Paul Craig Roberts

Last March I reviewed Matt Taibbi’s important book Griftopia, an entertaining account of the through-going financial fraud that gave us the financial crisis. Taibbi shows that the US “superpower” can match any third world backwater in the magnitude of greed and fraud that is endemic in business and government. I would not be surprised if Taibbi’s book motivated the more aware participants of Occupy Wall Street.

Taibbi’s Griftopia was published last year. This year Henry Holt publishers have provided us with Gretchen Morgenson and Joshua Rosner’s Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.

Morgenson and Rosner tell the story again, but with less drama and provocation. Possibly, it might be more acceptable to those gullible Americans who wrap themselves in the flag and refuse to believe that their country could ever knowingly do anything that is wrong.

I am not suggesting that Morgenson and Rosner pull their punches. To the contrary, the authors deliver enough knockouts to be contenders with Taibbi as world champions in exposing the reckless fraud that the US financial sector and its regulators now epitomize.

The financial crisis, which is very much still with us, did not result from accident or miscalculation; neither did it result because of a flaw in Alan Greenspan’s theory, as he told Congress when a feeble effort was made to hold him accountable. It was the intentional result of people motivated by short-term profits who wanted to get theirs and get out.

As Reckless Endangerment shows, fraud characterized every stage of the process from the fraudulent borrower incomes and credit scores that mortgage issuers gave to unqualified buyers, through the securitization of the mortgages and their triple-A investment grade ratings by the rating agencies (Standard & Poor’s especially, but also Moody’s and Fitch) to the investment banks that sold what the banks knew was junk to investors around the world as investment grade securities. Indeed, Goldman Sachs was simultaneously betting against the mortgage derivatives that it was selling to clients.

Investment banks, such as Goldman Sachs, which once considered it a matter of honor to represent the interests of customers, took advantage of the trust that had been built up in the past to commit fraud against customers in order to advance the banks’ short-term profits and the out-sized multi-million dollar managerial bonuses that these fraudulent profits produced.

More »

Stephen Lendman

Though a long shot at best, her doggedness during hard times makes anything possible. However, the notion of President Bachmann should chill everyone to fight it at a time America already is no fit place to live in. Imagine it under her, making Washington Christian fascist occupied territory. Don't rule her out.

Frances Fitzgerald titled her 2000 book on Reagan's Star Wars Strategic Defense Initiative, "Way Out There in the Blue," leaving [it] unsaid but letting readers conclude that America during his tenure was run by right wing extremists.

He and most others around him were ideologically hard right, their legacy including:

● disdain for working Americans;
● contempt for the rule of law, civil liberties, human rights, and democratic freedoms; and
● support for concentrated wealth, power and budget-busting militarism.

They backed:

● sweeping deregulation;
● destructive "free trade;"
● offshoring high-paying manufacturing, service, and other jobs;
● the war on drugs - in fact, a war on poor minorities, escalating America's prison population to the highest by far in the world, two-thirds in it Blacks and Latinos, most for nonviolent offenses;
● tax cuts for the rich;
● draconian social program cuts;
● support for global despots, apartheid South Africa, star wars, death squads, proxy wars in Central America, Africa, Afghanistan, and Middle East by helping Iran and Iraq wage war; and
● contempt for gays, lesbians, people of color, the poor and disadvantaged, and more.

Age 24 in 1980, Bachmann voted for Reagan and worked for his campaign. In Congress and as a Tea Party presidential candidate, her extremism may be unrivaled.

More »

Andrew Gavin Marshall
Global Research

The following is a sample from an forthcoming book by Andrew Gavin Marshall on 'Global Government', Global Research Publishers, Montreal. For more by this author on the issue of the economic crisis and global governance, see the recently-released book by Global Research "The Global Economic Crisis: The Great Depression of the XXI Century," Michel Chossudovsky and Andrew Gavin Marshall, (Editors), in which the author contributed three chapters on the history of central banking, the rise of a global currency and global central bank, and the political economy of global government.

Problem, Reaction, Solution: “Crisis is an Opportunity”

In May of 2010, Dominique Strauss-Kahn, Managing Director of the IMF, stated that, “crisis is an opportunity,” and called for “a new global currency issued by a global central bank, with robust governance and institutional features,” and that the “global central bank could also serve as a lender of last resort.” However, he stated, “I fear we are still very far from that level of global collaboration.”[1] Well, perhaps not so far as it might seem.

The notion of global governance has taken an evolutionary path to the present day, with the principle global political and economic actors and institutions incrementally constructing the apparatus of a global government. In the modern world, global governance is an inter-lapping, intersecting, and intertwined web of international organizations, think tanks, multinational corporations, nations, NGOs, philanthropic foundations, military alliances, intelligence agencies, banks and interest groups. Globalization – a term which was popularized in the late 1980s to refer to the global spread of multinational corporations – has laid the principle ideological and institutional foundations for this process. Global social, economic and political integration do not occur at an equal pace; rather, economic integration and governance on a global level has and will continue to be ahead of the other sectors of human social interaction, in both the pace and degree of integration. In short, global economic governance will set the pace for social and political global governance to follow.

More »

Matt Taibbi

It's early May in Washington, and something very weird is in the air. As Chris Dodd, Harry Reid and the rest of the compulsive dealmakers in the Senate barrel toward the finish line of the Restoring American Financial Stability Act – the massive, year-in-the-making effort to clean up the Wall Street crime swamp – word starts to spread on Capitol Hill that somebody forgot to kill the important reforms in the bill. As of the first week in May, the legislation still contains aggressive measures that could cost once-indomitable behemoths like Goldman Sachs and JP Morgan Chase tens of billions of dollars. Somehow, the bill has escaped the usual Senate-whorehouse orgy of mutual back-scratching, fine-print compromises and freeway-wide loopholes that screw any chance of meaningful change.

The real shocker is a thing known among Senate insiders as "716." This section of an amendment would force America's banking giants to either forgo their access to the public teat they receive through the Federal Reserve's discount window, or give up the insanely risky, casino-style bets they've been making on derivatives. That means no more pawning off predatory interest-rate swaps on suckers in Greece, no more gathering balls of subprime shit into incomprehensible debt deals, no more getting idiot bookies like AIG to wrap the crappy mortgages in phony insurance. In short, 716 would take a chain saw to one of Wall Street's most lucrative profit centers: Five of America's biggest banks (Goldman, JP Morgan, Bank of America, Morgan Stanley and Citigroup) raked in some $30 billion in over-the-counter derivatives last year. By some estimates, more than half of JP Morgan's trading revenue between 2006 and 2008 came from such derivatives. If 716 goes through, it would be a veritable Hiroshima to the era of greed.

More »

Matt Taibbi

"The Obama administration said Sunday it would seek a law allowing investigators to interrogate terrorism suspects without informing them of their rights, as Attorney General Eric H. Holder Jr. flatly asserted that the defendant in the Times Square bombing attempt was trained by the Taliban in Pakistan." ~ via Attorney General Backs Miranda Limit for Terror Suspects – NYTimes.com.

Memo to those Tea Party activists out there who’ve been howling about those liberal wusses in the Obama Justice Department who read Faisal Shahzad his Miranda rights: congratulations. You’ve just opened the door for a major new expansion of government power.

Having followed the Tea Party around on and off for a few months now it’s been hard not to notice some of the contradictory messages emanating from the movement. You’ll hear the same people who want to abolish the EPA complaining about the slow federal response to the Gulf oil spill, or the same people who are stocking up on guns to ward off the inevitable government assault on their property cheering for beefed-up drug enforcement laws and the no-knock search warrant.

More »

Ellen Brown

Last week, Goldman Sachs was on the congressional hot seat, grilled for fraud in its sale of complicated financial products called “synthetic CDOs.” This week the heat was off, as all eyes turned to the attack of the shorts on Greek sovereign debt and the dire threat of a sovereign Greek default. By Thursday, Goldman’s fraud had slipped from the headlines and Congress had been cowed into throwing in the towel on its campaign to break up the too-big-to-fail banks. On Friday, Goldman was in settlement talks with the SEC.

Goldman and Wall Street reign. Congress appears helpless to discipline the big banks, just as the European Central Bank appears helpless to prevent the collapse of the European Union. . . . Or are they?

Suspicious Market Maneuverings

The shorts circled like sharks in the Greek bond market, following a highly suspicious downgrade of Greek debt by Moody’s on Monday. Ratings by private ratings agencies, long suspected of being in the pocket of Wall Street, often seem to be timed to cause stocks or bonds to jump or tumble, causing extreme reactions in the market. The Greek downgrade was suspicious and unexpected because the European Central Bank and International Monetary Fund had just pledged 120 billion Euros to avoid a debt default in Greece.

Markets were roiled further on Thursday, when the U.S. stock market suddenly lost 999 points, and just as suddenly recovered two-thirds of that loss. It appeared to be such a clear case of tampering that Maria Bartiromo blurted out on CNBC, “That is ridiculous. This really sounds like market manipulation to me.”

More »

Matt Taibbi

How the nation's biggest banks are ripping off American cities with the same predatory deals that brought down Greece

If you want to know what life in the Third World is like, just ask Lisa Pack, an administrative assistant who works in the roads and transportation department in Jefferson County, Alabama. Pack got rudely introduced to life in post-crisis America last August, when word came down that she and 1,000 of her fellow public employees would have to take a little unpaid vacation for a while. The county, it turned out, was more than $5 billion in debt — meaning that courthouses, jails and sheriff's precincts had to be closed so that Wall Street banks could be paid.

As public services in and around Birmingham were stripped to the bone, Pack struggled to support her family on a weekly unemployment check of $260. Nearly a fourth of that went to pay for her health insurance, which the county no longer covered. She also fielded calls from laid-off co-workers who had it even tougher. "I'd be on the phone sometimes until two in the morning," she says. "I had to talk more than one person out of suicide. For some of the men supporting families, it was so hard — foreclosure, bankruptcy. I'd go to bed at night, and I'd be in tears."

Homes stood empty, businesses were boarded up, and parts of already-blighted Birmingham began to take on the feel of a ghost town. There were also a few bills that were unique to the area — like the $64 sewer bill that Pack and her family paid each month. "Yeah, it went up about 400 percent just over the past few years," she says.

More »

Matt Taibbi

But the state still gets between 10 and 20 e-mails seeking verification of Obama’s birth each week, most of them from outside Hawaii, Kim said Tuesday. (Via Hawaii considering law to ignore Obama ‘birthers’ – Yahoo! News.)

I was tempted to laugh at this story about the Birthers still asking for Barack Obama’s birth information — the state of Hawaii is considering passing a law allowing them to ignore these requests — but then it occurred to me that at least those people are actually doing their homework.

On the other hand, I get pestered at least once a day by some lunatic who a) hasn’t noticed that I actually oppose the health care bill, and b) has fallen for the reams of robo-emails floating around the internet making extravagant claims about what’s in the Obama Health Bill. One of the most popular is something written by a Texas County Judge named David Kithil – I have no idea if he actually exists or not — who purports to have combed through HR 3200 and found evidence of all sorts of fiendishness.

More »

Matt Taibbi

MY health insurer here in California is Anthem Blue Cross. So far, my group policy hasn’t been affected by Anthem’s planned rate increase of as much as 39 percent for its customers with individual policies — but the trend worries me, as it should everyone. Rates are soaring all over the country. Insurers have been seeking to raise premiums 24 percent in Connecticut, 23 percent in Maine, 20 percent in Oregon and a wallet-popping 56 percent in Michigan. How can insurers raise prices as much as they want without fear of losing customers?

Astonishingly, the health insurance industry is exempt from federal antitrust laws, which is why a handful of insurers have become so dominant in their markets that their customers simply have nowhere else to go. But that protection could soon end: President Obama on Tuesday announced his support of a House bill that would repeal health insurers’ antitrust exemption, and Speaker Nancy Pelosi signaled that she would put it toward an immediate vote. Op-Ed Contributor – Bust the Health Care Trusts – NYTimes.com.

This is how politics is supposed to work. Well, not really — in reality, you’d like to see your leaders actually lead, i.e. do the right thing first, before being forced into it by circumstance. But we’ll take the latter.

More »

Matt Taibbi

The Greatest Non-Apology of All Time

“While we regret that we participated in the market euphoria and failed to raise a responsible voice, we are proud of the way our firm managed the risk it assumed on behalf of our client before and during the financial crisis,” he said. (via Goldman Regrets ‘Market Euphoria’ That Led to Crisis - DealBook Blog - NYTimes.com.)

Anyone else out there find himself doubled over laughing after reading Goldman, Sachs chief Lloyd Blankfein’s “apology” for his bank’s behavior leading up to the financial crisis? Has an act of contrition ever in history been more worthless and insincere? Even Gary Ridgway did a better job of sounding genuinely sorry at his sentencing hearing — and he was a guy who had sex with dead prostitutes because it was cheaper than paying live ones.

Looking at Blankfein’s one-sentence apology, I’m struck in particular by a couple of phrases:

While we regret that we participated in the market euphoria…Really, Lloyd?

More »