THE GREATEST THEFT IN THE HISTORY OF HUMANKIND

An Unfair And Ineffective Bailout

The Bush administration's initial plan to bail out Wall Street's ailing financial markets was just three pages long. It called for Treasury Secretary Henry Paulson to be given unprecedented and unilateral authority to buy up $700 billion in souring mortgage assets from the very financial institutions that "engineered the current crisis." Section 8 of the proposed legislation ensured that none of Paulson's actions could be challenged by any court or federal agency. The section read: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency." Across the political spectrum, economic and financial analysts immediately questioned the fairness and effectiveness of the plan. Indeed, economist Paul Krugman wrote yesterday in the New York Times, "If this plan goes through in anything like its current form, we'll all be very sorry in the not-too-distant future." In a rare moment of agreement, New York Times columnist Bill Kristol wrote similarly that he is "not convinced" that the Bush administration "has even the basics right." In addition to offering nothing in the way of oversight, the Paulson plan provided no relief for struggling homeowners and gave tax payers nothing in return for taking on the bad debts of Wall Street. While congressional negotiators made significant headway yesterday toward a progressive version of the Paulson plan, it is not there yet.

BUSINESS AS USUAL: The Bush administration's initial attempt to railroad anyone skeptical of the Paulson plan is reminiscent of some of its previous legislative initiatives. The Bush administration has a long track record of using times of crisis to demand -- and then mismanage -- unprecedented amounts of power and money. Just as troubling, the Wall Street Journal reported yesterday that lobbyists for Wall Street firms have launched an aggressive campaign to ensure that the terms of the Treasury's proposed bailout are as favorable to the finance industry as possible. A major player in this effort is the Financial Services Roundtable, a "lobbying group representing the nation's banks." Over the weekend, the Roundtable successfully lobbied the Treasury to make the proposed bailout "broad enough to include different types of assets" -- possibly including assets held by foreign banks. Further, the Roundtable said yesterday that including relief for struggling homeowners in the bill would be a "deal breaker." The Los Angeles Times notes that finance sector is well-positioned to shape the legislation because it has "given lavishly to both parties in Congress."

Robert Scheer on Paulson's Plan
"A Fox to Protect the Henhouse?" -- Does it really matter which party is in charge when it comes to bailing out the Wall Street hustlers whose shenanigans have bankrupted so many ordinary folks? Not if the Democrats roll over and cede power to the former head of Goldman Sachs, the investment bank at the center of our economic meltdown.

Chris Hedges on the Economic Bailout
"Fleecing What’s Left of the Treasury" -- The lobbyists and corporate lawyers, the heads of financial firms and the crooks who control Wall Street, all those who spent the last three decades assuring us that government was part of the problem and should get out of the way, are now busy looting the U.S. treasury. 

Protest the Bailout Today

There are more than 200 events planned coast to coast for today, September 25, protesting the Bush Administration's proposed bailout. There's a big rally scheduled for 4:00pm on Wall Street in New York City and similar activities nationwide.Find an event near you.

If you can't make it out to a protest, you can still contact your elected reps and implore them to reject Paulson's plunder and enact a plan that bails out Main Street as well as Wall Street and provides for investment in a new productive economy.

And check out this new Wired.com article about today's Wall Street action, and the nationwide protest movement sparked by New Yorkers over email.

The War Economy

Congress and the administration are embroiled in contentious talks over on the details of a $700 billion infusion into the financial system, intended to restore liquidity and maintain the flow of credit. But the talks stalled yesterday. "It was an implosion that spilled out from behind closed doors into public view in a way rarely seen in Washington," the New York Times observed. Tonight, Sens. Barack Obama (D-IL) and John McCain (R-AZ) are scheduled to debate foreign policy matters in Oxford, MS. While the subject matter seems disconnected from the situation in financial markets, prescient economists predicted this fall-out from the Iraq war long ago. In 2002, Gerd Hausler, director of international capital markets at the IMF, said that "a serious conflict with Iraq would not be a very healthy development" for the financial markets. Robert Shapiro, undersecretary of commerce in the Clinton administration stated, "If the [Iraq] conflict wears on or, worse, spreads, the economic consequences become very serious." The debt was $5.7 trillion when Bush took office; it will be $10.3 trillion by the time he leaves. While Congress hesitates to appropriate $700 billion for the financial crisis, the administration still is pouring $12 billion a month into Iraq, also raising the question of how the Iraq war funds could be spent better at home.

IRAQ RECESSION?: A significant reason for the current $9.6 trillion federal debt has been the Iraq war, which the U.S. largely financed through borrowing. This week, President Bush said that the crisis began after "a massive amount of money flowed into the United States from investors abroad because our country is an attractive and secure place to do business," which led to easy credit and to the housing bust. But the problem isn't simply one of excessive foreign investment because of businesses. "It's that the U.S. had to borrow money from foreign nations at an alarming rate, after it dug itself into debt paying for the Iraq War while cutting taxes," The Wonk Room observed. Thus, the United States had to turn to investment from abroad for financing. This, as well as lax regulation and oversight of Wall Street contributed to the credit troubles. Currently, 45 percent of Treasury securities are owned by foreign nations, with the most owned by China and Japan. Other nations owned less than 20 percent of these securities as recently as 1994. Bush left out of his assessment the fact that much of the foreign investment went to finance a war and his tax cuts.

PAYING FOR $700 BILLION: The rhetoric used in justifying giving a $700 billion blank check to the administration mimics the arguments used to justify the Iraq war. "Money will flow back to the Treasury as these assets are sold, and we expect that much, if not all, of the tax dollars we invest will be paid back," President Bush said on Tuesday. "The government could make 10 or 20 times what it pays on this, possibly," Sen. Norm Coleman (R-MN) said this week. Similarly, Iraq war architect Paul Wolfowitz remarked in 2002, "We are talking about a country that can really finance its own reconstruction and relatively soon." "[T]he negative effect will be quite small relative to the economic benefits," said White House economic adviser Lawrence Lindsey. As economist Paul Krugman wrote, "The premise of the Paulson plan -- though never stated bluntly -- is that these assets are hugely underpriced, so that Uncle Sam can buy them at prices that help the financial industry a lot, without big losses for taxpayers. Are you prepared to bet $700 billion on that premise?" "Both the $200 billion surge and the proposed $700 billion bailout are emblematic of a failed conservative ideology," writes the Center for American Progress's Matt Duss today.

ACHIEVING BIN LADEN'S GOAL: As Congress stalls on whether to appropriate $700 billion, exploding the deficit and handicapping the next administration, it's hard not to notice that this sum closely resembles the amount that the United States has spent thus far in Iraq. This is Osama bin Laden's very strategy: entangling the United States abroad and plunging the country into economic turmoil. In 2004, he remarked that his "bleed-until-bankruptcy" plan was seeing "evidence of the success." "And it all shows that the real loser is...you. It's the American people and their economy," he added. Lawmakers are cognizant of bin Laden's plan. The Iraq war "has weakened our national economy -- which is what bin Laden did to the Soviets in the 1980's and has expressly set out to do to us," said Sen. Russ Feingold (D-WI) this month. "I think Osama bin Laden is sitting back right now looking at this thing [and saying] in effect, 'We're kinda bankrupting this country," Sen. George Voinovich (R-OH) remarked in April. The United States will have spent at least $3 trillion regardless of who the next president is, according to Nobel Prize-winning economist Joseph Stiglitz. 

Bailout benefits only banks and their unsecured creditors

http://www.rgemonitor.com/blog/roubini/

Is purchasing $700 billion of toxic assets the best way to recapitalize the financial system? No. It is rather a disgrace and ripoff benefitting only the shareholders and unsecured creditors of banks.

America is about to taste the medicine it’s institutions like the World Bank & International Money Fund has been administrating the world over. 

Joseph Stilglitz should know; he was the World Bank's former Chief Economist and a Nobel prize winner in economics. 

Here’s how it works… 

Step One is Privatization - which Stiglitz said could more accurately be called, 'Briberization.' Rather than object to the sell-offs of state industries, he said national leaders - using the World Bank's demands to silence local critics - happily flogged their electricity and water companies. "You could see their eyes widen" at the prospect of 10% commissions paid to Swiss bank accounts for simply shaving a few billion off the sale price of national assets. 

And the US government knew it, charges Stiglitz, at least in the case of the biggest 'briberization' of all, the 1995 Russian sell-off. "The US Treasury view was this was great as we wanted Yeltsin re-elected. We don't care if it's a corrupt election. We want the money to go to Yeltzin" via kick-backs for his campaign. 

Stiglitz is no conspiracy nutter ranting about Black Helicopters. The man was inside the game, a member of Bill Clinton's cabinet as Chairman of the President's council of economic advisors. 

Most ill-making for Stiglitz is that the US-backed oligarchs stripped Russia's industrial assets, with the effect that the corruption scheme cut national output nearly in half causing depression and starvation. 

After briberization, Step Two of the IMF/World Bank one-size-fits-all rescue-your-economy plan is 'Capital Market Liberalization.' In theory, capital market deregulation allows investment capital to flow in and out. Unfortunately, as in Indonesia and Brazil, the money simply flowed out and out. Stiglitz calls this the "Hot Money" cycle. Cash comes in for speculation in real estate and currency, then flees at the first whiff of trouble. A nation's reserves can drain in days, hours. And when that happens, to seduce speculators into returning a nation's own capital funds, the IMF demands these nations raise interest rates to 30%, 50% and 80%. 

"The result was predictable," said Stiglitz of the Hot Money tidal waves in Asia and Latin America. Higher interest rates demolished property values, savaged industrial production and drained national treasuries. 

At this point, the IMF drags the gasping nation to Step Three: Market-Based Pricing, a fancy term for raising prices on food, water and cooking gas. 

This leads, predictably, to Step-Three-and-a-Half: what Stiglitz calls, "The IMF riot." 

The IMF riot is painfully predictable. When a nation is, "down and out, [the IMF] takes advantage and squeezes the last pound of blood out of them. They turn up the heat until, finally, the whole cauldron blows up," as when the IMF eliminated food and fuel subsidies for the poor in Indonesia in 1998. Indonesia exploded into riots, but there are other examples - the Bolivian riots over water prices last year and this February, the riots in Ecuador over the rise in cooking gas prices imposed by the World Bank. You'd almost get the impression that the riot is written into the plan.
And it is. What Stiglitz did not know is that, while in the States, BBC and The Observer obtained several documents from inside the World Bank, stamped over with those pesky warnings, "confidential," "restricted," "not to be disclosed." Let's get back to one: the "Interim Country Assistance Strategy" for Ecuador, in it the Bank several times states - with cold accuracy - that they expected their plans to spark, "social unrest," to use their bureaucratic term for a nation in flames. 

That's not surprising. The secret report notes that the plan to make the US dollar Ecuador's currency has pushed 51% of the population below the poverty line. The World Bank "Assistance" plan simply calls for facing down civil strife and suffering with, "political resolve" - and still higher prices. 

The IMF riots (and by riots I mean peaceful demonstrations dispersed by bullets, tanks and teargas) cause new panicked flights of capital and government bankruptcies. This economic arson has it's bright side - for foreign corporations, who can then pick off remaining assets, such as the odd mining concession or port, at fire sale prices. 
Stiglitz notes that the IMF and World Bank are not heartless adherents to market economics. At the same time the IMF stopped Indonesia 'subsidizing' food purchases, "when the banks need a bail-out, intervention (in the market) is welcome." The IMF scrounged up tens of billions of dollars to save Indonesia's financiers and, by extension, the US and European banks from which they had borrowed. 

A pattern emerges. There are lots of losers in this system but one clear winner: the Western banks and US Treasury, making the big bucks off this crazy new international capital churn. Stiglitz told me about his unhappy meeting, early in his World Bank tenure, with Ethopia's new president in the nation's first democratic election. The World Bank and IMF had ordered Ethiopia to divert aid money to its reserve account at the US Treasury, which pays a pitiful 4% return, while the nation borrowed US dollars at 12% to feed its population. The new president begged Stiglitz to let him use the aid money to rebuild the nation. But no, the loot went straight off to the US Treasury's vault in Washington. 

Now we arrive at Step Four of what the IMF and World Bank call their "poverty reduction strategy": Free Trade. This is free trade by the rules of the World Trade Organization and World Bank, Stiglitz the insider likens free trade WTO-style to the Opium Wars. "That too was about opening markets," he said. As in the 19th century, Europeans and Americans today are kicking down the barriers to sales in Asia, Latin American and Africa, while barricading our own markets against Third World agriculture. 

Ultimately, what drove him to put his job on the line was the failure of the banks and US Treasury to change course when confronted with the crises - failures and suffering perpetrated by their four-step monetarist mambo. Every time their free market solutions failed, the IMF simply demanded more free market policies. 

"It's a little like the Middle Ages," the insider told me, "When the patient died they would say, "well, he stopped the bloodletting too soon, he still had a little blood in him." 

I took away from my talks with the professor that the solution to world poverty and crisis is simple: remove the bloodsuckers. 

http://www.hartford-hwp.com/archives/25/079.html

Michael Moore about the bail out : The biggest robbery in the history of this country

Friends,

Let me cut to the chase. The biggest robbery in the history of this country is taking place as you read this. Though no guns are being used, 300 million hostages are being taken. Make no mistake about it: After stealing a half trillion dollars to line the pockets of their war-profiteering backers for the past five years, after lining the pockets of their fellow oilmen to the tune of over a hundred billion dollars in just the last two years, Bush and his cronies -- who must soon vacate the White House -- are looting the U.S. Treasury of every dollar they can grab. They are swiping as much of the silverware as they can on their way out the door.

No matter what they say, no matter how many scare words they use, they are up to their old tricks of creating fear and confusion in order to make and keep themselves and the upper one percent filthy rich. Just read the first four paragraphs of the lead story in last Monday's New York Times and you can see what the real deal is:

"Even as policy makers worked on details of a $700 billion bailout of the financial industry, Wall Street began looking for ways to profit from it.

"Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages.

"At the same time, investment firms were jockeying to oversee all the assets that Treasury plans to take off the books of financial institutions, a role that could earn them hundreds of millions of dollars a year in fees.

"Nobody wants to be left out of Treasury's proposal to buy up bad assets of financial institutions."

Unbelievable. Wall Street and its backers created this mess and now they are going to clean up like bandits. Even Rudy Giuliani is lobbying for his firm to be hired (and paid) to "consult" in the bailout.

The problem is, nobody truly knows what this "collapse" is all about. Even Treasury Secretary Paulson admitted he doesn't know the exact amount that is needed (he just picked the $700 billion number out of his head!). The head of the congressional budget office said he can't figure it out nor can he explain it to anyone.

And yet, they are screeching about how the end is near! Panic! Recession! The Great Depression! Y2K! Bird flu! Killer bees! We must pass the bailout bill today!! The sky is falling! The sky is falling!

Falling for whom? NOTHING in this "bailout" package will lower the price of the gas you have to put in your car to get to work. NOTHING in this bill will protect you from losing your home. NOTHING in this bill will give you health insurance.

Health insurance? Mike, why are you bringing this up? What's this got to do with the Wall Street collapse?

It has everything to do with it. This so-called "collapse" was triggered by the massive defaulting and foreclosures going on with people's home mortgages. Do you know why so many Americans are losing their homes? To hear the Republicans describe it, it's because too many working class idiots were given mortgages that they really couldn't afford. Here's the truth: The number one cause of people declaring bankruptcy is because of medical bills. Let me state this simply: If we had had universal health coverage, this mortgage "crisis" may never have happened.

This bailout's mission is to protect the obscene amount of wealth that has been accumulated in the last eight years. It's to protect the top shareholders who own and control corporate America. It's to make sure their yachts and mansions and "way of life" go uninterrupted while the rest of America suffers and struggles to pay the bills. Let the rich suffer for once. Let them pay for the bailout. We are spending 400 million dollars a day on the war in Iraq. Let them end the war immediately and save us all another half-trillion dollars!

I have to stop writing this and you have to stop reading it. They are staging a financial coup this morning in our country. They are hoping Congress will act fast before they stop to think, before we have a chance to stop them ourselves. So stop reading this and do something -- NOW! Here's what you can do immediately:

1. Call or e-mail Senator Obama. Tell him he does not need to be sitting there trying to help prop up Bush and Cheney and the mess they've made. Tell him we know he has the smarts to slow this thing down and figure out what's the best route to take. Tell him the rich have to pay for whatever help is offered. Use the leverage we have now to insist on a moratorium on home foreclosures, to insist on a move to universal health coverage, and tell him that we the people need to be in charge of the economic decisions that affect our lives, not the barons of Wall Street.

2. Take to the streets. Participate in one of the hundreds of quickly-called demonstrations that are taking place all over the country (especially those near Wall Street and DC).

3. Call your Representative in Congress and your Senators. (click here to find their phone numbers). Tell them what you told Senator Obama.

When you screw up in life, there is hell to pay. Each and every one of you reading this knows that basic lesson and has paid the consequences of your actions at some point. In this great democracy, we cannot let there be one set of rules for the vast majority of hard-working citizens, and another set of rules for the elite, who, when they screw up, are handed one more gift on a silver platter. No more! Not again!

Yours,
Michael Moore
MMFlint@aol.com
MichaelMoore.com

P.S. Having read further the details of this bailout bill, you need to know you are being lied to. They talk about how they will prevent golden parachutes. It says NOTHING about what these executives and fat cats will make in SALARY. According to Rep. Brad Sherman of California, these top managers will continue to receive million-dollar-a-month paychecks under this new bill. There is no direct ownership given to the American people for the money being handed over. Foreign banks and investors will be allowed to receive billion-dollar handouts. A large chunk of this $700 billion is going to be given directly to Chinese and Middle Eastern banks. There is NO guarantee of ever seeing that money again.

P.P.S. From talking to people I know in DC, they say the reason so many Dems are behind this is because Wall Street this weekend put a gun to their heads and said either turn over the $700 billion or the first thing we'll start blowing up are the pension funds and 401(k)s of your middle class constituents. The Dems are scared they may make good on their threat. But this is not the time to back down or act like the typical Democrat we have witnessed for the last eight years. The Dems handed a stolen election over to Bush. The Dems gave Bush the votes he needed to invade a sovereign country. Once they took over Congress in 2007, they refused to pull the plug on the war. And now they have been cowered into being accomplices in the crime of the century. You have to call them now and say "NO!" If we let them do this, just imagine how hard it will be to get anything good done when President Obama is in the White House. THESE DEMOCRATS ARE ONLY AS STRONG AS THE BACKBONE WE GIVE THEM. CALL CONGRESS NOW.

You know how your dog acts when sprayed by a skunk? He howls and runs around trying to shake it off, rubbing and rolling himself on every piece of your carpet, trying to get rid of the stench. That's what it looked like on the Republican side of the aisle yesterday, and it was a sight to behold.

Friends,

Everyone said the bill would pass. The masters of the universe were already making celebratory dinner reservations at Manhattan's finest restaurants. Personal shoppers in Dallas and Atlanta were dispatched to do the early Christmas gifting. Mad Men of Chicago and Miami were popping corks and toasting each other long before the morning latte run.

But what they didn't know was that hundreds of thousands of Americans woke up yesterday morning and decided it was time for revolt. The politicians never saw it coming. Millions of phone calls and emails hit Congress so hard it was as if Marshall Dillon, Elliot Ness and Dog the Bounty Hunter had descended on D.C. to stop the looting and arrest the thieves.

The Corporate Crime of the Century was halted by a vote of 228 to 205. It was rare and historic; no one could remember a time when a bill supported by the president and the leadership of both parties went down in defeat. That just never happens.

A lot of people are wondering why the right wing of the Republican Party joined with the left wing of the Democratic Party in voting down the thievery. Forty percent of Democrats and two-thirds of Republicans voted against the bill.

Here's what happened:

The presidential race may still be close in the polls, but the Congressional races are pointing toward a landslide for the Democrats. Few dispute the prediction that the Republicans are in for a whoopin' on November 4th. Up to 30 Republican House seats could be lost in what would be a stunning repudiation of their agenda.

The Republican reps are so scared of losing their seats, when this "financial crisis" reared its head two weeks ago, they realized they had just been handed their one and only chance to separate themselves from Bush before the election, while doing something that would make them look like they were on the side of "the people."

Watching C-Span yesterday morning was one of the best comedy shows I'd seen in ages. There they were, one Republican after another who had backed the war and sunk the country into record debt, who had voted to kill every regulation that would have kept Wall Street in check -- there they were, now crying foul and standing up for the little guy! One after another, they stood at the microphone on the House floor and threw Bush under the bus, under the train (even though they had voted to kill off our nation's trains, too), heck, they would've thrown him under the rising waters of the Lower Ninth Ward if they could've conjured up another hurricane. You know how your dog acts when sprayed by a skunk? He howls and runs around trying to shake it off, rubbing and rolling himself on every piece of your carpet, trying to get rid of the stench. That's what it looked like on the Republican side of the aisle yesterday, and it was a sight to behold.

The 95 brave Dems who broke with Barney Frank and Chris Dodd were the real heroes, just like those few who stood up and voted against the war in October of 2002. Watch the remarks from yesterday of Reps. Marcy Kaptur, Sheila Jackson Lee, and Dennis Kucinich. They spoke the truth.

The Dems who voted for the giveaway did so mostly because they were scared by the threats of Wall Street, that if the rich didn't get their handout, the market would go nuts and then it's bye-bye stock-based pension and retirement funds.

And guess what? That's exactly what Wall Street did! The largest, single-day drop in the Dow in the history of the New York Stock exchange. The news anchors last night screamed it out: Americans just lost 1.2 trillion dollars in the stock market!! It's a financial Pearl Harbor! The sky is falling! Bird flu! Killer Bees!

Of course, sane people know that nobody "lost" anything yesterday, that stocks go up and down and this too shall pass because the rich will now buy low, hold, then sell off, then buy low again.

But for now, Wall Street and its propaganda arm (the networks and media it owns) will continue to try and scare the bejesus out of you. It will be harder to get a loan. Some people will lose their jobs. A weak nation of wimps won't last long under this torture. Or will we? Is this our line in the sand?

Here's my guess: The Democratic leadership in the House secretly hoped all along that this lousy bill would go down. With Bush's proposals shredded, the Dems knew they could then write their own bill that favors the average American, not the upper 10% who were hoping for another kegger of gold.

So the ball is in the Democrats' hands. The gun from Wall Street remains at their head. Before they make their next move, let me tell you what the media kept silent about while this bill was being debated:

1. The bailout bill had NO enforcement provisions for the so-called oversight group that was going to monitor Wall Street's spending of the $700 billion;

2. It had NO penalties, fines or imprisonment for any executive who might steal any of the people's money;

3. It did NOTHING to force banks and lenders to rewrite people's mortgages to avoid foreclosures -- this bill would not have stopped ONE foreclosure!;

4. It had NO teeth anywhere in the entire piece of legislation, using words like "suggested" when referring to the government being paid back for the bailout;

5. Over 200 economists wrote to Congress and said this bill might actually WORSEN the "financial crisis" and cause even MORE of a meltdown.

Put a fork in this slab of pork. It's over. Now it is time for our side to state very clearly the laws WE want passed. I will send you my proposals later today. We've bought ourselves less than 72 hours.

Yours,
Michael Moore
MMFlint@aol.com
MichaelMoore.com

THE GHOST OF SPITZER LOOMS OVER BAILOUT !

Special Note: For powerfully revealing information on the $700 billion bailout and mortgage crisis, find out why New York Attorney General Eliot Spitzer was politically assassinated early this year for blatantly exposing the role of the current U.S. administration in blocking investigations of extremely irresponsible lending practices. Read the article he wrote in the Washington Post just weeks before he was accused of sexual impropriety and resigned at http://www.washingtonpost.com/wp-dyn/content/article/2008/02/13/AR2008021302783.html. 

For a seven-minute video covering this key topic, click here. For a short, inspiring video clip of two Congresswomen who speak truth to power on the banking bailout, click here. So who really was behind this mortgage crisis? For more on the key, but little known role of the banking elite, click here and here.