Just a few laws broken by the Fed and Treasury Secretary this year, and yep! The media isn't telling anyone! Are you supprised? The forth estate in America has failed us worse than the Congress in protecting us from the bad guys. Laws, that which this great Nation is founded on have been blatently violated and no one is talking about it! Why
1 Violating Contracts between Employer's and Employee's.
2 Financial Fraud conducted by the FED.
3 The Treasury Secratery failed to shut down the Banks by Law.
Congressional officals making laws that violate the U.S. Constitution. Attempting to make a bill of Attainder is prohibited. These elected Congressional representatives need to be ejected from the Captial by the Commander and Chief under the Constitution.
Fed has not reported where the peoples money is going or is being used. Violates Public Laws with respect to governmental fraud.
The treasury secretary has clearly voilated the law in not closing the failed banks, arguments not withstanding. The law is clear, he is mandated to close them, not to prop them up with new money and nationalize them. Nor is he suppose to take charge of them. They are to be placed into receivership by law.
Were is the Press, the peoples outrage, the presidential leadership on the hill, all absent!
These crimes against the law are going unpunished and no one is talking about them.
Our government passed a law into being during the Regan years after the Savings and Loan crisis, called the Prompt Corrective Action Law. This law requires them to close these institutions and they are refusing to obey the law. Paulson could have closed them as well and Geithner. They could close them and put them into receivership now but aren't. They just WANT control of them, yet they are mandated by law to close them. Bad policy, it lacks integrity and the violate's the law in the process. Look it up if you don't believe me.
What reason do they give for not doing it? They ignore it. And nobody calls them on it.
Well, where's Congress? Where's the press? Where--where's the Pecora investigation?
The Pecora investigation. The Great Depression, we said, "Hey, we have to learn the facts. What caused this disaster, so that we can take steps, like pass the Glass-Steagall law, that will prevent future disasters?" Where's our investigation?
What would happen if after a plane crashes, we said, "Oh, we don't want to look in the past. We want to be forward looking. Many people might have been, you know, we don't want to pass blame. No. We have a nonpartisan, skilled inquiry. We spend lots of money on, get really bright people. And we find out, to the best of our ability, what caused every single major plane crash in America. And because of that, aviation has an extraordinarily good safety record. We ought to follow the same policies in the financial sphere. We have to find out what caused the disasters, or we will keep reliving them. And here, we've got a double tragedy. It isn't just that we are failing to learn from the mistakes of the past. We're failing to learn from the successes of the past.
In the Savings and Loan debacle, we developed excellent ways for dealing with the frauds, and for dealing with the failed institutions. And for 15 years after the Savings and Loan crisis, didn't matter which party was in power, the U.S. Treasury Secretary would fly over to Tokyo and tell the Japanese, "You ought to do things the way we did in the Savings and Loan crisis, because it worked really well. Instead you're covering up the bank losses, because you know, you say you need confidence. And so, we have to lie to the people to create confidence. And it doesn't work. You will cause your recession to continue and continue." And the Japanese call it the lost decade. That was the result. So, now we get in trouble, and what do we do? We adopt the Japanese approach of lying about the assets. And you know what? It's working just as well as it did in Japan.
Timothy Geithner, the Secretary of the Treasury, and others in the administration, with the banks, are engaged in a cover up to keep us from knowing what went wrong?
Absolutely, because they are scared to death. All right? They're scared to death of a collapse. They're afraid that if they admit the truth, that many of the large banks are insolvent. They think Americans are a bunch of cowards, and that we'll run screaming to the exits. And we won't rely on deposit insurance. And, by the way, you can rely on deposit insurance. And it's foolishness. All right? Now, it may be worse than that. You can impute more cynical motives. But I think they are sincerely just panicked about, "We just can't let the big banks fail." That's wrong.
But what might happen, at this point, if in fact they keep from us the true health of the banks you ask?
Well, then the banks will, as they did in Japan, either stay enormously weak, or Treasury will be forced to continue increasingly absurd giveaways of taxpayer money. We've seen how horrific AIG is and remember, they kept secrets from everyone.
So who's doing what? Treasury and both administrations. The Bush administration and now the Obama administration kept secret from us what was being done with AIG. AIG was being used secretly to bail out favored banks like UBS and like Goldman Sachs. Secretary Paulson's firm, that he had come from being CEO. It got the largest amount of money. $12.9 billion. And they didn't want us to know that. And it was only Congressional pressure, and not Congressional pressure, by the way, on Geithner, but Congressional pressure on AIG. Where Congress said, "We will not give you a single penny more unless we know who received the money." And, you know, when he was Treasury Secretary, Paulson created a recommendation group to tell Treasury what they ought to do with AIG. And he put Goldman Sachs on it. Even though Goldman Sachs had a big vested stake, massive stake. And even though he had just been CEO of Goldman Sachs before becoming Treasury Secretary. Now, in most stages in American history, that would be a scandal of such proportions that he wouldn't be allowed in civilized society. Yeah, like a massive conflict of interest, it seems.
So, how did he get away with it? I don't know whether we've lost our capability of outrage. Or whether the cover up has been so successful that people just don't have the facts to react to it.
Who's going to get the facts? We need some chairmen or chairwomen in Congress, to hold the necessary hearings. And we can blast this out. But if you leave the failed CEOs in place, it isn't just that they're terrible business people, though they are. It isn't just that they lack integrity, though they do. Because they were engaged in these frauds. But they're not going to disclose the truth about the assets.
To know who committed the frauds. Whose bonuses we should recover. How much the assets are worth. How much they should be sold for. Is the bank insolvent, such that we should resolve it in this way? It's the predicate, right? You need to know the facts to make intelligent decisions. And they're deliberately leaving in place the people that caused the problem, because they don't want the facts. And this is not new.
The Reagan Administration's central priority, at all times, during the Savings and Loan crisis, was covering up the losses. I know people in power, political power, and financial power, act in concert when their own behinds are in the ringer, right? And it's particularly a crisis that brings this out, because then the class of the banker says, "You've got to keep the information away from the public or everything will collapse. If they understand how bad it is, they'll run for the exits."
You could call it a moral crisis. Because it is a fundamental lack of integrity. But also because, if you look back at crises, an economist who is also a presidential appointee, as a regulator in the Savings and Loan industry, right here in New York, Larry White, wrote a book about the Savings and Loan crisis. And he said, you know, one of the most interesting questions is why so few people engaged in fraud? Because objectively, you could have gotten away with it. But only about ten percent of the CEOs, engaged in fraud. So, 90 percent of them were restrained by ethics and integrity. So, far more than law or by F.B.I. agents, it's our integrity that often prevents the greatest abuses. And what we had in this crisis, instead of the Savings and Loan, is the most elite institutions in America engaging or facilitating fraud.
The loss of worker's income. And security and pensions and future happened, because of the misconduct of a relatively few, very well-heeled people, in very well-decorated corporate suites.
And their ideologies, which swept away regulation. So, in the example, regulation means that cheaters don't prosper. So, instead of being bad for capitalism, it's what saves capitalism. "Honest purveyors prosper" is what we want. And you need regulation and law enforcement to be able to do this. The tragedy of this crisis is it didn't need to happen at all.
Now, going forward, get rid of the people that have caused the problems. That's a pretty straightforward thing, as well. Why would we keep CEOs and CFOs and other senior officers, that caused the problems? That's facially nuts. That's our current system. Tell me what you think?
