/Cheney regime so you might have forgotten, but nonetheless these people still play a role in our government. Personally, I believe they have had ample time to examine and change the “bonus” practices of AIG if they so desired.

In 2008, Congressman Elijah Cummings [D-M] requested a hearing “to examine American International Group, Inc.’s use of taxpayer dollars, specifically with regards to compensation policies and expenditures and corporate events.” One wonders why more of his colleagues didn’t pursue the matter. Clearly, if they had dealt with it in a more timely fashion, we would not have a problem today.

http://www.house.gov/list/press/md07_cummings/20081216aighearing.shtml

Report this

By ispy, March 19, 2009 at 11:28 pm Link to this comment
(Unregistered commenter)

Although Robert Sheer is correct this article does not go far enough and deep enough by any stretch of the imagination. Anyone who has studied the Baking System knows full well it’s illegal and unlawful in nature. Even the Vatican at one time considered the practice of charging “interest” as an offense punishable by hanging. YES, by hanging / death.

History tells us the only true value for any business or trading are Gold and Silver, PERIOD.

Federal Reserve and “related bankers” have “stolen” Millions of tons of gold and hidden it away over the last Century. How much you may ask? Enough to build every building, road and structure from Key West Florida to Portland Maine out of pure gold. Every last bit of them.

Not angry enough yet? These bankers have created a plan to take over all privately owned land across the USA. And what they can’t own they plan to kill off the owners by food poisoning. Don’t believe me? Look up CODEX ALIMENTARIUS and then genetically engineered foods with google and watch related videos. Include affects of Fluoride, dangerous prescription drugs, real purpose of vaccinations and other related subjects in your search.
Here is an example: Controlling Our food
http://video.google.ca/videoplay?docid=6262083407501596844&ei=ai7DSdLNIoym-wHHqfzjAQ&q=controlling+our+food&hl=en

If that wasn’t enough then what about the 8,000 plus “active” nukes in USA alone? Only 600 or so will wipe out all sentient life on this planet. What do they need so many and why are they fully active at all times?

I think you people need to watch the following link “fully” and realize what those filthy rich idiots are up to. Then look around for related subjects to learn more.
Big Brother, the Big Picture (Final Edit):
http://video.google.ca/videoplay?docid=-4788106431016278751&ei=cDHDSeecB6Ss-gGYq5XKAQ&q=Big+Brother,+the+Big+Picture&hl=en

When you are done you have a number of options:
1 Get every person, no matter what color or creed, and who’s not making a million per year and march on banker’s homes and arrest them via citizens arrest.
2 Enlist in local militias and march on bankers and all your governments to take them back. As you march invite all military and peace officers to join you.
3 Take back your gold and silver wherever they have stashed it and put bankers in prison or make them homeless.
4 Get back to gold and silver standard and never let this happen again.
5 Sit there like a lump on a log and wait to be killed off.

If you don’t act within next 6 months then you deserve what you get. CODEX ALIMENTARIUS comes into affect late this year, by then it will be too late and millions if not billions will die world wide, not just majority in USA.
There’s only a few 1,000 of them and more than 300 Million of you. Who’s going to win?

Report this

By msgmi, March 19, 2009 at 9:19 pm Link to this comment
(Unregistered commenter)

The butchers of IRA funds have no conscience, only greed to satisfy their hunger.

Report this

By Michael Shaw, March 19, 2009 at 9:06 pm Link to this comment
(Unregistered commenter)

Absolutely right Ed! and the bottom line is who will buy the treasury notes to back that money? I heard someone say somewhere that foreign countries are gobbling them up even at zero interest because they feel their money is safer here then anywhere else. So in the end this will mean the tax payer is ultimately responsible. We will be essentially paying taxes for no services from government. Of course we’ll be doing that anyway from more then thirty years of building deficits along with the two wars we are currently fighting. Just add in all this new money.

Report this

By Michael shaw, March 19, 2009 at 8:58 pm Link to this comment
(Unregistered commenter)

Thanks Wild Flower! It is not the regulations, it is the lack of regulations on Wall Street on top of the people Obama chose to solve this crisis who are all in the same boys club as the people they are bailing out. I agree with the Times article you presented, However, the title seems to take the regulators off the hook. It almost lends the impression that regulating Wall Street is bad when it is so disparately called for. I know it doesn’t do this in the body of the article. I merely question it’s title. For example who in the major media beyond Paul Krugman and a scant few others who are getting to the real meat of this fraud, which in fact has little to do with the bonuses? Also why did Madoff get the bulk of media attention when by comparison to AIG, his crimes are small potatoes?

Those who were assigned to regulate AIG are themselves a part of the same boys club. In other words what is going on here is no different than what Paulson did in the Bush administration. We own 80% of AIG yet we haven’t got the power to even make those so called contracts public? But again the real ripoff comes in the billions in bailout money, paying off AIG counterparties like Goldman Sachs and Bank of America who themselves have already gotten bail out money outright and thanks to AIG they are getting them again and apparently with th governments blessing! That’s a double whammy on the US taxpayer. The government is refusing to regulate Wall Street the way it needs to be regulated. It needs to set new boundaries and new oversight. It needs to be the boss! Instead and just like Paulson, Geithner has decided to bail out the criminals at our expense over and over! As Nader put it, “down the rat hole!” Geithner must go! So must Bernanke and in fact Obama’s entire economic team. He jeopardizes his presidency if he doesn’t and he needs to take immediate action with real regulators and real regulations.

Here’s a good article/interview by Robert Kuttner and Ralph Nader from Democracy Now. What they are talking about is exactly what is called for.

http://www.democracynow.org/2009/3/18/lawmakers_vow_to_recoup_millions

Report this

By 99jonny100, March 19, 2009 at 8:49 pm Link to this comment

To any of you who find it so difficult to quit your
irrational and stupid adulation of President Obama—
How do you reconcile your delusion with the obvious
fact, that he is standing before the nation lying strait
faced about the “administration"s involvement with the
bonus scandal. The stench rising from Obama’s lack
of moral fibre cannot be ignored for long, nor can we
“sweep it under the rug”. “Congress” may cave, but I
won’t.

Report this

By 99jonny100, March 19, 2009 at 8:47 pm Link to this comment

Too any of you who find it so difficult to quit your
irrational and stupid adulation of President Obama—
How do you reconcile your delusion with the obvious
fact, that he is standing before the nation lying strait
faced about the “administration"s involvement with the
bonus scandal. The stench rising from Obama’s lack
of moral fibre cannot be ignored for long, nor can we
“sweep it under the rug”. “Congress” may cave, but I
won’t.

Report this
Ed Harges's avatar

By Ed Harges, March 19, 2009 at 8:45 pm Link to this comment

re: By BlueEagle, March 19 at 10:21 pm:

Good lord, BlueEagle, we can’t break through! People are going on and on about this AIG bonus stuff, ignoring the much bigger economic news: the Fed yesterday announced that it will now PRINT A TRILLION DOLLARS OUT OF THIN AIR to buy federal debt from the government and worthless mortgage “securities” from the banks. Hello? Can you say hyper-inflation? (Incidentally, when people create flimsy derivative financial doodads like this, why do they call them “securities”? “Secure” is exactly what they’re not.)

Do you understand, people? The fed is not borrowing this trillion dollars from the Chinese. It is not borrowing this money from any one. It is essentially DECREEING IT INTO EXISTENCE. Do you people realize what this could do to the value of the dollar?

And if dollars become every day less valuable, then people who hold large quantities of US dollars - like, say, the Chinese - might just decide to dump them while they’re still worth more than they will be tomorrow or the next day.

Do you realize, people, what that could do to the price of everything?

Report this

By wildflower, March 19, 2009 at 8:03 pm Link to this comment

Re Michael Shaw: “As we are seeing, deregulation is not the only culprit but only 1/2 of the problem. The other half is. . .  the regulators themselves. . . ”

Some excellent points made on this critical issue in today’s New York Times Opinion section – “It’s the Regulations, not the Regulator:”

“. . . the unfolding fiasco of the American International Group and its federal bailout seems to have reinforced the drive for a systemic-risk cop — and the notion that putting one in place is the key to solving all our problems.  .  .

There’s just one problem with all that. The premise is false. The financial crisis, including what went wrong at A.I.G., is not just the result of a missing regulator, a gaping structural gap in the regulatory framework. . .

Rather, it is rooted in the refusal of regulators, lawmakers and executive-branch officials to heed warnings about risks in the system and to use their powers to head them off. It is the result of antiregulatory bias and deregulatory zeal — ascendant over the last three decades, but especially prevalent in the last 10 years — that eclipsed not only rules and regulations, but the very will to regulate.

. . . what is needed is a comprehensive response — to restore rules, develop new ones as needed and enforce them day to day; to reassert the government’s regulatory mission; and to reaffirm the centrality of solvency, safety and soundness of financial firms, and of investor and consumer protection.”

Report this

By Ted Swart, March 19, 2009 at 7:52 pm Link to this comment

This idea of taxing bonuses reeks of flailing the air. There could hardly be a more ridiculous solution.
The truth is that no one in power—not Geithner, not Obama himself and last of all in the universe Pelosi—seems to want to really get to the bottom of what was actually done and by whom to get AIG into such a terrible mess. The argument for allowing the bonuses was supposed to be the need to retain talent. Yet those who got the bonuses seem to have no talent worth a row of beans.

Report this

By BlueEagle, March 19, 2009 at 7:21 pm Link to this comment

This is just a smokescreen.

This news is much bigger than AIG:

Fed Plans to Inject Another $1 Trillion to Aid the Economy
The Federal Reserve sharply stepped up its efforts to bolster the economy on Wednesday, announcing that it would pump an extra $1 trillion into the financial system by purchasing Treasury bonds and mortgage securities.

http://www.nytimes.com/2009/03/19/business/economy/19fed.html?_r=1&dlbk;
And even bigger:

IMF poised to print billions of dollars in ‘global quantitative easing’
The International Monetary Fund is poised to embark on what analysts have described as “global quantitative easing” by printing billions of dollars worth of a global “super-currency” in an unprecedented new effort to address the economic crisis.
http://www.telegraph.co.uk/finance/financetopics/recession/4986287/IMF-poised-to-print-billions-of-dollars-in-global-quantitative-easing.html

And even bigger yet:

The Invisible One Quadrillion Dollar Equation — Asymmetric Leverage and Systemic Risk
http://www.infowars.com/the-size-of-derivatives-bubble-190k-per-person-on-planet/

Report this

By christian96, March 19, 2009 at 7:02 pm Link to this comment

Congress passed legislation to tax 90% of bonus
money.  What a waste.  Can you imagine the paperwork
and governemnt bureacracy this will create to enforce?  Why not just pass a bill to make it illegal
for anyone receiving gov’t money to pay bonuses until
the country, hopefully, gets back on it feet?  People are angry!  Just look around you!  I hate to
get on the highways.  I wonder how many car wrecks
can be attributed to hate related accidents?

Report this
Ed Harges's avatar

By Ed Harges, March 19, 2009 at 4:47 pm Link to this comment

OK, this is maddening. Truthdig is ignoring the single most important piece of economic news. The federal reserve yesterday decided to, in effect, print - that is, create out of thin air - a trillion dollars to buy US government debt and lousy mortgage “securities” from the banks. This is called monetizing the debt, and it can lead to hyperinflation unless it’s somehow “done right”, whatever that means.

We’re talking possible Weimar Republic, folks. Like, you know, taking your money in a wheelbarrow to the grocery store to buy bread.

Report this

By flow, March 19, 2009 at 2:11 pm Link to this comment

What’s another $1 trillion? Fed moves to boost lending | McClatchy

Good article examining the Fed’s recent decision to purchase more debt, the strategy behind it, and the potential long term consequences.

Report this

By flow, March 19, 2009 at 1:34 pm Link to this comment

Under what authority, or in what capacity does the Federal Reserve attend AIG meetings, including all board and committee meetings, and have the authority to say “ya or nay” to all decisions made by AIG?

Is this a new authority? Or an authority the Fed has always had but is recently more interested in exercising?  This disclosure was made by Liddy yesterday in testimony given to the House Sub-committee on Banking.  The Fed then makes the decision concerning whether to inform Treasury about the decisions made, such as bonus payments.

Is the Federal Reserve the voice of the U.S. taxpayer at AIG? How ironic that the Federal Reserve (an essentially private firm, outside the democratic auspices of the Federal government), would be the “representative” of our interest in the matter!

Every time the Federal Reserve “prints” a new dollar, our dollars are worth less. Since, September the Federal Reserve has quadrupled its balance sheet, now with approximately two trillion dollars of “new” money added to the system. 2,000,000,000,000! That is two million million dollars!

At what point will we, the U.S. taxpayer, get full disclosure concerning payments to counter-parties? Are we to seriously believe that AIG counter-party liabilities were strictly limited to large banks? Where are the disclosures concerning payments to private equity firms and hedge funds? Remember, unlike traditional insurance, any party can purchase a CDS contract, you need not own or even control the underlying security. This is akin to buying life insurance on your boss! Or taking out a fire insurance policy on your ex-wife’s house. It is more perverse than gambling.

And finally, which firm does your Senator have his/her hedge fund account with? How is their account performing?

Is it true, that Senator Dodd, Chair of the Senate Banking, Housing, and Urban Affairs Committee, is the top beneficiary of political contributions made by AIG and its affiliates?

The game their playing sure looks fun! I wonder how you get on the inside?

Report this
prole's avatar

By prole, March 19, 2009 at 12:22 pm Link to this comment

“the $165 million in taxpayer funds used to reward them is but a sideshow in a far larger drama of moral decay swirling around the banking bailout. It should not distract from the many billions not paltry millions, of our dollars being diverted to reward the very folks who brought us such misery” But of course, that’s exactly what it is being used to do. How quaint that Andrew Cuomo, who has grand personal political ambitions of his own, should be sending a righteously indignant letter to the slimy Barney Frank, himself one of the chief “enablers” of the perasive “chicanery” enveloping the financial sector. “The bailout is a response to a banking crisis that resulted from the radical deregulation pushed by former Goldman Sachs honcho Robert Rubin when he was President Clinton’s treasury secretary.”  At the center of the banking crisis is the implosion of the mortgage market, especially the subprime stratum. Frank, on the House Banking Committee all throughout the 90’s, was a leading proponent of laxer regulation of Fannie Mae and its financial cousin, Freddie Mac, the giant quasi-governmental lending firms which are under the jurisdiction of the Committee and are blamed in part for spreading bad mortgages throughout the private financial markets. Among other efforts, Frannk prodded the agencies to loosen regulations on mortgages for two- and three-family homes, even though they were defaulting at twice and five times the rate of single homes, respectively. Frank was having a torrid affair with Herb Moses at the time, who was Fannie’s assistant director for product initiatives and worked at the government-sponsored enterprise from 1991 to 1998. The two lived together in a Washington home until they broke up in 1998, a few months after Moses left Fannie Mae. According to National Mortgage News, Moses “helped develop many of Fannie Mae’s affordable housing and home improvement lending programs.” Such programs have been faulted by critics for contributing to the mortgage meltdown that led to last fall’s government takeover of Fannie Mae and Freddie Mac. Not long after, Bill Clinton commented, “I think the responsibility that the Democrats have may rest more in resisting any efforts by Republicans in the Congress or by me when I was president, to put some standards and tighten up a little on Fannie Mae and Freddie Mac.” This may of course be another fine case of the kettle calling the pot black, since Clinton and his appointees have their own explaining to do. But at least some of the blame has to fall on lover-boy Frank, who more recenntly as chairman of the House Financial Services Committee has added to his complicity by being one of the chief architects of the “trillion-dollar bank bailout that will go down as the greatest swindle in U.S. history.”

Report this

By Folktruther, March 19, 2009 at 12:04 pm Link to this comment

I don’t get it.  except for a few like Dr wu and Crimes of the State, commenters don’t connect the AIG scandal with Obama.  there is an emotional disconnect seperating Obama from the baulout swindles he put together and authorized his neoliberal economists to implement.  The same neolibs that he appointed in the first place.

Apparently American progressives are afraid or otherwise disinclined to attack Obama from the left.  this would apparently make people ‘radicals’ which is un-American in the mainstream truth, where people don’t want to be.

Consequently many crucial political events are invisible in plain sight.  No one, with notable exceptions, wants to say that Obama is serving the rich.  Who provided the money, media and political management to put him in office.

Apparently it takes a long time for the simple truth to crystalize in the population even after it is long obvious.  In this case it involves a conceptual transformation.

In the mainsteam truth politics is what happens between Democrats and Republicans.  this must be trassformed in class struggle politics to maintain that politics is what happens when the people confront power.  Both wings of DemGop power.

I wonder how long this will take.

Report this

By andrew b. lee, March 19, 2009 at 11:35 am Link to this comment
(Unregistered commenter)

the people who received bonuses SHOULD have their names released. look, AIG and other companies giving out these crazy bonuses are all de-facto nationalized - we the people are SUPPOSED to own them through the government. if we don’t have any control, then what’s happened is not a nationalization of banks but a PRIVATIZATION OF THE TREASURY.

the banks like AIG have public money and thus are subject to regular govt. action like PUBLIC DISCLOSURE. some say it’s ‘criminal’ to release the names of the people who received bonus money? well, it’s a greater crime for them to receive bonus money in the first place.

it’s good and all to focus on the sticks on the ground while ignoring the trees, but people then cannot be blamed for labeling you either an idiot or a hypocrite.

if something is not done to bring about some kind of real justice, i fear that there will be some nazi-style fascist revolution. look at the anger across the country!

Report this

By NYCartist, March 19, 2009 at 10:26 am Link to this comment

Let’s go back to the Fall (interesting word),2008 Congressional bail-out legislation.  How many folks yelled “NO!”?!  Question: are the members of the U.S. House of Representatives and U.S. Senate (majority of),
just stupid, “follow the leader” or cynical crooks or some other?  Kucinich and Marcy Kaptur, both of Ohio, were correct in voting “No!”.  Now what, folks?

Report this

By remoran, March 19, 2009 at 10:13 am Link to this comment
(Unregistered commenter)

The comments are absolutely awesome. To me, the only way out begins with abolishing the Fed. If this is not done, we are done.

‘Nuff said.

Report this

By Crimes of the State Blog, March 19, 2009 at 9:58 am Link to this comment

Hard to miss that most of YOU people put Obama in the white house TO DO THIS.

Obama is an employee of this criminal cartel. 

Are we still cheering in the streets?

$630 million to buy the presidency.  Do some math.

http://crimesofthestate.blogspot.com/

Report this
Outraged's avatar

By Outraged, March 19, 2009 at 9:55 am Link to this comment

So… it looks as though these people NEVER learn, now they’re betting AGAINST their benefactor’s fate!  Check this out:

“Betting Against Geithner

One measure of that pressure is reflected in the betting that Geithner will wind up leaving the job by the end of the year. Futures trading on Intrade.com, an online exchange based in Dublin, indicated yesterday that bettors see a 35 percent chance Geithner will leave office by Dec. 31, up from a 24.9 percent chance the day before, and a record high for a contract that started trading Feb. 23. A week ago, traders saw a 22 percent chance Geithner would be forced out.”

http://www.bloomberg.com/apps/news?pid=20601103&sid=aU_NGGmiEFX8&refer=us

Does that indicate a severe problem or what?  Bizarre.  Hey morons….you have a PROBLEM…!

TWENTY QUESTIONS

1 Did you ever lose time from work or school due to gambling?
2 Has gambling ever made your home life unhappy?
3 Did gambling affect your reputation?
4 Have you ever felt remorse after gambling?
5 Did you ever gamble to get money with which to pay debts or otherwise solve financial difficulties?
6 Did gambling cause a decrease in your ambition or efficiency?
7 After losing did you feel you must return as soon as possible and win back your losses?
8 After a win did you have a strong urge to return and win more?
9 Did you often gamble until your last dollar was gone?
10 Did you ever borrow to finance your gambling?
11 Have you ever sold anything to finance gambling?
12 Were you reluctant to use “gambling money” for normal expenditures?
13 Did gambling make you careless of the welfare of yourself or your family?
14 Did you ever gamble longer than you had planned?
15 Have you ever gambled to escape worry, trouble, boredom or loneliness?
16 Have you ever committed, or considered committing, an illegal act to finance gambling?
17 Did gambling cause you to have difficulty in sleeping?
18 Do arguments, disappointments or frustrations create within you an urge to gamble?
19 Did you ever have an urge to celebrate any good fortune by a few hours of gambling?
20 Have you ever considered self destruction or suicide as a result of your gambling?

Most compulsive gamblers will answer yes to at least seven of these questions.

http://www.gamblersanonymous.org/20questions.html

From now on, USE YOUR OWN DAMN MONEY!

Report this
Ed Harges's avatar

By Ed Harges, March 19, 2009 at 9:28 am Link to this comment

Paul Krugman pointed out last fall that when the government bailed out a bunch of these companies, including AIG, by buying what should be “controlling” stakes in them (80%, in the case of AIG), the legislation included provisions stating in effect that the government agrees not to exercise the control that owning a “controlling” share of a company normally entails.

The “representatives of the American people” in effect said, “We agree to take on the burden, but not the power, of owning these companies. We won’t tell the management what to do, even though we own the companies. Because actually owning the companies and telling the companies what to do would be ‘nationalizing’ them, and we understand that that’s bad, because it’s socialism, which is the worst thing in the whole universe, because Ronald Reagan told us that, and he got it from Milton Friedman, who was God.”

Report this

By Rodger Lemonde, March 19, 2009 at 8:55 am Link to this comment
(Unregistered commenter)

Now we all know what “trickle down economy ” means.
The rich keep skimming and scheming and then the economy trickles to a halt. Our prisons are awaiting a chance to serve them.

Report this

By nwmuse, March 19, 2009 at 8:30 am Link to this comment
(Unregistered commenter)

If you haven’t watched it, watch “The Money Masters”.
It is available online, in two parts:

http://video.google.com/videoplay?docid=6076118677860424204

http://video.google.com/videoplay?docid=-7336845760512239683&hl=en

I watched it last weekend and seriously, it helped put everything that has been happening in perspective. It starts with the Roman Empire and works it’s way forward with how money has been used through the ages. It focuses on the development of the central banks and their effects on various countries and historical events. It goes into great detail on the Federal Reserve through our history and the impact they have had on our own economy at different times in our own history. The film talks about the main players in the global banking world. Also talks about various presidents who have tried to go against it, and the outcomes.

Seriously interesting stuff if you want to understand what is happening right now.

Report this

By altara, March 19, 2009 at 7:44 am Link to this comment
(Unregistered commenter)

The Republicans are being unduly exploitive, but the AIG situation has been mishandled.

Surely, someone (Paulson or Geitner?) should have known about the compensation contracts that has resulted in this bonus mess and required their unraveling before the bail out money was released.  Negotiation: The employees could well have been persuaded to negotiate because of the alternative might have been bankruptcy and loss or drastic reduction of bonuses.

It is a mess and an embarrassing distraction for the Obama administration. It is, however, important to realize that these sordid payments total a relatively small sum when compared to aggregate bail out money. Also, the bail out is not really forAIG but for the counterparties to is unwise insurance contracts, and for the financial system as a whole. The government owns 80% of AIG so the stockholders have been losers. (But why not 100%?)

Negotiation: It seems that the counterparties are getting full payment under their contracts. Why?  Reductions would be in order given that otherwise they could be dealing with a company in bankruptcy.

I don’t know if these contracts can be broken, but I would say let them sue for their money. Wouldn’t incompetence and causing company ruin be a defense?

Question: Much is being made of the mysterious deletion of a legislative provision that, it is said, would have prevented unreasonable bonuses. But, according to what I’ve seen in the media, all this provision did was to tax at 35% bonus compensation in excess of $100,000. But wouldn’t such a bonus, on top of a salary, already be taxed at this rate?

A related point. Many say, and it is true, that Wall Street contracts are being treated differently from blue collar union contracts in Detroit. And that is unfair. The difference is that any individual contract makes little difference whereas the requested changes in the union contracts may well save thousands of jobs.

homer http://www.altara.blogspot.com

Report this
blogdog's avatar

By blogdog, March 19, 2009 at 2:39 am Link to this comment

Forget the bonuses - this is endemic - and these players are literally pawns - it’s the global finance oligarchs who need to led to the block - I heard Michael Parente on the radio today calling for the same - now he’s a buttoned down scholar, not a hot-headed artist, like me - so if we agree on the need for La Place de la Concord redux then any of this lot had better hope they never find themselves in the same room with either of us.

Report this

By altlic, March 18, 2009 at 11:19 pm Link to this comment

1.  Don’t lose sight of the fact that this bonus shenanigans is just a tiny fragment of what is now coming into focus.  Is this really where everyone wants to make their stand against capitalism?  While the economic tsunami rolls in?

2.  I want to address the conspiracy theorists - yet again.  Now I find that TAO Walker also believes in the grand conspiracy.  I would like to suggest a context, a fertile ground in which these seemingly elaborate but baseless worldviews can thrive.  (Look, if the Bilderberg Group was plotting the end-times, don’t you think they would just have a conference call so as not to attract attention?)

Here’s my theory: We don’t need to come up with these despicable uber-plans to explain the sheer monstrosity of reality because: life itself is the ultimate destroyer of human castles-in-the-sand (Jimi Hendrix, anyone?).  Think about the Hindu deities like Kali and Shiva.  Think of Maya - the world of illusion. 

Here in the monotheistic West there’s the Devil, which, of course we’ve all outgrown as a childish religious idea.  Well have we, really?  Or are we still sublimating our innate distaste for all that seems to work against our aspirations?  I wonder if those who look for patterns of evil in the human world are not just conjuring up the extant form of the devil, so that they can point with some self-satisfaction - as indeed the televangelists do - at the source of the evil undercurrent that continually batters our best intentions and most ardent dreams.

Report this
Outraged's avatar

By Outraged, March 18, 2009 at 10:56 pm Link to this comment

Re: Michael Shaw

Good post.  Another similar article at the Global Research site by William Engdahl:

Theatre of the absurd or deflection?

This all makes great food for tabloid headlines and popular outrage. They can write that elected politicians are finally acting in taxpayer interests. Until we look a bit more closely. Paying $165 million in employee bonuses or any amount for a company that is in the middle of a multi-trillion dollar fraud that is bringing the world economy down with it is ‘outrageous.

The problem is the tax bailout haemmorrhage will go on. The reason is the Obama Administration like its predecessor refuses to take consequent action with AIG, despite the fact today the US Government owns at least 80% of AIG stock, bought for $180 billion of, yes, taxpayer dollars. To demand AIG ‘pay back the government’ is absurd as the government is in effect demanding it pay itself back with its own money. The latest claim that the Treasury will subtract the $165 million bonus money from the next $30 billion tranche it will give AIG says it all.”

It continues:
“The reason the Government says it can’t let AIG fail is that if the company defaulted, hundreds of billions of dollars’ worth of Credit-Default Swaps (CDS) would ‘blow up,’ and US and European banks whose toxic assets are supposedly insured by AIG would suddenly be sitting on immense losses. Quite the contrary, AIG is ‘too big to save’ under current rules of the game that have been written by Wall Street and the privately-owned Federal Reserve, Treasury Secretary Geithner’s former employer.

” AIG went big into the selling Credit Default Swaps with banks around the world, from its London ‘Financial Practices’ unit. AIG in effect issued pseudo ‘insurance’ for the hundreds of billions of dollars in new Asset Backed Securities (ABS) that Wall Street firms and banks like Citigroup, Goldman Sachs, Deutsche Bank, Barclays were issuing, including Sub-prime Mortgage Backed Securities.

It was a huge Ponzi scheme built by AIG that depended on the fact the world’s largest insurance company held a rare AAA credit rating from Moody’s and S&P rating agencies. That meant AIG could borrow more cheaply than other companies with lower ratings.”

and:
“What can be done?

Fortunately there is a simple way out of the AIG debacle. The US Government can step in and fully nationalize AIG, 100%, kick out responsible management, declare AIG’s CDS contracts null and void and let holders sue the US government to regain value for what were in reality lottery gambles not loans to the real economy. They own 80% so the step is small to 100%. Doing that would end the global market in CDS and open the door for countless legal challenges. But AIG’s counterparties, as we begin to learn, were exactly the big Wall Street players like Goldman Sachs, Citigroup, even Deutsche Bank. They have gotten enough taxpayer bailouts to cover their risk in CDS. Let them recognize risk is the heart of banking, not the opposite.”

http://www.globalresearch.ca/index.php?context=va&aid=12787

Report this

By Remoran, March 18, 2009 at 9:50 pm Link to this comment
(Unregistered commenter)

The real deal here is NOT AIG. The real deal is the theft being conducted by Treasury and the Fed right before our eyes. It’s like the Sarin Palin Turkey video where Palin (AIG) is the faux star of the video while the grinning Turkey Man (dispatching turkeys behind her) is Geither and Bernanke stealing money from us with nary a care in the world.

We are fast becoming toast while Obama just passively sits there and lets this crap happen. I can only say the Banks and the Fed are lucky I’m not president because these boys would be sporting a new orifice given to them by yours truly on January 20th, 2009.

We are in such trouble and to think, just two months ago, we had real hope that someone could deal with this fubar with courage and intelligence but in reality, we were sold a bill of goods in Obama, Melville’s Confidence Man, writ large.

Simply unreal as we slowly slide toward the abyss.

Report this

By BobZ, March 18, 2009 at 9:37 pm Link to this comment

“Caterpillar just announced the lay-offs of 2,200 workers. That’s in addition to the 20,000 lay-offs they announced earlier this year. According to the president of   UAW Local 974 in East Peoria IL, the average salary of a Catterpillar union worker is roughly $34,000 per year. Therefore, the $165M paid to the AIG employees, who caused the meltdown of the global economy, is roughly equivalent to two and a half years salary of the 2,200 laid off works at Caterpillar.”

Excellent point which shows how tone deaf our government and the Wall Street business community are. It is obvious we have a double standard at work, where we can push blue collar workers to the brink and force givebacks but treat the AIG executives with kid gloves and then try to hide it from the American taxpayers who are the new owners of AIG. Obama needs to own this issue and start cracking down on both his Treasury Dept. and Federal Reserve who seem to be way too cozy with Wall Street. Perhaps it’s time we stopped picking our Treasury Secretaries from the ranks of Goldman Sachs. This looks like an issue where the Democrats are as much at fault as the Republicans. This is not why we voted Obama into office. We did not want business as usual on Wall Street.

Report this

By Michael Shaw, March 18, 2009 at 8:43 pm Link to this comment
(Unregistered commenter)

Former US Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein and Fed Chairman Ben Bernanke made the initial decision to bail out AIG.

  It’s not the bonuses. It’s that AIG’s counter-parties are getting paid back in full.

http://www.truthout.org/031809R

Article from Eliot Spitzer

“Everybody is rushing to condemn AIG’s bonuses, but this simple scandal is obscuring the real disgrace at the insurance giant: Why are AIG’s counterparties getting paid back in full, to the tune of tens of billions of taxpayer dollars?

  For the answer to this question, we need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman’s collapse, they feared a systemic failure could be triggered by AIG’s inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG’s trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.

  It all appears, once again, to be the same insiders protecting themselves against sharing the pain and risk of their own bad adventure. The payments to AIG’s counterparties are justified with an appeal to the sanctity of contract. If AIG’s contracts turned out to be shaky, the theory goes, then the whole edifice of the financial system would collapse…......

......But wait a moment, aren’t we in the midst of reopening contracts all over the place to share the burden of this crisis? From raising taxes - income taxes to sales taxes - to properly reopening labor contracts, we are all being asked to pitch in and carry our share of the burden. Workers around the country are being asked to take pay cuts and accept shorter work weeks so that colleagues won’t be laid off. Why can’t Wall Street royalty shoulder some of the burden? Why did Goldman have to get back 100 cents on the dollar? Didn’t we already give Goldman a $25 billion capital infusion, and aren’t they sitting on more than $100 billion in cash? Haven’t we been told recently that they are beginning to come back to fiscal stability? If that is so, couldn’t they have accepted a discount, and couldn’t they have agreed to certain conditions before the AIG dollars - that is, our dollars - flowed?

Report this

By wildflower, March 18, 2009 at 7:46 pm Link to this comment

Yes, Bob Scheer. So many criminals, so many cover-ups, so many agendas, so much to sort out, and where did it all begin? Philosophically, we know the Republican “deregulation” chant started with the Reagan revolutionaries, but where did the problems with AIG begin? Did it start with Greenberg?

And exactly where were our illustrious leaders in 2005 when N.Y.’s Att. Gen. Spitzer sued AIG and Greenberg for inflating reserves, hiding losses and ordering improper transactions? Shouldn’t this have been at least been a “yellow” alert? Since AIG plays such a critical role in the financial world, one would think they would have taken note and provided a little oversight.

For that matter, where were our illustrious leaders in 2008 when Elijah Cummings [D-M] first requested a hearing to examine American International Group’s (AIG) use of taxpayer dollars, specifically with regards to their compensation policies and expenditures and corporate events? Was there ever an outcome?

Yet, there they were today. Performing “outrage” in the theater of the absurd – at least eight years too late to prevent our economic crisis, five years too late to prevent the AIG crisis, and five months too late for the “retention” bonuses. Yes, we deserve so much better than what these people have to offer.

Report this

By voice of truth, March 18, 2009 at 6:39 pm Link to this comment

There is not a sole person here who would not, if given the option last year, have signed a contract guaranteeing a 100% bonus for 2008.  It is not the fault of the individuals receiving the money, it is the fault of the board of AIG for allowing it and, even worse, for the idiots in congress (Chris Dodd) who guaranteed they would be allowed to do it with OUR money.  Add that to the fact that Obama and his troupe of clowns knew this would happen, then feign righteous indignation, is almost too much to stomach.

It would be absolutely irresponsible, and perhaps even criminal, to release the names of the actual individuals who received the bonuses.  It would be akin to inviting people to attack them and their families and property (you know it would happen).

Report this

By mill, March 18, 2009 at 6:37 pm Link to this comment

Mr. Scheer was cynical about Geitner and i thought he was being unduly harsh, certainly premature, in his negative view.  Mr. Scheer was right.  I suspect he is also right about the need for criminal investigations and possible prosecutions at AIG. Necessary in some other companies as well.

It’s sad that only the NY attorney general is interested in capitalist crimes ... nobody in Washington DC seems to mind, so long as their campaigns are funded, their bosses re-elected.

Report this

By Daro, March 18, 2009 at 5:09 pm Link to this comment
(Unregistered commenter)

Great article! That’s all.

Report this

By Michael Shaw, March 18, 2009 at 3:24 pm Link to this comment

As we are seeing, deregulation is not the only culprit but only 1/2 of the problem. The other half is that the regulators themselves are in collusion. Geithner was a bad move on Obama’s part and now he knows it. A wake up call should have been the fact that Geithner worked for Kissinger and Associates for three years before he joined the treasury department. Another problem was leaving Bernanke in charge of the Federal Reserve. That’s almost like bringing Bush back and making him Obama’s top economic adviser.

But before anyone gets the wrong idea, let’s not forgot this bonus deal happened a year ago when Bush was still the president. I would further add that Obama’s stimulus package to go green, reform health care and rebuild the infrastructure is a great thing though it needs to be expanded. Also the bailout of Wall Street should open the eyes of the general public when they hear from the right(and Wall Street) that single payer health care would be too expensive for the country. With all the money Wall Street has gotten because of their criminal negligence, single payer health care, which in fact would save the tax payer money and supply everyone in the nation with better health care then they now get, could have been up and solvently running. The real reason why health care in this nation is so expensive is because the insurance companies rake in 30% of the overall cost to run it. So in other words, a third of all costs goes directly into the pockets of the insurance company CEO and his board of directors.

Another hypocrisy is Boehner and the GOP outcry to blame Obama entirely for this mess. It was they who more than anyone enabled Bush to create this charade and setting the stage for this current swindle/debacle.

As for Clinton’s role in all of this, let’s not forget the whole idea of regulating derivatives also came from his administration. But Rubin and Greenspan were “joined at the hip” in opposing this proposition. Brooksley Born, the then head of the Commodity Futures Trading Commission, the federal agency that oversees the futures and commodities options markets was pushing for strong regulation of derivatives. But in the end Rubin and Greenspan won(and we lost).

Also remember let’s not forget who gave us Arnold Greenspan either,,,,Ronald Reagan.

Report this

By dr wu, March 18, 2009 at 3:20 pm Link to this comment

Scheer nails it! Jail ‘em! Geithner, AIG, Citigroup, Rubin, Paulson, Rubin, Greenspan…

Obama’s pose/posture is inexcusable in all this. His economy gurus insisted that the auto union workers contracts be shredded but the AIG contracts are sacrosanct?

Handwriting was on the wall on this one: Obama taught at the University of Chicago law school (Home of Tory, free-marketer economist Milton Friedman ), hired UChicago economist Austan Goolsbee as his advisor on things economic and globalizing. (Remember the Canada free-trade flap?) Further, hired members from Robert Rubin’s unregulated free-traders found at Citibank/Citigroup/Harvard/Central Bank—like Summers,  Geithner, etc.

They all drank the wild west gambling casino economic kool-aid and then their world went into melt-down and still, incredibly, they are running (ruining) the show.

As for AIG, sure, resign, suicide or jail.  AIG’ers did at least 2 crimes: 1-they took in subprime junk mortgages and relabeled them as AAA or AA securities, (Selling junk as gold is fraud).

2- Its credit default operation in London was really a gambling casino.  Bets (sometimes called insurance) were placed on anything—for example, would so and so’s dog die in a fire on April 3, 2013? Hundreds of people could place this bet. And, here’s the crime, they never put in the money to support these bets in case someone won the bet. Instead, they relied on the government bailing them out. If they made money on the gambling casino it was theirs, if they lost they taxpayers would bail them out.

As I said, AIG’ers resign, commit suicide or go to jail. (don’t pass home and don’t collect $200.00)

Moreover, as bad as Madoff’s ponzi scheme was,  he’s small potatoes compared to the Wall Street banking giants.

The biggest scam ever was the subprime mortgage business. Credit was so easy that anyone with a pulse was given a junk mortgage, these, in turn, were shoveled through the doors of the banks and insurers like AIG. Next, our best and brightest bankers prevailed upon the rating agencies to label the junk as AAA securities. These “troubled assets” were then sliced and diced, collaterized, leveraged 30x and sold around the world as if they were gold. The business was such a money machine that it was impossible to say no to it. When the housing bubble burst, people lost their life savings, and countries went down. It seems to me that knowingly selling junk as if it were gold is fraud.  Trillions of dollars were scammed and yet no one is busted?

Report this
Eric L. Prentis's avatar

By Eric L. Prentis, March 18, 2009 at 2:42 pm Link to this comment

Piling on more and more debt to resuscitate the previous and now discredited securitized global financial system is a no-win strategy. What is required is debt forgiveness/reorganization as part of receivership, starting with zombie financial institution such as Citi, BofA and AIG. A piecemeal approach to propping up failed institutions, hoping that the market will revive and asset values will return to full valuations, is a policy of desperation that is only good for the insolvent banks’ directors, executives, stockholders and bondholders but terrible for the US. The credit crisis bank bailout policy of Obama/Geithner/Summers/Bernanke will put the US into a no/slow growth economy for 20 years, like the Japanese (1989-2009), and result in an S&P 500 Index value of 321 in the year 2029, like the Japanese (Nikkei Index ’89 top of 38,916; ’09 currently at 7,972: down 80%).

Report this

By TAO Walker, March 18, 2009 at 2:18 pm Link to this comment

The “global economy” is a for-profit prison, owned and operated by a plutoligarchy rarely, if-ever, recognized in-public.  It is run (and about to be “locked-down”) by ‘contract’ thugs who’s own “income” they must extort from the inmates however they can get-away-with it.  The “Bilderberg Group” and its “local” affiliates are all second-, third-, and fourth-tier place-holders and fronts, who may-or-may-not be allowed into the ultimate “undisclosed locations” when the trap-door is sprung on the 90-plus% “surplus population” rapidly reaching the zero-point in its amortization on the gangsters’ secret cooked “books.”

Those like Robert Scheer here, who persist in their reassuring delusions of a “rule-of-law,” seem to be having a more-and-more difficult job these days pretending that the actual governing principle in their virtual world-o’-hurt isn’t just plain FEAR (again metasticized into one of its periodic, and this time intended to be “terminal,” reigns of outright TERROR)....of losing their own still relatively intact coccoons of “comfort” and “CONvenience,” the primary signifiers they rely-on as proof they’re not dead, yet.  It has yet to dawn on them, too, that it is their very fear of death that condemns them to the diminishing half-lives they are “enjoying” less-and-less, lately.

So people prattle-on about prosecutions and “perp-walks,” of poor fools who only took “the money,” while their hidden sponsors mean to make-off with the very ground under everybody’s feet, the very air they breathe, the very Living Water they have no Life without.  Maybe this ‘site’ could more accurately be called “truthbarelyscratchingthesurface.”

HokaHey!

Report this

By Prajna, March 18, 2009 at 1:24 pm Link to this comment
(Unregistered commenter)

You might ask yourself, “What would Nader do?”

Report this
Outraged's avatar

By Outraged, March 18, 2009 at 12:50 pm Link to this comment

“There must be a criminal investigation of the AIG debacle,”

Good article.  Absolutely.  This is the component that is missing in this whole debacle.  If we need to “rally the troops” and demand one so be it, this thing has gone too far for way too long. 

Ralph Nader has a good article on this also, an excerpt:

“The other day I saw Alan Greenspan, former chairman of the Federal Reserve, just about predicting another round of recklessness in about fifteen years. But he called it “human nature” not casino capitalism.

Here are seven avoidance indicators which outline what Washington is not doing to prevent another round of greed and misdeeds by the Wall Street few against the innocent many throughout the country.

1. Where are the resources for comprehensive law enforcement against the Wall Street crooks, swindlers and purveyors of costly deceptive practices?

2. Where are the anti-trusters to revive the moribund divisions in the Justice Department and Federal Trade Commision?

3. What about Congress and Obama shifting some power to the investors and shareholders who are paying for all these losses?

4. The federal officials are talking up stronger regulation and re-regulation proposals but we have not yet been informed of their specific plans.

5. By now, Washington should be devising ways to pay for these gigantic deficits and bailouts. A fraction of one percent sales tax on the hundreds of trillions of dollars in derivative transactions annually would produce hundreds of billions of dollars in revenue….

6. Our government doesn’t highlight not-for-profit institutions like the 8000 credit unions that are increasing their loans and continue to serve over 80 million Americans without a single insolvency.

The article ends this way:
In 21 pages of very large type, you will see why the AIG bosses believe that failure of their gigantic corporation would only “trigger a cascading set of further failures which cannot be stopped except by extraordinary means.? In other words, AIG says to Uncle Sam and you the taxpayer save it or be prepared for a global collapse through a dominoes effect of unknown catastrophic sequences. Here’s theastonishing AIG text.

Right from the horse’s mouth”

http://www.counterpunch.org/nader03162009.html

On my system the link to the memo didn’t work at the article site, but I found this one on the net.

http://www.scribd.com/doc/13112282/AIG-Risk-Bankruptcy-Report

There are things which can be done and it’s ridiculous for anyone to claim otherwise.  Mr. Nader has been saying this all along as have many others.  America’s patience needs to stop here and now and demands need to be made.  Here we are again right back where we started and what we “knew” all along.  Goldman-Sachs, Goldman-Sachs, Goldman-Sachs….

Geithner and Summers have to go, along with Rubin’s son Jamie.  An interview on the Real News:

“Kuttner:  “One of the key people on his transition team, who picked… not picked personally, cause Obama appointed them…., but teed up the appointments of the top regulatory and economic officials was Jamie Rubin, Bob’s son.”

Report this

By Crimes of the State Blog, March 18, 2009 at 11:44 am Link to this comment

Scheer,

If you were serious (and taking a serious stand), then the “perp walks” would have to start at the top: Bush and Obama.  Yes, impeachment, now, before the disaster gets any worse.

Candidate Obama couldn’t wait to endorse the $700Bn previous heist last year.  To the same criminal interests.  Just as he’s doing today, even as he squirms about these bonuses (trivial sums in comparison).

Obama does not work for us, for our children nor our grandchildren.  Bush, ditto.  The mega-corruption is top down.  Nothing will be done until this stranglehold on the executive branch (and legislative) by the oligarchs can be broken. 

Obama has shown his true nature.  The treasury is raided.  “Change” is a sick joke.  The real change will be millions of Americans into the streets and onto bread lines.  Sucked up into Obama’s new Hitler youth inspired “national service” and military expansion plans.

Why is it so hard to wake up “liberal” journalists who have no problem seeing these issues when a Republican is in charge.  They have quite a deaf demeanor when you point out that everything was done WITH THE APPROVAL OF A DEMOCRATIC CONGRESS…

CRIMES OF THE STATE

Report this

By laurie becklund, March 18, 2009 at 10:55 am Link to this comment
(Unregistered commenter)

anyone have time to make Bob’s notion of a perp walk come alive? marry the idea of a perp walk with nominees’ photos and moderate blog-like links to relevant evidence proposed and discussed by readers and citizen reporters? You could probably even implement ratings or gambling software to gauge public opinion. Only question would be whether to keep the perp walk image or change the metaphor to a “walk of shame” (i live in hollywood) or a “stock-ade,” (think hester prynne). Or, perhaps, most appropriate of all, an ongoing interactive game board called “truth dig.”

Report this

By Dalmazio, March 18, 2009 at 10:33 am Link to this comment

Great article. However I believe one very important statement in the article requires deeper examination as it gets to the root of the entire mess. The article states that:

“The bailout is a response to a banking crisis that resulted from the radical deregulation pushed by former Goldman Sachs honcho Robert Rubin when he was President Clinton’s treasury secretary.”

We need to be careful here. It’s not “deregulation” that is the cause of the banking crisis, but “misregulation.” Many believe as a result of Greenspan’s own testimony before a Congressional Committee, that capitalism and “deregulation” is to blame. It is not. A free market hasn’t existed in the US for over a century. The market’s have been increasingly managed, planned, and manipulated during this time. In a truly free market, a la laissez-fair capitalism, the market would correct itself. In such a system as the Founding Fathers of the United States envisioned, the role of government as pertaining to economics was negative: to *protect* the free market only, ensuring that it remained truly free. That no entity, no matter how powerful, could manipulate or influence it any way. Instead, what we have in the United States and all over the world is central banking, heavily manipulated markets, and fiat currency systems—-all anathema to the very idea of a constitutional republic or limited democracy.

Again, the problem is not deregulation and overly free markets but misguided regulation. For example, the Fed made artificially cheap credit available, and the government encouraged and even forced banks, through public policy and legislation to extend that credit to poor-credit borrowers. As a result, housing prices climbed about 50% in 7 years while all the traditional market forces were trying to pull these prices down through higher interest rates. But the Fed prevented this natural correction from happening through their forced low interest rate policy. Couple this to massive leveraging of these bad debts (20x-30x, up to 100x in some instances), and we have the current credit crisis.

Traditional market forces could and would have corrected the problem, if these forces were allowed to function, by not allowing bad debt to circulate in the first place. However, the root of the problem is even more menacing: it stems from the debt-based fiat currency system in use today in the United States and all over the world. This system facilitates derivatives, leveraging, and fractional reserve banking. In our current debt-based system, the markets need to be carefully shielded from manipulative/interventionist forces (i.e., artificial interest rates), and greedy banking interests (i.e., derivatives, leveraging, and fractional reserve banking).

But instead of shielding the market from these forces, the US government allows and even participates in these activities. These are the excesses pandemic in our current debt-based financial system. The problems we are facing today would simply not exist, if the financial system was a real asset-based system, where banks and governments effectively had their hands tied so they could not simply print money out of thin air whenever these wished, either through a printing press, derivatives, leveraging, or fractional reserve practices.

For a more detailed analysis citing many prominent economists, educators and publications, look at this excellent editorial http://www.tuccille.com/blog/2008/11/financial-deregulation-what-financial.html

Best
Dalmazio

Report this

By marriea, March 18, 2009 at 9:09 am Link to this comment

I get a headache when I consider how the big companies always get away with murder but don’t even so much get charged for the crimes they commit.
I always thought a bonus was the reward one got for a job well done. People rig documents to look like what they are not, then say that others just don’t understand how business is run…that sounds like double talk to me. 1+1 will always equal 2.  But when one start playing with percentages and projectories those numbers can and are played with.

Those bonuses should be given back.  It not freely, then that money should be taxed at 50% immediately and it shouldn’t be allowed to be treated a some sort of tax shelter.

The sad thing is the is not new. When trusted to handle the monies and funds of another, thru iniquity greed has always been prevelent whether by kings having their subjects pay taxes or by having them tithe as many do in churches.  It’s all a form of extortion. In churches one is said to be paying God his due by tithing. Either one pays up or the wrath of God will be your fate.  In government it is thru taxes.  If you are lucky you get to eat dinner and play golf with the ‘gods’ and they will take care of you.
I understand why many people hid their riches in their mattresses and shoeboxes.

Report this

By John Giannini, March 18, 2009 at 8:55 am Link to this comment
(Unregistered commenter)

Caterpillar just announced the lay-offs of 2,200 workers. That’s in addition to the 20,000 lay-offs they announced earlier this year. According to the president of   UAW Local 974 in East Peoria IL, the average salary of a Catterpillar union worker is roughly $34,000 per year. Therefore, the $165M paid to the AIG employees, who caused the meltdown of the global economy, is roughly equivalent to two and a half years salary of the 2,200 laid off works at Caterpillar.

Report this

By mud, March 18, 2009 at 8:17 am Link to this comment

It’s Goebbelicious!

US taxpayers paying AIG’s new PR firm to put the shuck on everyone. Cool.

http://www.prwatch.org/node/8263

Report this

By Ted Swart, March 18, 2009 at 8:06 am Link to this comment

All I will say is: actions speak louder than words. 
Obama has asked the tax cheat Geithner—whom he appointed without without adequate vetting—to try and get the bonus money back from the greedy thieves who ran AIG. Give me a break!
And that same Obama’s campaign funding irregularities are legion. And his various stimulus/bailout packages—which no one had the time to even read properly—are absolutely riddled with pork.
And when ever will we see ground rules which ban obscenely high remuneration for those at the top of most large companies.  And when will we completely outlaw golden parachutes for failure.
I am waiting and waiting and waiting . . . . .

Report this

By Shift, March 18, 2009 at 8:01 am Link to this comment

STEP TWO: It has become clear that releasing frustration through the written word is not working to move change.  The time has come to take another step forward, non-violent steps of civil disobedience.  We should not wait for a violent response from those forced into untenable life circumstances.  We owe it to ourselves, and to them, to begin a peaceful process of resistance now before the violence begins.

Report this

By mud, March 18, 2009 at 7:53 am Link to this comment

Me too media TD?

Why focus on puny million dollar bonuses while hundreds of billions in stolen tax payer money are flooding out the back door?

Report this

By Thomas Mc, March 18, 2009 at 7:45 am Link to this comment

If the Obama Administration doesn’t soon get serious about prosecuting this financial terrorism, the French Revolution is going to look like a walk in the park.

Report this

By Frank Goodman, Sr., March 18, 2009 at 7:14 am Link to this comment

I suppose the ‘perp walk’ has its place in American justice and in public opinion influence of the courts. It is very hard to maintain the official and public standard of innocence until proven guilty. Certainly proof of guilt is flawed as is justice-in-fact. After all freedom of expression is matched by freedom to lie. Who is free, and who is innocent until proven guilty?

We do not even honor human rights in this country or in the world, let alone a legal fiction of innocence until proven guilty. It is de facto presumption of guilt that we incarcerate the accused or assign bail for release until a ‘proving’ process of courts and a parade of lawyers. Mob justice is not justice. Rabble can be roused at will by manipulators on either side of the law. Law itself is in question in many jurisdictions. There is a law of the jungle in which it is presumed that the guilty will be judged on the field of combat. This in no way presumes innocence or guilt of executives of AIG, Bernard Madoff, or of President Bush.

I propose that justice be served in an orderly execution of the laws and amendment of procedures and laws flawed in their ‘perp’itration.

Report this

By psickmind fraud, March 18, 2009 at 7:11 am Link to this comment

I know it’s merely a drop in the bucket, but shouldn’t the politicians who accepted campaign contributions from AIG and the other financials be giving the money back, too?  Or are our pols just hypocrites?  Well, of course they are!

Report this

By Litchfield, March 18, 2009 at 6:23 am Link to this comment
(Unregistered commenter)

The idea that the govt. cannot get the money back because it was “paid out” on Friday is a joke. How about freezing teh accounts that the checks or whatever are drawn on. The money has to come back from the bonees, not the company, so the idea that AIG would use taxpayer monies to pay back the bonuses makes no sense to me. We have to investigate each and every bonee’s business transactions over the past year and analyze it. Furthermore, the idea of paying people millions to right the wrongs they committed that also cost the country billions is obscene.

Unfortunately, Obama is (rightly) taking the hit for protecting Wall Streeters. His snarky comments making it clear that he just doesn’t “get” what the problem is (“I am choking with anger”—where does he get off thinking he can, essentially, make a little joke of a very serious issue, for his administration and the country; what planet is he on?). Shame on you, Obama, the buck is flying toward your desk very fast.

Report this
photoshock's avatar

By photoshock, March 18, 2009 at 6:10 am Link to this comment

The very idea of ‘bonuses,’ for the legal loan sharks that created the worldwide economic meltdown is inane. We now have the government, our public servants, giving money to people who, by their very nature, created a disastrous and disingenuous form of laissez-faire capitalism.
The disastrous form of this laissez-faire capitalism, is this; the banks given the go-ahead by the rescinding of the act that separated the commercial banks from the speculative banks, then created monster size firms that ‘could not fail’ because they were so big. These men and women who were the traders in these false instruments of capital, made billions of dollars in bonuses for their avaricious nature. These people knew that these
instruments of debt, insured by companies that did not have the capital to cover the losses that were known to have to take place, were and are disastrous in policy and action.
The disingenuous part of their creation of these ‘derivatives,’ is this; the very thought that insurance could cover the losses totaling $485 Billion US, is completely without merit. For no company in the world, could cover losses that total more than the Gross Domestic Product of all the countries in the world. Their dependence on the government to cover their losses, is not laissez-faire capitalism, but a socialistic form of banking that would not and could not happen in the real world of true laissez-faire capitalism.
Ronald Reagan, the ‘great communicator,’ was not what
he seemed.  He was not a free-market capitalist, what
he was and will be remembered for is a specious and disingenuous man of the uber-rich, who when faced with the collapse of true free-market capitalism, fled into the hands of the government for ‘bailout.’
This cannot and should not continue! It is government
that is socialistic in nature, for the rich and well-heeled, but for the middle class and poor, a false government that does not give a shit about us.
They could care less if we die, and truly have plans to make sure that we do; at least 80% of our population are slated for death by either disease or starvation, due to the lack of common food stuffs and
medical care that will be given to those that created
this mess in the first place.
We the people, the true government of the United States of America, cannot long stand for this kind of
socialistic capitalism. We will not fund to the tune of Billions of our tax dollars, companies which created the economic meltdown, while the players receive bonuses of millions of dollars per person.
We cannot bear the burden of an economic bailout of companies which are stupid at least and criminal at most in their financial dealings.
The derivatives market is at best true loan-sharking,
and should be shut down immediately. The true cost of
the ‘economic bailout’ will not be known for a few years, because the $485 Billion US in derivatives have yet to be accounted for, and they are not due for another few years. But when due, will completely bankrupt the world’s economy.
So Sorry, So Sad! You are now faced with the prospect
of ‘perp walks,’ rightly and truly, for you stole from the American people, their hard earned tax dollars and gave these monies to yourselves in congratulations of your false accomplishments of success and disaster.

Report this

By AWM, March 18, 2009 at 6:07 am Link to this comment

These weren’t bonuses they were hush payments. These animals are the ones who know what criminal acts were committed and by whom.
Lets hope that someone investigates this thorough which they rarely do.
Hopefully AIG has like Enron gone way to far over the line thus forcing the authorities to take action

Report this
Ed Harges's avatar

By Ed Harges, March 18, 2009 at 5:36 am Link to this comment

SteveK9 is right. This began with Reagan. By the end of the 1970s, this nation had gone through some very humbling experiences (e.g., the civil rights and women’s movements, Vietnam, Watergate, the Iran hostage crisis) that were leading to some much needed soul-searching. If that process had continued, we could have become a much better country. But along came Reagan with his happy talk pushing shallow free market bromides and militaristic arrogance as the solution to all ills, and people fell for it. They were so relieved to be told they could stop thinking and reflecting. He was turned into a saint, so that even when Democrats run for office, they have to genuflect before this charlatan. Reagan poisoned everything. God how I hated that man.

Report this

By SteveK9, March 18, 2009 at 5:00 am Link to this comment

It all started with Reagan.  Although new names were found it is the same old ‘laissez-faire’ capitalism.  Thirty years in the making, it will take a long time to repair, if we are able to do so at all.

Report this

By richfam, March 18, 2009 at 4:53 am Link to this comment

Maybe we should go after the bonuses of the people at the firms that created, traded and sold these derivatives to AIG. All of those counter-parties that received the money from AIG have salespeople and traders and analysts that did business with AIG. Thats how they became counter-parties. Shouldn’t we take back their bonuses as well? I mean, they probably talked the people at AIG into this stuff to a certain extent.
AIG should never have given out those contracts so late in the game but lets face it, they were the losers and we are blaming them not to mention they’ll have some serious difficulty getting new work at that sort of pay. Aren’t the banks/people who sold these products to AIG even more to blame? You can read a story a while back about how Goldman traders removed much of their risk on sub-prime mortgages through derivatives. Who do you think they sold that risk too?! And believe me the salespeople who sold the risk to AIG didn’t mention it was Goldman’s proprietary risk…

Report this
Purple Girl's avatar

By Purple Girl, March 18, 2009 at 4:46 am Link to this comment

They should already be walking the ‘Green Mile’- this ones NOT lined with cash!!
What makes AIG and it’s ‘Capos’ any different than the Mafia?
They have embezzled and laundered money through dirty deals. Extorted it from US claiming that if we did not fork over some money the entire system would collapse??? Sound like what those RICO Laws were design to prosecute.
These 73 won’t voluntarily return these Ill Gotten gains- (along with any other top brass from bailed out Corps), Can’t figure out how to recind the contract or legislate the Return of funds….Then Prosecute them under criminal laws. At the very least RICO, but more approriately ‘conspiracy to commit’ and Economic Treason. AIG not only played with in the Rackets, they were meant to be the ones backing the ‘markers’. They not only gambled away the assets they were granted, they couldn’t back the ones they were meant to secure.It’s as if th eCasino had no funds to back up the house Losses! Put you money into the machine- Bells start Ringing and yet nothing comes out!!! Worse yet they put a Gun to the US taxpayers head and demand we stick more money into the machine. this is not bad business practices this is an Organized Crime syndicate.
Time to take away their Armani suits and Gold Watches and replace them with Orange Jumpsuits and Shackles.

Report this

Page 1 of 2 pages  1 2 >

Newsletter

sign up to get updates


 
 
Right 1, Site wide - BlogAds Premium
 
Right 2, Site wide - Blogads
 
Join the Liberal Blog Advertising Network
 
 
 
Right Skyscraper, Site Wide
 
Join the Liberal Blog Advertising Network
 

A Progressive Journal of News and Opinion   Publisher, Zuade Kaufman   Editor, Robert Scheer
© 2014 Truthdig, LLC. All rights reserved.

Like Truthdig on Facebook