Is This The New World Order Without Oversight – Who Is Paulson?
If you think about it, we could ever get a loan from any of these failed lenders and failed financial institutions, without signing over our children, pets and souls. These same arrogant lenders and financial gurus would charge fees, both declared and hidden. Our ability to pay, decided by a risk management computer program, would determine the interest rates we would be charged.
Knowing all this, the $700 million bailout is being thrown in our face with the insistance that no oversight or accountability be in its way, is like a used car salesman insisting “if you don’t buy it now …”! Thank goodness for Chris Dodd. If this Administration can pull off saving their sickneningly rich, irresponsible, greedy and arrogant hoodlums just before they slither back into their well appointed holes, we have indeed lost it all. And, we earned it. The moths have already destroyed our retirement purses. I am looking at staying at work until I am 90 years old.
Republicans and Secretary of Treasury Henry Paulson Jr are really nasty about any oversight or accountability. Democrats are stepping up to ensure we don’t reward the robber barons for giving the finger to the global community and our neighborhoods.
By Pepe Escobar – WASHINGTON and SAO PAULO – The George W Bush administration’s US$700 billion no-accountability scheme, globally, informally dubbed “cash for trash”, is making all the headlines. Simultaneously, there’s the small matter of the United Nations General Assembly sanctioning the troubled birth of a new, multipolar world. As a 21st-century counterpart to the Dadaist Manifesto, this chain of events is priceless. [whole article] ..
WASHINGTON — Congressional Democrats began to set their own terms on Sunday for a plan to rescue the nation’s financial institutions, including greater legislative oversight of the Treasury Department, more direct assistance for homeowners and limits on the pay of top executives whose firms seek help.
The Democrats’ demands came as Treasury Secretary Henry M. Paulson Jr. blanketed the Sunday talk shows to promote the Bush administration’s $700 billion bailout package, emphasizing that it was needed not just for Wall Street, but for all Americans. He urged Congress to move swiftly to approve a “clean” rescue plan without tacking on extra programs.
“I hate the fact that we have to do it, but it’s better than the alternative,” Mr. Paulson said on “Fox News Sunday.”
The Bush administration proposal could be the largest government bailout of private industry in the nation’s history, and it calls for nearly unfettered powers to the Treasury secretary. There is intense pressure to pass a rescue measure quickly because the markets remain jittery.
Still, competing interests were already complicating the negotiations, as Democrats pushed for assistance for distressed homeowners and for oversight authority of the bailout program. Some lawmakers also said they did not want to be rushed into approving extraordinary new powers for the Treasury secretary and the government without full consideration of the consequences.
WASHINGTON — Just over two years ago, Henry M. Paulson Jr. took the job of Treasury secretary, though the post had become so devalued that others had turned it down. He is likely to leave as one of the most powerful of the 74 secretaries in history and to pass those powers on to his successor.
The financial emergency has expanded the Treasury secretary’s authority beyond anything that Alexander Hamilton could have foreseen when George Washington tapped him 219 years ago this month. And that was before Mr. Paulson sent Congress a spare three-page proposal for broad new powers. Newsweek magazine put Mr. Paulson on its cover as “King Henry.”
All of this has ignited speculation about whom Senator Barack Obama or Mr. McCain might name as Treasury secretary if elected president. The consensus in both parties is now that the next secretary must — like Mr. Paulson, formerly chief executive of Goldman Sachs, one of only two surviving investment banks — be well versed in financial markets.
The emergency also has spawned talk of Mr. Paulson staying on for a time, as secretary or something else. As the Great Depression deepened, the Treasury secretaries to President Herbert Hoover, a Republican, and his Democratic successor, Franklin D. Roosevelt, initially cooperated to try to sort out the mess of failed banks.
Until the crisis, many Republicans seemed stumped about Mr. McCain’s potential candidates for Treasury secretary, reflecting the fact that he has been little involved in fiscal and economic issues during his years in Congress.
Also, some Republicans privately lament that their bench is shallower than it should be for the historically pro-business party. The least regarded Treasury secretaries of recent decades have been Republicans, including Mr. Bush’s first two, the businessmen Paul H. O’Neill and John W. Snow. The Bush White House controlled policy, sidelining both men and diminishing their authority domestically and abroad.
Mr. McCain has not indicated whether he might keep Mr. Paulson.
Speculation about a McCain Treasury secretary now centers on Robert B. Zoellick, 55, who was a top McCain policy adviser before he took his current job as president of the World Bank. Mr. Zoellick was a deputy secretary of state and the United States trade representative in the Bush administration, and before that a director of Goldman Sachs.
Also mentioned is John A. Thain, 53, the former chairman of the New York Stock Exchange who has raised about $500,000 for the McCain campaign. He became chief executive of Merrill Lynch in December and this month orchestrated the bank’s buyout by Bank of America. Republicans close to Mr. McCain say Mr. Thain was in that job too short a time to be blamed for Merrill’s financial troubles.
What is it about former Goldman Sachs executives or old Financial Guru buddies? Why do Republicans lean on them? Oh, they raise a lot of money for Republican hairbrained schemes. Goldman is a primary dealer in the U.S. Treasury securities market. They’ve been selling US Treasuries to China and other foreign investors. Paulson, credentials and all, is doing just what Bush had planned. He is using the classic ‘used car salesman’ technique of focusing on urgency so that closer scrutiny is not allowed. Bush’s Armageddon Envy had a back up plan after all. If he failed to start the war with Iran, plan B, crash global economy. Another Great Depression will have a similar Armageddon effect as an Iranian War. These are this administrations OTHER buddies. If you can’t make your Military Industrial Complex richer, then make your money moguls richer, all at TAXPAYER expense!. There is a lot of history here. Understanding the roots of this crisis may allow you to make life saving adjustments to your decisions. The fogged window, that has been the past eight years, must be broken. This administration has depended on a somnambulistic public to agree to anything they cook up. With the American public scrutiney out of the picture, it is too enticing to become addicted to the lure of ABSOLUTE POWER. No leader in history has been strong enough to resist grabbing ABSOLUTE POWER, even when it was offered up on a plate of blood, sweat and tears.
|By Rob Reynolds, Al Jazeera’s senior Washington correspondent|
The roots of the panic in financial markets around the world are deep and complex but they lie in the convergence of three factors.
Millions of people pursuing the “American dream” of home ownership, politicians and regulators who dismantled a system of financial safeguards and then ignored warnings of impending disaster and financial markets and institutions disregarding risk in their headlong pursuit of profit.
Let’s go back to the beginning — or at least to the year 2000 – when the ‘Dotcom’ boom went bust.
That drove down stocks and sparked a recession and then came the attacks of September 11, 2001 – a body blow to the US economy.
To hasten economic recovery, the US central bank, the Federal Reserve headed by Alan Greenspan, used the most powerful weapon in its arsenal — it cut interest rates repeatedly.
Lower rates made it easier for banks to lend and consumers to borrow and spend.
“It did stimulate the economy,” says Clyde Prestowitz, the head of the Economic Strategy Institute.
“And it stimulated housing, because effectively the cost of investment was negative, you could borrow money for virtually nothing.”
Home-ownership is the bedrock of the “American dream”.
US tax laws encourage home ownership by allowing people to deduct the interest they pay on their mortgages.
And government-sponsored financial institutions like Fannie Mae and Freddie Mac contributed by underwriting mortgages and making it easier for people of modest means to put down the money for a home.From around 2001 and 2002, with mortgage interest rates at near-record lows, millions of Americans went shopping for homes.
With demand soaring, the price of housing nearly doubled from 2000 to 2006.
But many of those buyers couldn’t really afford what they were getting, Prestowitz says.
“They wanted to buy a house and it’s understandable, they wanted a piece of the dream and the mortgage industry was encouraging them to buy.
“It got to the point where the brokers were offering mortgages to people who had little or no income, who somehow thought they could put these payments together.”
Sensing a potential bonanza, banks and mortgage companies began peddling loans to riskier segments of the population — especially low-income first time homebuyers.
These were called “sub-prime” mortgages.
“Many of the mortgages were adjustable-rate mortgages,” Prestowitz explains.
“They were built so that in the first year your interest rate was low, but somewhere down the road, your interest rate jumped.”
But something else was at work as the housing bubble grew: The US government, under the sway of the free-market, anti-regulation ideology, had begun to systematically dismantle rules and regulations established after the Great Depression of the 1930s.