Sunday, October 19, 2008

Throwing Money At Wall Street, Continued

(I couldn't find the Feiffer cartoon I wanted, but the one above will do as a reminder that Bush wasn't the first American President to distort facts to support his warmongering. Click on it to enlarge it and make it more readable.)

A few weeks ago I quoted Barack Obama telling a Nevada audience that the Bush-Obama bailout "is not a plan to just hand over $700 billion of your money to a few banks on Wall Street." Since Obama was a major player in pushing the bailout through Congress, he must have known he was lying. Events since then only show how shameless he was. (I know, it's not quite fair to call it "the Bush-Obama bailout" when so many other hands were also involved. I could with as much justice have called it the "Bush-Obama-McCain-Pelosi-Paulson-Frank" bailout, or have hyphenated the names of every other pol who supported the scam. But Obama being the Beacon of Hope and Change, I think it's fair enough to stress his involvement -- especially since he's trying to pretend it's not his fault.)

The indispensable Chris Floyd throws down this article from the Guardian. As he says, that's right, an English newspaper has the information that American newspapers would rather not tell us.
Financial workers at Wall Street's top banks are to receive pay deals worth more than $70bn (£40bn), a substantial proportion of which is expected to be paid in discretionary bonuses, for their work so far this year - despite plunging the global financial system into its worst crisis since the 1929 stock market crash, the Guardian has learned.

Staff at six banks including Goldman Sachs and Citigroup are in line to pick up the payouts despite being the beneficiaries of a $700bn bail-out from the US government that has already prompted criticism. The government's cash has been poured in on the condition that excessive executive pay would be curbed.

Floyd comments:

The Guardian errs a bit in that last sentence, of course. Almost all of the "conditions" mentioned in connection with the bailout have no teeth whatsoever, no enforcement mechanism, no real penalities. They are more properly termed "suggestions," or rather, "PR exercises that we hope our Wall Street lords will deign to at least pretend to follow for a short time, until the heat is off."
Now, I'm as punitive as the next radical business-hating lefty who wants to see every Wall Street banker hung from a lamppost. But punitiveness really has nothing to do with it. Given the failure of these institutions and the responsibility of those who run them, there can be no reason why they should be getting bonuses, let alone from public money. Except of course, because they can.

Pam Martens has more on the subject at Counterpunch:
And what will taxpayers get for their investment in these financial firms whose stock prices are getting hammered as the public recoils in revulsion at what they have done to our financial system? The taxpayers, who were not invited to send their own legal representative to the negotiating table, will receive a paltry 5% dividend, exactly half of what Warren Buffett received for his recent investment in General Electric, a company that actually makes something real, like jet engines and light bulbs.

Now we learn from the U.S. Treasury web site that it has hired the law firm of Simpson, Thacher & Bartlett to represent our taxpayer interests going forward at a cost to us of $300,000 for six months work. But we’re not allowed to know their hourly wages; that information has been blacked out on the Treasury’s contract. Curiously, the Treasury has named in its contract the specific lawyers it wants to work for us. Two of those are Lee A. Meyerson and David Eisenberg. Mr. Meyerson has been a central player in facilitating the bank consolidations that have led to the present train wreck, including building JPMorgan Chase from the body parts of Chemical Bank, Chase Manhattan and Bank One.
Our elected representatives may not have been present at the negotiating table, but that didn't stop them from approving the bailout. (Some did oppose it, including my own Congressman Baron Hill. Despite his general enablement of the Bush gang since he returned to Washington in 2006, I guess I'll have to vote for him after all.) As Chris Floyd pointed out last month, though,
The crisis of Wall Street's financial meltdown has demonstrated, once again, that although the Bush Faction thugs are criminals, killers, torturers, and thieves, without even the slightest competence in governing, they remain brilliant political tacticians. They may be willfully ignorant and brutally stupid in almost every other area, but when it comes to advancing their own narrow interests -- at the expense of the political opposition -- their low cunning cannot be denied.

Just look how they have made the Democratic leadership the face of the Administration's bailout plan -- which is perhaps the most virulently unpopular government action in the last 100 years. This unconscionable giveaway to the greedy rich was cooked up in the poison kitchen of the Oval Office, long before the late summer collapses that triggered the public crisis -- yet at every turn, before every camera, who do we see fighting hard for the plan? Why, Nancy Pelosi and Barney Frank, front and center, day after day, talking it up, defending the President and his wise counselor, the rapacious Wall Street profiteer Henry Paulson. When the bailout goes through, and ordinary Americans see that their own lives and livelihoods are still collapsing all around them, who are they going to blame? Why, the Democrats, of course.

As usual -- as always -- the Democrats have handed their ostensible opponents a razor-sharp sword. You can hear it now: "That radical liberal feminist from San Francisco, that stubby little Massachusetts homo -- they're the ones who did this to you! Liberals and Jews and homos, they've stabbed you in the back again!"
You betcha! In fact, they have already started. It's hard to say how well it's worked so far, but things haven't gotten as bad yet as they likely will, and besides, the Republicans still occupy the White House -- they'll be able to make a more convincing noise once That One is elected. (But there's the rub, or at least a rub: am I sitting here waiting gleefully for the Crash to come, for the US economy to crumble again as it did in 1929, to show those crooks in Washington and on Wall Street what's what? No, I'm not, if only because I'm one of the millions who would be buried in the rubble of the collapse. I first figured this out in 1991, when I realized that some opponents of the first Gulf War seemed a little too upbeat about the prospect that the war might not turn out to be the cakewalk Bush I promised. So I found myself in the position of trying to persuade my fellows that Bush was right on that one point, that a quagmire wasn't something we should hope for -- too many innocent people would suffer. The people I talked to quickly saw my point, for once.)

The problem is how to make the guilty suffer. That's not going to be easy, since the guilty have most of the power, and since the Democrats showed themselves all too willing to collaborate again with Bush, we are really left with no alternative. It's the eternal unofficial (and gleeful) campaign slogan of the Dems: What are you going to do, vote for a Republican? It's a clear sign of how blind the supporters of both presidential candidates are, that they're willing to blame the other guy for the bailout. Both of them are in it up to their necks. And the voters' money continues to flow to those who made the mess to begin with; I guess they do deserve those bonuses after all -- they know how to keep the moolah coming in.

Finally, Avedon Carol found this quotation from the also-indispensable (if at times insufferable) Alexander Cockburn at The Nation:
On September 23 Obama stated on NBC that the crisis and the prospect of a huge bailout required bipartisan action and meant he likely would have to delay expansive spending programs outlined during his campaign for the White House. Thus did he surrender power even before he gained it.
During this economic crisis, as during previous ones of the past couple of decades, I've seen some journalists complain about the declining quality of Wall Street bankers, who haven't been "taking responsibility" by throwing themselves out of windows to their deaths as they supposedly did in 1929. As a true American of the old school, then, I guess the only people I can say this to now are Obama's fans who urge all voters to make a Leap of Faith and vote for their candidate: Jump! Jump!