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Published on Saturday, March 7, 2009 by CommonDreams.org
The Bottomless Bailout
Does anybody in the federal government know or could know “who, what,
where and when” of the massive, complex, vertical, horizontal, global
collapse of Wall Street and its planetary tentacles in over 100
countries abroad? Step forward if you exist! Uncle Sam needs you!
Is the multi-million dollar bailout of this financial mess and house of cards, this phantom wealth mummy hitting air beyond the federal governments’ salvage capability?
It is relatively easy to announce hundreds of billions of dollars of corporate rescue programs here and hundreds of billions of dollars of guarantees of corporate recklessness there and trillions of dollars of assorted stimulus, loan availabilities and foreclosure prevention initiatives in all directions. Now comes the rubber hitting the road.
Where are the skilled people to be hired by the federal agencies—the administrators, field implementers, auditors, financial whizzes able to understand the complexity of greed and over-reach; the inspectors, prosecutors and contract negotiators to name a few categories?
In other words, how are a hurried President Obama and his deputies going to rapidly build up the infrastructure of the federal government itself to advance all these “public works” efficiently and to avoid expenditure disasters amidst a potential orgy of waste, fraud and abuse by the coast to coast recipients?
So many of the federal government’s functions have been contracted out to corporations and consulting firms under Clinton and the Bushes that there is a serious dearth of skilled civil servants. Moreover, Obama has indicated he wants this work done by an accountable government and not by Halliburton-type outside contractors at greater expense to taxpayers.
Knowing and doing have to go hand in hand. Some Congressional Committees have finally gotten around to asking the basic questions about what is actually going on inside companies like the giant financial conglomerate AIG. Since the Goliath’s near collapse in September, the federal government has committed $160 billion to keep it from splattering its reckless red ink over small businesses, municipalities, 401(k) plans, policyholders and of course the Fortune 500 big companies led by the omnipresent Goldman Sachs bank.
At a Senate hearing on March 5, 2009 to review yet another $30 billion in rescue funds, Senators from both parties demanded that the Federal Reserve make public the names of the parties benefiting from all this taxpayer largesse. These include the derivatives trading partners (eg credit default swappers) who have received tens of billions of these dollars passing from Washington through AIG to them.
Senators Chris Dodd, Richard Shelby and Jim Bunning went after Donald L. Kohn, the vice-chairman of the Fed board of governors who finally promised he would ask the other governors to reconsider their corporate privacy policy under these megabailouts. Don’t hold your breath!
Surprisingly, the Wall Street Journal editorial writers weighed in three days earlier about this fourth ever-sweeter rescue of AIG. in six months. In an editorial titled “AIG’s Black Box” the Journal thundered: “Perhaps someday the feds will even explain to taxpayers which AIG creditors had to be rescued and why…..try figuring out exactly who benefits when taxpayer money arrives at the insurance giant.”
Besides rebuilding the federal workforce and finding out what is going on inside casino capitalism begging for bailouts, the Obama Administration is wading into an administrative nightmare that could run through trillions of mis-directed dollars and not turn around a deep Recession plunging toward Depression.
When dealing with esoteric gambling chips called “derivatives” that are bets on bets on debts on debts, more than astute regulations and prosecutions are needed to punish, disgorge and deter present and future self-paid corporate crooks looting and draining other people’s pensions and savings. What is essential is that the federal surgeons have to know just where to apply their scalpel on the continuum spanning the big predators to the millions of direct and indirect victims.
So, during the next Congressional hearings featuring government witnesses from the Federal Reserve, the Treasury Department and the securities, insurance and banking regulatory agencies, the Senators should start with four direct questions:
Is the multi-million dollar bailout of this financial mess and house of cards, this phantom wealth mummy hitting air beyond the federal governments’ salvage capability?
It is relatively easy to announce hundreds of billions of dollars of corporate rescue programs here and hundreds of billions of dollars of guarantees of corporate recklessness there and trillions of dollars of assorted stimulus, loan availabilities and foreclosure prevention initiatives in all directions. Now comes the rubber hitting the road.
Where are the skilled people to be hired by the federal agencies—the administrators, field implementers, auditors, financial whizzes able to understand the complexity of greed and over-reach; the inspectors, prosecutors and contract negotiators to name a few categories?
In other words, how are a hurried President Obama and his deputies going to rapidly build up the infrastructure of the federal government itself to advance all these “public works” efficiently and to avoid expenditure disasters amidst a potential orgy of waste, fraud and abuse by the coast to coast recipients?
So many of the federal government’s functions have been contracted out to corporations and consulting firms under Clinton and the Bushes that there is a serious dearth of skilled civil servants. Moreover, Obama has indicated he wants this work done by an accountable government and not by Halliburton-type outside contractors at greater expense to taxpayers.
Knowing and doing have to go hand in hand. Some Congressional Committees have finally gotten around to asking the basic questions about what is actually going on inside companies like the giant financial conglomerate AIG. Since the Goliath’s near collapse in September, the federal government has committed $160 billion to keep it from splattering its reckless red ink over small businesses, municipalities, 401(k) plans, policyholders and of course the Fortune 500 big companies led by the omnipresent Goldman Sachs bank.
At a Senate hearing on March 5, 2009 to review yet another $30 billion in rescue funds, Senators from both parties demanded that the Federal Reserve make public the names of the parties benefiting from all this taxpayer largesse. These include the derivatives trading partners (eg credit default swappers) who have received tens of billions of these dollars passing from Washington through AIG to them.
Senators Chris Dodd, Richard Shelby and Jim Bunning went after Donald L. Kohn, the vice-chairman of the Fed board of governors who finally promised he would ask the other governors to reconsider their corporate privacy policy under these megabailouts. Don’t hold your breath!
Surprisingly, the Wall Street Journal editorial writers weighed in three days earlier about this fourth ever-sweeter rescue of AIG. in six months. In an editorial titled “AIG’s Black Box” the Journal thundered: “Perhaps someday the feds will even explain to taxpayers which AIG creditors had to be rescued and why…..try figuring out exactly who benefits when taxpayer money arrives at the insurance giant.”
Besides rebuilding the federal workforce and finding out what is going on inside casino capitalism begging for bailouts, the Obama Administration is wading into an administrative nightmare that could run through trillions of mis-directed dollars and not turn around a deep Recession plunging toward Depression.
When dealing with esoteric gambling chips called “derivatives” that are bets on bets on debts on debts, more than astute regulations and prosecutions are needed to punish, disgorge and deter present and future self-paid corporate crooks looting and draining other people’s pensions and savings. What is essential is that the federal surgeons have to know just where to apply their scalpel on the continuum spanning the big predators to the millions of direct and indirect victims.
So, during the next Congressional hearings featuring government witnesses from the Federal Reserve, the Treasury Department and the securities, insurance and banking regulatory agencies, the Senators should start with four direct questions:
1. Just what is it that you do NOT understand about what is going on inside this widening Wall Street mess?As one solid small town banker in Indiana put it recently: “If these big companies are too big to fail, then they’re too big.”
2. Why don’t you understand what you need to know?
3. How are you going to use your powers to achieve such understanding?
4. Finally, if these corporations like AIG are too big to fail, too secret to fail and overwhelmingly global in structure and operations, why aren’t you asking other governments to pitch in with their own rescue packages and tell you what they know?
- Posted in
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142 Comments so far
Show AllIt all sounds like shutting the barn door after all the horses have escaped. Why weren't all the questions asked BEFORE bailout money was thrown at companies that had proven themselves incapable of remaining solvent? The very first question that should have been asked is "who is the head of this company". The needed response to the corporate leadership should have been, "You're fired!" That would have prevented the obscene spectacle of CEOs laughing all the way to the bank.
I simply refuse to believe that our elected officials are so stupid that they could have not seen what would happen when they started tossing billions (and eventually trillions) of tax payer dollars around. Only greed and corruption could have prevented these questions from being asked.
I'd feel a lot better of people like Ralph Nader were advising our president. It's all such a no brainer. But that's what's wrong with our country. Greed makes for poor thinking. And we can't afford much more of that.
WE can't afford ANY more of that.
Amen!
Obama seek out advice from Nader? For that to happen Obama would need to get his nose out of the rectum of corporate Ameri[k]a, stop listening to the morons like Summers who was the chief developer of de-regulation in the first place. The only thing Obama is doing is rearranging the deck chairs on the Titanic. The Super Structure is going to come crashing down and with it the denial evidenced by people like you.
I pick my river (De Nile) and you pick yours. We are in agreement on the facts. But using words like Ameri(k)a is a real turn off.
Your river seems to be stuck in the 60s and 70s.
George Markley: How about "Amurkah!" with a little chest pounding for emphasis? The self righteous and willful ignorance of the sheep who continue to support Bush and/or Obaahhmaah (hear the bleating?) is breathtaking.
What the elites need is another false flag (nuke or bioattack in the US) or Israeli nuking of Iran, bringing us into war with Russia, in order to allow the congressional-miltary-industrial-transnational-banking rip off to continue unabated. The Federal Reserve shareholders (JP Morgan, Citi, BofA, Rockefeller, Bank of England, etc.) never met a fascist or a war that they didn't like.
This is more than an economic looting. The intention is to bring down civil society so as to have us beg for: a new digital North American Union currency as an intermediate segueway to the "one world government" that our secret societies all crave; a comprehensive surveillance grid, tracking all purchases, car movement, and inoculation status; the military patrolling the streets; forced vaccinations; FEMA camps for the disenfranchised; Internet 2.0 that will ban speech unwanted by corporate or political interests; microwave dispersed civil protests (under the guise of fighting "terror"); a UN and Mason wish to reduce human population by 90%, even if it means forcibly; and much more.
The enforcement of state sovereignty is probably the best route to take at this point.
***
9/11 was an inside job, as was the Oklahoma City bombing and the $2500 trillion credit default swap rip off. We are at war. The worst is yet to come. Obama is a puppet. Wake up. Vote 3rd party. Take back your states.
http://www.globalresearch.ca/
http://www.infowars.com/
http://www.rockcreekfreepress.com/
http://www.endthefed.us/
http://www.restoretherepublic.com/
"I simply refuse to believe that our elected officials are so stupid that they could have not seen what would happen when they started tossing billions (and eventually trillions) of tax payer dollars around. Only greed and corruption could have prevented these questions from being asked."
Mr. Markley, I believe you far too optimistic about the intelligence of our elected legislators. But greed is certainly a major issue ,greed that led to the deregulation of industries only too willing to write large campaign checks in return for the abandonment of controls.
I do echo your regard for the wisdom of Mr. Nader, and would add that there are a number of men and women out there who think as does he, and who are overlooked in favor of those who think like the very folks who created this mess. That is why I remain rather pessimistic about these so-called solutions.
"Most people would sooner die than think, in fact they do so." Bertrand Russell
No, we can't have Ralph Nader advising the President! He's an EGOTIST!!!!!!
Better to keep him surrounded by humble friends of the crooks like Geithner and Summers.
and I liked the damn Corvair,too!
"Most people would sooner die than think, in fact they do so." Bertrand Russell
Ralph, Great article and please do us a favor as a historical muckraker and please volunteer publicly to help Obama in this great mess the planet is in.
If your efforts are recorded, you could have the next Michael Moore type Documentary Hit and just send us the utube,
What to make of the fact that Obama reaches out to the GOP but fails to do so to independents and Greens?
"Most people would sooner die than think, in fact they do so." Bertrand Russell
Why do I get the feeling that the wealthy are fleecing us in their march to ease the pain of their economic downfall. Confusion is their weapon of choice. We seem to be living in a fog and when it lifts there will be nothing left. Allowing businesses to fail and suffering the direct consequences, may be the less damaging path. End the bailouts and get on with the bankruptcies. At least there is clarity in bankruptcy.
racom40
Read the book, 'the shock doctrine'. Many things clear up.
What Ralph understands pretty well is that our basic problem is not the subprime housing debacle or somesuch tangible complex of events, but systemic moral rot. You can try to cure chicken pox by painting the spots pink or treat the disappearance of wealth by replacing the wealth or deal with the proliferation of maggots by throwing them more meat. The symptoms have been mistaken for the disease, and so the disease remains untreated.
Where I now depart from Ralph (and agree with Rush in some inverted way) is that the severity of the problem, its possible hopelessness, is really a good thing. My biggest fear is that Obama will succeed in resuscitating this monster instead of just letting it go ahead and devour itself. Given her history since Vietnam it is hard to wish America well, or the corporate global enterprise, or economies which attach themselves to such cancerous notions. Call me a cockeyed optimist, but I think things are going swimmingly right now.
I think you are right. It is insane to prop up a failed system. The real choice is between controlled collapse or uncontrolled collapse.
If people knew there was a system, perhaps through federal and state FEMA, that would assure them they wouldn't starve or freeze during the collapse, and focus given to small business, small farms, bioregional development Schumacher-style (Small Is Beautiful,1974) we'd have a chance to pull off a controlled collapse.
I like the comment below "Bring on the bankruptcies! Paul Volcker has been a huge disappointment to me. He is on record that readopting Glass-Steagall is not
on the program "We're way beyond that" His plan is to have very tight, very close scrutiny onthe biggest banks. What BS. Why should taxpayers foot the bill so a company can be too big to fail. Break them up NOW.
Oh well, what's the harm in a little totalitarian fascism if it will get rid of those pesky Democrats.
Yes the total destruction of the industrial powers would be great. But really, doesn't it boil down to the fact that there are simply too many people in the world? So, why not just create a germ that will kill off say 90% of the human population?
Easy, effective, and it will save the planet too!
Because we'd be wasting too many good people. The problem arises from the consumer lifestyles of the rich and famous in the West. When you have 5% of the world's population consuming 25% of the resources so they can live the "American Dream", I'd say that is the problem. As to killing off the human population - glad you've stepped forward and volunteered. That should put an end to the shit you spout off here all the time.
-----------------------------------------
What Is Marxism? - a short primer on a subject the working class needs to know.
http://www.marxist.com/Theory/what_is_marxism.html
So you don't see a billion Chinese, and another billion Indians as a problem? Believe me, it's a big problem---I've been there and seen it. Have you?
It's already in the works. The next killer pandemic is close at hand. One aspect is the weaponization of the avian flu mixed in with vaccines. The avian flu is not that easy for humans to contract, but when recombinated with more common types of flu pathogens which are easily aeresolized (coughing, sneezing, dropping from planes or helicopters...)--well--voila!--you have easy contamination. The most recent episode was Baxter Pharmaceuticals "accidently" shipping this vaccine concoction to 18 different countries. However, one contractor decided to test the vaccine on ferrets before distribution. The ferrets died suddenly, and the weaponized combo was discovered. This is just one of many tools of our MIC to be used against
http://www.infowars.com/us-air-force-study-proposed-2009-influenza-pandemic-in-1996/
Mister Chips,
Always a pleasure to have you on board here! Hey, wasn't that an iceberg we just hit? Didn't they say that the USS United States of America was too big and too powerful to fail? Is that Obama directing the orchestra on the tilting top deck? What beautiful music! Ahh! I am so lulled by his soft and reassuring tones! No need to patch the leaking hull, or inquire as to who is using this moment to board the safety rafts! The sheep, up to their necks in icy water, will baaahh obediently, subduing their survival instincts as they watch another rerun of our great leader on the tube. We are all just one pill and infomercial away from true freedom!
"So, why not just create a germ that will kill off say 90% of the human population?"
What is it that makes you think this hasn't already been done and is waiting for deployment?
Wow, great, so does that mean you'll be willing to volunteer yourself and/or your children first? And save the planet for what??? Pricks who think they are more deserving of life than everyone else? I'm sure I wouldn't want to share the earth with the 10% who thought it was a good idea to murder the other 90%, for whatever reason.
Good perspective Chessgame, as always.
If 90% have to go extinct, shouldn't it be put to democratic vote how?
And isn't this what our problem has been all along? Political and Nobel Dynasties who feel their bloodlines are immortal and better deserving of power and policy trumping democratic representation? (Clinton and Bush come to mind.) The 1776 Revolution was apparently all for naught. Little King George the Inferior, destroyed what was left of the constitution during his poor imitation of his father's reign. Now we have another Harvard graduate on the throne who has resurrected the Court of Clinton.
The reason the American Revolution was considered do-able by Ben Franklin and John Adams was that the colony's population had outstripped the population of Great Briton. We currently outnumber the elite by 9 to 1. We have to educate our fellow tv-staring countrymen on their own revolutionary history and the misdeeds of the power elite and the federal reserve bank.
The elite will probably soon extinguish the internet (President's helicopter P2P compromised national security you see...)
Our fight has to be along side the Electronic Frontiers Foundation
http://www.eff.org/
If we lose the internet and its free speech we have lost all.
TJ
"All tyranny needs to gain a foothold is for people of good conscience to remain silent." - Thomas Jefferson
Sorry madcow, but Cheny, Rumsfeld, Wolfowitz, and the rest of the PNAC crew already had that idea years ago. What do you think they meant when they said that developing biological weapons that would attack specific genotypes "would be a political useful tool"?
I am afraid that the monsters are no longer hiding under the bed.
Why would Obama ignore the advice of Ralph Nader who has been studying and addressing the problem for many years and knows more about it than anyone?
"Why would Obama ignore the advice of Ralph Nader who has been studying and addressing the problem for many years and knows more about it than anyone?"
Obviously it is an unintended oversight. But our Commander in Chief is such a charismatic and melodious speaker!
I love my Obaahmaah (bleat bleat)! That is why I have a larger than life poster of Him in my house (based on Stalin's own propaganda portraits). And that is why I shop for Obama clothing and accessories at my every opportunity!
http://www.amazon.com/s/ref=nb_ss_?url=search-alias%3Dapparel&field-keywords=obama&x=0&y=0
Good question, even though most CD posters know the answer.
Youze guys is funny! Perceptive too!
"Most people would sooner die than think, in fact they do so." Bertrand Russell
Who will replace Nader once he is gone? Any ideas?
Matt Gonzoles ? Howard Zinn? Dude, I dunno but good question.
Oregoncharles
Howard Zinn is probably older than Nader. Nader is only in his 70s! He's got at least another 25 years. People like Nader don't die young unless they're assassinated!
Dennis,
Actually Rick answered the question perfectly when he said "I nominate you and I" Just think about it for a minute and you will clearly see Rick's challenge to everyone with claims of being progressive in his five word response. Do you/we accept the nomination?
I nominate you and I...
"Most people would sooner die than think, in fact they do so." Bertrand Russell
Very good answer Rick.
Again Mr. Nader, you ask the most pertinent questions. Too bad you are not President of the United States.
Had the electorate given this man the chance from 2001-2008, or better yet 1997-2004, we wouldn't be in the shit we're in !
Vote 3rd party, let the Republicans take back power -then we'll all be in such better shape.
Do nothing and let your dreams of Democrat Party nirvana fill your head as the massive ripoff continues.
Idiot ! We already have the Republicans in power. It's just those Republicans call themselves "Democrat" !
You got that right! Democrats are for the most part, just crooked Republican, attorneys who are incognito, so they fool a lot of the sheeple.
Without Instant Runoff Voting, I don't see how a third party can win. Memphis is the next city to use it. It will catch on. Work for it when and where you can.
And, if one reads and listens to what Republicans have to say, they expected to lose in '08, they wanted to lose. They said the financial **** would hit the fan in '09 or '10 and the Dems wouldn't know what to do and would screw it up. Then the R's would take over and finally have their permanent majority. (This, of ocurse, brings up the point "they knew". They all knew, they just kept hoping it would wait. And then it came early.)
The real answer is to drastically decrease the power of the federal gov't before it devours us all.
If Ralph Nader had been president from 2001 to 2008, none of this bailout shit would have happened. Better yet, had he won in 1996, the Glass-Steigel Act wouldn't have been repealed either.
Dennis,
This may come as a surprise to some here but I admire Mr.Nader. My question is had he been elected President would he have be able to achieve his goals? Would Mr.Nader have had enough support from the Congress,special interest groups, and the people, to pass the legislation which would have altered the tragic course of this nation's history? Or; would Mr.Nader have been a transitional President? What deals would he have made? Compromises? How many of his campaign promises would he ,for reasons of political necessity, have had to dishonor? How would his supporters have reacted to such deals, compromises, and campaign promises dishonored or placed in a perpetual holding pattern?
These are questions that will never be answered. It is like saying; What if Robert Kennedy had been elected way back then........etc. We can speculate but we will never know for sure....
This was an excellent article by Mr. Nader. As usual.
Thomas Gilbert
Well Dante, as soon as he got in he would be labeled a corporate shill---anyone who makes it to President in our corrupt system must---by definition---be an elite kissing, corporate lackey. No progress can ever be made in America.
Right, it's all about what label you put after your name. I thought you believed it was about the money it took to get there.
If, by some miracle, Ralph got elected, it would be because he had the cash to spend to get his message out there---and where does the cash come from? Corporations!
Follow the money: the cash first comes from the Federal Reserve, that's why your dollar bill says "Federal Reserve Note" across the top.
I guess some of his money comes from Republicans too.
I was wondering when you'd come out with your DPA slur. It's a pretty tired argument---one size fits all, anyone who sees any good in the Democratic party is a DPA. I even heard one poster call Chomsky a gate-keeper because he said some nice things about progress. Russ Feingold and Dennis Kucinich are DPA's too, so I'm in good company. Guess what Dave, I'm a Republican Party Apologist too because I like Ron Paul.
What about my point about how Nader can never get elected without Corporate money---thereby making him a sellout, if he should by some miracle get elected?
Madcow,
Well I partially agree with you with regard to the labeling but I firmly believe that progress can and will be achieved in the United States but this cannot and will not be accomplished by any single administration. The process of Progressive political restructuring will be achieved over time via an evolutionary process as opposed to any sudden revolutionary process.
I believe that the United States at this time is moving toward a centrist transitional period. The shift we are observing is one from a radicalized right to a moderate center. (The cross roads) This is a very critical period for the United States as the nation desperately struggles to achieve stability. When this center stability is achieved I believe we will see a further shift to the left of center. When this shift occurs a Ralph Nader could very well be elected President of the United States.
Thomas Gilbert.