Bailout by Stealth

While distracted by “bailout bill”, trillions are pumped in

to keep financial balloon inflated

Bailout by Stealth

While the public is distracted by the “bailout bill” and its rejection, trillions are pumped in to keep financial balloon inflated

James Corbett

The media is falling all over itself to report on every minutiae of the so-called Wall Street “bailout bill” and its rejection by Congress yesterday (just a few of the thousands of examples can be seen here and here and here and here). And why not? The media’s breathless coverage of the bill has produced a furious backlash by the public and hysteria on Wall Street in a self-justifying feedback loop that makes the media attention seem merited.

The startling truth which the controlled corporate media is not reporting, however, is that a bailout is actually taking place right now, completely out of the public spotlight. This program has already pumped trillions of dollars into Wall Street (compared to the mere $700 billion proposed in the legislation that the media is focusing on) to help prop up the faltering investment banks and promises to pump in even more, every dime of it to the detriment of the taxpayer though the public will have no stake in its success. Why, then, is this program not being talked about in the media?

Slipping under the radar last week amidst the hullabaloo in Washington over the bailout bill was this story noting that in the past week alone, the Federal Reserve had pumped an astonishing $188 billion per day into the system in the form of emergency credit. This means that in just four days, the Fed injected as much money into the system as the entire $700 billion bailout proposal. After the proposal was rejected, the Fed responded by immediately announcing it would pour another $630 billion into the global financial system.

The Federal Reserve, of course, is America’s central bank and although the above story conjures the reassuring image of a national bank lending out some of its vast reserves to help Wall Street weather the storm, the fact is that the Federal Reserve is not Federal and has doubtful reserves. In fact, the trillions of dollars that have been lent to the banks in the last few weeks were created out of nothing by the privately-owned Federal Reserve. When the Federal Reserve “lends” money to a bank through repurchase agreements (repos), credit auction or other method, it is not actually lending out money from its vaults. It is simply creating the money it “lends” out as electronic credits created in the recipient banks account. It is literally money out of thin air.

That the general public is on the hook for this money created out of nothing is not an exaggeration. It is paid for in a dimly-understood mechanism often known as the “inflation tax.”

Inflation is nothing more than an indication that the ratio of money to products that can be purchased with that money has been increased. Since the overall number of dollars has gone up without any corresponding increase in economic production (as happens when the Federal Reserve creates money out of thin air), the value of each individual dollar goes down. That means that the value of the money in each individuals’ bank account (not to mention their pension and social security dividends) can be reduced simply by the flick of a pen of a Federal Reserve paper-pusher. (Unless of course that individual just happens to be a billionaire investment mogul or a Vice President who can divest themselves of U.S. dollars in time for this inflation not to affect them.) This is sometimes known as an inflation tax because its overall effect is the same as if the government came in and took that value out of the individuals’ bank account. Watch Ron Paul explain the inflation tax in the video below:

The most insidious part of this inflation tax is that the inflation does not begin until the new money begins to circulate in the system. In other words, the first person (or, more likely, giant corporate conglomerate) to use the money receives its full value, while those at the bottom of the pyramid retrieve the diminished returns of a devaluing dollar.

Why, then, is the public not furious about this stealth bailout, now taking place at the blistering pace of nearly $1 trillion a week, and all to the taxpayer’s detriment? The obvious answer is that the media is not whipping the public into a frenzy about it, instead focusing its attention on a $700 billion program and allowing the public to feel like they scored a blow against Wall Street when the program gets rejected. If so, it’s time the public got wise to how the system is really being run by and for the benefit of private bankers and at the expense of the average taxpayer. Otherwise, the fleecing of the public will continue unabated even as the public thinks they’ve won the battle.

Fed keeps banks afloat as money market crisis deepens

Fed keeps banks afloat as money market

crisis deepens

By John Parry and Jamie McGeeever

NEW YORK/LONDON (Reuters) – U.S. banks and money managers borrowed a record amount from the Federal Reserve in the latest week, nearly $188 billion a day on average, showing the central bank went to extremes to keep the banking system afloat amid the biggest financial crisis since the Great Depression.

The data on borrowing from the Fed closed out another day of high anxiety in global money markets. Key measures of funding stress hit record levels on both sides of the Atlantic as nervous market participants awaited developments from Washington on a $700 billion U.S. financial bailout plan.

Federal Reserve data showed on Thursday the total amount banks borrowed nearly quadrupled the previous record of $47.97 billion per day notched just the week before.

“This looks like the balance sheet of a central bank that is keeping the financial system on life support,” said Michael Feroli, U.S. economist with JPMorgan in New York.

Borrowings by primary dealers via the Primary Dealer Credit Facility, and through another facility created on Sunday for Goldman Sachs (GS.N: Quote, Profile, Research, Stock Buzz), Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz) and Merrill Lynch (MER.N: Quote, Profile, Research, Stock Buzz) and their London-based subsidiaries, totaled $105.66 billion as of Wednesday, the Fed said.

The Federal Reserve’s lending to U.S. depository institutions and bank holding companies to finance their purchases of high-quality asset-backed commercial paper from money market mutual funds via a new lending facility the Fed announced on September 19, came in at $72.67 billion as of Wednesday.

The Fed designed the loan facility to help money market funds meet huge demands for redemptions from fearful investors over the past week after one U.S. money market mutual fund’s value fell below $1 a share, and to foster liquidity in the asset-backed commercial paper markets.

The move followed the U.S. Treasury’s action last Friday to set up a temporary guaranty program for the money market mutual fund industry.

Tom Sowanick, chief investment officer at Clearbrook Financial cited “a big increase in borrowings from securities firms which came at a time when the turmoil on Wall Street hit an apex and money market funds came under pressure, so they went to the window to make sure their funds remained stable.”

Lending in the “other credit extensions” category to insurer American International Group (AIG.N: Quote, Profile, Research, Stock Buzz) and possibly others was $44.57 billion as of September 24, compared with $28.0 billion as of September 17.

“It is stunning how much you see the Fed extending credit all over the place,” Feroli said.

“Every facility got used to a large degree, the ABCP facility, the AIG loan, the Primary Dealer Credit Facility and the good old discount window,” he said.

“Everywhere you see huge amounts of reserves being put into the system,” Feroli said.

LAST RESORT

The data showing the huge reliance of financial institutions on the U.S. central bank came on a day of other extremes within the funding markets for banks and companies.

Key measures of U.S. dollar funding strains hit record levels as nervous market participants awaited developments from Washington on a $700 billion U.S. financial bailout plan.

The inter-bank premium for borrowing three-month dollars over anticipated official policy rates, or Overnight Index Swaps, known as the Libor/OIS spread, blew out to 200 basis points, while the cost of borrowing euros and sterling also jumped.

That dollar Libor/OIS spread was around 164 basis points on Wednesday, and around 80 basis points at the start of September.

Yet late in the New York day, market participants’ hopes of an imminent passage of the $700 billion government bank bailout dragged some gauges of risk aversion including interest rate swap spreads, back from the brink.

The U.S. commercial paper market also shrank dramatically, marking the biggest weekly contraction in a year, Fed data showed on Thursday, as the escalating global credit crisis shook investors’ confidence in all but the safest instruments issued by the U.S. government.

For the week ended September 24, the size of the U.S. commercial paper market, a vital source of short-term funding for daily operations at many companies, shrank by $61.0 billion to $1.702 trillion, the lowest level since early 2006 Federal Reserve data showed.

“The declines add to the urgency for fixes to the credit crisis,” wrote Tony Crescenzi, chief bond market strategist with Miller, Tabak & Co. in New York in an email note.

The closely-watched TED spread, meanwhile, was last indicated around 430 basis points on Reuters screens, edging back up toward the near 500 basis points struck last week, the widest in over a quarter of a century.

The three-month sterling Libor/OIS spread, meanwhile, widened to almost 160 basis points, more than doubling since the start of the month.

These spreads are seen as a key indicator of financial market stress and risk aversion, reflecting the true cost of funding for banks and financial instututions. Some 60 percent of corporate lending is tied to London interbank offered rates (Libor), according to Credit Suisse.

Interview with Gulbuddin Hekmatyar notorious taliban leader

CLICK ON CBS ICON IN MIDDLE OF SCREEN

IN “BIZARRO WORLD,” WHY DO SO-CALLED “TERRORIST” LEADERS MAKE MORE SENSE THAN OUR OWN?

more about “Sling – Afghan Resistance Leader Talk…“, posted with vodpod

Throw Them All Out.Com

Are You Tired of Being Ripped Off By Congress and the White House?

Is this Wall Street Bailout the Last Straw for You?

Well we have a chance to do something about it this November, on Election Day.  The people of Pennsylvania showed us the way.

Last year, Pennsylvania residents learned that their legislature–Republicans and Democrats–had connived in the middle of the night to give themselves a raise in violation of the state constitution, which said raises could only be given to the next cycle of elected officials, not to those who were voting. They got around this by declaring the increases “undocumented expense reimbursements.”

The citizenry rose up and in a leaderless grassroots campaign, they swept out off office many long-time members of the legislature who had voted for the measure, as well as a judge who backed the action (the state’s judges get whatever the legislators get)!

If Pennsylvania voters can do this, so can the rest of America.

If you are fed up with having your money (and your kids’ money, and their kids’ money!) stolen and handed to the greedy, crooked bankers, insurance executives and auto tycoons who have been destroying jobs and undermining the US economy for years while enriching themselves at our expense, then make a pledge to yourself to vote against any member of your congressional delegation, whatever the party, who votes for this latest colossal $700-billion Wall Street bailout!

Vote for a third party candidate, or vote for the incumbent’s challenger (a better option if you really want to oust him or her).

No exceptions! It doesn’t matter of your senator or representative has done some good things. Voting for this bailout is a travesty that outweighs any other act.

Next (and this is critical!) send this website address:
http://www.throwthemallout.synthasite.com
to everyone you know.

And talk to everyone you know and get them to join this viral campaign to clean out the Capitol of the thieves and corporate whores who are wrecking the country.

We have been passive too long!

Islamophobia: the pathology of paranoia

By Abukar Arman

While each has its distinctive history, like Anti-Semitism and racism, Islamophobia is a real phenomenon that cultivates hate among communities, stereotypes a whole group for the acts of a few, and justifies transgression against the innocent. And like the rest, Islamophobia was developed and is fostered by special interest groups who often have access to power in order to reach a political, social, or an economic end.

With few exceptions, gone are the days when the perpetrators of hate would march with banners explicitly expressing their bigoted perceptions and attitudes. However, that is hardly an indication that the phenomenon has seized to exist.

Today, hate speech and propaganda are often craftily camouflaged as talk radio punditry, political lampooning, speeches, or political infomercial.

Last year, in a bizarre outburst of bigotry that makes Islamophobes such as David Horowitz, Daniel Pipes and Robert Spencer objective intellectuals, radio talk show host Michael Savage of the Savage Nation had this ranting and raving to share with his audience: �I�m not gonna put my wife in a hijab. And I�m not gonna put my daughter in a burqa. And I�m not gettin� on my all-fours and braying to Mecca . And you could drop dead if you don�t like it.�

Spewing his hate via hundreds of the over 1,200 radio stations owned by the notoriously Islamophobic corporation Clear Channel, he continued his provocative diatribe: �You can shove it up your pipe. I don�t wanna hear anymore about Islam. I don�t wanna hear one more word about Islam. Take your religion and shove it up your behind. I�m sick of you.�

Along the same path, albeit more artistically, the July 2008 issue of the New Yorker magazine had on its front page a political caricature of Barak and Michelle Obama. The couple is standing in the middle of the Oval Office. Obama is wearing a traditional Islamic dress with turban and sandals. He is approvingly fist-bumping with a militant looking Michelle as his sinister left eye gazes away. Michelle is wearing an Angela Davis style afro and a guerilla fatigue with an M-16 hanging from her back. Looking over them is an Africa-American looking picture of Osama Bin Laden . . . hanging over the fire place where the American flag is set on flames.

Then came September 4, 2008 — the Republican Convention — where the merchants of fear and paranoia found their ideal platform. Inadvertently or otherwise, the underlying theme seemed to be to broaden the definition of the enemy from a cult-like Al-Qaeda to a much broader, indeed more fluid, definition that indicts all those who practice Islam as suspect or worse.

Rudolph Giuliani, the former New York City mayor, condemned the Democrats for being �politically correct� and avoiding the use of the term �Islamic terrorism�� to describe the enemy.

Taking the politically synthesized anti-Islamic mantra to the next level by directly speaking to the race-conscious voters, former congressional leader Dick Armey, who now leads one of the most power lobby groups in Washington, had this to say: Barack Obama�s �funny name� could �give people concerns that he could be or has been too much influenced by Muslims, which is a great threat now.� Obama is Christian.

It is a shame that the media are less interested in what Mr. Armey and others who routinely use more provocative and broadly condemning terms such as �Islamo-fascism,� �Islamic terrorism,� and �Jihadism� to describe the enemy send to the 7 million Muslims in the United States and 1.2 billion around the world.

Recently, many localities around the U.S. were hit by a new �swift-boating� campaign. This one, targeting swing states, is aimed to induce paranoia by distributing �28 million DVDs� of the propaganda film Obsession: Radical Islam�s War Against the West.

The film, like any Goebbelian piece of propaganda, connivingly exploits the human tendency to surrender their capacity to think critically when their emotions are stirred or fear is instilled in their hearts. The film does this successfully as it is made from selective footage from various parts of the world of individuals expressing hate, training, and committing acts of terror, and the bloody scenes of their crimes. It is a dangerously effective way of collectively demonizing Muslims, as the so-called experts featured in the film use all the aforementioned hot button terminologies to describe the terrorists and interlink all these cases with their subjective narrative.

This latest campaign is being carried out by an obscure New York based group called The Clarion Fund whose funders are not known.

In pursuit of their goal to effectively distribute the DVDs and secure subliminal legitimacy, this group has selectively targeted the newspaper distribution apparatuses of various cities in critical states. Here in central Ohio, the Columbus Dispatch has distributed 10,000 copies of the DVDs through its most widely read issue, the Sunday Dispatch. The same was done by the New York Times, the Miami Herald and a host of other newspapers.

Venomous hyperbole aimed to stir fear and paranoia and indict all Muslims continues despite the Department of Homeland Security Office for Civil Rights and Civil Liberties� conclusion that �Words matter� and its recommendation that U.S. officials and representatives should � . . . avoid inflating the religious bases and glamorous appeal of the extremists� ideology.� According to a memo from the said department, the terminologies used should depict the terrorists as the dangerous cult leaders they are.

Abukar Arman is a freelance writer who lives in Ohio. He writes about Islam, Somalia and U.S. foreign policy.

Copyright © 1998-2007 Online Journal

Eat your cats and dogs

By Joel S. Hirschhorn Online Journal Contributing Writer Sep 30, 2008, 00:11

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Nations come and go, rise and fall as elites and the wealthy make victims of most citizens and plutocracies prevail.

Current dogma is that we live in the greatest nation on Earth. Perhaps in terms of ideals there is some truth to that. But with another trillion dollars that we now must borrow at higher costs because of the meltdown of the financial sector, solidifying our position as the greatest debtor nation, Americans have little to be proud of. Our government and politicians as well as the corporate state have failed us. What do our young people and future generations have to look forward to? Be prepared to eat your cats and dogs.

Still more lies and deceptions will surely hit us as the fear-selling two-party plutocracy works hard to convince us prior to the coming election that things have turned better. In reality, there is no reason whatsoever for thinking that the nation is back on the right track. Of all the many narcotic delusions filling people�s heads, the most dangerous and self-defeating is that we can vote our way out of this mess. Everyone needs to understand that Democrats in Congress have played a major role in delivering the nation into the abyss we now find ourselves in.

If Barack Obama had an ounce of honesty and courage, he would have boldly told his first debate audience that he was going to modify his spending plans and focus on reducing the nation�s debt. And why did he not express deep sadness that the current bailout was repeating a long history of making a mockery of capitalism, with government refusing to let most large companies fail? When corporate fat cats know that they can continue to rape the country and walk away with tons of money, all we really have is corporate socialism. So why did we not hear Obama talk about his commitment to put corporate criminals in prison? Not dozens, but hundreds of Wall Street thieves and lying bank officials should be dragged publicly in handcuffs into the justice system. Why can�t Obama talk this way?

Don�t get me wrong. John McCain is even worse. Newsweek has reported that McCain, in his last mission before becoming a prisoner of war, ignored the warning that an enemy missile had locked onto his plane and instead of taking evasive action decided to keep flying straight ahead to complete his mission. Is it not clear that McCain will fly the nation straight into oblivion if he thinks his conception of our national mission should be adhered to, no matter what the costs are?

Back to my point: Americans cannot vote their way out of this mess. Their only real opportunity this year is to vote AGAINST the two-party plutocracy by voting for any of the four third-party presidential candidates. We need the world to see tens of millions of votes protesting the failures of both major parties. This electoral rebellion would keep faith with Thomas Jefferson�s correct view that America would need a revolution every generation or so. To keep voting for Democrats and Republicans just makes gullible and delusional citizens co-conspirators in the vast criminal conspiracy that is our political system.

Keep that sickening image of Americans, many sleeping in the cars, unable to afford pet food and their own food in mind when you go to vote. We are not merely on the wrong track. We are on track for people being forced to eat their cats and dogs.

HOUSE VOTE: The Uprising Comes to Wall Street and Washington

by David Sirota

I’m scheduled to appear on CNN at 3:30pm EST to discuss the House’s extraordinary vote to reject the $700 billion Wall Street bailout. What I’m going to say is pretty simple: it’s clear that Congress is facing a full on revolt from both the Right and Left – the very revolt that I predicted in my book, The Uprising. No longer is this a populist revolt merely scaring Wall Street and Washington – this is a populist revolt that has, to quote Markos, crashed the gate, and it represents a real victory for the progressive movement and voices who said Hell No.

Those who are surprised by this turn of events just haven’t been paying attention to what’s going on out in the country – they haven’t been paying attention to, for instance, the social survey research showing rising rage against both our corrupt government and Corporate America. During my three-month book tour, I faced a wave of skepticism from the Establishment media about my thesis. This earthquake on the floor of the U.S. House should end that skepticism once and for all.

Just as I said in the book that it’s not clear what is going to come out of the Left-Right grassroots uprising throughout the country, it’s not clear what is going to come out of this uprising in Congress. Will Democratic leaders tack to the hard right, load the bill up with corporate tax cuts and pass this bill with only Republican votes? Or will they actually be leaders of the Democratic Party, make this bill a vehicle for the kind of New Deal-style investments and regulations that are necessary to start rebuilding this country, and pass this bill with full Democratic Party support?

This is the question moving forward. I’ve laid out the top 5 reasons to vote against this bill and go back to the drawing board. That article outlines what should be the basic conditions for any bailout, including a speculators tax, re-regulation, economic stimulus, bankruptcy law reform and aid to homeowners. No amount of tinkering with Paulson’s atrocity is going do the trick. They have to go back and start from scratch.

Make no mistake about it. This is not a moment of celebration; it is a moment for increasing pressure. The Uprising is waiting for a serious response; will Congress step up to the plate? Contact your member of Congress right now and demand he/she goes back to the drawing board.

THE PEOPLE DO HAVE A VOICE! Congress Listens Twice In One Week!

IF WE CAN STOP THE WAR AGAINST OUR MONEY

THEN WE CAN STOP OUR WAR AGAINST

THE WORLD!

The Power of “No” and the Need to Keep

the Pressure on Congress

by Dave Lindorff

Incredible! This time, when the People spoke, Congress listened.

At least 228 members of the House listened. They voted early this afternoon to reject the Bush Administration’s scaremongering, and the cowardly Democratic Congressional leadership’s attempt at ducking and covering by attaching some meaningless verbiage to what remains a case of legalized highway robbery. At least for the moment, the bailout scam is killed.

Earlier in the day, the Congressional switchboard was jammed. You could get through, but it took a dedicated finger on the redial button of your phone. Operators at the Capitol say it’s been that way for a week now, as Americans across the country have been flooding their Congressional delegations with phone calls (and emails) urging them to vote “No” on the Bush/Paulson Wall Street bailout.

That today was no exception, even after Democratic Party leaders (and both major party presidential candidates, John McCain and Barack Obama) had bought into the plan following their adding of some window-dressing measures designed to make it look more palatable, showed that the public is not being fooled (calls were reportedly running better than 9:1 or more like 999:1 against a bailout, perhaps more like 99:1).

People see clearly that this proposal is a trillion-dollar giveaway to the very people who have been hollowing out and destroying the US economy for over a decade or more by convincing both parties to let them do whatever they want to get rich, free of any kind of significant oversight or regulation.

As Nobelist economist Joseph Stiglitz has written of this outrageous rip-off, there are four problems facing the financial system, and the bailout proposal only addresses one–getting the toxic mortgages off the banks’ books and onto taxpayers’ hands. Left unsolved is the gaping hole in banks’ balance sheets in the form of loans made to people and companies which cannot be repaid, which will mean they still won’t start lending money again. Left unaddressed too is the continuing collapse of housing prices, which will inevitably lead to more bank collapses even after the bailout. Finally, Stiglitz says there is the general loss of faith in the financial system–a major crisis which the bailout will also not solve.

Stiglitz doesn’t even address a fifth problem which is that this trillion-plus-dollar boondoggle (and when you add in the bailouts of Fannie Mae, Freddie Mac, AIG, Bear Stearns, the multiple mega-bank failures and the pending auto-industry bailout, you’re already talking $1.5 trillion and counting), all of it with borrowed money, the stage is being set for a collapse in the US dollar, with consequences that will reverberate through the economy. Consider: if the dollar collapses, as many experts say is almost inevitable with this kind of huge addition to the national debt, oil prices (which are set in dollars) will soar to compensate, the price of all the other goods that Americans import–more than half of everything we use in daily life thanks to the decimation of American manufacturing–will rise dramatically, and ultimately, in an effort to stem the bleeding, interest rates will have to be raised, thus bringing what’s left of the economy to a grinding halt.

All of this is readily predictable–and indeed a group of over 200 prominent economists has written Congress joining Stiglitz in opposing the bailout plan–but that doesn’t matter to the proponents of the bailout in Washington. What they want is to get past Election Day, and the bailout may do that, unless the public gets really aroused.

The tsunami of calls and emails to Congress, and last week’s nationwide demonstrations against the bailout suggest that the public is waking up to this looming disaster and to the fact that they are being sold a bill of goods.

But it ain’t over yet. We can be sure there will be arm-twisting now to try and get 12 members of Congress to change their votes and win passage in the House (the Senate, where two-thirds of the members aren’t facing election for two or four years, will probably pass the bill easily). A continued expression of public outrage and of a promise of retaliation at the ballot box against those who vote for the bailout needs to be expressed.

If you haven’t made an effort to call your two senators and your representative to demand that they vote “No” on this bailout, do it now (the number is 202-225-3121 or 202-224-3121), and don’t give up when you get a busy signal. That’s a sign that you are not alone. Just keep hitting “redial” until you get through. At that point, get the operator, before switching you, to give you direct numbers for your three members of Congress, so you can bypass the main switchboard number after that. If you did call, call again and say you don’t want anyone changing their vote to become a bailout backer.

Unlike the 2002 rush to war against Iraq, we’ve shown that this latest bum’s rush can still be stopped. We did stop it.

To make your next call more impactful, make sure you tell each member of your congressional delegation that any yes vote on the bailout means you will vote against them next election. To read about this strategy, go to: ThrowThemAllOut.com…and then spread the word.

Keep the pressure on!

And don’t forget to contact the Obama campaign too. How embarrassing for candidates Obama and McCain, who both got suckered into backing the bailout, which it is now abundantly clear the American people recognize as a ripoff.

PS: Imagine if the same kind of pressure had been brought on Congress back in October 2002 when Bush was scare-mongering Congress into approving a war against Iraq. We’d have 4500 young Americans still alive, 40,000 other young Americans would still have their limbs and other body parts. A million-plus Iraqis would still be alive. And the country would have an extra $500 billion with which to deal with the current economic crisis.

ISRAEL TRIES TO HIDE ITS NUKES BEHIND A PILE OF SEMANTICS

Israel Slams Fresh Arab Move to Isolate It at IAEA Readers Number : 32 30/09/2008 Israel slams fresh Arab move to isolate it at IAEA to fester over inaction regarding what is assumed to be the Middle East’s only nuclear arsenal in Israel, which critics say causes an imbalance of power and spurs adversaries in an unstable region to seek nuclear weaponry. Israel, which has called the Arab move “substantially unwarranted and flawed”, filed a motion on Monday for it to be struck off the IAEA General Conference agenda. The measure is expected to be considered later this week. “Among sponsors of this draft resolution are states which openly do not recognize the state of Israel and even call for its annihilation,” Israel Atomic Energy Commission Director Shaul Chorev said, alluding to Iran. “What is the moral standing of sponsors of this agenda item who do not recognize Israel’s right to exist while criticizing Israeli policies aiming at securing its very existence?” Chorev said Israel, along with India and Pakistan outside the nuclear Non-Proliferation Treaty, “possesses advanced nuclear expertise”. But he said some countries had been developing atomic bomb capability despite being members of the NPT. He was alluding to Iran and Syria, the subjects of special IAEA investigations. Iran and Syria both deny pursuing nuclear weapons or hiding any activity from IAEA non-proliferation inspectors. Chorev said Israel had long backed a Middle East free of nuclear arms and other weapons of mass destruction in principle. “But this cannot be advanced out of context. It can only emerge gradually from a process of mutual acceptance, reconciliation and lasting peace, followed by more confidence building measures and modest arms control measures.” Iranian envoy Ali Asghar Soltanieh condemned the “shameful silence” of Israel’s Western allies about its nuclear exclusivity and said this “left no doubt about the urgent need for reform in the United Nations”.

Israel Has Most to Gain from Syria Terror Attack- “Sacred Terror”?

“Israel Has Most to Gain from Syria Terror Attack”

Batoul Wehbe Readers Number : 398

28/09/2008 Syrian Foreign Minister Walid Muallem said Saturday in response to the fatal attack in Damascus that “Israel is one of those who have the most to gain from this criminal act,” Kuwaiti news agency Kuna reported. Seventeen people were killed and dozens were injured in the Syrian capital Saturday morning when a booby-trapped car exploded on the road leading to the country’s international airport. “Unfortunately, in the years following the American war on terror, terror has spread even further. Such incidents can take place anywhere and do not indicate that there was a security breach. “I can promise you that Syria’s security forces will continue to stand guard for the citizens and the state,” said Muallem, who is currently in New York for the United Nations General Assembly. At the meantime, counter-terrorist officers in Syria on Sunday hunted for those behind the car bomb. Earlier Saturday, the Syrian foreign minister held a short meeting with US Secretary of State Condoleezza Rice, and one of the issues discussed by the two were the Turkey-mediated negotiations between Israel and Syria. WIDE CONDEMNATIONS The terror attack in Syria was condemned by the US, Europe and the Arab world. US Secretary of State Condoleezza Rice spoke out against the attack, while a State Department spokesman said the US had closed the consular section of its embassy except for emergency services and would reopen on October 5 after the Eid holiday. The UN Security Council condemned the attack “in the strongest terms” and called for the “perpetrators, organizers, financiers and sponsors” of the attack to be brought to justice. Lebanese President Michel Suleiman and Prime Minister Fouad Siniora issued a statement of condemnation, saying that “the blast which hit one of Damascus’ neighborhoods and caused the death and injury of innocent civilians is a disgraced terror crime which we reject. “It must not be accepted under any circumstances, particularly when it takes place in an Arab capital.” Hezbollah added its voice to those condemning the attack. “Hezbollah strongly condemns the bombing… and expresses its full sympathies with its brothers in the Syrian leadership, government and people in face of the atrocious attack that only serves the enemy of the nation in creating chaos and instability in the region,” it said in a statement. Iranian Foreign Ministry Spokesman Hassan Qashqavi strongly condemned the “terrorist and inhuman bomb blast in Damascus which took lives of many innocent civilians.” Qashqavi in a message voiced the sympathy of the Iranian nation and government with the families of the victims and prayed for immediate recovery of those injured in the blast. Egyptian Foreign Minister Ahmed Abul Gheit, still in New York for the UN General Assembly session, expressed sympathy for the victims of the attack, Foreign Ministry spokesman Hossam Zaki said. Earlier, Egyptian President Hosni Mubarak sent a message of condolences to his Syrian counterpart Bashar al-Assad over the victims of the car bomb blas. In Amman, Jordan’s King Abdullah II on Saturday called the bombing an act of “terrorism,” a royal court statement said. In a message of condolences to Syrian President Bashar al-Assad, King Abdullah also expressed Jordan’s solidarity with Syria in its handling of the bombing.

Israel Hails “Decapitator, Throat Slitter” Meir Dagan

Hanan Awarekeh Readers Number : 128 30/09/2008 Israeli sources, close to intelligence services, have revealed close cooperation and coordination between the Mossad and some Arab intelligence apparatuses which led to the success of the Mossad and its chief Meir Dagan in carrying out a series of operations abroad. The sources said that the mentioned Arab states don’t actually have peace ties with Israel. They added that Dagan’s most serious operations were the February assassination of Hezbollah military commander Imad Moghniyeh (Haj Redwan) in the Syrian capital and Syrian army brigadier general Mohammad Suleiman in August. Hence, what is the connection between Israel’s focus on the personality of the Mossad Chief and talking about “his major accomplishments” in Lebanon and Syria? Israeli television security analyst, Ronen Bergman, said, “Dagan made three fundamental steps including establishing cooperation with every intelligence apparatus willing to cooperate with us, not just the Americans, but those whom we did not have previous ties with. When the files are opened one day, we’ll see that this cooperation may have led, more than anything else, to the latest Mossad achievements.” Perhaps the proof to the Mossad and Dagan’s “dirty business” is what Israeli Channel 2 revealed, citing former Israeli PM Ariel Sharon,  about horrific acts. Yaron London, one of the most significant Israeli journalists, said, “Our colleague in Channel 2 disclosed that Meir Dagan used to cut the Arabs’ throats with a Japanese knife, and he quoted that from Ariel Sharon who said that Dagan’s specialty was decapitating Arabs. Be careful to the details: it is a Japanese knife that spreads a lot of blood on TV screens. For the first time I hear the Israeli TV and one of its important Channels say proudly that the Man of the Year (Meir Dagan) is the one who had slaughtered Arabs and not Arab fighters. It quoted from Sharon that his distinguished trait is separating the Arabs’ heads from their bodies and I think that this is absolute savagery.” Israeli media considered that choosing Dagan as the Man of the Year was for carrying out a three-part task, with each part considered as a great intelligence accomplishment, and they are: First: working in very difficult environment, which is Syria Second: Studying a person like (martyr) Imad Moghniyeh Third: placing the bomb in his car.

Grand Theft America: Financial Crime of the Century

Grand Theft America: Financial Crime

of the Century

The 3rd Infantry’s 1st Brigade is for combat. It’s not the National Guard or local police. It’s trained for war. “Equipped to kill people” with potent weapons, and a last hurrah scheme may be planned to divert public attention from the financial crisis. A “terrorist” attack with “chemical, biological” or other dangerous weapons. A possible pretext for martial law at a time the administration and Congress are vulnerable. When people are angry about Washington protecting the privileged. Partnering with them in crime. Defrauding the public and stifling dissent. Moving one step closer to tyranny and away from silly notions about democracy. Proving crime indeed does pay and awfully well on Wall Street. “It’s the economy, stupid.” Theirs, not ours. – Stephen Lendman

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by Stephen Lendman
World Prout Assembly
September 29, 2008

09/29/08 – “WPA” – The crime of the century. The greatest one ever. Author Danny Schechter calls it “Plunder.” The title of his important new book on the subprime and overall financial crisis. Economist Michael Hudson and others refer to a kleptocracy. A Ponzi scheme writ large. Maybe an out-of-control Andromeda Strain. An economic one. Deadly. Unrecallable. Science fiction now real life. Potentially catastrophic. World governments trying to contain it. Trying everything but not sure what can work. Maybe only able to paper it over for short-term relief. Buy time but in the end vindicate the maxim that things that can’t go on forever, won’t.

The world as we know it is changing. Industrial capitalism. The entire global economic system. Interconnected. What affects one nation touches others. If the troubled country is America it reaches everywhere, and if the crisis is great enough, the disease may be fatal and human wreckage catastrophic. Precisely the current dilemma that world leaders and financial experts are scrambling to figure out. Desperate to contain, and not sure what, if anything, can work. How did this happen and why?

The result of unfettered capitalism’s fatal flaw – unbridled greed in a rigged system that rewards the few at the expense of most others. First an explanation of how it works. Free-wheeling, “free market” Chicago School fundamentalism the way economist Milton Friedman championed it in his 1962 book “Capitalism and Freedom” and taught it to students for decades. He believed that government’s sole function is “to protect our freedom both from (outside) enemies….and from our fellow-citizens.” Preserve law and order. Enforce private contracts. Protect private property and “foster competitive (unregulated) markets.” Everything else in public hands is “socialism….blasphemy.” Not to be tolerated.

He said “free markets” work best. Unfettered by rules, regulations, onerous taxes or any at all, trade barriers, entrenched interests, and human interference. That anything government does, business does better, so let it. That the best government is one that governs least. That public wealth should be in private hands. The accumulation of profits unrestrained. Corporate taxes abolished. Social services also, and that “economic freedom is an end to itself….and an indispensable means toward (achieving) political freedom.”

He called most all government interference a restriction of freedom. Opposed foreign aid. Subsidies. Import quotas and tariffs, and illicit drug laws for being a subsidy to organized crime, but he found no fault with major banks laundering their profits. He believed business should be unrestrained in maximizing them, even the illegal kind apparently.

He opposed the minimum wage and right of unions to bargain collectively on equal terms with management. He believed high wages and benefits harm everyone. They raise prices, and in the end, hurt workers as well as management. He called Social Security “The Biggest Ponzi Scheme on Earth,” even though it’s been the most effective poverty reduction program ever for millions of seniors who’d be desperate without it. Especially today given a deepening economic crisis. The nation’s social safety net disappearing, and heading everyone toward managing on his or her own. Dependent on their ingenuity, resources, and good fortune. Milton Friedman’s ideal world. For those who can’t make it, it’s their own fault. It’s everyone for him or herself in his judgment, and let the devil take the hindmost.

As for today’s largest ever unraveling Ponzi scheme, it’s just the workings of the “free market.” Creative destruction. “Freedom to choose.” The best of all possible worlds, and unfettered capitalism will figure out the right solutions. Provided government gets out of the way and gives it free reign. Free money also to wreck world economies and human lives even more than what’s already done.

The Chickens Are Home to Roost

Are they ever, and here’s what we’ve got. A global asset bubble. A predictable crisis allowed to build and mushroom. Begun after Chicago School economics took hold under Ronald Reagan. Continued under GHW Bush. Became religion under Bill Clinton, and ultimately fundamentalism under GW Bush.

The result – a “slow motion train wreck” gaining speed. Banks and other financial institutions failing globally. On September 25, the largest bank failure in US history with Washington Mutual’s collapse. Earlier it was giant insurer AIG. Before that Fannie Mae and Freddie Mac, Lehman Brothers, Bear Stearns, and Merrill Lynch a forced liquidation to Bank of America.

Others are now teetering on the edge. Strapped by toxic debt. The result of out-of-control greed for easy profits. Massive fraud to get them. Thinking they’re the best and brightest, and only mere mortals mess up. Knowing Fed moral hazard will cushion them if they do. True for some. Not for others, and learning that the Federal Reserve (the world’s key central bank) failed in its primary job. To protect the country’s financial system from insolvency. By contributing to a financial crisis and one of confidence. By creating near-limitless amounts of capital. Fueling a housing bubble. Outsized consumer debt, and irresponsible investments free from government oversight. Fraudulent ones involving multi-trillions of dollars.

Partnering with government to make it easy. Risking a global economic meltdown as a result. Scrambling to find solutions. Unsure if there are any. The present crisis is unparalled. Maybe it can be fixed, and maybe not. The problem is multi-fold. A perfect storm involving:

– residential housing;

– commercial real estate;

– consumer over-indebtedness;

– unknown amounts of toxic debt (in the multi-trillions);

– affecting world finance and economies;

– causing bankruptcies;

– many more will follow;

– selected ones bailed out;

– the entire system endangered;

– consumer money market, bank accounts and private pension funds as well; government backing is needed to protect them; there’s not enough money to do it; and

– the contagion is spreading; threatening world economies and people everywhere.

This time is really different. A $700 billion bailout (called the Emergency Economic Stabilization Act of 2008 – EESA) is just a down payment. Trillions will be needed in the end. Other nations contributing to help. The problems are deeper and more intractable than anyone expected. Before this ends, unimaginable amounts of capital will be written off. Too much to even contemplate. Bad investments contaminating good ones. Threatening world financial structures with paralysis. Severe economic damage to their economies as a result.

Eroding industrial capitalism as we know it. At best managing a short-term fix and delaying a final denouement for a later time. Under new management with the current and past ones claiming no responsibility. And unmindful of millions of homeowners facing foreclosure and bankruptcy. One in ten currently behind in their payments. Others losing their jobs and way of life. They’re the most vulnerable. Least able to cope, and for some their ability to survive.

According to The New York Times, here’s how the Paulson scheme helps them: “it requires the government to use its new role as owner of distressed mortgage-backed securities to make ‘more aggressive’ efforts to prevent home foreclosures.” Weasel words. No specifics. No assurances, and nothing apparently for homeowners already in foreclosure.

On September 22, ahead of the announced agreement, American Research Group (ASG) published its latest public sentiment poll results, and they were stunning. At 19%, George Bush scored lowest ever for a US president, surpassing Harry Truman at the depth of the Korean War and Richard Nixon during Watergate. It came at a time ASG’s results showed 82% of Americans believe the economy is getting worse, and only 17% approve of how Bush is handling it. Among registered voters, the number is 18% at a time no one surveyed (zero percent) said the economy is improving and 68% say it’s in recession. True or false, it’s how they feel. How the crisis affects them, and that’s what counts most.

Yet on September 24, the president addressed the nation audaciously. Callously dismissing public pain and anger. Deceitfully stating outright lies. A typical performance. Demanded that Congress give the treasury secretary carte blanche authority over $700 billion to address “a serious financial crisis.” Asked taxpayers to pay for corporate fraud. Reward criminals and ignore their crimes. Said nothing about the root cause. The effect on ordinary people, or how Paulson’s scheme will help them. Ignored growing public opposition. Large numbers of credible observers believing the proposed solution is worse than the problem. The most honest of them saying it will enrich fraudsters and offer no help for homeowners.

Yet Bush concluded that “democratic capitalism (is the) best system the world has ever devised” in spite of clear evidence that it’s broken and corrupted. Exploits people for profit. Enriches the few at the expense of the many. Rewards criminals for their crimes. Protects the rich from beneficial social change.

Ahead of the president’s address on September 24, The New York Times showed a rare display of candor in a critical Timothy Egan opinion piece. About “nearly nationalizing the banking system and giving the treasury secretary more power than a king….whose decisions may not be reviewed by any court of law or any administrative agency.” He asked readers to remember “where the biggest heist took place, and how Wall Street dragged down the rest of the country once before,” referring to the Great Depression but leaving out everything in between.

He stressed, however, “how Wall Street brought down main street,” and things have now come full circle. Deregulation unleashed casino capitalism, and bankers made a killing. Now they’re in trouble and Bush demands “the biggest bailout in American history….or the world will crumble. He said the a similar thing in the run-up to war” so who can believe him now. Egan quotes a dirt farmer asking why not the same “concerns (for) average Americans.” Because “we the people” Bush speaks for are them, not us.

As for Paulson’s plan, here’s what the Financial Times writer Martin Wolf said on September 23. He called it “not a true solution to the crisis.” It doesn’t address the “fundamental problem.” It’s “neither a necessary nor an efficient solution. It is not necessary because the (Fed can) manage illiquidity through its many lender-of-last resort operations. It is not efficient because it can only deal with insolvency by buying bad assets (overpriced junk) at far above their true value, thereby guaranteeing big losses for taxpayers and providing an open-ended bail-out to the most irresponsible investors.”

Wolf also objects to Paulson getting unchecked powers. Providing little or no help to the poor and “ill-informed” (read duped) borrowers, and lists other operational suggestions “essential for the long-run health of any financial system” without needing “a penny of public money.” Among them, forcing creditors to take losses and not taxpayers.

Unmentioned in his article is the underlying fraud behind the crisis and a lack of regulatory oversight that made it easy. Also, omitted was what’s covered in the section below.

The 1937 Housing Act’s Empowering Section 8 Authority

One Section 8 sentence provided the basis for the treasury secretary’s empowerment. It reads:

“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 administration agency.”

In other words, unchallengeable czarist powers. In contrast to the 1930s Reconstruction Finance Corporation’s (RFC) closely supervised operations. That era’s Home Owners’ Loan Corporation (HOLC) that refinanced homes to prevent foreclosures. And the 1980s Resolution Trust Corporation (RTC) mandate to liquidate assets from failed S & Ls. Not dispense free money for bad investments unchecked. The above authorities subject to judicial review. Not governed by a financial boss to run as he pleased.

The Announced “Bailout” Deal – The Emergency Stabilization Act of 2008 (ESA)

According to The New York Times, EESA calls for “strict oversight of the program by a Congressional panel and conflict-of-interest rules for firms hired by the Treasury to help run the program.” Also “a change in the bankruptcy laws sought by some Democrats to give judges the authority to modify the terms of first mortgages.”

Given the bipartisan blame for today’s crisis. The post-9/11 willingness to give the administration near-carte blanche authority across the board. Eight years of indifference to social needs and public welfare. Who now believes that policy going forward will change and that the agreed-on scheme will protect people or curb the secretary’s authority. On his own initiative, George Bush usurped supreme power post-9/11 while few in Congress blanched. None in leadership positions. Little today has changed.

Disclaimers notwithstanding from both sides of the aisle, Wall Street is pleased. Paulson got what he wanted. The plan’s fine print will assure it. Public money. Far more, if needed, than $700 billion. The power to dispense it freely. With weak at best oversight and judicial review, and the ability to conceal fraud and malfeasance. In short, the between-the-lines meaning of Paulson saying: “We have made great progress toward a deal, which will work and be effective in the marketplace.”

The same one that fleeced the nation and betrayed the public trust. Now empowered to take more with the full faith and blessing of the government from both sides of the aisle. Belying George Bush’s insult that “The rescue effort….is not aimed at Wall Street; it is aimed at your street.” And Nancy Pelosi’s hypocrisy that: “All of this was done in a way to insulate Main Street and everyday Americans from the crisis on Wall Street….I want to congratulate all of the negotiators for the great work they have done.” Who in banker boardrooms would disagree.

Some Relevant Facts

Clearly the present crisis is unprecedented. As stated above, maybe it can be fixed and maybe not. No one is sure because no one understands it fully. Where all the problems lie. To what degree can they be contained. How great their fallout may be. Their full effect on world economies. How bad things may get before they stabilize and improve, and the way the world will look like when they do.

Whatever’s coming, industrial capitalism is eroding. A kleptocracy replaced it. If the system is saved, it will be temporary, and an even greater one will emerge. Why this article is called Grand Theft America. A criminal class runs it, and they’re rewarded for their crimes. Backed by the full faith and credit of the government with taxpayer money. A near-limitless amount created and borrowed. Who said crime doesn’t pay!

For over 30 years, an unimaginable wealth transfer to the rich has been ongoing. To the top 1% and corporate America from most others. It proves the failure of a system that rewards the few at the expense of the many. Licenses greed and creates this kind of global financial crisis so far uncontained. It begs the questions: what caused it and what’s the fallout:

– the ruinous effects of militarization; insane amounts of spending on it; “military Keynesianism;” believing capitalism thrives on foreign wars; “Global Wars on Terrorism” currently; their costs are unsustainable and are heading the nation toward bankruptcy;

– the drain on an already weakened economy;

– maxed out consumers now debt slaves;

– so is government from unrepayable obligations in the tens of trillions; not the fictitious “official” reported numbers;

– the possibility of future default; hyperinflation; national bankruptcy, and the demise of the republic;

– human default as well: mass bankruptcies; home foreclosures; rising unemployment; increased poverty; and growing numbers of families unable to survive;

– the subprime crisis is just part of it; seven million mortgages sold to the unwary; the idea was to criminally defraud them; offer two-year teaser rates; then reset them higher semi-annually based on an interest rate benchmark; payments soared as much as 30% and became unaffordable; the scheme was to cash in at the expense of mortgage holders, and five million risk losing their homes and life savings;

– an “economic Pearl Harbor” for Warren Buffett; for Senator Chris Dodd a “50-state Katrina;” a “house of cards (built on) reckless finance” for author Kevin Phillips; Frankenstein finance; casino capitalism; for most Americans, a human catastrophe;

– the demise of our manufacturing base; letting malls replace factories as the economy’s engine;

– permitting the financialization of the economy; speculative finance writ large; replacing productive investment; totally deregulated; run by fraudsters; free from government oversight; letting investment banks game the system at up to 40 to 1 leverage; until 2004, 12 to 1 was the maximum;

– a government – business conspiracy for global dominance and the single-minded pursuit of profit; unfettered amounts of it through cleverly manipulated schemes; transferring multi-trillions of dollars from workers to the most wealthy; doing it without people even noticing;

– creative destruction to let giant businesses grow larger by removing and devouring smaller ones; even large ones;

– permitting and/or ignoring massive fraud; involving multi-trillions of dollars; the largest ever Ponzi scheme; a calculated crime with media complicity through silence; not reporting a growing problem as it emerged; waiting until it mushroomed and still not explaining it accurately and honestly; and

– wondering won if the best and brightest can fix things or if no amount of money or ingenuity can do it.

The Plan’s Architect – Henry Paulson

From a Nixon administration staff assistant to the assistant secretary of defense. To assistant to key Watergate official John Erlichman. To Goldman Sachs in 1974. To a partnership in the firm in 1982. Then Chief Operation Officer (COO) in 1994 and CEO in 1998 by a palace coup against co-chairman and now New Jersey governor Jon Corzine, according to New York Times columnist Floyd Norris.

Even before the current crisis, Goldman was the preeminent Wall Street firm. A survivor. The largest, and along with Morgan Stanley, the remaining two Street giants left standing. But no longer as investment banks after the Federal Reserve’s September 21 announcement that both companies will become bank holding companies after a mandatory five-day waiting period, now over.

In theory, they’ll be under stricter Fed oversight but will get Fed help to complete their transition and thereafter. As a well-connected financial powerhouse, whatever Goldman wants, Goldman gets. Always in the past by recycling top executives into Democrat and Republican administrations, and now more than ever given Henry Paulson’s extraordinary financial czar powers.

Before his $700 billion giveaway plan, the 2008 Housing and Economic Recovery Act gave him authority to fleece taxpayers by rescuing Fannie Mae and Freddie Mac as well as raise the national debt by over $5 trillion dollars. He also orchestrated the demise of Bear Stearns, Lehman Brothers and Washington Mutual. The forced sale of Merrill Lynch, and arranged the government takeover of AIG.

He has near-open checkbook authority to reward close allies with loans and free money and let them acquire troubled assets on the cheap. This from a man with much responsibility for today’s crisis. A June 12, 2006 Business Week cover story titled “Mr. Risk Goes to Washington” called him “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.” Such as assuming huge amounts of debt and “placing big bets (with their own money) on all sorts of exotic derivatives and other securities.” Advising clients to do the same. Casino capitalism at up to 40 to one leverage. Hugely profitable in up markets. Disastrous in down ones.

Paulson earned millions and now has an estimated $700 million + net worth. For 2007 overall, according to Bloomberg.com, “Wall Street’s five biggest firms (paid out) a record $39 billion in bonuses (and did it in) a year when three of the companies suffered the worst quarterly losses in their history and shareholders lost more than $80 billion.”

Speculative finance pays well, even in down years, and it even raised Bloomberg’s ire in a Michael Lewis September 24 commentary titled “America Must Rescue the Bonuses at Goldman Sachs.” It reflected on a possible global financial collapse but sacrificing Goldman bonuses is another matter. If firm “employees (take) pay cut(s), it will be (tantamount to failure and) our country may never recover.” How will the company induce new talent to come aboard. Goldman is well-positioned to get maximum gain from its former CEO’s $700 billion handout.

Why else would Warren Buffett bet $5 billion on the firm! For preferred shares paying an annual 10% dividend. Warrants as well to buy $5 billion in common stock at a $115 a share strike price. Well off its $251 peak and below the latest September 26 $138 a share.

Joseph Stiglitz on the Economy

Stiglitz was formerly part of the system he now criticizes. Free market fundamentalism in its most extreme form. For many months, he warned about a worsening global economy and growing financial crisis that’s as bad or worse than the Great Depression.

He sees similar problems now as then:

– outsized speculation through excessive leverage;

– pyramid schemes;

– multiple bubbles through so-called Wall Street innovations; and

– a lack of transparency and government oversight.

Combined they created a crisis “so great that no one knows exactly the magnitude of the risk they face. It is particularly bad because our financial institutions are based on trust. You put money in the bank and you trust that you can get (it) out, so trust is absolutely essential for the functioning of our financial markets and economy.”

The problem is exacerbated by those providing the news. The dominant media and frequent spokespeople. Industry representatives like Lehman Brothers CEO saying last April that “we turned the corner, and the economy is on the uptick.” Also from the president, treasury secretary and others in government as things keep worsening.

Stiglitz calls this a “top down crisis.” The “$3 trillion cost” of foreign wars a key. Creating huge deficits and consuming vital resources needed for growth. “This is the first war in American history that has been totally financed on the credit card. For the last five years….we have been a debt economy.” Not since the Revolutionary War have “we have had to turn to foreigners,” so now “40% of our national debt is financed by (them). Even as we went (to war) we had a big deficit, and yet the president called for tax cuts for upper middle class Americans.” Insane but we did it.

Another factor is other countries trusting that our economy is working well, and when the president says it is he’s believable. “This administration burned that trust….no wonder everybody around the world is losing confidence.” Even worse is that the administration isn’t dealing responsibly with these problems, mostly because they’re of our own making.

Stiglitz worries about the “real economy:” home prices dropping; owners forced into foreclosure; more financial firms in crisis; and a good many won’t survive. He sees a weakening financial system unable or unwilling “to provide credit (the lifeblood of the economy for) loans, mortgages,” and that means lower home prices, contracting businesses, rising unemployment, and a “downward vicious cycle. You have to be in fantasy land to say that everything is fine (or even) that we have turned the corner.” He sees at least another 18 months of pain. Maybe longer. Who can know or how much.

For sure, real economic stimulus is needed. Productive investment. Not the phony “bailout” kind proposed. Aiding state and local governments. Better unemployment insurance and more for infrastructure. Providing a basis for long-term growth. Not feeding markets and starving the hungry, as one writer put it. Not believing markets on their own will fix things.

Understanding that government must intervene. Responsibly. Facilitate job creation. End casino capitalism. Provide incentives for real economic growth. Let foreclosed and threatened homeowners stay in their homes. Work out an equitable way to do it. “We learned a painful lesson in the 1930s and today: The invisible hand often seems invisible because it’s not there.” It led to the kind of predicament now confronting the country. The solutions proposed will just compound it.

Ones that Can Fix It

Good ones not considered. From figures like Dean Baker of the Center for Economic and Policy Research. Others as well with solid advice to:

– make fraudsters eat the bulk of their losses;

– use public funds only “to sustain the orderly operation of the financial system;”

– minimize speculative finance; the root of the current problem;

– “minimize moral hazard” – the Paulson (and Bernanke) “put” picking up where Greenspan left off;

– let delinquent homeowners stay in their homes and pay rent;

– curtail executive compensation for companies getting government aid;

– make a key Fed responsibility the prevention of asset bubbles; reinstitute regulations to do it; Glass-Steagall for starters that prohibited commercial and investment banks and insurance companies from combining;

– impose a modest financial transactions tax to curb excesses and raise revenue;

– trade assets, like credit default swaps, openly on exchanges to establish fair value for them;

– impose strict limits on leverage;

– keep Fannie and Freddie public institutions; their status before being privatized in 1968; and

– restructure the Fed democratically; a far better solution is abolish it and let government control its own money; use it responsibly for all Americans, not just the privileged few.

Other recommendations recognize no quick or easy solutions to problems this great. Economist James Galbraith says borrowers need collateral. A new Home Owners Loan Corporation to rewrite mortgages. Manage rental conversions, and decide what degraded properties should be demolished. Which ones to save and refurbish. Set it up in communities under federal guidelines and do it quickly. Help state and local governments strapped for cash. Reestablish federal revenue sharing. A National Infrastructure Bank making capital available for infrastructure. Put people to work building it. Protect seniors and near-retirees from wealth loss. Extra Social Security, Medicare and Medicaid revenue will help. Get money in the hands of people who’ll spend it.

Address other crucial issues like energy conservation, reconstruction and renewable power. Infrastructure overall. Tuition help for students. Another GI bill. Credit card and mortgage interest rate caps. Rescind anti-consumist laws like the misnamed 2005 Bankruptcy Abuse Prevention and Consumer Protection Act. A boon for credit card companies and other businesses. Unfairly burdensome to the public.

A whole range of other projects and ideas to redirect the economy away from speculative finance and militarism and toward high-return public investment. Do it before it’s too late. Recognize that the present course is unsustainable. Imagine a government working for everyone and not just the privileged few. Imagine it not tolerating fraud and malfeasance.

Instead, Congress agreed to a “bailout” and passed a record $634 billion omnibus spending bill (to run the government through March 6, 2009) to include a record Pentagon budget; $25 billion in low-interest auto industry loans; maybe with no provision for repayment; lifting a quarter-century ban on Atlantic and Pacific off-shore drilling; billions more in earmarked pork; and likely more coming later for the airlines and other endangered companies. Taxpayers for Common Sense criticized the bill at the same time it noted that government “bailout” appropriations will reach about $1.2 trillion with the $700 billion Paulson scheme. Others put the total above $1.5 trillion, and many say it’s only for starters.

Paying “hold-to-maturity” prices compounds the fraud. For securitized assets worth a fraction of full value. Much of it pennies on the dollar, if anything. Trillions of dollars of toxic ones. All sorts of them. Newly invented ones. Structured finance and insurance. Asset-backed securities. Repackaged into marketable pools. Sold to investors. It’s been done for decades but only recently so out of hand. Greed and deregulation created an alphabet soup of levered-up, high-risk securitized assets. Financial alchemy. Largely outright fraud, including:

– collateralized debt obligations (CDOs), including auto loans, credit and corporate debt;

– collateralized (asset-backed home) mortgage obligations (CMOs);

– commercial mortgage-backed securities (CMBS);

– mortgage-backed securities (MBS) and levered loans;

– structured investment vehicles (SIVs);

– special purpose vehicles (SPVs);

– pass-through securities;

– credit and interest rate default swaps;

– commercial paper and more;

– repackaged arcane stuff most people don’t understand; even investors who bought them; like eating a stew with no idea what’s in it; a recipe with no list of ingredients; learning too late it’s toxic and you’re in trouble;

Credit card companies as well from growing amounts of unrepayable credit card debt. The auto industry already assured of a low-interest $25 billion loan (or maybe handout) for starters. Airlines coming next. Select homebuilders and troubled companies called too big to fail. If they’re too big to fail, says one observer, they’re too big to exist.

EESA will give the treasury secretary near-carte blanche powers to conceal fraud and help the fraudsters, including his former company, Goldman Sachs, now in trouble. Pick and choose among others. Which will survive, and what less favored ones will go on the block at fire sale prices or disappear. Today there are 9000 banks in the country. In a decade, half or more of them may be gone.

Economist Michael Hudson calls EESA “cash for trash” and a “giveaway,” not a bailout. A “transfer of wealth to insiders.” A financial coup d’etat. The “largest and most inequitable (kind) since the (19th century) land giveaways to the railroad barons.”

In this case, socializing losses to let fraudsters “sell out all their bad bets.” Junk of all sorts: a stew of securitized assets, bad mortgages, car loans, credit card loans, student loans, anything for insiders stuck with too much of them.

A doomed scheme that will raise the debt level instead of lowering it. Enrich fraudsters with taxpayer funds. Stick the public with toxic junk. Maybe buy time before more people and markets catch on, but, in the end, cripple the economy and erode industrial capitalism with it.

Hudson is justifiably angry given the amount of fraud and deceit. The government-concocted scheme to whitewash it. Reward criminals. Harm most others, and wreck the country at the same time. He says a “kleptocratic class has taken over the economy to replace industrial capitalism….’banksers’ ” for FDR and earlier condemned by Jefferson with this stinging comment:

“I sincerely believe that banking institutions are more dangerous to our liberties than standing armies. Already they have raised up a money aristocracy that has set the government at defiance. The issuing power should be taken from the banks and restored to the people to whom it properly belongs.”

A half century later Lincoln said:

“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country….corporations (including bankers) have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.”

Lincoln refused to pay bankers usurious rates to finance the Civil War and got Congress to pass the 1862 Legal Tender Act. It empowered the US Treasury to issue “greenbacks” that were interest-free because government printed its own money. When Lincoln was assassinated in 1865, the “Greenback Law” was rescinded. A new national banking act was passed, and the government once again had to pay interest to bankers.

On June 4, 1963, President Kennedy issued executive order (EO) 11110 giving the president authority to issue currency. He ordered the treasury to begin printing “United States (Treasury) Notes” to replace “Federal Reserve Notes.” He began a process to let government control its own money and no longer private bankers under the guise of the Federal Reserve. Months later, Kennedy was assassinated. Once Lyndon Johnson took office, he rescinded EO 11110 and reestablished the current system. More on that below.

The Two Greatest Ever Financial Crimes – Today’s Fraud and the 1913 Federal Reserve Act’s Privatization of Money Creation

Most people think the Federal Reserve is a government agency, subject to its control. It’s sometimes mistakenly called a quasi-governmental decentralized central bank to disguise its real identity and purpose. Its Eccles building headquarters compounds the subterfuge. Below it’s stripped away.

The Federal Reserve is a private for-profit banking cartel. Owned and run by major banks and Wall Street in each of its 12 Districts. It was created and operates in violation of Article 1, Section 8 of the Constitution that states that Congress alone shall have the power to create money and regulate its value. In 1935, the Supreme Court ruled that Congress cannot constitutionally delegate this power to another authority, but, in fact it did.

On December 22, 1913, between 1:30 – 4:30 AM, the Federal Reserve Act was shepherded through a special Congressional Conference Committee. Then voted on and passed the next day. Two days before Christmas with many members gone and most others with no time to read or consider this momentous document.

By enacting this law, Congress and President Woodrow Wilson defrauded the public. Wilson later said (when it was too late to matter) he made a mistake and “unwittingly ruined my country.” This from a man who was an intellect. Trained in the law. A PhD in political science and president of Princeton University in his earlier years.

The Federal Reserve Act gives private bankers the most important of all powers. The one most of all that governments should never relinquish. The authority to print money. Control its supply. Its price through the Fed Funds rate and how it influences the whole yield curve. Loan it out for profit, and charge government interest on its own money. It’s later returned minus operating expenses and a guaranteed 6% profit. Taxpayers foot the bill. An early and continuing example of wealth transfer from the public to powerful bankers. Illegally sanctioned by Congress and the president.

The Fed literally creates money out of nothing. Expands or contracts its supply as it wishes – with no government oversight or control. Gold once backed it until Nixon closed the gold window in August 1971. Suspended dollar convertibility into the metal, and ended compliance with the Bretton Woods core provision. The US dollar became fiat currency. Mere paper. Backed by nothing except the faith of the issuing authority.

Given today’s crisis, that faith is fast eroding and is to blame for dollar weakness. Mostly because of profligate policies by private bankers running the country’s monetary policy for their own gain. The grandest of grand thefts along with today’s all-consuming fraud. Backed by the full faith and credit of the government, and up to now at least, with most people none the wiser.

A Growing Public Response to the Crisis

For how long is the question given growing public anger and people expressing it publicly. It has administration officials worried enough to order what Michel Chossudovsky wrote in his September 26 article titled “Pre-election Militarization of the North American Homeland.”

He cites an Army Times article saying that the 3rd Infantry’s 1st Brigade Combat Team is coming home (in October) from Iraq as (according to the Times) “an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks.” Perhaps with a manufactured incident as pretext. To defend the homeland against ourselves. Be deployed against dissent. Erupting public anger. On city streets like in Denver and St. Paul. Displaying civil disobedience. Defiance against fraud, deceit, illegal foreign wars, and nearly eight intolerable years under George Bush and a complicit Congress. Capped by the current financial crisis touching everyone while government rewards crime and hangs its victims out to dry.

The 3rd Infantry’s 1st Brigade is for combat. It’s not the National Guard or local police. It’s trained for war. “Equipped to kill people” with potent weapons, and a last hurrah scheme may be planned to divert public attention from the financial crisis. A “terrorist” attack with “chemical, biological” or other dangerous weapons. A possible pretext for martial law at a time the administration and Congress are vulnerable. When people are angry about Washington protecting the privileged. Partnering with them in crime. Defrauding the public and stifling dissent. Moving one step closer to tyranny and away from silly notions about democracy. Proving crime indeed does pay and awfully well on Wall Street. “It’s the economy, stupid.” Theirs, not ours.

The Shadow of the Pitchfork: Elite Panic Attack as Bailout Goes Bust

The Shadow of the Pitchfork: Elite Panic Attack

as Bailout Goes Bust

Then again, who knows? There are obviously a lot of very powerful and privileged people sweating more bullets tonight than they have sweated in many and many a year. They have roused the drowsy beast of popular anger at last, and no one can say what might happen next. Probably nothing — or rather, more of the same, in some form or another. But still, it is good to see the icy beads of panic dotting the brows of elites who have inflicted and/or countenanced so much death, destruction, terror and degradation in the past few years. Today they have suffered a very rare defeat in the relentless, remorseless class war they have been waging against us for decades. And that it is something to celebrate — at least for one night. – Chris Floyd

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Mon 29 Sep 2008

Written by Chris Floyd

The vote by the House of Representatives to defeat the Wall Street bailout plan is the first act of political courage that the Congress of the United States has mounted in the last seven years. The fact that it was due largely to right-wing Republicans afraid of going down with the sinking ship of the witless leader they have followed blindly throughout his reign is a delicious irony — but the whys and wherefores of the vote are not important. What matters is that one of America’s moribund institutions has flickered to life long enough to derail a disastrous action that would have shoved the nation even deeper into the pit of corruption and ruin where it has been mired for so long.

The New York Times called the House vote “a catastrophic political defeat for President Bush, who had put the full weight of the White House behind the measure.” But this is manifestly untrue. As everyone but the nation’s media — and the Democratic Party — knows, George W. Bush has no “political weight” to use, or lose. Yes, he still retains the authoritarian powers that the spineless Democrats have given him with scarcely a whimper of protest (and often with boundless enthusiasm); but as a political force — i.e., someone whose opinions and statements can sway popular opinion — he has been a dead and rotting carcass for a long time. He is the most unpopular president in American history; and I can report from first-hand, eyewitness knowledge that he is thoroughly despised by some of the most rock-ribbed, Bible-believing, flag-waving, down-home, John Wayne-loving Heartland types that you can imagine. Even his own party — a party fashioned in his own image, the Frankensteinian melding of willfully ignorant religious primitivism and rapaciously greedy crony capitalism that he has embodied in his twerpish person — kept him away from their convention this year.

Nothing — absolutely nothing — could be politically safer than opposing George W. Bush. And yet the entire Democratic leadership, Barack Obama included, lined up to support a cockamamie plan proposed by this scorned and shriveled figure, a plan that was transparently nothing more than an audacious raid on the Treasury by Big Money hoods and yet another authoritarian power grab by a gang of murderous, torturing, warmongering toadies. This was the plan and these were the people that the Democrats decided to fight for.

What’s more, the Democrats stood shoulder to shoulder with the president on what is apparently the only issue that can now stir Americans to genuine anger and widespread protest: a direct threat to their bank accounts. Wars of aggression like the Nazis used to wage; elaborate tortures like the KGB used to practice; concentration camps, lawbreaking leaders, diminishment of liberty, the slaughter of a million innocent people in a land destroyed by an illegal and pointless invasion — all of that stuff is pretty much OK, easily swallowable, worth no more than a shrug or perhaps a frowny “tsk tsk” before going on to the sports pages or flipping over to another channel. But put out an open ploy to steal their money and give it to the filthy rich — and baby, it’s pitchfork time! Yet here, as the public face of just such a ploy, is where the Democrats chose to make their stand.

So Monday’s rejection of the bailout plan is not a catastrophic political defeat for George W. Bush; he has no political standing, no political future. But it is a vast and humiliating defeat for the Democratic leadership, across the board, who, as Democrat Lloyd Dogget of Texas said

“never seriously considered any alternative” to the administration’s plan, and had only barely modified what they were given. He criticized the plan for handing over sweeping new powers to an administration that he said was to blame for allowing the crisis to develop in the first place.

Now the Democratic elites have had their collective head handed to them on a platter. It is a dish most richly deserved. And although it is almost possible to believe that they will learn anything from this episode, there is now a chance — a chance — that we can at least have a discussion of alternatives to the Bush scheme.

I still believe it is unlikely any genuinely effective program — one that could manage and mitigate the now-unavoidable effects of the Wall Street/Washington-induced disaster — will ever get enacted. After all, the Democrats are largely owned by the same corrupt and greedy elites now seeking a handout. And it seems reasonable to assume that the Bipartisan Bailout Bunch will eventually find some kind of sugar to tempt away the two dozen votes they need for their next “compromise” on the Bush-Paulson plan.

Then again, who knows? There are obviously a lot of very powerful and privileged people sweating more bullets tonight than they have sweated in many and many a year. They have roused the drowsy beast of popular anger at last, and no one can say what might happen next. Probably nothing — or rather, more of the same, in some form or another. But still, it is good to see the icy beads of panic dotting the brows of elites who have inflicted and/or countenanced so much death, destruction, terror and degradation in the past few years. Today they have suffered a very rare defeat in the relentless, remorseless class war they have been waging against us for decades. And that it is something to celebrate — at least for one night.

FEMA Concentration Camps: Locations and Executive Orders

FEMA Concentration Camps: Locations

and Executive Orders

It may be easy to find fault with the premise of this article. You may even know of numerous sites that are not used as camps. But the plain fact remains that the USA maintains illegal prisons around the world. It remains a secret only to imbeciles in the US. The rest of the world knows for certain that it’s quite real. The way things are going in the US, it’s not a matter of if, but when these underused facilities come online to serve the master — otherwise known as Moloch. Most likely, not many Japanese in the US doubt the premise of this article. And for Jews in Europe during the Holocaust, the article must hit a hard note. So, what makes you think it can’t happen here? The executive orders below are quite real. The camps exist. Do the math.

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Friends of Liberty (undated) 3 sep 04

Mindfully.org note:

It may be easy to find fault with the premise of this article. You may even know of numerous sites that are not used as camps. But the plain fact remains that the USA maintains illegal prisons around the world. It remains a secret only to imbeciles in the US. The rest of the world knows for certain that it’s quite real.

The way things are going in the US, it’s not a matter of if, but when these underused facilities come online to serve the master — otherwise known as Moloch. Most likely, not many Japanese in the US doubt the premise of this article. And for Jews in Europe during the Holocaust, the article must hit a hard note.

So, what makes you think it can’t happen here?

The executive orders below are quite real. The camps exist. Do the math.

Update. . . 31jan2006 – Halliburton subsidiary KBR Awarded $385 Million Contract to Build Detention Facilities in USA

PARTIAL SOLUTION. . .
Stop taking freedom for granted. Stop watching TV. Learn to ignore commercials and advertisements where ever encountered. Stop believing what you’re told by the popular media and political representatives. Learn to think for yourself. Stop buying the products of this machine that has no scruples. Become more independent by ridding yourself of debt. Become as self-sufficient as possible. Use less power. Buy less stuff in general. Have more time to pay attention to your family and friends. Understand that the frills of the wealthy are generally not worth having in the first place. They take your time and attention away from things that really matter. Demand that your representatives take no corporate contributions. Electing the least-worst candidate is no longer an option. Pay more attention to what representatives actually say by reading between the lines, so to speak. Republicans and Democrats are essentially the same. For instance, did you know that if elected, Barack Obama would shift troops from Iraq to places like Iran and other Mideast countries? Other candidates are about the same or worse. As president, Giuliani would be worse than Bush in pretty much all aspects. And that isn’t easy because Bush is recognized as the worst president in U.S. history. Giuliani likes to cross dress, his father was a felon, and he associates closely with others who have no respect for decency. Under Giuliani we’d live under an even more repressive regime. Hillary Clinton, being the wife of Slick Willie would give us more of the same — NAFTA and more wars.

There over 800 prison camps in the United States, all fully operational and ready to receive prisoners. They are all staffed and even surrounded by full-time guards, but they are all empty. These camps are to be operated by FEMA (Federal Emergency Management Agency) should Martial Law need to be implemented in the United States and all it would take is a presidential signature on a proclamation and the attorney general’s signature on a warrant to which a list of names is attached. Ask yourself if you really want to be on Ashcroft’s list. The Rex 84 Program was established on the reasoning that if a “mass exodus” of illegal aliens crossed the Mexican/US border, they would be quickly rounded up and detained in detention centers by FEMA. Rex 84 allowed many military bases to be closed down and to be turned into prisons.

Operation Cable Splicer and Garden Plot are the two sub programs which will be implemented once the Rex 84 program is initiated for its proper purpose. Garden Plot is the program to control the population. Cable Splicer is the program for an orderly takeover of the state and local governments by the federal government. FEMA is the executive arm of the coming police state and thus will head up all operations. The Presidential Executive Orders already listed on the Federal Register also are part of the legal framework for this operation.

The camps all have railroad facilities as well as roads leading to and from the detention facilities. Many also have an airport nearby. The majority of the camps can house a population of 20,000 prisoners. Currently, the largest of these facilities is just outside of Fairbanks, Alaska. The Alaskan facility is a massive mental health facility and can hold approximately 2 million people.

Now let’s review the justification for any actions taken…

(List of FEMA Camps)

Saudis Sell-Out arab Brothers to Zionist Assassins

Arab country ‘cooperates with Mossad’
Tue, 30 Sep 2008 09:27:02 GMT

Assassinated Hezbollah commander Imad Mughniyeh

The Israeli spy agency Mossad may have used intelligence provided by an Arab country to carry out assassinations in the region.

Israeli sources confirmed on Monday that Mossad chief Meir Dagan’s reliance on cooperation with an Arab country was the reason behind the successful completion of Israeli operations in various countries, IRNA reported.

The Arab country does not have diplomatic relations with Israel, the sources added.

Among the operations attributed to the Israeli regime is the assassination of the Lebanese Hezbollah movement’s top commander Imad Mughniyah and Syrian army officer Brigadier-General Mohammed Suleiman.

Israel is also accused of carrying out the recent bombings in Syria and Lebanon.

Lebanon’s Al-Manar TV station reported on Monday that Saudi Arabia was the country that provided the intelligence to Mossad, suggesting that Saudi Secretary General of the National Security Council Prince Bandar bin Sultan played a role in the cooperation between the intelligence agencies.

Fixing The Blame Will Solve The Problem!

Fixing The Blame

Will Solve The Problem!

Jim Kirwan

The verdict has been dissected by the major media, and the public’s opinion is of course still not even being considered, as being necessary to solving this problem. The market began its record breaking fall before the vote was even begun, because this problem has been directly and selectively hitting institutions throughout Europe, and even a bank in Iceland has felt the heat. What has happened is simple: Massive fraud and criminal manipulations have taken over the largest financial institutions in the world because of the actions of the twelve central banks and their owners who are launching a full-court-press in order to capture control over all financial assets. The most directly affected populations are beginning to scream bloody murder because they will be the first ones fired, and the last to be paid if any crumbs are left from the feast that these thieves are about to make of our money! These current day inheritors of the ethics adopted by the original Robber-Barons are convinced that if they hold financial guns to the heads of parliament’s & congress, and virtually every other body anywhere that holds the public’s trust in their blood-stained hands-then they will get what they are demanding (largely because of short-term self-interest). Yet this is far larger than that-because if we surrender now then we are finished as a society, or as free individuals-forever! To the media here this is some kind of game looking for a simple and painless “fix” to problems that can be delayed while enhancing the take for the same people that caused it all. BUT THIS IS NOT THAT! The media is NOT a neutral observer in any of this, because it is they that have massively assisted in this stealth-driven takeover, by those that own their stations and the pages of the publications. This is about the most basic right anyone can possess: the right to have and keep our own money! McCain says: ‘This is no time to be fixing blame; this is the time to find the fix.’ He could not be more wrong! But then he is nothing, as his positions change radically with every passing breeze. This was not a random act of nature, this was planned and carried out to enhance the profits and eliminate all of the responsibilities of the major players behind the latest failings of a lot of so-called institutions. Nor was this ‘a first,’ this was simply Act Two from the play that produced the Crash of 1929. The characters are descendants of the original cast, with the addendum that this time they are going after the entire planet, and all the assets which have been accumulating since Roosevelt put an end to their deluded plundering of the wealth of the world, seventy-nine years ago! They’re in a hurry because they need the cover which these totally-criminal puppets are willing to provide, in the last gasp of the Clinton-Bush legacy. This leaves the American public with a genuine dilemma. The people that are supposed to vote according to our voices, and our will, have decided that “they know best”! But do they? Or are they too part of this slow-motion collapse of the world’s financial markets! If they are not part of this coup, then they should have had a Plan B ready to implement, if there was a taxpayer rebellion against this strong-arm attempt to blackmail the public into compliance: but they did not have such a plan! However history has recorded the entire structure that actually works and would satisfy all the needs which this failure is furiously attempting to bring on. FDR called his plan the “New Deal,” but whatever we end up calling ours, we ought to use a large part of that very successful earlier response to this same problem: in order to both save the country and eliminate the problem people that are bringing this down upon us all. “PRESIDENT FRANKLIN DELANO ROOSEVELT: First of all, let me assert my firm belief that the only thing we have to fear is fear itself-nameless, unreasoning, unjustified terror, which paralyzes needed efforts to convert retreat into advance. We face our common difficulties. They concern, thank God, only material things. The withered leaves of industrial enterprise lie on every side. Farmers find no markets for their produce. And the savings of many years in thousands of families are gone. More important, a host of unemployed citizens face the grim problem of existence, and an equally great number toil with little return. Only a foolish optimist can deny the dark realities of the moment. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men. Yes, the money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. This nation is asking for action, and action now. There must be a strict supervision of all banking and credits and investments. There must be an end to speculation with other people’s money. And there must be provision for an adequate but sound currency. These, my friends, are the lines of attack. I shall presently urge upon a new Congress in special session detailed measures for their fulfillment, and I shall seek the immediate assistance of the forty-eight states.” (1) FDR had to wait for the dust to settle, but his legacy leaves us with a blueprint which can be easily read and followed, in order to clean out this ‘Nest of Vipers’ where they have come to live, as certainly as they have schemed to bring us to the edge of this major collapse! The congressional Cyclops has stumbled and shall not regain its footing until Thursday, by then the people of this nation need to have deluged their so-called representatives with the full import of what FDR so eloquently said in 1933: Augmented by their own determinations not “to settle” for anything less! Secretary Paulson created this monstrous beast and then demanded that he and he alone be allowed to dispatch it from our shoulders. No questions, no compromise and nothing at all for the huge population of suffering home-owners, or any of the other ‘little-people’ that will be damaged or ruined by his actions! That fallacy has been proven to be the wrong approach, and now the Secretary must step down, in disgrace, as he is too biased to come up with anything that might actually work toward solving the problem, instead of merely passing it on to the next set of fools in the Tarnished House. If Paulson were to be charged with what he has tried to do, in criminal court, he would be found guilty of attempted grand theft: but since what he has done is nothing short of attempting to steal not only an obscene amount of money, but an entire nation as well as our way of life-So if he is not tried for that treason, and shot, then he ought to at the very least spend the rest of his life (without assets or possessions) in solitary confinement. These people are jackals, predators of the most vicious order; they must be leashed and monitored 24-7! Their every act must be scrutinized and they should never again be allowed anywhere near invests, banking of any kind, or stocks and bonds! That ought to be the first step taken, while we are beginning to implement the necessary new programs. Some might think this is impossible as there is a congressional break coming up: Have those who are mindful of “the break” forgotten that this country is fighting for its very life! Congress is divided into many factions for the protection and creation of what needs to happen to keep this nation functional. They have been on an eight-year long break already: maybe it’s time they did some work on behalf of the public for a change. If they cannot figure out a way to do that, then we certainly don’t need to re-elect them to anything except their own private cells in federal prison. The public juggles a thousand and one things every day just to try and stay alive, while these satiated and over-paid flunkies wallow in their perks while they sell us into the sewers of privation and semi-permanent-poverty. If this had happened in the bad-old days they would all find themselves in the stocks being horse-whipped before they were sent directly off to jail! But maybe some of them might just have a sudden epiphany, or at least a sudden-enough jolt of reality to get this job done right for a change! If the congress were to act decisively enough now: then most of the real nightmare would begin to vanish in the haze. If they fail to act then the nightmare will descend, and none of them will be spared from its most disastrous effects. Make no mistake this is not just the ‘big problem’ that Bush attempts to lamely call it: this is about everything that counts both now and in the future; for you and I as well as for our descendants down to at least the fifth generation. How does this compare with some idiotic and bloated schedule of vacations for these over-paid traitors that have the nerve to call themselves our “representatives”? Call them, write to their cubicles and demand that they do their jobs and “represent us,” because the longer they stay loyal to our enemies the more certain will be their own political demise; and the prison-time that shall follow! kirwanstudios@sbcglobal.net

THE BANKERS’ BUDDIES: Sellout Congressmen Who Voted Yes for Bailout

Ackerman Allen Andrews Arcuri Bachus Baird Baldwin Bean Berman Berry Bishop (GA) Bishop (NY) Blunt Boehner Bonner Bono Mack Boozman Boren Boswell Boucher Boyd (FL) Brady (PA) Brady (TX) Brown (SC) Brown, Corrine Calvert Camp (MI) Campbell (CA) Cannon Cantor Capps Capuano Cardoza Carnahan Castle Clarke Clyburn Cohen Cole (OK) Cooper Costa Cramer Crenshaw Crowley Cubin Davis (AL) Davis (CA) Davis (IL) Davis, Tom DeGette DeLauro Dicks Dingell Donnelly Doyle Dreier Edwards (TX) Ehlers Ellison Ellsworth Emanuel Emerson Engel Eshoo Etheridge Everett Farr Fattah Ferguson

Fossella Foster Frank (MA) Gilchrest Gonzalez Gordon Granger Gutierrez Hall (NY) Hare Harman Hastings (FL) Herger Higgins Hinojosa Hobson Holt Honda Hooley Hoyer Inglis (SC) Israel Johnson, E. B. Kanjorski Kennedy Kildee Kind King (NY) Kirk Klein (FL) Kline (MN) LaHood Langevin Larsen (WA) Larson (CT) Levin Lewis (CA) Lewis (KY) Loebsack Lofgren, Zoe Lowey Lungren, Daniel E. Mahoney (FL) Maloney (NY) Markey Marshall Matsui McCarthy (NY) McCollum (MN) McCrery McDermott McGovern McHugh McKeon McNerney McNulty Meek (FL) Meeks (NY) Melancon Miller (NC) Miller, Gary Miller, George Mollohan Moore (KS) Moore (WI) Moran (VA) Murphy (CT) Murphy, Patrick Murtha

Nadler Neal (MA) Oberstar Obey Olver Pallone Pelosi Perlmutter Peterson (PA) Pickering Pomeroy Porter Price (NC) Pryce (OH) Putnam Radanovich Rahall Rangel Regula Reyes Reynolds Richardson Rogers (AL) Rogers (KY) Ross Ruppersberger Ryan (OH) Ryan (WI) Sarbanes Saxton Schakowsky Schwartz Sessions Sestak Shays Simpson Sires Skelton Slaughter Smith (TX) Smith (WA) Snyder Souder Space Speier Spratt Tancredo Tanner Tauscher Towns Tsongas Upton Van Hollen Velázquez Walden (OR) Walsh (NY) Wasserman Schultz Waters Watt Waxman Weiner Weldon (FL) Wexler Wilson (NM) Wilson (OH) Wilson (SC) Wolf

FINALLY Someone Said “No”

by Richard C. Cook

FINALLY, someone said “No” to the criminal gang that runs the U.S. economy when the House voted down the Bush-Paulson $700 billion Wall Street bailout plan by a vote of 228-205.

Shame on the Democrats! Speaker of the House Nancy Pelosi, Majority Leader Steny Hoyer, and Majority Whip Rahm Emanuel delivered “yea” votes from 60 percent of Democratic House members and thereby gave the bill the only chance of passage it had.

Hooray for the Republicans! The bill went down to defeat only because 67 percent of House Republicans voted against it.

The bailout bill is one of the most critical ever brought before Congress. The Republicans who defied President George W. Bush, Secretary of the Treasury Henry Paulson, and the House leadership did so because their constituents demanded it. Ideologically, they acted to let the free market do its work. If overextended financial institutions which had invested recklessly go bankrupt, so be it.

For Democrats who voted against the legislation, the rationale was more complex—not enough taxpayer protection and too little help for homeowners facing foreclosure who would lose their homes even with the bill. But they also bucked the leaders of a party which, since pro-business Democrat Bill Clinton won the presidency in 1992, has completely sold out to the financier elite. Since then, Wall Street investment firms have been the principal bankrollers of a party that in recent years has totally betrayed its New Deal roots.

However it happened, the result of today’s vote was momentous. After rolling over and playing dead for the financial elite that has held the U.S. economy in a death grip due to the deregulation of the last quarter-century, a majority in Congress stood up and said, “Enough,” even after the two parties’ presidential candidates, Democrat Barack Obama and Republican John McCain discredited themselves by voicing support.

Of course the financiers and their many political lackeys attempted to blackmail the country by claiming the economy would seize up and the stock market crash without the legislation, and, in a self-fulfilling prophecy, the Dow-Jones went down 777.68 points today. Traders interviewed on CNN said that if a bill were not passed before the session ended in a week, the fall could amount to 2000 points.

But so what? Everyone knows that the peak of the stock market last year—over 14,100 points—was the result of the bubble economy. Now that the bubble is bursting why shouldn’t the stock market find out where it really belongs, along with the prices of houses, as well as the worth of the banks and stock brokerages that got us into the mess?

So now what happens? It is unclear whether the House leadership will try to revive the bill or just let the voters decide in November who they want to step in to fix an economy which Bush, Greenspan, and their enablers in Congress have ruined.

What then can be done? Well, no one in government has much of an idea, and the huge number of commentators writing about the debacle in print and on the internet and talking about it on TV have offered literally thousands of suggestions. These range from returning to the gold standard to another New Deal. But few of these suggestions really get to the heart of the matter.

We do know one thing—unfettered finance capitalism as a national economic engine, which was the solution offered by Ronald Reagan and his supply-side, trickle-down “revolution,” has totally, dismally, hysterically failed. And we might suspect the same thing of a return to New Deal Keynesianism—i.e., more federal deficit spending—which is what the progressives are offering in an infinite number of disguises.

In discussing the Keynesian alternative, we should remember that it wasn’t until World War II that the Roosevelt administration was able to use Keynesian economics to produce full-employment. So do the new New Dealers want a World War III for the same ends?

They wouldn’t admit it, but let’s be honest. No nation on earth has yet implemented a stable industrial economy. In fact, there is one honest man writing about the crisis. His name is Robert Samuelson, and he is the economics writer for the Washington Post. What Samuelson is saying is absolutely true. This is that no one knows what is going on and no one knows what to do.

He writes:

“What we are witnessing, in the broadest sense, is the bankruptcy of modern economics. Its conceit has been that we had solved the problem of stability. Oh, there would be periodic recessions, but the prospects of a major economic collapse were negligible because we knew how the system worked and could take steps to prevent it. What’s been so unsettling about the present crisis is that it has not conformed to the standard model of business cycles and has not submitted to familiar textbook solutions.”

He goes on to point out the major economic issue of the industrial age is not “supply” as the monetarists—a.ka. Reaganite trickle-downers—said ad nauseum, but demand:

“The word that best epitomizes mainstream ‘macroeconomics’ (the study of the entire economy, not individual markets) is demand. If weak demand left the economy in a slump, government could rectify the situation by stimulating more demand through tax cuts, higher spending, or lower interest rates. If excess demand created inflation, government could suppress it by cutting demand through more taxes, less spending, or higher interest rates.”

“Demand” means, quite simply, “purchasing power.” The trouble is that a modern industrial economy does not produce enough purchasing power through wages, salaries, and dividends to buy what is produced at prices that must be charged to keep the system running. There is a gap, which was Keynes’ main point. The gap exists because of savings, or “retained earnings,” needed for reinvestment to keep the system operating and innovating. Without this savings, the system runs down due to entropy, or the law of diminishing returns.

Few of the writers commenting on the current economic situation—including most professional economists I’ve read on the subject—understand this basic point of Keynes’ thesis. That’s why none of their solutions ever work.

As I said, Keynes wanted to fill the gap through government deficit spending—pump priming. Supply-siders want to fill it by, well—by nothing. They don’t recognize the gap. They think that if more is produced, more will be bought, and there will be more income to do it. This is because they believe in “Say’s Law,” an early 19th century formulation that worked for medieval village economies—as did Adam Smith’s free-market ideas—but not modern industrial ones.

Still, the gap has been filled, except it has been filled by debt, by consumer borrowing, and by the hundreds of different kinds of exotic debt instruments dreamed up by Wall Street firms since Reagan took office in the 1980s. This debt pyramid is what is crashing today.

And behind all the exoticism is the debt-based monetary system run by the banks who own the Federal Reserve, because it is these banks that provided the leverage for it all to happen. It’s the banks that leveraged the bubbles—the merger-acquisition bubble, the dot.com bubble, the housing bubble, the commercial real estate bubble, the equity bubble, the hedge fund bubble, the derivative bubble, the commodity bubble, and on it goes.

So this is what deregulation has done for us. It may very well destroy the U.S. economy. It is already destroying democracy, because the social stress the system has produced is a hot-bed for every type of illness and social break-down and also feeds the anxiety that sees a terrorist under every bed and leads to wars and international crises as well.

It’s the big banks that have been the winners, at least so far. Citibank is eating Wachovia. Bank of America ate Merrill Lynch. J.P. Morgan Chase is eating Bear Stearns and WaMu. They are paying $1.9 billion for WaMu which has assets of $310 billion. Of course the latter is the bank of David Rockefeller and his family, so they are not doing too badly. The Rockefellers also own much of Exxon-Mobil, which continues to run record profits due to the oil price run-up.

But then the system was set up to benefit people like the Rockefellers and their ilk in the first place. That’s why we got the Federal Reserve System, because the bankers of the world already knew in 1913 that if they could control the currency and introduce money into circulation only through public and private debt they would be the big winners when the incredible productivity of modern industry became manifest.

And what is a real solution? It’s a dividend-based economy, as I have written many times, and as the Social Credit movement in Great Britain, Canada, Australia, and New Zealand have known for decades. What we should do is monetize savings and retained earnings by issuing a corresponding dividend to the consuming population to balance production and be able to purchase what industry can produce through a non-inflationary production-based monetary system.

This is how credit really should be used. You can read about it in the many articles I have written over the past year or in my forthcoming book: We Hold These Truths: The Hope of Monetary Reform (Tendril Press, 2008). Among many other benefits, we would have a rebirth of local and regional economies as well as family farming, all of which the banks, under the global monetarist regime, have wiped out.

So that’s what happened today in Washington. But just remember, it’s the big banks that are really the ones behind the bailouts. They are the ones who call the shots with the Bush administration and the leadership of both the Republican and Democratic parties.

But thank God a few real “mavericks” in Congress left the reservation today. Will they have the guts to continue to “just say no” and make a real change in U.S. politics? Was this the day the revolution began? Or just a final rear-guard action in the death of American democracy?

Copyright 2008 by Richard C. Cook

911 False Flag, German Documentary

IAEA ‘puts Israeli nukes on agenda’

NEW YORK, Sep. 29 (Agencies) The UN nuclear watchdog has unanimously agreed to put the issue of the Zionist entity’s nuclear capabilities on the agenda of its annual meeting.

After requests by the Non-Aligned Movement and the Arab League, the International Atomic Energy Agency (IAEA) agreed to put the issue of the apartheid regime’s nuclear capabilities on the agenda of the 52nd annual meeting of the UN body.

The move was initially met with protests by the US and Canada but the two countries had to back down from their position after they realized that other member states of the IAEA meeting’s presidential board would not support their stance, an informed source told Fars News Agency as saying on Monday.

The Zionist entity is believed to possess the only nuclear arsenal of the Middle East but it has so far refused to allow IAEA inspectors to visit its nuclear sites.

Look What WE Are Doing To Other People’s Babies

House Rejects Bailout Package, 228-205; Stocks Plunge

House Rejects Bailout Package, 228-205;

Stocks Plunge

By CARL HULSE and DAVID M. HERSZENHORN

WASHINGTON — In a moment of historic import in the Capitol and on Wall Street, the House of Representatives voted on Monday to reject a $700 billion rescue of the financial industry. The vote came in stunning defiance of President Bush and Congressional leaders of both parties, who said the bailout was needed to prevent a widespread financial collapse.

The vote against the measure was 228 to 205, with 133 Republicans turning against President Bush to join 95 Democrats in opposition. The bill was backed by 140 Democrats and 65 Republicans.

Supporters vowed to try to bring the rescue package up for consideration again as soon as possible, perhaps late Wednesday or Thursday, but there were no definite plans to do so. A former Treasury Department official predicted that the administration would try to get another House vote before the end of the week, and with only “tiny tweaks” to the package, given the relative closeness of the vote.

Stock markets plunged as it appeared that the measure would go down to defeat, and kept slumping into the afternoon when that appearance became a reality. By late afternoon the Dow industrials had fallen more than 5 percent, and other indexes even more sharply. Oil prices fell steeply on fears of a global recession; investors bid up prices of Treasury securities and gold in a flight to safety.

The vote was a catastrophic political defeat for President Bush, who had put the full weight of the White House behind the measure and had lobbied wavering Republicans in intensely personal telephone calls on Monday morning.

“We put forth a plan that was big because we got a big problem,” the president said afterward. “And we’ll be working with members of Congress, leaders of Congress on the way forward. Our strategy is to continue to address this economic situation head on.”

The president was described as “very disappointed” by a spokesman, Tony Fratto. Mr. Bush’s disappointment may have been deepened by the fact that members of his own party voted against the package by more than 2 to 1.

Treasury Secretary Henry M. Paulson Jr., appearing at the White House late Monday afternoon, warned that the failure of the rescue plan could dry up credit for businesses big and small, making them unable to make payrolls or buy inventory. Vowing to continue working with Congress to revive the rescue plan, Mr. Paulson said it was “much too important to let fail.”

Supporters of the bill had argued that it was necessary to avoid a collapse of the economic system, a calamity that would drag down not just Wall Street investment houses but possibly the savings and portfolios of millions of Americans. Moreover, supporters argued, a lingering crisis in America could choke off business and consumer loans to a degree that could prompt bank failures in Europe and slow down the global economy.

Opponents said the bill was cobbled together in too much haste and might amount to throwing good money from taxpayers after bad investments from Wall Street gamblers.

House leaders pushing for the package kept the voting period open for some 40 minutes past the allotted time at mid-day, trying to convert “no” votes by pointing to damage being done to the markets, but to no avail.

The former Treasury Department official who predicted another House vote this week, and who spoke on condition of anonymity, said that before there could be another vote, he would expect Speaker Nancy Pelosi, the California Democrat, and Representative John A. Boehner of Ohio, the Republican minority leader, to approach members with seats in safe districts and tell them, in effect: “You’ve got to do this. The fate of the country hangs on your vote.”The United States Chamber of Commerce vowed to exert pressure of another kind, warning in a letter to members of Congress that it would keep track of who votes how. “Make no mistake,” the letter said. “When the aftermath of Congressional inaction becomes clear, Americans will not tolerate those who stood by and let the calamity happen.”

Immediately after the vote, many House members appeared stunned. Some Republicans blamed Ms. Pelosi for a speech before the vote that disdained President Bush’s economic policies, and did so, in the opinion of the speaker’s critics, in too partisan a way.

“Clearly, there was something lacking in the leadership here,” said Representative Eric Cantor, Republican of Virginia.

Democrats, meanwhile, blamed the Republicans for not coming up with enough support for the measure on their side of the aisle.

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