Your Black World: Will Obama Hold Paulson Accountable?

Lawless Capital, Rushing to Armageddon
A Black Agenda Radio commentary
By: Glen Ford
Reprinted From Black Agenda Report

The fundamental law of capital - the system's need to extract by any means possible ever increasing returns on investment, or die - brought the world to the current catastrophe. Inevitably, despite all the noise about the need for transparency and tightening of regulations on the behavior of capital, the system's response to its crisis is to descend into even greater depths of lawlessness.

The frenzy of unchecked illegality pulsates outward from the chaotic center of crisis and criminality: Wall Street, which has succeeded in establishing a kind of privatized martial law economic regime in the waning months of the Bush kleptocracy. The $700 billion "bailout" is revealed as a brazen bait-and-switch bamboozlement, in which Goldman Sachs Family Don Hank Paulson, under color-of-law as Treasury Secretary, ignores the terms of congressional legislation to dispense mountains of public wealth to his bankster friends as he sees fit. In return for their cut of the loot, the banking mafia give the public - nothing! No recycling of the billions into loans to small business or college-bound students or any of the intended beneficiaries. Instead, the Lords of Capital hijack the people's money to expand their territory, buying up the turf of smaller banksters in order to make themselves more indispensable, more untouchable, more removed from the elementary rule of law. Paulson attaches no strings of public obligations to his gifts, demands no voting stakeholder position in the banks.

"Congress fails to protest this theft of its core legislative duty: to make the laws that govern society."

Then, the master criminal, in secrecy and with total contempt for a spineless and utterly compromised Congress, rewrites the laws of the land, to forgive $140 billion in taxes due from the banks' merger deals, accomplished with the public's money. But Congress fails to protest this theft of its core legislative duty: to make the laws that govern society. Paulson and his banksters are above the law - mega-thieves operating with total impunity.

Meanwhile, Paulson's partner in crime at the Federal Reserve, Ben Bernanke, has distributed two trillion dollars in "loans" to a list of corporations whose identities are secret, for purposes that are also secret. Even the billionaire Michael Bloomberg's news agency is in the dark, and has sued to find out where the two thousand billion dollars has gone. Few lawmakers on Capitol Hill seem to even want to know, fearing they would be blamed for the panic that might break out if the public were aware of who had pocketed their trillions.

If there is one person who possesses the moral capital to demand an accounting from the conspirators, it is Barack Obama. But the president-elect behaves as if it is none of his business if the Bush gang loots the national wealth on its way out. But then, Obama fought for the bailout, has had the kindest words for Paulson, and gets his economic advice from Robert Rubin, a former Goldman Sachs Godfather and Treasury Secretary, and Larry Summers, another former Treasury chief who teamed with Rubin during the Clinton administration to cast a cloak of silence over questions surrounding derivatives, the exotic financial instruments that finally wrecked the global system. Obama says he wants a "smooth transition." But his silence on the lawlessness at the heart of the transition calls his own motives, competence and integrity into question.

For Black Agenda Radio, I'm Glen Ford.

BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it

The Info Today

http://www.msnbc.msn.com/id/3036677/26763771
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"Fundamentally a deregulator."
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Video: Truth of Reagan (I love this)
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(The Economic Meltdown in a Nutshell continued below)


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http://www.msnbc.msn.com/id/21134540/vp/26798551
2:06 - Funny ignorance
2:58 - She so didn't answer the question, lol
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4:20 - Unconstitutional Cheney admin rhetoric

http://www.msnbc.msn.com/id/21134540/vp/26782378
McCain got caught up on trying to score points about the economy...got it wrong.
Several McCain foreign policy "misspeaks."

http://www.msnbc.msn.com/id/3036677/26782086
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The Economic Meltdown in a Nutshell

ROBERT SCHEER: Yeah, well, the point is, when Bush and McCain and Paulson, who was head of Goldman Sachs before he was head of the Treasury, say they don't know how this happened, they designed this system. We had a regulatory regime in place ever since the Great Depression to prevent this kind of meltdown, and that said that stockbrokers, insurance companies, banks, investment banks, commercial banks, could not merge. And in 1999, they passed legislation, the Gramm-Leach-Bliley Act. Gramm is the guy who McCain supported for president in '96. He was co-chair of his campaign until he complained about the whiners out there, meaning the public. And that legislation is what caused this. It allowed the swaps and everything else.

And then, in 2000, hours before the Christmas break, Gramm introduced legislation. I'm holding it in my hand. This smoking gun is available on the internet; you can read it. And what it said is that the swaps is defined in the Financial Service Modernization Act, meaning that instead of going into a bank and somebody said, "OK, we'll give you a loan, and we expect you to pay it over thirty years. We know your house has the equity. We know you have the means to pay it"—that was the traditional way—instead, they allowed these mergers, and as a result, they could buy insurance on it, they could do these swaps, they could do what they call hybrid instruments. And it is legislation that was never discussed, was—never had hearings or anything, says that all of this stuff is exempted from all previous regulation. The SEC cannot regulate it, the Commodity Futures Board cannot regulate it.

So they gave these institutions, of which Goldman Sachs was critical—so was Citigroup, where Robert Rubin, who was Clinton's Treasury secretary, he had also come from Goldman Sachs. And, by the way, even though this is Republican-led, there were plenty of Democrats, in fact, a majority of Democrats, who voted for this. And Robert Rubin, who unfortunately is advising Barack Obama—I don't know how this guy can wake up and—you know, and not be embarrassed and how he can appear on television—and Lawrence Summers, these are the two guys in the Clinton administration who teamed up with Phil Gramm to pass that atrocious legislation.

And now, you know, it seems to me, in terms of the bailout, why don't they do what Hillary Clinton said during the primaries: just put a freeze on foreclosures? Start out with helping the homeowners and say, "OK, we're not going to foreclose your house for the next year. We're going to force the banks to work out reasonable payments. We'll try to help you hold on to it." That would have stopped the bleeding here much more effectively than throwing $700 billion at these bandits.

I don't know why we're not considering criminal charges against these people. They have done more to hurt this nation than bin Laden could ever dream of.

DEAN BAKER: Absolutely, and this speaks to the nature of the bailout. The bailout should not be fun, if it's constructed right. The way this should be constructed is, if you're on the edge of bankruptcy, you come to the Treasury, and you get the money. But guess what? You're selling your company, and you also have serious limits on CEO pay. You know, you only get $2 million a year; how's that? Or maybe less.

You know, some people have proposed less than that. But the bailout has to be punitive, if it's serious. It shouldn't be a field day. We shouldn't have people lining up to get in. That's telling us that this is not a serious bailout. So the idea that the administration is proposing is that the people who were engaged in incredibly reckless behavior, who made out like bandits, getting tens of millions of dollars in salary and compensation over the last few years are now going to get this $700 billion blank check from the American taxpayer. It's just unbelievable. If Henry Paulson doesn't want it to be punitive, that's telling us, from the word go, he is not the guy to run this.

This is not supposed to be a giveaway. You know, these are the richest people in the whole country. And if it's not punitive, what we're telling them is just, you know, "Go out, run your banks in a reckless manner" — because that's what they did; they wouldn't be here if they didn't run their banks in a reckless manner — "pay yourself $30, $40, $50 million a year in compensation. Then, when you get in trouble, go running to the government, and we'll just hand you hundreds of billions of more." If this isn't punitive, if this isn't really painful for them to come to the government, then we've messed up with the bailout. Think of what we do to welfare people, when they—you know, everything they have to go through to get, you know, a $500-a-month check, and these people want billions, no questions asked.

ROBERT SCHEER: Well, I think Senator Sanders made a very important point, that, you know, Barack Obama, back in March at Cooper Union—Robert Rubin, who is now unfortunately close to the campaign, in January of this year—he's the guy who in the Clinton administration pushed through the Financial Services Modernization Act, allowing this madness—but in January, he said we don't have a problem, this is just the normal fluctuation of the market. That was in a speech he gave at Cooper Union. However, in March, Barack Obama gave a very good speech on the economy. He said much of what we have been saying on this show so far. Unfortunately, he lost that voice temporarily, and these people like Summers and Rubin moved over to his campaign. So, I think if Barack Obama can recover his populist voice that got him where he—so far in the primaries, I think this should be a runaway. I mean, it's unbelievable that the American people would want four more years of this madness.

I would point out, you have asked the question about covering foreign banks. One of those foreign banks, UBS, Swiss bank, is where Phil Gramm works. He was rewarded after being head of the Banking Committee, pushing through this deregulation. His wife Wendy Gramm went to work for Enron, was on their audit committee. She runs a big institute for deregulation that the big corporations put a lot of money into. Phil Gramm went to work for UBS, a foreign-based banking conglomerate. And now they want to extend this coverage to those banks. These people have no shame.

I think it's time, as I said before, to really talk about criminal investigation. They have defrauded the American people, and they changed the laws. You know the old folk song, Woody Guthrie, I guess, you know, some will rob you with a gun, and others with a fountain pen. I mean, imagine, these people came in, rewrote federal regulation to exempt the kind of credit swaps—I notice people find this a bit confusing, but I'm saying they've got to read up on it. The hybrid instruments that they talk about, that's what allowed all of this. That's why AIG got in trouble. They're supposed to be selling insurance; they're not supposed to be backing security packages. And all of this stuff was hidden, it was murky. The bankers themselves admit they don't know what was going on.

And all of that was made legal; it was illegal up until, you know, less than ten years ago. It was made legal by acts of Congress, led by the Republicans, and unfortunately a majority of Democrats backed it, and Bill Clinton signed off on that first major legislation.