| THE HANDSTAND | LATE AUTUMN2008 |
Now Is the Time to Resist Wall Street's Shock Doctrine
The best summary of how the right plans to use the economic crisis to push through their policy wish list comes from Former Republican House Speaker Newt Gingrich. On Sunday, Gingrich laid out 18 policy prescriptions for Congress to take in order to "return to a Reagan-Thatcher policy of economic growth through fundamental reforms." In the midst of this economic crisis, he is actually demanding the repeal of the Sarbanes-Oxley Act, which would lead to further deregulation of the financial industry. Gingrich is also calling for reforming the education system to allow "competition" (a.k.a. vouchers), strengthening border enforcement, cutting corporate taxes and his signature move: allowing offshore drilling.
It would be a grave mistake to underestimate the right's ability to use this crisis -- created by deregulation and privatization -- to demand more of the same. Don't forget that Newt Gingrich's 527 organization, American Solutions for Winning the Future, is still riding the wave of success from its offshore drilling campaign, "Drill Here, Drill Now!" Just four months ago, offshore drilling was not even on the political radar and now the U.S. House of Representatives has passed supportive legislation. Gingrich is holding an event this Saturday, September 27 that will be broadcast on satellite television to shore up public support for these controversial policies.
What Gingrich's wish list tells us is that the dumping of private debt into the public coffers is only stage one of the current shock. The second comes when the debt crisis currently being created by this bailout becomes the excuse to privatize social security, lower corporate taxes and cut spending on the poor. A President McCain would embrace these policies willingly. A President Obama would come under huge pressure from the think tanks and the corporate media to abandon his campaign promises and embrace austerity and "free-market stimulus."
We have seen this many times before, in this country and around the world. But here's the thing: these opportunistic tactics can only work if we let them. They work when we respond to crisis by regressing, wanting to believe in "strong leaders" -- even if they are the same strong leaders who used the September 11 attacks to push through the Patriot Act and launch the illegal war in Iraq.
So let's be absolutely clear: there are no saviors who are going to look out for us in this crisis. Certainly not Henry Paulson, former CEO of Goldman Sachs, one of the companies that will benefit most from his proposed bailout (which is actually a stick up). The only hope of preventing another dose of shock politics is loud, organized grassroots pressure on all political parties: they have to know right now that after seven years of Bush, Americans are becoming shock resistant.
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How can you resist the "shock doctrine"
if you don't have a plan? These free market ideologues
have their plan, and what has the opposition got?
Protest. Resist. To what end?
Naomi's "disaster capitalism" does not explain
what is going on and why, it merely describes how it is
done.
Private capital is running roughshod over the public
interest, and it is able to do this because private
capital owns and operates the monetary system and
exercises the greatest influence over government policy.
Naomi Klein doesn't address this fundamental matter. No
progressive does. Only Ralph Nader is recommending that
the Chairman of the Fed become a cabinet post in an
attempt to make the Fed accountable to the people.
The Federal Reserve is a private corporation that serves
the interests of powerful corporate oligarchs. They
introduced this Trojan horse into the American economy in
1913. These people run the monetary system in their own
interest. Cronies and insiders get all the credit they
want and then they dump the public wealth down a rat hole.
If you cannot identify the problem, Naomi, how can you
fix it? You have no political vision to inspire positive
change, you have simply described the modus operandi of
the ruling elite. Useful, but not the basis for a genuine
opposition.
The private monetary system is the source of this crisis.
It is the control arm of the corporate oligarchy. If you
want something that resembles democracy, you must take
the monetary system out of the hands the robber barons.
Anything less is just a compromise of the public interest.
Do these fucks ever compromise? It's time to kick them
out of the driver's seat.
To do that, leadership is required, and more than
leadership, we need a coherent vision of what needs to be
done.
Another Jewish Media Gatekeeper:
Naomi Klein
Dear Naomi Klein:
This is not a left v right issue, this is not a Mccain v
Obama issue, this is not a captitalism issue: (Incidentally
Makow got it right when he said that you Naomi Klein keep
setting up and perpetuating these false dichotomies to
fool the public and keep them confused about real issues)
how gatekeeperish of you.
This is an illegal privately owned Jewish banking
industry issue that is steeped in fraud and scams - with
major implications for obvious reasons:
These big businesses and rich individuals promoting their
prosperity at the expense of hard working-well-intentioned
American people are not nameless, faceless. They are not
non descript nor are they innocuous. In fact quite the
opposite. Failure to expose these criminals in our
economic financial system is exactly the reason that
"they" continue to be exonerated and granted
imunity from prosecution. Unfortunately, we will continue
to pay and our children will continue to pay for all
their financial scams and crimes.
Take a look at the latest Fannie Mae - Freddie Mac
debacle. It was and is a set up from the beginning:
"Jews and Zionists passed the [illegal] Federal
Reserve Act, which controls credit [and illegally
commandeered our banking system], and in turn controls
the economy. They squeezed credit in 1929, causing the
Great Depression which enabled them to buy America's
corporations, small businesses, and real estate for
pennies."
http://judicial-inc.biz/
87crises..._national_m.htm
AIG Scam:
AIG loses 150 Billion in 401K values.....
"Greenberg took over the company, and an accountant
with a magic pen, showed enormous profits. Next Greenberg
took the company public, using the Zionist's piggy bank (stock
market) and sold his shares which were estimated at $20
to $40 billion. The next step is to ask where the
corporate profits were invested.
It is a safe bet that a massive amount of real estate was
inflated, AIG bought the mortgages, and some lucky
Zionists are sitting with countless retiree's funds in
offshore banks."
Surprise! Mr. Greenberg also involved in fraud:
http://judicial-inc.biz/
89AIG_sw...AIG_swindle.htm
Lehman Is At $.21 Cents A Share
"The stock has gone from $85.00 dollars to $.21
cents. It's a safe bet that 'insiders' had big short
positions in that stock."
What Happened Over at Lehman Brothers:
"Lehman bought US sub-prime mortgages from banks, re-packaged
them, and sold them on to global investors. They became
an investment bank lending money to real estate. They
would lend Abe Marovitz $200 million, who then bought
Jack Gold's shopping center, and the shopping center
would go bankrupt. Jack Gold got $200 million and Lehman's
investors got a bad IOU."
http://judicial-inc.biz/
89ltehma...nnew_page_1.htm
Call It What It Is:
Transferring Wealth
This money just doesn't go: pooff! Abacadabra! And it
magically and mysteriously disappears....it just changes
hands from common every day people to obscenely wealthy
Jews. This is a huge wealth transfer from the pockets of
ordinary American citizens (non Jews) into the pockets of
the fabulously wealthy Jews. Now the criminal
collaborators in Congress are bailing them out. Unfriggin
believable.
Who pays for this bailout? You and me, our children, our
children's children et al.
In summary Naomi Klein, stop making broad sweeping
generalizations, false dichomtomies, and setting up
propaganda hasbara disinformation stories about the
financial-economic conundrum we are currently
experiencing. There are names and faces behind these
scams and to the extent that we continue to protect and
not expose these scam artists aka criminals, we will
continue to be scammed by them.
Sincerely,
Who is Henry Paulson?
By Tom Eley
23 September 2008
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The plan to rescue the US financial industry arrogates virtually unlimited money and power over the financial affairs of the state to the office of Treasury Secretary Henry Paulson. Paulson is a figure with a long history of intimate connections to the political and financial elite.
In 1970, fresh from the Masters program of the Harvard Business School, Paulson entered the Nixon administration, working first as staff assistant to the assistant secretary of defense. In 1972-73, Paulson worked as office assistant to John Erlichman, assistant to the president for domestic affairs. Erlichman was one of the key figures involved in organizing President Richard Nixon’s notorious “plumbers” unit that carried out illegal covert operations against the president’s political opponents, including espionage, blackmail, and revenge. Ehlichman resigned in 1973, and in 1975 he was convicted of obstruction of justice, perjury, and conspiracy, and was imprisoned for 18 months.
Utilizing his connections, Paulson went to work for Goldman Sachs in 1974. In a 2007 feature, the British newspaper the Guardian wrote, “Not only was he well connected enough to get the job [in the Nixon White House], but well connected enough to resign in the thick of the Watergate scandal without ever getting caught up in the fallout. He went straight to Goldman back home in Illinois.”
Paulson rose through the ranks of Goldman Sachs, becoming a partner in 1982, co-head of investment banking in 1990, chief operating officer in 1994. In 1998 he forced out his co-chairman Jon Corzine “in what amounted to a coup,” according to New York Times economics correspondent Floyd Norris, and took over the post of CEO.
Goldman Sachs is perhaps the single best-connected Wall Street firm. Its executives routinely go in and out of top government posts. Corzine went on to become US senator from New Jersey and is now the state’s governor. Corzine’s predecessor, Stephen Friedman, served in the Bush administration as assistant to the president for economic policy and as chairman of the National Economic Council (NEC). Friedman’s predecessor as Goldman Sachs CEO, Robert Rubin, served as chairman of the NEC and later treasury secretary under Bill Clinton.
Agence France Press, in a 2006 article on Paulson’s appointment, “Has Goldman Sachs Taken Over the Bush Administration?” noted that, in addition to Paulson, “[t]he president’s chief of staff, Josh Bolten, and the chairman of the Commodity Futures Trading Commission, Jeffery Reuben, are Goldman alumni.”
“But the flow goes both ways,” the article continued, “Goldman recently hired Robert Zoellick, who stepped down as the US deputy secretary of state, and Faryar Shirzad, who worked as one of Bush’s national security advisors.”
Prior to being selected as treasury secretary, Paulson was a major individual campaign contributor to Republican candidates, giving over $336,000 of his own money between 1998 and 2006.
Since taking office, Paulson has overseen the destruction of three of Goldman Sachs’ rivals. In March, Paulson helped arrange the fire sale of Bear Stearns to JPMorgan Chase. Then, a little more than a week ago, he allowed Lehman Brothers to collapse, while simultaneously organizing the absorption of Merrill Lynch by Bank of America. This left only Goldman Sachs and Morgan Stanley as major investment banks, both of which were converted on Sunday into bank holding companies, a move that effectively ended the existence of the investment bank as a distinct economic form.
In the months leading up to his proposed $700 billion bailout of the financial industry, Paulson had already used his office to dole out hundreds of billions of dollars. After his July 2008 proposal for $70 billion to resolve the insolvency of Fannie Mae and Freddie Mac failed, Paulson organized the government takeover of the two mortgage-lending giants for an immediate $200 billion price tag, while making the government potentially liable for hundreds of billions more in bad debt. He then organized a federal purchase of an 80 percent stake in the giant insurer American International Group (AIG) at a cost of $85 billion.
These bailouts have been designed to prevent a chain reaction collapse of the world economy, but more importantly they aimed to insulate and even reward the wealthy shareholders, like Paulson, primarily responsible for the financial collapse.
Paulson bears a considerable amount of personal responsibility for the crisis.
Paulson, according to a celebratory 2006 BusinessWeek article entitled “Mr. Risk Goes to Washington,” was “one of the key architects of a more daring Wall Street, where securities firms are taking greater and greater chances in their pursuit of profits.” Under Paulson’s watch, that meant “taking on more debt: $100 billion in long-term debt in 2005, compared with about $20 billion in 1999. It means placing big bets on all sorts of exotic derivatives and other securities.”
According to the International Herald Tribune, Paulson “was one of the first Wall Street leaders to recognize how drastically investment banks could enhance their profitability by betting with their own capital instead of acting as mere intermediaries.” Paulson “stubbornly assert[ed] Goldman’s right to invest in, advise on and finance deals, regardless of potential conflicts.”
Paulson then handsomely benefited from the speculative boom. This wealth was based on financial manipulation and did nothing to create real value in the economy. On the contrary, the extraordinary enrichment of individuals like Paulson was the corollary to the dismantling of the real economy, the bankrupting of the government, and the impoverishment of masses the world over.
Paulson was compensated to the tune of $30 million in 2004 and took home $37 million in 2005. In his career at Goldman Sachs he built up a personal net worth of over $700 million, according to estimates.
After Paulson’s ascension to the treasury, his colleagues at Goldman Sachs carried on the bonanza. At the end of 2006, Paulson’s successor Lloyd Blankfein was handed over a $53.4 million year-end bonus, while 11 other Goldman Sachs executives raked in $150 million in year-end bonuses combined. That year, the top investment firms Goldman Sacks, Morgan Stanley, Merrill Lynch, Lehman Brothers, and Bear Stearns handed out $36 billion in bonuses. At the end of 2007, the executives of the same firms, excepting Merrill, were handed another $30 billion.
See Also:
Paulson warns: No limits on CEO
pay
[23 September 2008]
No to Wall Street bailout! The
socialist answer to the financial crisis
[22 September 2008]
US government to bail out Wall
Street
[20 September 2008]
Obama’s response to
financial meltdown: Deception and subservience to Wall
Street
[19 September 2008]