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Too Big to Jail May 24, 2011

Posted by rogerhollander in Criminal Justice, Economic Crisis.
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 Goldman Sach’s Lloyd Blankfein

Published on Tuesday, May 24, 2011 by CommonDreams.org

  by  Danny Schechter

This week the financial crisis finally went prime time in the form of a big budget HBO docudrama called “Too Big To Fail.”Goldman Sach’s Lloyd Blankfein. (File)

It was a well-acted docudrama focused on the BIG men and some women in the banks and in government who tried to put Humpty Dumpty back together again up on that wall to prevent a total economic collapse when panic dried up credit and financial institutions faced failure.

Based on the work of a New York Times reporter, it offered a skillfully-made but conventional narrative which, like most TV shows, showcase events but miss their deeper context and background.

We heard all the explanations, save one.

There was greed, ambition, ego and money lust. There were personal rivalries and ideological battles, parochial agendas and narrow self-interest. There was panic on THE Street and in the halls of mighty institutions. In many ways, the program recycled and made an official narrative compelling viewing. In the end, everyone was to blame so no one was to blame.

But… what was missing was any notion of intentionality and premeditation, almost no mention of systemic fraud and CRIME, that one word that sums up what really happened for those millions of Americans who have lost jobs and homes. We never saw victims or felt their pain and bewilderment. We were never shown how a shadow banking system emerged or how the finance industry worked with their counterparts in finance and insurance to transfer wealth from the poor and middle class to the superrich,

When I was but a precocious lad, my elementary school encouraged students to take out a savings account at the nearby Dime Bank in the Bronx. We were each given a bankbook and taught to put in $.50 a week to show us how to build wealth by being thrifty. It was with a sense of pride that I watched my balance grow.

It may have been peanuts in the scheme of things, but to me, at the time, it was the way to plan for the future.

At the same time, in those year I watched TV shows glamorize the bank robbing antics of a man named Willie Sutton who also staged jail breaks wearing masks and costumes. When he was asked why he robbed banks, he responded famously, “That’s where the money is.”

And it still is, except in our era, it is the banks that are robbing us.

That’s because what’s now called the “financial Services sector” has gone from about 30 percent of our economy to over 60 percent. Through a process called financialization, they have transformed how all business is done.

Making money from money soon began to surpass making money from making things. What we were never warned about was the danger of getting too deeply in debt, or how the economy was shifting from production to consumption.

Private equity, credit swaps, derivative deals and collateralized debt obligations soon drove the economy. Markets became captives of high performance trading by powerful computers.

When Wall Street became the defacto capital of the country, the bankers accrued more power than the politicians who they bought up with impunity. Their lobbying power deregulated the economy and decriminalized their activities. They killed many of the reforms enacted during the New Deal designed to protect the public. They built a shadow (and shadowy) banking system beyond the reach of the law.

And now, here we are, in 2011, five years after the meltdown of 2007, four years after the crash of 2008 and the passage of the TARP bailout that pumped money into their treasuries at taxpayer expense. Since then, there has been a steady parade of scandals and the disclosures that have come out since. Every week, more banks close and or consolidate and run into problems with regulators.

Take “my” old bank in the Bronx. It has been through as many changes as I have been. A website on bank histories runs it down:

Dime Savings Bank of New York, The
04/12/1859 NYS Chartered Dime Savings Bank of Brooklyn
09/10/1930 Acquire By Merger Navy Savings Bank
06/30/1970 Name Change To Dime Savings Bank of New York, The
09/30/1979 Acquire By Merger Mechanics Exchange Savings Bank
07/01/1980 Acquire By Merger First Federal S & L Assoc. of Port Washington
08/01/1981 Acquire By Merger Union Savings Bank of New York
06/23/1983 Convert Federal Dime Savings Bank of NY, FSB
01/07/2002 Purchased By Washington Mutual Inc.
01/07/2002 Name Change To Washington Mutual Bank

And then, of course, some years later, Washington Mutual itself, went bust and was bought up for a song by JP Morgan Chase. Here are some of the latest headlines about the bank now known as WAMU:

WaMu agrees on post-bankruptcy control — report‎ – Reuters
WaMu, Shareholders, Biggest Creditors Said to Settle …‎ – Bloomberg
WaMu shareholders are offered $25M-plus to drop claims

On the day I wrote this commentary, the New York Times reported:

“The nation’s biggest banks and mortgage lenders have steadily amassed real estate empires, acquiring a glut of foreclosed homes that threatens to deepen the housing slump and create a further drag on the economic recovery.

All told, they own more than 872,000 homes as a result of the groundswell in foreclosures, almost twice as many as when the financial crisis began in 2007, according to RealtyTrac.”

And to whom does the Times turn for expertise on the subject, but a key former operative at Washington Mutual who was with the bank in the go-go era of shoveling out subprime mortgages? Now, he gives advice on risk management:

“These shops are under siege; it’s just a tsunami of stuff coming in,” said Taj Bindra, who oversaw Washington Mutual’s servicing unit from 2004 to 2006 and now advises financial institutions on risk management. “Lenders have a strong incentive to clear out inventory in a controlled and timely manner, but if you had problems on the front end of the foreclosure process, it should be no surprise you are having problems on the back end.”

What were people’s homes are now “inventory” to be stockpiled even though it has a negative cumulative effect on economic recovery of the housing market.

The banks that are increasingly despised and blamed for their role in engineering the financial disaster, are now trying to play nice to change their negative image.

Explains the Times:

“Conscious of their image, many lenders have recently started telling real estate agents to be more lenient to renters who happen to live in a foreclosed home and give them extra time to move out before changing the locks.

“Wells Fargo has sent me back knocking on doors two or three times, offering to give renters money if they cooperate with us,” said Claude A. Worrell, a longtime real estate agent from Minneapolis who specializes in selling bank-owned property. “It’s a lot different than it used to be.”

So, they are still foreclosing, but with a smile. Is it a ‘lot different than it used to be’?
Just last month, Huffington Post reported:

“Top executives at Washington Mutual actively boosted sales of high-risk, toxic mortgages in the two years prior to the bank’s collapse in 2008, according to emails published in a wide-ranging Senate report that contradicts previous public testimony about the meltdown.

The voluminous, 639-page report on the financial crisis from the Senate Permanent Subcommittee on Investigations singles out Washington Mutual for its decision to champion its subprime lending business, even as executives privately acknowledged that a housing bubble was about to burst.”

The truth is that most of the bigger banks have emerged from the financial crisis stronger than ever, with executives cashing in with higher salaries and bigger bonuses. That old saying about criminals who “laughed all the way to the bank” has to be revised because in this case they never left the bank.

More shocking has been the largely passive response by our government and prosecutors. At last, the Attorney General of New York is said to be investigating but none of the big bankers have yet gone to jail or suffered for the scams and frauds they committed. Most of the State officials who vowed to after the banks in the absence of aggressive federal actions have backed down.

So what can “we the people” do? We can do nothing and watch more of what’s left of our wealth vanish, or we can join others in demanding a “jailout,” not a bailout.

A well-known international banker was just arrested for a high profile alleged sex crime but not one of possibly thousands have been prosecuted for well documented financial crimes.

Where are the political leaders and activist groups willing to “fight the power” and demand accountability and transparency on Wall Street?

Why are so many us banking on a financial recovery to bring back jobs and a modicum of justice created by the very people and institutions responsible for the crisis?

And why didn’t I learn about these dangers when I first discovered the wonderful world of banking? Isn’t that what schools are for?

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–>

Danny Schechter

Mediachannel’s News Dissector Danny Schechter investigates the origins of the economic crisis in his book Plunder: Investigating Our Economic Calamity and the Subprime Scandal (Cosimo Books via Amazon). Comments to dissector@mediachannel.org

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Don’t Blame Bunning March 3, 2010

Posted by rogerhollander in Economic Crisis.
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Published on Wednesday, March 3, 2010 by TruthDig.comby Robert Scheer

How convenient that seemingly everyone in the liberal blogosphere, and even at many points to the right, got to use Jim Bunning as a scapegoat. The venom of the attacks suggests that the maverick Republican senator from Kentucky provided a welcome alternative to the real villains: bankers much closer to the centers of power. As if Bunning’s denial of unanimous consent to a stopgap extension of unemployment insurance-easily overcome, as was demonstrated Tuesday night-is at the root of our economic crisis. 

It isn’t, and it is vicious nonsense to transform Bunning, who has a long record of opposition to the bipartisan policies that caused America’s financial mess, into a poster boy for economic heartlessness. The issue was not one of extending aid for another month to those whose benefits had run out but rather holding the government accountable for the means of payment. 

Bunning’s action was a sideshow, a boneheaded symbolic gesture that backfired with slight consequences. Yet the senator was made to look the dangerous fool in media accounts while many of those who enabled the financial catastrophe continue to be treated as reasonable experts after being rewarded for their folly with the highest posts in both the Bush and Obama administrations. 

The real issue here is the banking bailout, a bipartisan swindle that Bunning opposed and that has led to a dangerously spiraling deficit without providing relief to ordinary folk. It is the same issue that carried Texas Gov. Rick Perry to victory Tuesday in his state’s Republican gubernatorial primary, in which he defeated U.S. Sen. Kay Bailey Hutchison in part because of her support of the bank bailout. 

As with the January defeat of the Democratic candidate in the Massachusetts election for a U.S. Senate seat, the message from voters is loud and clear: The political establishment cares only about the fat cats and not the people who are hurting. Bunning’s gesture was not intended, as his critics insisted, to increase that pain but rather to hold the government accountable for the money it is spending. He has consistently blasted the bailout as a shameless gift to the Wall Street hustlers and urged that the money being wasted on them instead be spent to aid homeowners and other victims of their greed.

This is not the first time that Bunning has stood alone in Congress. He was the sole member of the Senate to vote against the nomination of Ben Bernanke to be head of the Federal Reserve. That appointment came from Republican President George W. Bush, and yet it was Republican Sen. Bunning who warned that Bernanke as a Fed governor had been allied with then-Fed Chairman Alan Greenspan in his disastrous policymaking. 

That was four years ago, when Greenspan was still being lionized by most Democratic and Republican politicians as well as by much of the media. On Jan. 28 of this year, Bunning once again rose in the Senate to challenge Bernanke, this time after President Barack Obama had nominated him for a second term:

“Chairman Bernanke … bowed to the political pressure of the Bush and Obama administrations and turned the Fed into an arm of the Treasury. … Instead of taking that money and lending to consumers and cleaning up their balance sheets, the banks started to pocket record profits and pay out billions of dollars in bonuses. … So if you like those bailouts, by all means vote for Chairman Bernanke.  But if you want to put an end to bailouts and send a message to Wall Street, this vote is your choice.”

He is right to point out that enormous sums always seem to exist to aid Wall Street but that assistance to average Americans has consistently been only an afterthought. And he does have a point in noting that if the latest spending extension was felt to be so important, why wasn’t it funded in a timely manner or in an orderly procedure by his congressional colleagues from both parties who are now trouncing him? 

The money is always there when they want it, as we have witnessed throughout the banking bailout when enormous sums have suddenly been made available to those who least need it. The Treasury Department managed to find $200 billion last week to deposit with the Fed to increase the purchase of toxic mortgages to $1.25 trillion to make the bankers whole.

But the level of vituperation unleashed against this senator is so disproportionate to his role in the economic catastrophe as to raise questions of motive. The overreaction to Bunning’s protest was never anything more than a ploy for Democratic and Republican leaders to profess great sorrow for the folks on Main Street while they continue to coddle Wall Street.

© 2010 TruthDig.com

Robert Scheer is editor of Truthdig.com and a regular columnist for The San Francisco Chronicle.

Hopebroken and Hopesick: A Lexicon of Disappointment April 17, 2009

Posted by rogerhollander in Barack Obama.
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by Naomi Klein

All is not well in Obamafanland. It’s not clear exactly what accounts for the change of mood. Maybe it was the rancid smell emanating from Treasury’s latest bank bailout. Or the news that the president’s chief economic adviser, Larry Summers, earned millions from the very Wall Street banks and hedge funds he is protecting from reregulation now. Or perhaps it began earlier, with Obama’s silence during Israel’s Gaza attack.

Whatever the last straw, a growing number of Obama enthusiasts are starting to entertain the possibility that their man is not, in fact, going to save the world if we all just hope really hard.

This is a good thing. If the superfan culture that brought Obama to power is going to transform itself into an independent political movement, one fierce enough to produce programs capable of meeting the current crises, we are all going to have to stop hoping and start demanding.

The first stage, however, is to understand fully the awkward in-between space in which many US progressive movements find themselves. To do that, we need a new language, one specific to the Obama moment. Here is a start.

Hopeover. Like a hangover, a hopeover comes from having overindulged in something that felt good at the time but wasn’t really all that healthy, leading to feelings of remorse, even shame. It’s the political equivalent of the crash after a sugar high. Sample sentence: “When I listened to Obama’s economic speech my heart soared. But then, when I tried to tell a friend about his plans for the millions of layoffs and foreclosures, I found myself saying nothing at all. I’ve got a serious hopeover.” 

Hoper coaster. Like a roller coaster, the hoper coaster describes the intense emotional peaks and valleys of the Obama era, the veering between joy at having a president who supports safe-sex education and despondency that single-payer healthcare is off the table at the very moment when it could actually become a reality. Sample sentence: “I was so psyched when Obama said he is closing Guantánamo. But now they are fighting like mad to make sure the prisoners in Bagram have no legal rights at all. Stop this hoper coaster-I want to get off!”

Hopesick. Like the homesick, hopesick individuals are intensely nostalgic. They miss the rush of optimism from the campaign trail and are forever trying to recapture that warm, hopey feeling-usually by exaggerating the significance of relatively minor acts of Obama decency. Sample sentences: “I was feeling really hopesick about the escalation in Afghanistan, but then I watched a YouTube video of Michelle in her organic garden and it felt like inauguration day all over again. A few hours later, when I heard that the Obama administration was boycotting a major UN racism conference, the hopesickness came back hard. So I watched slideshows of Michelle wearing clothes made by ethnically diverse independent fashion designers, and that sort of helped.”

Hope fiend. With hope receding, the hope fiend, like the dope fiend, goes into serious withdrawal, willing to do anything to chase the buzz. (Closely related to hopesickness but more severe, usually affecting middle-aged males.) Sample sentence: “Joe told me he actually believes Obama deliberately brought in Summers so that he would blow the bailout, and then Obama would have the excuse he needs to do what he really wants: nationalize the banks and turn them into credit unions. What a hope fiend!”

Hopebreak. Like the heartbroken lover, the hopebroken Obama-ite is not mad but terribly sad. She projected messianic powers on to Obama and is now inconsolable in her disappointment. Sample sentence: “I really believed Obama would finally force us to confront the legacy of slavery in this country and start a serious national conversation about race. But now whenever he seems to mention race, he’s using twisted legal arguments to keep us from even confronting the crimes of the Bush years. Every time I hear him say ‘move forward,’ I’m hopebroken all over again.”

Hopelash. Like a backlash, hopelash is a 180-degree reversal of everything Obama-related. Sufferers were once Obama’s most passionate evangelists. Now they are his angriest critics. Sample sentence: “At least with Bush everyone knew he was an asshole. Now we’ve got the same wars, the same lawless prisons, the same Washington corruption, but everyone is cheering like Stepford wives. It’s time for a full-on hopelash.”

In trying to name these various hope-related ailments, I found myself wondering what the late Studs Terkel would have said about our collective hopeover. He surely would have urged us not to give in to despair. I reached for one of his last books, Hope Dies Last. I didn’t have to read long. The book opens with the words: “Hope has never trickled down. It has always sprung up.” 

And that pretty much says it all. Hope was a fine slogan when rooting for a long-shot presidential candidate. But as a posture toward the president of the most powerful nation on earth, it is dangerously deferential. The task as we move forward (as Obama likes to say) is not to abandon hope but to find mor eappropriate homes for it-in the factories, neighborhoods and schools where tactics like sit-ins, squats and occupations are seeing a resurgence.

Political scientist Sam Gindin wrote recently that the labor movement can do more than protect the status quo. It can demand, for instance, that shuttered auto plants be converted into green-future factories, capable of producing mass-transit vehicles and technology for a renewable energy system. “Being realistic means taking hopeout of speeches,” he wrote, “and putting it in the hands of workers.”

Which brings me to the final entry in the lexicon. 

Hoperoots. Sample sentence: “It’s time to stop waiting for hope to be handed down, and start pushing it up,f rom the hoperoots.”

Naomi Klein is an award-winning journalist and syndicated columnist and the author of the international and New York Times bestseller The Shock Doctrine: The Rise of Disaster Capitalism, now out in paperback. Her earlier books include the international best-seller, No Logo: Taking Aim at the Brand Bullies; and the collection Fences and Windows: Dispatches from the Front Lines of the Globalization Debate (2002). To read all her latest writing visit www.naomiklein.org

Leahy: Truth Commission Dead; Law School Dean Rocks Radio on Torture April 5, 2009

Posted by rogerhollander in Criminal Justice, Economic Crisis, Torture.
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Ralph Lopez 

www.opednews.com, April 5, 2009

Moving more out of step with progressive Vermonters all the time, Senator Pat Leahy announced at a meeting with constituents that his Truth Commission is off.

My friend and logger Ed Dickau writes:

[The] senator is a hypocrite and a back peddling coward and opportunistic sell out. He could have been a servant of this nation and its Constitution; instead he chose to enjoy a measure of good press, progressive and liberal support, turned around and asked for campaign contributions for his “Good Acts” and then dumped us in the sewer of DC politics, bleeding, with a knife in our backs.

The Green Mountain State has been at the forefront of movements to hold Bush administration officials accountable for torture, lying us into the Iraq War, subverting the Constitution, and other crimes. A 2007 CBS poll showed two-thirds of Vermonters for impeaching Bush. At Matt Stoller’s Opens Left 2010 Senate Primary Watch a commenter affirms the grumblings about Leahy:

let’s please primary Leahy no matter what happens. His performance as ranking Dem on the judiciary committee during the Roberts and esp. the Alito hearings was dismal. Utterly Dismal. As ranking member, he should have had a game plan for Alito, esp after seeing the stealth type campaign that swept Roberts in. Now we have two more Scalias. Sure, it would have been a tough, uphill battle, but it would have been worth it and the buck stops at Leahy. Lousy strategy (i.e. none) lousy examination during hearings (I listened) and just downright lousy performance.

The news is not all bad however. Law School Dean Lawrence Velvel of the Justice Jackson prosecution project, which seeks to file a complaint against Bush administration officials for torture this spring, has taken to the airwaves and is tearing them up. This interview with WMPG FM’s Michael Cutting in Portland, Maine is a strong indication that this is not going away, as politicians from Obama on right and on down would like it to. You can’t hang men who are innocent, who you know are innocent, by the arms from the ceiling and torture them in the name of the American people. This interview is a MUST LISTEN.  (To get Velvel on the radio/TV in your town contact neimpeach-AT-gmail-DOT-com)

Matt Stoller wrote last October:

I’m going to assume that the Senate, as the most conservative institution on our Federal level, will be a major breeze to the right in terms of health care, trade agreements, civil liberties, economic justice, etc. Let’s then examine the playing field for 2010; the environment for 2010 is unpredictable and probably chaotic, with a sharp recession on its way and a credit crisis here now.

I’m particularly interested in possible primaries to the Democrats, the party that the lobbyists are going to fete repeatedly and intensely in 2009 and 2010, much to our chagrin. I’m sure there will be retirements, but here’s the list of Democrats up for reelection:

Bayh, Evan – (D – IN)
Boxer, Barbara- (D – CA)
Dodd, Christopher J.- (D – CT)
Dorgan, Byron L.- (D – ND)
Feingold, Russell D.- (D – WI)
Inouye, Daniel K.- (D – HI)
Leahy, Patrick J.- (D – VT)
Lincoln, Blanche L.- (D – AR)
Mikulski, Barbara A.- (D – MD)
Murray, Patty- (D – WA)
Reid, Harry- (D – NV)
Salazar, Ken- (D – CO)
Schumer, Charles E.- (D – NY)

The economic crisis is likely to soften up incumbents as only an economic crisis can, as Americans previously fat and happy keep raiding food pantries and losing homes. Anger and political involvement always increase when a threshold of greed, beyond what is normal and expected of our ruling classes, is crossed, and Americans wake up from the disbelief of staring at nest eggs which are now empty. Yep, that’s good and empty alright. A lifetime of work. And those guys who are getting bailed out, their idea of pain is having to buy a smaller offshore villa.

When it sinks in that a mere $114 million to senators and lobbyists bought $300 billion in TARP funds for banks and financial institutions who made bad bets, a 260,000 PERCENT return on investment, American Idol will no longer keep the rabble diverted and entertained, especially if they have to shut off the cable to buy food. Meanwhile, the top one-percenters in income who by themselves get 1/3 of the pie, go bargain hunting in the stock market, with the bailouts you are paying for. Sucks, doesn’t it?

Even Donald Trump admits he has lost plenty of net worth, but sunnily gloats:

“We’re going up. We’re buying things we couldn’t have dreamed of buying two years ago. And we have a lot of cash.”

The way the pie is now divided and how it got there is neatly summarized in these two charts, from the Too Much Newsletter on Excess and Inequality:


 

Ronald Reagan was only the first part of the build-up in the action which continued under Clinton and the Bushes until the grand finale – now – when they steal the last of your childrens’ inheritance and disappear to places like Monaco and off-shore havens like “The Colony.” Too Much reported just last September:

several top Wall Streeters purchased villas in The Colony, a new Caribbean luxury project touted as Jamaica’s “most expensive gated oceanfront development on record.” The villas run up to $7 million each and carry a $72,000 annual fee that gives owners 60 days of butler, chef, and maid service.

When you own a third of the whole American pie, that kind of money is no problem. And this is who is getting your bail-out money.

It sure isn’t going to the schmucks getting laid off at these institutions. It sure isn’t going toward a 2-year voucher for any worker training you choose, help with your mortgage, and jobs programs. That’s because you aren’t the one who gave $114 million in campaign money to fewer than 100 men and women, especially those sitting on banking and finance committees and sub-committees.

You ain’t seen nothing yet. The economy is hemorrhaging jobs like the blood of an accident victim in the head trauma unit, and we haven’t even had a terror attack produced by the blown job in Afghanistan yet. Or the Chinese calling in their debt.

Primary challenges to senators like Leahy are hard to come by in ordinary times, but the next two years will be anything but ordinary times. The following is posted on behalf of Charlotte Dennett, one of the Vermonters reporting on Leahy’s Truth Commission wimp-out.

Leahy’s Truth Commission Hits the Skids

Those of you following the prosecution trail will be interested to know that Patrick Leahy’s Truth Commission is a no-go. I was in a meeting with Leahy and 4 other Vermonters on Monday when he broke the news to us. We had asked for the meeting to learn why he supported a Truth Commission over the appointment of a special prosecutor. Halfway through the allotted 30 minute meeting (with him taking up much of the time explaining why he was not generally opposed to prosecution, since he had been a DA for 8 years and had the highest conviction rate in Vermont) he told us that his Truth Commission had failed to get the broad support it needed in Congress , and since he couldn’t get one Republican to come behind the plan, “it’s not going to happen.”

It was a sobering exchange. The meeting had begun with our expressing serious concerns about ongoing dangers to our democracy, with the trend going to executive power while damaging our constitution. “We are a nation of laws,” said Dan DeWalt, who had helped organize 36 Vermont towns to vote for Impeachment of Bush on town meeting day. ” If we have a system of justice, why not let it take its course? It seems to many Americans that the rich and powerful don’t have the same system of justice, and they’re getting away with torture, murder, fraud, and Ponzi schemes.”

By the end of the meeting, we were beginning to wonder whether anything at all was going to done – by Congress, by Attorney General Holder, by President Obama — to hold the Bush team accountable for its crimes.

Leahy own aversion to appointing a special prosecutor appeared to be more practical than philosophical.

“We don’t want another Abu Ghraib,” he said. “You know, ‘Boy did we get those privates and corporals. So many up on high will never get touched. Its like the war on drugs – lets get those black kids on cocaine.” So its not that he had a problem with prosecutions per se. “I just worry that the prosecutions will be done only on middle-level people.”

Well then, what would happen to the higher ups? Leahy had said, on previous occasions, that the purpose of his Truth Commission was to grant immunity to those willing to testify – presumably middle level people – and we could infer from that that they, in turn, would spill the beans on their superiors. If any of the witnesses lied under oath or were less than thorough in their answers, he had told MSNBC’s Rachel Maddow a month ago, they could be prosecuted for perjury. But that still left the destiny of high government officials uncertain.

Leahy had hinted to Maddow that if officials refused to honor subpoenas, they, too could be prosecuted. But in the real world, as Monday’s news suggests, the people most responsible for the crimes will continue to get off free.

We should at least be content, Leahy said, with his success in forcing former Attorney General Alberto Gonzalez’s resignation.

After Leahy left the meeting, his aide, Chuck Ross, assured our group that there was no one more devoted to protecting the Constitution than Leahy. “He has been persistent in the face of obfuscation. He got rid of Gonzalez. I would challenge you to find someone who has done more to defend the Constitution.”

Then Ross let out a memorable one-liner. “He’s all you’ve got.”

What?  Leahy’s all we got to protect the Constitution? And we have to accept Gonzalez’s resignation as the only punishment for years of gutting the rule of law? It took about five minutes for all this to sink in. Then fellow Vermonter John Nirenberg spoke, I think, for all of us. “If he’s the only guy, this is not a healthy situation.”

It is, perhaps, no coincidence, that the same time Leahy downplayed the Truth Commission, Congressional aides were quoted by reporter Jason Leopold of Consortium News that “the focus has shifted to the economy and that pressure for a special prosecutor to bring criminal charges over the Bush administration’s past actions could become a distraction to that focus.” Leahy’s aide Ross had said the same thing. Everyone was focusing on the economy.

So now, it seems, the wrecked economy – complements of the Bush Administration — is becoming the excuse for Congressional inaction after eight years of unremitting malfeasance. This is serious, folks. Appointing a Special Prosecutor had been the top issue on President Obama’s website when he took office. Either he’s not listening any more, or his supporters are “moving forward, not backward,” just as he prefers – and his right flank (the CIA, the neocons, and everyone else who has something to hide) desperately want.. It remains to be seen if his huge base can get through to him on this issue, now that he occupies the White House. If they cannot, then the failure to hold even a Truth Commission, let alone prosecutions, signals a return to the same old way of doing things. Deterrence be damned.


Charlotte Dennett is a lawyer and investigative journalist. She ran for Attorney General in Vermont on a pledge to prosecute George W. Bush using state criminal statutes

LAWRENCE VELVEL, DEAN OF THE MASSACHUSETTS SCHOOL OF LAW, ON TORTURE, WMPG FM, PORTLAND, MAINE, MUST LISTEN. (To get Velvel on the radio/TV in your town contact neimpeach-AT-gmail-DOT-com)

Those Hit Hardest Get No Bailout March 18, 2009

Posted by rogerhollander in Economic Crisis.
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by Amy Goodman

Taxpayers’ bailout money for AIG bonuses has rightfully provoked a massive backlash against AIG, Wall Street, President Barack Obama and his economic advisers, Treasury Secretary Timothy Geithner and Larry Summers. The U.S. public now owns 80 percent of AIG. The outrage is bipartisan: Iowa Republican Sen. Charles Grassley even suggested that AIG executives “resign or go commit suicide.” New York State Attorney General Andrew Cuomo just released details on the bonuses, exposing AIG’s ridiculous claim that they are “retention bonuses” aimed at keeping key employees, since 11 of those who received bonuses of $1 million or more are no longer employed by AIG.

These AIG millionaires may need to return their unearned millions (Congress may pass a tax law aimed just at them, taxing their bonuses at 100 percent). But will the outrage help those who have been hardest hit by the economic meltdown? Will the hundreds of millions of dollars in various stimulus packages and bailouts find its way to regular people who are trying to get by, or will it go only to corporations deemed “too big to fail,” leaving behind millions of people who are, apparently, small enough to fail?

The Center for Social Inclusion has just issued a report on the economic meltdown and how best to solve the problem. It links race to the lack of opportunity and to the prevalence of the notorious subprime mortgages that triggered the economic crisis.

CSI Executive Director Maya Wiley told me, “We have to stimulate equality in order to stimulate the economy.” Access to education, transportation, housing and a clean environment give people a firm footing to respond to crisis and to succeed. Noting that “shovel-ready” stimulus jobs in construction will disproportionately favor those who are already in that industry, predominantly white males, Wiley is pushing for “community benefits agreements for construction jobs [that] ensure when the government has construction contracts, low-income people, people of color, women, are going to have their fair share of those jobs.” Since people of color are more likely to live far from available jobs and are less likely to have cars, Wiley says, “we must ensure that the way transportation dollars get spent go to transit … to connect people who need jobs to the places where there are jobs.”

The group United for a Fair Economy also highlights the racial wealth divide, noting that “24 percent of blacks and 21 percent of Latinos are in poverty, versus 8 percent of whites. In the corporate world, we are seeing the highest executive pay and the biggest bailouts in history. CEO pay is 344 times that of the average worker.”

Prevailing wisdom posits that freeing up credit will save the economy, thus these huge banks need hundreds of billions of dollars in taxpayer bailouts. But the crisis was initially caused by defaults on subprime mortgages. One option at the outset would have been to support the distressed homeowners, helping them avoid foreclosure. Wiley points out that “35 percent of subprime mortgage holders were actually eligible for prime-rate loans. … Most of those were people of color … communities of color did not have fair access to credit.”

The banks and the mortgage lenders pushed bad loans on poor and minority borrowers. The NAACP has just filed lawsuits against Wells Fargo and HSBC, alleging “systematic, institutionalized racism in subprime home mortgage lending.”

The banks bundled the bad loans into securities and sold them, then created derivatives based on these securities that are impossible to understand, let alone value. AIG insured the investment banks against potential losses from these complex derivatives. The U.S. Treasury bailed out the banks along with AIG. AIG then paid out tens of billions of its bailout money to the very large banks that already received billions in bailout funds: Bank of America and Goldman Sachs. Yet, despite the hundreds of billions being siphoned off by these megabanks, we are told that the credit market is still frozen. Many European banks also received funds this way, including Swiss bank UBS, which offers secret bank accounts that allow the richest Americans to avoid taxes. In effect, beleaguered U.S. taxpayers are bailing out wealthy U.S. tax dodgers.

Obama has surrounded himself with financial advisers who are too cozy with Wall Street, like Summers and Geithner. It’s time to direct the stimulus to the people who need it, to those whose tax dollars are funding it.    

Denis Moynihan contributed research to this column.

Bad News From America’s Top Spy February 17, 2009

Posted by rogerhollander in Economic Crisis.
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Posted on Feb 16, 2009, www.truthdig.com
AP photo / Petros Giannakouris

Riots have become common occurrences in many countries as the financial meltdown continues. The U.S. military is preparing to quell civil unrest at home.

By Chris Hedges

We have a remarkable ability to create our own monsters. A few decades of meddling in the Middle East with our Israeli doppelgänger and we get Hezbollah, Hamas, al-Qaida, the Iraqi resistance movement and a resurgent Taliban. Now we trash the world economy and destroy the ecosystem and sit back to watch our handiwork. Hints of our brave new world seeped out Thursday when Washington’s new director of national intelligence, retired Adm. Dennis Blair, testified before the Senate Intelligence Committee. He warned that the deepening economic crisis posed perhaps our gravest threat to stability and national security. It could trigger, he said, a return to the “violent extremism” of the 1920s and 1930s.

It turns out that Wall Street, rather than Islamic jihad, has produced our most dangerous terrorists. You wouldn’t know this from the Obama administration, which seems hellbent on draining the blood out of the body politic and transfusing it into the corpse of our financial system. But by the time Barack Obama is done all we will be left with is a corpse—a corpse and no blood. And then what? We will see accelerated plant and retail closures, inflation, an epidemic of bankruptcies, new rounds of foreclosures, bread lines, unemployment surpassing the levels of the Great Depression and, as Blair fears, social upheaval.

The United Nations’ International Labor Organization estimates that some 50 million workers will lose their jobs worldwide this year. The collapse has already seen 3.6 million lost jobs in the United States. The International Monetary Fund’s prediction for global economic growth in 2009 is 0.5 percent—the worst since World War II. There are 2.3 million properties in the United States that received a default notice or were repossessed last year. And this number is set to rise in 2009, especially as vacant commercial real estate begins to be foreclosed. About 20,000 major global banks collapsed, were sold or were nationalized in 2008. There are an estimated 62,000 U.S. companies expected to shut down this year. Unemployment, when you add people no longer looking for jobs and part-time workers who cannot find full-time employment, is close to 14 percent.

And we have few tools left to dig our way out. The manufacturing sector in the United States has been destroyed by globalization. Consumers, thanks to credit card companies and easy lines of credit, are $14 trillion in debt. The government has pledged trillions toward the crisis, most of it borrowed or printed in the form of new money. It is borrowing trillions more to fund our wars in Afghanistan and Iraq. And no one states the obvious: We will never be able to pay these loans back. We are supposed to somehow spend our way out of the crisis and maintain our imperial project on credit. Let our kids worry about it. There is no coherent and realistic plan, one built around our severe limitations, to stanch the bleeding or ameliorate the mounting deprivations we will suffer as citizens. Contrast this with the national security state’s strategies to crush potential civil unrest and you get a glimpse of the future. It doesn’t look good.

“The primary near-term security concern of the United States is the global economic crisis and its geopolitical implications,” Blair told the Senate. “The crisis has been ongoing for over a year, and economists are divided over whether and when we could hit bottom. Some even fear that the recession could further deepen and reach the level of the Great Depression. Of course, all of us recall the dramatic political consequences wrought by the economic turmoil of the 1920s and 1930s in Europe, the instability, and high levels of violent extremism.”

The specter of social unrest was raised at the U.S. Army War College in November in a monograph [click on Policypointers’ pdf link to see the report] titled “Known Unknowns: Unconventional ‘Strategic Shocks’ in Defense Strategy Development.” The military must be prepared, the document warned, for a “violent, strategic dislocation inside the United States,” which could be provoked by “unforeseen economic collapse,” “purposeful domestic resistance,” “pervasive public health emergencies” or “loss of functioning political and legal order.” The “widespread civil violence,” the document said, “would force the defense establishment to reorient priorities in extremis to defend basic domestic order and human security.”

“An American government and defense establishment lulled into complacency by a long-secure domestic order would be forced to rapidly divest some or most external security commitments in order to address rapidly expanding human insecurity at home,” it went on.

“Under the most extreme circumstances, this might include use of military force against hostile groups inside the United States. Further, DoD [the Department of Defense] would be, by necessity, an essential enabling hub for the continuity of political authority in a multi-state or nationwide civil conflict or disturbance,” the document read.

In plain English, something bureaucrats and the military seem incapable of employing, this translates into the imposition of martial law and a de facto government being run out of the Department of Defense. They are considering it. So should you.

Adm. Blair warned the Senate that “roughly a quarter of the countries in the world have already experienced low-level instability such as government changes because of the current slowdown.” He noted that the “bulk of anti-state demonstrations” internationally have been seen in Europe and the former Soviet Union, but this did not mean they could not spread to the United States. He told the senators that the collapse of the global financial system is “likely to produce a wave of economic crises in emerging market nations over the next year.” He added that “much of Latin America, former Soviet Union states and sub-Saharan Africa lack sufficient cash reserves, access to international aid or credit, or other coping mechanism.”

“When those growth rates go down, my gut tells me that there are going to be problems coming out of that, and we’re looking for that,” he said. He referred to “statistical modeling” showing that “economic crises increase the risk of regime-threatening instability if they persist over a one to two year period.”

Blair articulated the newest narrative of fear. As the economic unraveling accelerates we will be told it is not the bearded Islamic extremists, although those in power will drag them out of the Halloween closet when they need to give us an exotic shock, but instead the domestic riffraff, environmentalists, anarchists, unions and enraged members of our dispossessed working class who threaten us. Crime, as it always does in times of turmoil, will grow. Those who oppose the iron fist of the state security apparatus will be lumped together in slick, corporate news reports with the growing criminal underclass.

The committee’s Republican vice chairman, Sen. Christopher Bond of Missouri, not quite knowing what to make of Blair’s testimony, said he was concerned that Blair was making the “conditions in the country” and the global economic crisis “the primary focus of the intelligence community.”

The economic collapse has exposed the stupidity of our collective faith in a free market and the absurdity of an economy based on the goals of endless growth, consumption, borrowing and expansion. The ideology of unlimited growth failed to take into account the massive depletion of the world’s resources, from fossil fuels to clean water to fish stocks to erosion, as well as overpopulation, global warming and climate change. The huge international flows of unregulated capital have wrecked the global financial system. An overvalued dollar (which will soon deflate), wild tech, stock and housing financial bubbles, unchecked greed, the decimation of our manufacturing sector, the empowerment of an oligarchic class, the corruption of our political elite, the impoverishment of workers, a bloated military and defense budget and unrestrained credit binges have conspired to bring us down. The financial crisis will soon become a currency crisis. This second shock will threaten our financial viability. We let the market rule. Now we are paying for it.

The corporate thieves, those who insisted they be paid tens of millions of dollars because they were the best and the brightest, have been exposed as con artists. Our elected officials, along with the press, have been exposed as corrupt and spineless corporate lackeys. Our business schools and intellectual elite have been exposed as frauds. The age of the West has ended. Look to China. Laissez-faire capitalism has destroyed itself. It is time to dust off your copies of Marx.

Yes, we can’t February 15, 2009

Posted by rogerhollander in Barack Obama, Economic Crisis.
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 Jerry Mazza
Online Journal Associate Editor

www.onlinejournal.com

February 13, 2009

When I say we can’t, I mean the big WE, the US government, the president, his fellow would-be change-makers and the forces of reaction and retribution that just can’t seem to get their fear, stinginess and partisanship under control or pandering to the worst in the people of the US.

For instance, this latest stimulus plan has proved to b far less than stimulating than it should have been for education, health care, climate change, pursuit of alternate energy and reforming the balance of wealth towards working and middle classes.

Once again, its stimulation buzzes towards tax cuts, keeping in $70 billion on the Alternative Minimum Tax, which cuts would have been forthcoming later in the year anyway. But the right just couldn’t help sink their teeth in now, right now, and into $35 billion for the state fiscal fund. So, yes we can’t do the right thing; can’t do what we have to do, not now. So when?

Moreover, the would-be followers in the footsteps of FDR, today’s “yes we can” folks, from the top down, did not display the fire, sense of empowerment or will to win for the common good. Instead, they caved too quickly, too willingly to make nice with the savages on the right. Yes we can’t, it seemed they were saying, fight you tooth and nail to the ground. We’re here to build bridges, not to tear them down, which was what is about to happen with or without them.

And, when it came to the next day, the Obama-touted Geithner-designed, new bank bailout, it was another case of yes we can’t. Yes, we can’t tell you exactly how we are going to punish the pampered bankers. Yes, we can’t tell you what new laws we can create to regulate the financial excesses that brought us here. Yes, we can’t even tell you how much this is going to end up costing.

Yes we can’t even tell you what old banking laws should be should either rescinded (like the Commodity Futures Modernization Act, CFMA, which included “The Enron Loophole,” signed by Bill Clinton in 2000), or reinstated (like the Glass Steagall Act repealed in 1999 by the Gramm-Leach-Bliley Act) to create the kinds of protections we had even before Clinton, both signed around Christmas when Congress was dipping in the grog and a gift from Santa came down the chimney for the bank and securities industries. And on and one we go . . .

Yes we can’t tell you who will clean out the Sleepy Hollow of the Securities and Exchange Commission (SEC) to get the folks awake, up and running to can the next bad guy, like Bernard Madoff (now under penthouse arrest), or how to put the fear of god into the banking and investment industries for even the hint of future scams.

Once again, corporate protectionism, lack of transparency, specific regulation of specific financial WMD, like subprime lending, derivatives, credit swaps, hedge funds, and CDOs quietly ruled the day. Yes, we can’t echoed through the walls of Congress, the press and living rooms of America, the once bountiful and beautiful. Yes, yes, we can’t has been a couple of truly downer days. And for all those who take pleasure in that, may you burn in hell. In fact, you’re already there.

On the other hand, the president couldn’t seem to say yes we can’t to a barbarous war in Afghanistan and their Pakistani neighbors. Or yes, we can’t to threatening Iran with nuclear warfare. Or saying yes, we can’t to continuing the annual multi-billion dollar support for Israel’s nuclear proliferation or to supporting its Gaza genocide.

President Obama couldn’t even seem to say yes, we can’t to Rahm Emmanuel for yanking the job of U.S. ambassador to Iraq from Retired Marine Corps General Anthony Zinni, as Wayne Madsen reported, along with Emmanuel sidelining the new Secretary of State, Hillary Clinton. So, it’s been a yes, we can’t holiday so far, which I’m waiting for someone in the White House to dispel like a bad headache.

What else is new? Well, yes, we can’t stop loving you, America that is, and all that you need, industry built, rebuilt to supply jobs; elites run out on poles; corruption eliminated; losing the still lingering stink of racism and creation of poverty. Until we can lose all the yes, we can’ts, yes, we can won’t be anything but a bumper-sticker. And one party will continue to look and sound just like the other after the illusion of an election. And the orthodoxy of both will rule our lives singularly like a political religion, with little room for question or change. So it goes. Or maybe not.

Jerry Mazza is a freelance writer living in New York City. Reach him at gvmaz@verizon.net. read his new book, State Of Shock: Poems from 9/11 onat www.jerrymazza.com, Amazon or Barnesandnoble.com.

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Michael Moore Needs Your Help to Expose Wall Street Swindle February 13, 2009

Posted by rogerhollander in Economic Crisis.
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Posted by ZP Heller, Brave New Films on February 13, 2009 at 7:00 AM.

www.alternet.org

 

Michael Moore is about to uncover “the biggest swindle in American history,” and he needs your help.  In an e-mail yesterday, Moore asked for anyone connected to Wall Street or the financial industry to contact him at bailout@michaelmoore.com with information about the economic meltdown.  All correspondence with him will be kept confidential.

The activist filmmaker’s previous documentaries like SiCKO, Bowling for Columbine, Fahrenheit 9/11, Roger & Me, and last year’s free release of Slacker Uprising revealed, ripped, and ridiculed gross injustices in the health-care industry, gun violence, the 9/11 attacks and aftermath, General Motors, and youth voter turnout, respectively.  You can only imagine what he’ll do to the bailed out bank CEOs whose excessive greed and impropriety resulted in millions of Americans facing foreclosure, soaring unemployment, and $1.1 trillion in economic loss.

As Howard Rubenstein, president of a New York-based public-relations firms that advises hedge funds, private-equity firms and banks, told Bloomberg, “Moore’s reputation is locked in. Whatever he touches gets gored.”  But this time around, Moore needs your help to tell “the greatest crime story ever told.”

 

Digg!

Rep. Marcy Kaptur (D-OH) Urges Homeowners to Stay in Foreclosed Homes February 3, 2009

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Guests:

www.democracynow.org, February 3, 2009

Rep. Marcy Kaptur, Democratic Congress member from the Ninth Congressional District of Ohio. She’s the longest-serving Democratic woman in the history of the House.

Bruce Marks, Founder and CEO of NACA, the Neighborhood Assistance Corporation of America, which has just successfully pressured Fannie Mac to restructure thousands of troubled mortgages.

Kathy Broka, President of the Fair Housing Center in Toledo, Ohio.

AMY GOODMAN: After an $850 billion bailout for Wall Street and another $25 billion for the auto industry, struggling homeowners still await large-scale government assistance. The Obama administration says it’s working out the details of its plan to stem foreclosures.

 

Well, in the absence of government action so far, some are taking action on the local level. In Michigan, Wayne County Sheriff Warren Evans announced Monday he won’t enforce sales of foreclosed homes. Wayne County includes the city of Detroit and has had more than 46,000 foreclosures in the past two years. Evans says he came to the decision after reviewing the Troubled Asset Relief Program, the Wall Street bailout measure known as TARP. He says the foreclosures would conflict with a provision ordering the Treasury Department to reduce foreclosures and help restructure loans. Evans said he’d be violating the law by denying foreclosed homeowners the chance at potential federal assistance. He said, “I cannot in clear conscience allow one more family to be put out of their home until I am satisfied they have been afforded every option they are entitled to under the law to avoid foreclosure.”

 

Meanwhile, the government-backed mortgage giant Fannie Mae has agreed to restructure mortgages after a campaign led by one of its biggest critics, the Neighborhood Assistance Corporation of America, or NACA. Fannie Mae will work with NACA to modify mortgage payments for struggling homeowners. In October, NACA held a protest outside Fannie Mae’s D.C. headquarters, blockading the entrance until being granted a meeting with top executives.

 

And in Ohio, Democratic Congress member Marcy Kaptur is encouraging homeowners facing foreclosures to stay in their homes. Kaptur says residents should exercise squatters’ rights to refuse being forced out because of loans she says could well have been illegal.

 

Congress member Kaptur joins us now from Toledo, Ohio. She is the longest-serving Democratic Congress[woman] in history. We’re also joined by Kathy Broka, president of the Fair Housing Center in Toledo. And on the line in Boston is Bruce Marks. He’s the president of the Neighborhood Assistance Corporation of America, which has just successfully pressured Fannie Mae to work with it to restructure thousands of troubled mortgages.

We’re going to go first to Ohio. Congress member Marcy Kaptur, can you repeat what you said on the floor of the House? What are you urging homeowners who could be foreclosed to do?

REP. MARCY KAPTUR: Well, the most important thing to do is to get legal help. And what we are finding is that if people receive a notice from a financial institution, their first reaction is fear, rather than getting proper legal representation. Here in our region, we recommend that people go to Legal Aid or the Advocates for Basic Legal Equality—or nationally, there’s a number people can call: (888) 995-HOME—and to get the proper legal representation, so they can actually have the scales of justice be balanced rather than, now, all the power to Wall Street and none of the justice to Main Street.

AMY GOODMAN: Now, explain how that works. If you have a person who’s at home, and they come to take the family out, you’re saying sit there?

REP. MARCY KAPTUR: Well, if it’s a sheriff’s eviction, if it’s reached that point, that is almost impossible. But we find that most of the foreclosures that haven’t reached that point, families are not getting the proper legal representation, and that’s why I’m saying that possession is nine-tenths of the law; therefore, stay in your property.

Get proper legal representation. If you believe that Wall Street has been deceptive, could have been fraudulent or tried to dupe the public, and with these subprime loans and with the kind of circuitous financing that’s been done, Wall Street cannot produce the deed nor the mortgage audit trail, you need a lawyer.

And you should stay in your home. It is your castle. It’s more than a piece of property. It’s your home.

And just because Washington hasn’t handled this bailout properly—and we never should have done it this way in the first place. We should have used the Federal Deposit Insurance Corporation and the Securities and Exchange Commission to resolve and do these workouts. Washington chose another road, which has been very, very destructive. I have opposed this all the way. But because they’ve done the wrong thing, you, at least, shouldn’t be the victim of what’s been happening on Wall Street and in Washington. You need a lawyer. You need a good lawyer. And you ought to get that legal representation so that the scales of justice are balanced.

AMY GOODMAN: And Congressman Kaptur, of course—Congress member Kaptur, of course, the people who are being forced out of their homes now are in the most difficult situations. How do they afford a lawyer? How can they even think along these lines?

REP. MARCY KAPTUR: Well, that’s why I’m recommending your Legal Aid Society. Call your local bar association or the national number, (888) 995-HOME. Most people don’t even think about getting representation, because they get a piece of paper from the bank, and they go, “Oh, it’s the bank,” and they become fearful, rather than saying, “Oh, wait a minute. This is contract law. The mortgage is a contract. I am one party. There is another party. What are my legal rights under the law as a property owner?” And many times, they are abrogating their own rights. They’re forgetting that they have rights in this proceeding. And they need to exercise those legal rights.

You know, when this mess started, when the meltdown really started back last year, 75 percent even of the subprime loans were performing. That means people were making their payments. What Washington has done and what Wall Street has done has made it so much worse. But those loans were performing loans. The other 25 percent weren’t all bad either. There were some issues, but they could have been worked out. Washington went backwards, when it should have gone forwards. It should have embraced Main Street; it embraced Wall Street first, and they trusted them again, the very same institutions, the five top ones, that have done most of the damage: JPMorgan, Wachovia, Bank of America, Citigroup and HSBC. If you get a letter from one of those, you should say, “I need a lawyer.” You need a lawyer in order to represent your interests in that contract.

AMY GOODMAN: You’re saying they did it wrong. Explain exactly what you felt was wrong and how it should have been done right and how it can be fixed now, Congress member Marcy Kaptur.

REP. MARCY KAPTUR: Alright. Well, if we look at prior meltdowns in the real estate market—and I’d love to have an hour to tell you what’s really gone wrong—but the federal institutions that were normally used to do workouts and to resolve pending bank failures are the Federal Deposit Insurance Corporation and the Securities and Exchange Commission. They have all the examination powers. They have enormous power to do workouts, to track that loan, to get it, to put the borrower at the same table. If they have to write down some losses, both by the lender and by the mortgagee, they do that. The Securities and Exchange Commission comes in and, through their auditors, they deal with the real valuation of property, even in a downturned economy.

Those institutions were put on the shelf. They were not used. In fact, I think one of the reasons they were not used is because when they come in, they bring examiners. They actually look at the books. They can do mortgage audit trails. And I think that Wall Street really didn’t want that, and they were powerful enough, in order to help to pass a bill, scaring Congress right before the election, before a new president was elected last fall, that they really put all the power in the Treasury Department, which isn’t a housing agency. It really doesn’t do bank regulation in the same way that the FDIC does, nor oversight. Treasury really works with Wall Street. They basically sell US debt. There’s a real circuit that goes between Wall Street and Washington, the Capitol, the US Treasury Department. So they used the wrong agency.

They brought in people from the very companies, like Goldman Sachs, to run the Treasury that had been one of the agencies—one of the companies that was going under, so they made it into a bank holding company. You can follow the trail of what they did. Meanwhile, they’re protecting their interests on Wall Street. And here on Main Street, the so-called bailout that they were given hasn’t trickled down. And so, millions and millions of families are getting foreclosure notices. They don’t have proper legal representation. The Washington-Wall Street circuit isn’t really working to allow these workouts to occur, and people are falling off the edge.

Somewhere, the scales of justice have to be balanced, and Washington has to use the traditional instruments that have worked. They have actually given power to a department that has been abysmal in its handling of taxpayer dollars. And you know what? There’s been no real oversight by the Congress, as required by that TARP law that was passed last year. So it, to me, is just an indication of how much power these institutions really have politically. But why should my constituents or the constituents of members around the country be hurt even more? They need representation in this process. They deserve it.

AMY GOODMAN: Congress member Marcy Kaptur, when you talk about those who caused the problem now being in charge of solving the problem, you can only think of a job description for the Treasury Secretary: be a part of the mess and don’t pay your taxes, and you, too, could be Treasury Secretary of the United States of America, Tim Geithner. Your thoughts?

REP. MARCY KAPTUR: Walk away with billions. And then—oh, Secretary Paulson came from Goldman Sachs, which, as this crisis began, carefully tucked itself as a—I call it a gambling house; it was an investment house up on Wall Street—they came under the Bank Holding Company Act. Why would they do that? Morgan Stanley did, as well. Why would they do that? They did that because they then become eligible for deposit insurance, which the good banks have paid into for decades. But Goldman didn’t pay into that. Morgan Stanley didn’t pay into that. So they all of a sudden went legit; they turned from a gambling house into a bank, just like that. Most of the public didn’t even catch that. And so, they wanted the protections, though they were high-risk institutions in their behavior, and they’ve hurt our country and the people of our country so much. They wanted to come under, put their nose under the tent of the Deposit Insurance Corporation.

You know, and then the good banks had to pay more for deposit insurance. They were powerful enough to turn the banking industry of this country almost upside-down and hurt banks in places like Ohio and caused the merger of institutions. Ohio now lost one of its major banks called National City Bank; it was merged with PNC in Pittsburgh. And the vice chair of PNC in Pittsburgh was the gentleman who invented derivatives on Wall Street. He left Wall Street and went to PNC. PNC now effectively has price control over the western part of Pennsylvania and parts of eastern Ohio now. That’s how powerful these institutions are.

And so, they’re not just powerful in Washington; they really have power out in the regions to control lines of credit, lending. It’s just unbelievable. This feels like the late 1920s and early 1930s, in terms of the concentration of the banking system itself. And if you look at the bad paper, if you look at where there’s trouble, 95 percent—95 to 98 percent of the paper really has moved to five institutions, the ones that I mentioned: JPMorgan Chase, Bank of America, Wachovia, Citigroup and HSBC. They have this country held by the neck.

AMY GOODMAN: We’re talking to Congress member Marcy Kaptur. This term, she becomes the longest-serving Democratic congresswoman in US history. She is the dean of the Ohio congressional delegation. I hope you’ll stay with us. We are also going to go to a housing activist in Toledo, and we’ll be joined by Bruce Marks, who’s head of NACA, the Neighborhood Assistance Corporation of America. He’s from Boston. He was blockading Fannie Mae; now he’s working with them. We’ll find out what’s happened. Stay with us.

[break]

AMY GOODMAN: We’re talking about the housing crisis. Our guests are Congress member Marcy Kaptur, the longest-serving congresswoman in US history. She joins us from Toledo, Ohio, as does Kathy Broka, president of the Fair Housing Center in Toledo, and Bruce Marks, founder and CEO of NACA, the Neighborhood Assistance Corporation of America.

We’re going to come back to Toledo in a minute. But, Bruce Marks, tell us the scope of the problem in Massachusetts. And how did you, who was blockading the doors of Fannie Mae in October until you could meet with its CEO, how did you end up now working with Fannie Mae?

BRUCE MARKS: Well, it’s good to be on, Amy.

I mean, we have got offices around the country. We have got forty offices around the country. We do the best solutions out there for working people throughout this country. So if you go through NACA, you’re able to restructure your mortgage by permanently reducing your interest rate to as little as three percent and reducing your principal to make your mortgage affordable. And we’re doing it for tens of thousands of homeowners.

And in a sense, it’s done through nonviolent bank terrorism. So what we do is we confront these institutions. And yes, Fannie Mae has done the right thing. They have set the standard. But on this Saturday, Sunday and Monday, if you go to our website, Amy, and you go there, and what—we appreciate what Marcy is saying in terms of being able to—don’t leave your home, like what the sheriff in Cook County, Chicago has done—he has said, “I will not foreclose. I will not throw anybody out of their home.” But this weekend, we’re going on the Predators Tour. So when the congresswoman says that we should hold JPMorgan responsible, we should hold Option One, Wilbur Ross, who heads Option One, responsible, and GMAC. Let’s go to their homes. So if you go to our website at naca.com—and we would like the congresswoman to join us—let’s go on the Predators Tour to the homes of these CEOs with thousands of homeowners.

And this is what we’re going to do with thousands of homeowners, go into their home and say, “I want you to meet my family. I want you to see who you’re foreclosing on.” We’ve got to not just talk the talk; we’ve got to walk the walk. And walking the walk means it’s personal. If someone’s going to lose their homes, if you go to our website, you can see pictures of how the rich and the greedy are living now on our dime, on our dollar, on our homes. So we’re going—if they’re going to take our homes, we’re going to go to their homes, and we’re going to tell them, “No more.” And that’s what it has to do, not just go and stop the foreclosures. Let’s go into their communities.

And so, you can see pictures of where Jamie Dimon, CEO of Chase, lives, not just in Stamford, Connecticut, where we’re doing this event with literally thousands of homeowners, or re. Wilbur Ross, who runs Option One, or Feinberg, who runs GMAC, you can see where they live. And if you can’t come to Stamford, Connecticut, then go to their—go to Jamie Dimon’s home in Chicago or in other parts of the country, because these CEOs, they have multi-million-dollar homes. The one in Stamford, Connecticut—actually it’s in Mount Kisco, $17 million, where he lives. And so, that’s what we have to do. And also, what we’re going to do—

AMY GOODMAN: And what are you demanding when you go to their homes?

BRUCE MARKS: I’m sorry?

AMY GOODMAN: What are you demanding when you go to their homes?

BRUCE MARKS: We are demanding that they meet with the homeowners who they’re foreclosing on. We believe that if they can see, face-to-face, in the eyes of the homeowners, what they’re doing and the consequences of their actions, that that makes it personal. And we want their children to meet the children of the homeowners who are losing their homes and have those children have a conversation with each other and have their children go back to their parents and say, “Mom, Dad, is it true that you’re foreclosing on these homeowners?”

I mean, Wilbur Ross, he owns Option One. He has $1.8 billion in net worth. $1.8 billion. Jamie Dimon, $300 million. Frey—this guy is suing Bank of America, because he does not want them to do modifications. I mean, you go down the line, you can see their homes, you can have their addresses. You can go visit them, not just on our Predators Tour, but anytime you want, because they—it’s personal now.

And we’re not just going as ten or twenty people; we’re going with hundreds and thousands, because at this event, we’re also doing individual counseling, because, yes, you’re right, we have agreements with the major servicers out there where they’re required to restructure your mortgage to make that affordable for the long term. Yes, it’s nice, and it’s a good step that we say get an attorney, but it’s the confrontation, it’s the advocacy, it’s personalizing the issue that makes that work, and to get other sheriffs around the country, like they’ve done in Cook County, saying, “I’m not going to foreclose on my own. I’m not going to foreclose on hard-working people, because that’s who I am,” to do that. And, you know—and we’re able to get it done.

And Congress has been nowhere on this stuff. Where is the moratorium on the foreclosures? Where is—we still have hearings today on the refinance option by Barney Frank. We know that doesn’t work. So—

AMY GOODMAN: Well, let’s talk about Hope for Homeowners, and I want—

BRUCE MARKS: —when is Congress going to step up and say, “Let’s restructure mortgages to make them affordable”?

AMY GOODMAN: I wanted to talk about the Hope for Homeowners bill, and maybe Congress member Kaptur could weigh in here. It was passed last summer. The idea is it would help out something like 450,000 homeowners to stop the foreclosures. And in the end, I think there have been twenty-one successful applications. It’s almost impossible to go through that system. Barney Frank is saying, well, now they’ve not only prevented abuse, they’ve prevented use. And so, today they’re reopening it. What’s that about, Congress member Kaptur?

REP. MARCY KAPTUR: Well, I am one of three Democrats that voted no on that bill. And during the debate and during our caucus meetings on the bill, Congressman Frank, who chairs the committee, and I had an ongoing debate in a very open forum, where I basically said it won’t work and that the necessary workouts were not going to be done, that the administration would find a way, because of the way that the bill was written, not to give us the immediate help that we needed. He prevailed in that vote; I did not.

But I went up to him after that vote—I’ll never forget it—and I said, “You know what, Barney?” I said, “You’re a friend of mine. We serve together. I really hope you’re right.” And my heart was breaking at that point, because I knew that hundreds and hundreds and hundreds of more people in my region, just my region, would receive foreclosure notices and would be thrown out of their homes during that period. And that is exactly what has happened. I hope that Chairman Frank will act with dispatch to bring to the table the parties that need to be brought to the table to get these workouts going.

This foreclosure crisis has tied up our entire banking system to the point where companies that want to expand in districts like ours, where unemployment is over 11.5 percent now, cannot get credit from the banks. This is having a terrible impact on the credit system of this country. And that bill was completely inadequate, and it was almost doomed to fail.

The proper way to proceed is to bring the FDIC and the SEC to the table now. I hope that the new president, President Obama, will bring the chair, will bring Sheila Bair to his office, will make necessary appointments to those boards and talk to people who’ve actually resolved bank crises in the past, like William Isaac, who had served both the Democrats and Republicans back in the 1970s and ’80s when we had these problems before. This isn’t the first time that the banks of this country have sort of done it to the American people, and there are very knowledgeable experienced people in the commercial banking world who have actually done these workouts and have systemically changed what needs to be done. They’re not being used right now.

AMY GOODMAN: Congress member Kaptur, your assessment of the Treasury Secretary Tim Geithner and who he has brought on?

REP. MARCY KAPTUR: Well, you had asked me the question before about the influence of Wall Street in Washington. Mr. Geithner has now brought one of the major lobbyists who had lobbied for Goldman Sachs as his chief of staff, Mr. Patterson. And this revolving door between Washington and Wall Street is terribly strong. And I say, how can we trust the very people who brought us to this point to now manage the public dollars, the taxpayer dollars of the people of the United States? We need to clean out that operation, and we need to hold the Wall Street banks and all of their associates accountable to the American people. The scales of justice have to be balanced. They are far out of whack right now.

AMY GOODMAN: Kathy Broka is also in Toledo with Congress member Kaptur. She’s president of the Fair Housing Center there in Toledo. Tell us the scope of the problem, Kathy Broka. We heard Bruce Marks lay out what NACA is doing. What is Fair Housing Center in Toledo doing? How many people are being foreclosed on? How are you helping?

KATHY BROKA: Toledo is, along with Cleveland, which was considered the epicenter of the foreclosure crisis in the country—I was talking to Cleveland people months ago who had people from all over the country showing up in their offices as the epicenter of the foreclosure crisis. So we’ve been struggling with this for years.

The Fair Housing Center alone has helped save homeowners over $5 million by doing loan modifications and workouts. This is one small agency, whose primary purpose was to investigate allegations of discrimination in housing. Now, at least half of the work that we do is on foreclosures, because there were really no other agencies in the city that was doing the work, and it was the primary problem in our community. And so, we are doing workouts, but we’re one small agency. This needs to be on a massive national scale. We can’t piecemeal this any longer. I feel like my staff are little gerbils on a wheel that just keeps turning around. So, as much hard work as we do, as dedicated as my staff is, we need help.

I’m so tired of hearing how banks are saying, “Call us early, before you get in trouble.” And then we try to do that, and they tell us, “Why are you calling us? You’re not even behind yet on your mortgage payment,” even though the homeowners are doing their due diligence and know that they’ve got a loan that’s going to adjust in two to three months and that they absolutely won’t be able to keep those payments going. And so, they’re doing what the banks tell them to do. When are the banks going to do what they say they’re going to do? That’s my question.

I was watching TV not too long ago, when Maxine Waters was on trying to get in touch with one of her constituent’s lenders to see what could be done for them, and it took her over half-an-hour, maybe even longer, two, three hours, where she kept getting the runaround. If she can’t get an answer, a straight answer, from the banks, what do you think our constituents are doing? How hard do you think it is for those of us who are on the frontline trying to get these deals done to keep the homeowners in their houses?

AMY GOODMAN: What would be the single act that would help you most, would help people who are threatened with losing their homes most, Kathy Broka?

KATHY BROKA: The single act would be for the banks to do what they say they’ve been doing for months and years: just do what you say you’re doing, that you want to keep people in their houses, that you’re willing to work with them, because we get someone at a bank, we finally get a person who’s there to help, who will do these loan modifications and workouts, and then the next month they’ve been laid off, and somebody new comes on. Get people in those departments at the banks who have the authority to do workouts that make sense.

I get so tired of hearing the banks say, “Well, you know, these don’t work. These loan modifications don’t work, because we give them to homeowners, and then, two or three months later, they’re right back being in default.” But what they don’t say is, oftentimes those homeowners have gotten into workouts without any representation, the bank has thrown them something and said, “Take it or leave it,” have set them up once again for failure, and then they use those very statistics to tell the rest of the people in the United States that these are just freeloaders and why are we helping them. It’s so unfair, and it’s so untrue.

AMY GOODMAN: Congress member Kaptur, what do you think of the Obama stimulus plan? What do you think, the possibility that your state, that Ohio, could get something like $9 billion under the plan? How much of a stimulus is the overall plan?

REP. MARCY KAPTUR: Well, first of all, I’ve been concerned about how much a state like Ohio, which is in deep recession, will actually receive from this program. We appreciate the President’s leadership on extending unemployment benefits, on covering people with health insurance, on heating assistance. I call these lifeline programs, absolutely essential. The people who have been thrown out of work have paid tax dollars to help our country when she gets in a situation like this, so I think they’re getting back what they paid for, essentially.

But the real issue for Ohio is, if all Ohio gets is $9 billion or $12 billion, which some people have been saying, our population is 3.66 percent of the country. Not even discounting for unemployment, we should be receiving anywhere between $25 billion and $30 billion in the various tax provisions and the investment portions of the bill. And if we do not receive that, then my question is, to which states is that money going?

So I think that the lifeline support programs are critical, but here, regionally, right now, because our banks are not loaning, even green energy companies—we’re one of the three leading solar energy capitals in the hemisphere. I have solar companies out here that want to bring on employees. The banks won’t loan. They—we have companies that want to bring up factory floors right now, and even some of these Ohio banking institutions that have received TARP funds, the bailout funds, aren’t making loans. So it’s very important—and I hope the administration is listening to this—that—

AMY GOODMAN: Looks like we just lost the satellite. We’re going to try to bring it back. We’ve been talking to Congress member Marcy Kaptur, also Kathy Broka, president of the Fair Housing Center in Toledo. We’re going to go to a break. We’ll come back, and hopefully we’ll get her back on satellite, or we’ll get her on the phone. But we’ll wrap up that discussion, and then we’re going to turn to Sri Lanka and what’s happening there. This is Democracy Now! Stay with us.

[break]

AMY GOODMAN: We’re back with Congress member Marcy Kaptur. Again, she is the longest-serving congresswoman in US history. Two last questions for you.

Slightly off topic, but very much a part of the stimulus package, we just got this emergency email from a fellow Ohioan, Congress member Kaptur. It is from the well known anti-nuclear activist Harvey Wasserman. As you were talking about alternative energy, he says, “A $50 billion nuke power bomb is dropping toward Obama’s stimulus package. The desperate, dangerous nuclear power industry has dropped a $50 billion stealth bomb,” he says, “meant to irradiate the Obama Stimulus Package.

“It comes in the form of a mega-loan guarantee package that would build new reactors Wall Street [wouldn’t] finance even when it had cash.” He says, “It will take a [healthy] dose of citizen action to stop it, so start calling your Senators now.”

He says that “[t]he vaguely worded bailout-in-advance provision was snuck through the Senate Appropriations Committee in the deep night of January 27. It would provide $50 billion in loan guarantees for ‘eligible technologies’ that would technically include renewable sources and electric transmission. But the handout is clearly directed at nukes and ‘clean coal.’”

Now, this is in the Senate section. What do you think of this?

REP. MARCY KAPTUR: Well, I have not read the Senate bill. They’ve just been drafting that. I can tell you, in the House bill, we have $114.5 billion for green energy: for solar, for wind, for geothermal, for biofuels. These are all industries we are bringing up here in our region.

I happen to represent the nuclear power plant that in the last twenty years has had more accidents than any other one in the country. And so, my own view is—and, in fact, there was a brownout a couple years ago because of this particular—the system this particular plant is attached to. And my feeling is, until we can actually assure ourselves that these plants are operated safely, I don’t know why we would want to reward this industry. I would be very concerned about that, based on our own living history of what has happened here. This is a very dangerous technology and one that we have to exercise extraordinary responsibility. So I was—that was not in the House version, to my knowledge, and I haven’t read the Senate language.

AMY GOODMAN: Finally, two questions. One is Judd Gregg as Commerce Secretary, and the other is, well, the question about you. George Voinovich has announced he will not be seeking another Senate seat. You’re the longest-serving congresswoman in history. Will you be seeking his seat in 2010?

REP. MARCY KAPTUR: Well, maybe I’ll just say that in terms of my tenure, I’m the longest-serving Democratic woman. There are others, Republican women, who have served thirty-five years, so I’m far from that right now, but at least on the Democratic side of the aisle, I am the longest-serving woman.

And we’ve just come through an election out here in Ohio. Our economy is in really tough straits. And I think it’s too early for anyone to say that they are or are not running. Obviously, I think every elected official in Ohio who’s a Democrat is looking at that right now. And we’ll give it some time.

AMY GOODMAN: And as for Judd Gregg, who is stepping away from his seat as senator, tapped to be the third Republican in the Obama administration in a key seat as Commerce Secretary, your thoughts on him?

REP. MARCY KAPTUR: Well, the Department of Commerce is a very important department, obviously. And about 60 percent of its budget is NOAA, the National Oceanic and Atmospheric Administration. He comes from a coastal state in the Northeast, so I think that his knowledge of some of the issues that come before the Department of Commerce will be an asset. And we wish him very well. And the Department of Commerce, particularly in the Economic Development Administration, is very important to us here in the industrial and agricultural heartland. I would hope that the fact that he comes from a rather small state will not in any way prescribe his travels or his views about what needs to be done to help the big industrial and agricultural states to move forward economically.

AMY GOODMAN: Congress member Marcy Kaptur, thanks so much for being with us, again, the longest Democratic woman who has served in US history.

REP. MARCY KAPTUR: Thank you.

AMY GOODMAN: Thank you, speaking to us from Toledo, Ohio. And thanks also to Kathy Broka, president of the Fair Housing Center in Toledo, and Bruce Marks of NACA, naca.com, that’s the Neighborhood Assistance Corporation of America, speaking to us from Boston.