America Pays the Piper

September 24, 2008

To understand how the United States got itself into today’s bailout mess, one has to look back three decades to the rise of Ronald Reagan, the neocons and the anti-regulators, writes Robert Parry.

After a 28-year binge of drunken optimism and blind nationalism – often punctuated by chants of “USA, USA!” and “We’re No. 1!” – Americans are waking up with a painful hangover, facing a grim “morning in America,” not the happy vision that Ronald Reagan famously sold them on.”

For the full story, go to Consortiumnews.com .

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Tomgram: William Astore, Rebuilding America, Remaking Ourselves

September 24, 2008

[Note to TomDispatch Readers: Again, thanks to all of you who offered your hard-earned dollars to help this site via the new “Support TomDispatch. Resist Empire.” button. Believe me, that was truly appreciated. Be forewarned, I’m traveling this week and may turn out to be an even worse correspondent than usual for those of you who write in. Last week, I also appealed to all of you to consider writing friends, colleagues, relatives to suggest that they go to the “sign up” window at the upper right of the TomDispatch main screen, put in their email addresses, and sign on for the new, snazzily updated site mailing that offers notification whenever a post goes up. (Word of mouth is, of course, still the major kind of publicity this site can afford.) A number of you did so and TD got a small flood of new subscribers. So, many thanks indeed! If some of you meant to do this and didn’t quite get around to it, now’s as perfect a time as any. Lots of good posts upcoming, so please pass the word!]

When you can read a piece headlined in the Wall Street Journal, “Worst Crisis Since ’30s, With No End Yet in Sight” — with passages like, “Fed Chairman Bernanke and Treasury Secretary Henry Paulson, walking into a hastily arranged meeting with congressional leaders Tuesday night to brief them on the government’s unprecedented rescue of AIG, looked like exhausted surgeons delivering grim news to the family” — you know you’re at a new moment in our history. Recently, thinking about the American experience in the 1930s, I was wondering why the present administration was now so willing to throw vast sums at the speculators, who thought nothing of the rest of us in their high times, and not even crumbs to Americans; why no one calls us to “the colors” of civil society, as Franklin D. Roosevelt did then. Fortunately, along came TomDispatch regular William Astore with the following post, based on memories of his father’s days in the Civilian Conservation Corps. (That program, which put so many Americans to work rebuilding the country, was, by the way, the one New Deal initiative that even Republicans, even the fiercest opponents of President Franklin Delano Roosevelt, came to admire.) Tom

Hey, Government! How About Calling on Us?

Reviving National Service in a Big Way

By William J. Astore
Lately, our news has focused on tropical depressions maturing into monster hurricanes that leave devastation in their wake — and I’m not just talking about Gustav and Ike. Today, we face a perfect storm of financial devastation, notable for the enormity of the greed that generated it and the somnolent response of our government in helping Americans left devastated in its wake.

As unemployment rates soar to their highest level in five years and home construction sinks to its lowest level in 17 years, all our federal government seems able to do is buy up to $700 billion in “distressed” mortgage-related assets, bail-out Fannie Mae and Freddie Mac (at a cost of roughly $200 billion) or “loan” $85 billion to liquidate insurance giant AIG. If you’re Merrill Lynch, you get a hearing; if you’re just plain Marilyn Lynch of Topeka, what you get is a recession, a looming depression, and a federal tax bill for the fat-cat bail-outs.

But, amazingly enough, ordinary Americans generally don’t want bail-outs, nor do they want handouts. What they normally want is honorable work, decent wages, and a government willing to wake up and help them contribute to a national restoration.

Click here to read more of this dispatch.


FBI Investigating Companies At Heart Of Meltdown

September 24, 2008

As the house of cards built by corporate greed and fraud is collapsing, the FBI are investigating the mortgage giants Fannie and Freddie and insurance behemoth AIG — companies that were recently bailed out by the US government with American taxpayers’ money:

WASHINGTON (AP) ― The FBI is investigating four major U.S. financial institutions whose collapse helped trigger a $700 billion bailout plan by the Bush administration, The Associated Press has learned.

Two law enforcement officials said Tuesday the FBI is looking at potential fraud by mortgage finance giants Fannie Mae and Freddie Mac, and insurer American International Group Inc. Additionally, a senior law enforcement official said Lehman Brothers Holdings Inc. also is under investigation.

The inquiries will focus on the financial institutions and the individuals that ran them, the senior law enforcement official said.

[…]

Read more here.


Naomi Klein: Now Is the Time to Resist Wall Street’s Shock Doctrine

September 24, 2008
Now Is the Time to Resist Wall Street’s Shock Doctrine
By Naomi Klein
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.
http://www.informationclearinghouse.info/article20848.htm
===

Mike Whitney: Mushroom Cloud over Wall Street

September 23, 2008

In his latest post on his blog at The Smirking Chimp, Mike Whitney paints a very dark picture ahead for the U.S.:

“One bank to rule them all;
One bank to bind them…”

These are dark times. While you were sleeping the cockroaches were busy about their work, rummaging through the US Constitution, and putting the finishing touches on a scheme to assert absolute power over the nation’s financial markets and the country’s economic future. Industry representative Henry Paulson has submitted legislation to congress that will finally end the pretense that Bush controls anything more than reading the lines from a 4′ by 6′ teleprompter situated just inches from his lifeless pupils. Paulson is in charge now, and the coronation is set for sometime early next week. He rose to power in a stealthily-executed Bankster’s Coup in which he, and his coterie of dodgy friends, declared martial law on the US economy while elevating himself to supreme leader.

“All Hail Caesar!” The days of the republic are over.

Section 8 of the proposed legislation says it all:

“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.”

Right; “non-reviewable” supremacy.

[…]

Read the remainder of this post here.


Arianna Huffington: The Bailout Plan: Welcome to Economic Shock and Awe

September 23, 2008

In the preface to her post, Arianna Huffington has this to say about the Paulson bailout package:

“Over the past 30 years, Americans have been bombarded with sermons evangelizing for the free market religion of the Right. In the course of selling us on buying, the market-worshippers tried to convince us that all concerns about the most vulnerable members of society could be left up to the soulless, self-correcting calculus of supply and demand. Government involvement was an anachronism, regulatory oversight an impediment. The last few weeks have demolished that notion. In the battle over the proper role of government, the high priests of the church of the Free Market — including Bush, Paulson, and the Masters of Wall Street — have suffered a monumental defeat. So why are we allowing them to dictate the terms of their surrender?

Arianna begins her corresponding article The Bailout Plan: Welcome to Economic Shock and Awe with this:

See if this sounds familiar:

There is a gathering threat to the safety of the United States. We must take immediate action. Congress must quickly grant the President and the Secretary what they want and also give them full and unfettered authority to execute the plan.

Welcome to Economic Shock and Awe (or as some have dubbed it, according to Paul Krugman, “the Authorization for Use of Financial Force”).

Even the amount of taxpayer money being bandied about — $1 trillion — is similar. Think you got your money’s worth for the Iraq war? Congratulations — you’re about to buy another pricey debacle.

[…]

Read the rest of this article here.


Larisa Alexandrovna: Welcome to the final stages of the coup…

September 23, 2008

This latest bailout is the ultimate power grab with Congress giving up its power over finances into the hands of crooks. It is terrible and suicidal for a country that once was a ‘beacon of freedom and democracy’ to the rest of the world.

“If you must break the law, do it to seize power: in all other cases observe it.” ~ Julius Caesar

Read Larisa Alexandrovna’s chilling piece in the Huffington Post here.

No time needs to be wasted on hearings as we already now have in writing, formally as presented to Congress, the intentions of this administration to nullify Congressional powers permanently, to alter Judicial powers permanently, and to openly steal public funds using as blackmail the total collapse of the US economy if these powers are not handed over. You do see how this is blackmail, do you not? You do see how this is a manufactured crisis precisely designed to be used as blackmail, do you not?

[…]