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HERE COMES RAIN AGAIN POLICY the THE POLICY OF THE WORLD MARCH 2011 http://www.diginow.net ISSUE III
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HERE COMES
RAIN AGAIN
POLICYthe
THE POLICY OF THE WORLD MARCH 2011 http://www.diginow.net
ISSUE
III
Coalition Powers25 in general
United StatesFranceBritainCanadaItaly“To protect Libyancivilians!” The sameprotection was offeredto the millionsof Bosnians,Somalians, Koreans,Vietnamese,Afghans and Iraqiswho have beenkilled by their ‘protectors’over the lastseventy years.
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011
JAPON ARMY ATTENDS CO-ALITION POW-ERS TO HIT LIB-YA ALTHOUGH HUGE DEVESTA-TION IN THEIR COUNTRY BY RECENT EARTH-QUAKE !
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The PO
LICY
Will banksters get away with it?Wall Street crime goes deeper: The system means prosecutors fail to jail corporate criminals. Danny Schechter
Hats off to Matt Taibbi for staying on the Wall Street
crime beat, asking in his most recent report in Roll-
ing Stone: “Why Isn’t Wall Street in Jail?”
“Financial crooks,” he argues, “brought down the
world’s economy — but the feds are doing more to
protect them than to prosecute them.”
True enough, but that’s only part of the story. The
Daily Kos called his investigation a “depressing
read” perhaps because it suggests that the Obama
Administration is not doing what it should to reign
in financial crime. Many of the lawyers he calls on
to act come from big corporate law firms and buy
into their worldview.
Kos should be more depressed by the failure of the
progressive community to focus on these issues,
and not pressing the government to do the right
thing.
There is much more to this story. It’s also more
about institutions than individuals, more about a
captured system that enables and covers up crime
and, then, deflects attention away from the deeper
problem.
Ten problems
You could see that when television host Bill Mahrer
pressed Taibbi to name the biggest Wall Street
crooks, on his weekly political comedy show,
he didn’t fully understand what we are really up
against.
Here are ten of well-planned but flawed factors that
help explain the procrastination and rationalisation
for inaction. The government is not just to blame
either. Several industries working together, through
their firms associations, and well-paid operatives,
collaborated over years to financialise the economy
to their own benefit.
Personalising bad guys makes for good TV without
offering a real explanation.
When financial institutions and services became
the dominant economic sector, they, effectively,
took over the political system to fortify their power.
It was a done incrementally, over years, with savvy,
foresight and malice.
First, many of those who might be charged with fi-
nancial crimes and fraud invested in lobbying and
political donations to insure that tough regulations
and enforcement were neutered before the housing
bubble they promoted took off.
After hundreds of bankers were jailed in the wake
of the Savings and Loan crisis, financial fraudsters
pushed for weakened regulations, guaranteeing
that their colleagues wouldn’t be jailed in when the
next crisis hit.
In effect, their deregulation strategy also deliber-
ately “decriminalised” the environment to make
sure that practices that led to high profits and low
accountability would be permissible and permitted.
What was once illegal soon became “legal”.
No enforcement
The cops and watchdogs were taken off the beat.
Anticipating and then dissolving restraints, they
engineered a low-risk crime scene in the way the
Pentagon systematically prepares its battlefields.
This permitted illicit practices, to be encouraged by
CEOs in a variety of control frauds to keep profits
up so that the executives could extract more rev-
enue.
Today’s proposed Republican cutbacks of the fund-
ing of regulatory bodies aims to undercut recently
passed financial reforms. One Commissioner of the
Commodity Futures Trading Commission said if the
budget is slashed, “there would essentially be no
cop on the beat...we could once again risk another
calamitous disintegration.” He added, according to
a New York Times report, “the process will mean
nothing, squat, diddley … if we get cut we’re going
to be in a world of hurt.”
Second, the industry invented, advertised and ra-
tionalised exotic financial instruments as forward
looking “innovation” and “modernisation” to dis-
guise their intent while enhancing their field to ma-
neuver.
This was part of creating a shadow banking system
operating below the radar of effective monitoring
and regulation. Where is the focus on controlling
the out of control power of the leverage-hungry
gamblers at unregulated hedge funds?
Third, the industry promulgated economic theories
and ideologies that won the backing of the econom-
ics profession which largely did not see the crisis
coming, making those who favored a crackdown
on fraud appear unfashionable and out of date.
As economist James Galbraith testified to Con-
gress: “…the study of financial fraud received little
attention. Practically no research institutes exist;
collaboration between economists and criminolo-
gists is rare; in the leading departments there are
few specialists and very few students. Economists
have soft-pedaled the role of fraud in every crisis
they examined, including the Savings & Loan deba-
cle, the Russian transition, the Asian meltdown and
the dot.com bubble. They continue to do so now.”
Fourth, prominent members of the financial ser-
vices industry were appointed to top positions in
the government agencies that should have cracked
down on financial crime, but instead looked the
other way. The foxes were indeed guarding the
chicken coop guiding institutions that tolerated if
not enabled an environment of criminality.
Alan Greenspan and Ben Bernanke were repeat-
edly warned by underlings at the Federal Reserve
Bank about pervasive predatory practices in the
mortgage and Subprime markets and they chose
to do nothing. Now Greenspan acknowledges per-
vasive fraud but decries the lack of enforcement
while Bernanke wants to run a Consumer Protec-
tion Agency after ignoring consumer complaints for
years. Even as the FBI denounced “an epidemic of
mortgage fraud” in 2004, their white-collar crime
units were downsized.
Fifth, the media has been complicit, seduced,
bought off and compromised. The housing bubble
mushroomed in the very period that the media was
forced to downsize. Dodgy lenders and credit card
companies pumped billions into advertising in ra-
dio, television and the internet almost insuring that
there would no undue media investigations.
Financial journalists increasingly embedded them-
selves in the culture and narrative of Wall Street
by hyping stocks and CEOs. The “guests” routinely
chosen by media outlets to explain the crisis were
often part of it.
Foxes guarding the chicken coop
6
The PO
LICY
Mar
ch 2
011
“Many of the ‘experts’ whom I read or see on TV
seem clueless, [and] full of hot air. Many of their
predictions turn out wrong even when they seem
so self-assured and well-informed in making them,”
writes Jim Hightower,
His advice: “Don’t be deterred by the finance indus-
try’s jargon (which is intended to numb your brain
and keep regular folks from even trying to figure out
what’s going on).”
Sixth, politicians and corporate lawyers fashioned
settlements of abuses that were exposed rather
than prosecutions. The government benefited by
getting large fines while businessmen avoided jail.
Financial executives were often rewarded with bo-
nuses and huge compensation for practices that
skirted or crossed the line of criminality.
Intentional violations of the spirit and letter of laws
were justified because “everyone does it” by high
priced legal firms that often doubled as lobby-
ists. Conflicts of interest were sneered at. Judges,
dependent on industry donations for reelection
looked the other way.
Seventh, as the economy changed and industries
that were once separated began working togeth-
er, laws were not updates. Financial institutions
worked closely with Insurance companies and real
estate firms. Yet law enforcement did not recog-
nised this new reality.
Financial crime was still seen almost entirely under
the framework of securities laws that are designed
to protect investors, not workers or homeowners
who suffered far more in the collapse. Cases are
framed against individuals with a high standard of
proving intent, not under other kinds of laws used
to prosecute organised crime and conspiracies.
By defining crimes narrowly, prosecutions became
few and far between.
“Cases against Wall Street executives can be dif-
ficult to prove to the satisfaction of a jury because of
the mind-numbing volume of emails, prospectuses,
and memos involved in documenting a case,” Re-
uters news agency reported.
Criminal minds
Convicted financial criminal Sam Antar who ap-
pears in my film Plunder is contemptuous of how
government tends to proceed in these cases, in
part because they don’t seem to understand how
calculated these crimes and their cover-ups are.
“Our laws—innocent until proven guilty, the codes
of ethics that journalists like you abide by limit your
behavior and give the white-collar criminal freedom
to commit their crimes, and also to cover up their
crimes,” he said.
“We have no respect for the laws. We consider
your codes of ethics, and your laws, weaknesses
to be exploited in the execution of our crimes. So
the prosecutors, hopefully most prosecutors, are
honest if they’re playing by the set of the rules;
they’re hampered by the illegal constraints. The
white-collar criminal has no legal constraints. You
subpoena documents, we destroy documents;
you subpoena witnesses, we lie. So you are at a
disadvantage when it comes to the white-collared
criminal. In effect, we’re economic predators. We’re
serial economic predators; we impose a collective
harm on society, time is always on our side, not on,
not on the side of justice, unfortunately.”
Eighth, even as the economy globalises, and US fi-
nancial firms spread their footprint worldwide, there
was little internationalisation of financial rules and
regulations.
Today, even as the French and the Germans pro-
pose such rules, Washington still opposes a tough
global regime of codes of conduct.
Overseas, in Greece and England, and other
parts of Europe, there has been an indictment of
American corporate predators, especially Goldman
Sachs. They are being denounced as “financial
terrorists” and discussed in terms of their links to
various elite business formations like the Bilderberg
Group.
Ninth, With the exception of softball inquiries by a
financial crisis inquiry commission, there has been
no intensive investigations in the United States
even like the tepid 9/11 Commission.
While Senator Carl Levin of Michigan did spend a
day aggressively grilling Goldman Sachs on one
deceptive practice, their defense was more telling
about the real nature of the problem: “everyone did
it”.
The case for criminality has still not achieved critical
mass as an issue to become a dominant explana-
tion for why the economy collapsed. In fact, it is still
being sneered at or ignored.
Finally, tenth, a big problem in my countdown, are
the progressive critics of the crisis who also largely
ignore criminality as a key factor and possible focus
for an organizing effort.
They treat the crisis as if they are at a financial
seminar at Harvard, focusing on the complexities
of derivatives, credit default swaps and structured
financial products in language that ordinary people
rarely can penetrate. They argue that banks should
not be too big to fail, but rarely they are not too
big to jail.
Few progressive activist groups stress the immo-
rality of these practices, much less their criminality
after all these years! There is little active solidarity
even in the progressive community with the newly
homeless or jobless.
Where is the active empathy, compassion and the
caring for the victims of the financial crimes?
A populist response to the crisis has been muted.
There is little pressure from below on the Admin-
istration and Justice Department—which has now
created a financial crimes task force—to take real
action. It is as if this crime crisis within the financial
crisis does not exist.
Curiously, as they refuse to discuss the pervasive
fraud that did occur, the Obama administration is
considering a “global settlement” of all housing
fraud to get the issue off the table. They a propos-
ing a $20bn dollar deal to bury the problem.
By all means, workers should rally to protect their
jobs and pensions as they have in Wisconsin, but
they should realise that it is the banks who are ulti-
mately to blame for the financial pressures behind
the attack on them. Pension funds have lost billions
because of Wall Street scams. State governments
have taken a big hit.
Why have the unions and leftist groups been mostly
silent on these issues?
Even after the markets melted down, even after Wall
Street bonus scandals and bailout disgraces, Wall
Street has hardly been humbled. It is still spending
a fortune on PR and political gun slinging with 25
lobbyists shadowing every member of Congress to
scuttle real reform.
Its arrogance is evident in an email the Financial
Times reported was “pinging around” trading
desks. It reads in part:
“We are Wall Street: It’s our job to make money.
Whether it’s a commodity, stock, bond, or some
hypothetical piece of fake paper, it doesn’t mat-
7
ww
w.di
gino
w.ne
t
ter. We would trade baseball cards if it were profit-
able… Go ahead and continue to take us down, but
you’re only going to hurt yourselves. What’s going
to happen when we can’t find jobs on the Street
anymore? Guess what: We’re going to take yours...
We aren’t dinosaurs. We are smarter and more vi-
cious than that, and we are going to survive.”
Perhaps it’s not surprising, that in an act of preemp-
tive anticipation, some years ago, Wall Street firms
began financing the construction and administra-
tion of privatised jails. They know how to profit from
incarceration too.
When will we call a crime a crime? When will we
demand a jail-out, not just more bail-outs. Unless
we do, and until we do, the people who created the
worst crisis in our time will, in effect, get away with
the biggest rip-off in history.
News Dissector Danny Schechter made the film
Plunder The Crime of our Time. Parts of this essay
appear in his companion book The Crime of Our
Time (Disinfo Books).
Hats off to Matt Taibbi for staying on the Wall Street
crime beat, asking in his most recent report in Roll-
ing Stone: “Why Isn’t Wall Street in Jail?”
“Financial crooks,” he argues, “brought down the
world’s economy — but the feds are doing more to
protect them than to prosecute them.”
True enough, but that’s only part of the story. The
Daily Kos called his investigation a “depressing
read” perhaps because it suggests that the Obama
Administration is not doing what it should to reign
in financial crime. Many of the lawyers he calls on
to act come from big corporate law firms and buy
into their worldview.
Kos should be more depressed by the failure of the
progressive community to focus on these issues,
and not pressing the government to do the right
thing.
There is much more to this story. It’s also more
about institutions than individuals, more about a
captured system that enables and covers up crime
and, then, deflects attention away from the deeper
problem.
Ten problems
You could see that when television host Bill Mahrer
pressed Taibbi to name the biggest Wall Street
crooks, on his weekly political comedy show,
he didn’t fully understand what we are really up
against.
Here are ten of well-planned but flawed factors that
help explain the procrastination and rationalisation
for inaction. The government is not just to blame
either. Several industries working together, through
their firms associations, and well-paid operatives,
collaborated over years to financialise the economy
to their own benefit.
Personalising bad guys makes for good TV without
offering a real explanation.
When financial institutions and services became
the dominant economic sector, they, effectively,
took over the political system to fortify their power.
It was a done incrementally, over years, with savvy,
foresight and malice.
First, many of those who might be charged with fi-
nancial crimes and fraud invested in lobbying and
political donations to insure that tough regulations
and enforcement were neutered before the housing
bubble they promoted took off.
After hundreds of bankers were jailed in the wake
of the Savings and Loan crisis, financial fraudsters
pushed for weakened regulations, guaranteeing
that their colleagues wouldn’t be jailed in when the
next crisis hit.
In effect, their deregulation strategy also deliber-
ately “decriminalised” the environment to make
sure that practices that led to high profits and low
accountability would be permissible and permitted.
What was once illegal soon became “legal”.
No enforcement
The cops and watchdogs were taken off the beat.
Anticipating and then dissolving restraints, they
engineered a low-risk crime scene in the way the
Pentagon systematically prepares its battlefields.
This permitted illicit practices, to be encouraged by
CEOs in a variety of control frauds to keep profits
up so that the executives could extract more rev-
enue.
Today’s proposed Republican cutbacks of the fund-
ing of regulatory bodies aims to undercut recently
passed financial reforms. One Commissioner of the
Commodity Futures Trading Commission said if the
budget is slashed, “there would essentially be no
cop on the beat...we could once again risk another
calamitous disintegration.” He added, according to
a New York Times report, “the process will mean
nothing, squat, diddley … if we get cut we’re going
to be in a world of hurt.”
Second, the industry invented, advertised and ra-
tionalised exotic financial instruments as forward
looking “innovation” and “modernisation” to dis-
guise their intent while enhancing their field to ma-
neuver.
This was part of creating a shadow banking system
operating below the radar of effective monitoring
and regulation. Where is the focus on controlling
the out of control power of the leverage-hungry
gamblers at unregulated hedge funds?
Third, the industry promulgated economic theories
and ideologies that won the backing of the econom-
ics profession which largely did not see the crisis
coming, making those who favored a crackdown
on fraud appear unfashionable and out of date.
As economist James Galbraith testified to Con-
gress: “…the study of financial fraud received little
attention. Practically no research institutes exist;
collaboration between economists and criminolo-
gists is rare; in the leading departments there are
few specialists and very few students. Economists
have soft-pedaled the role of fraud in every crisis
they examined, including the Savings & Loan deba-
cle, the Russian transition, the Asian meltdown and
the dot.com bubble. They continue to do so now.”
Fourth, prominent members of the financial ser-
vices industry were appointed to top positions in
the government agencies that should have cracked
down on financial crime, but instead looked the
other way. The foxes were indeed guarding the
chicken coop guiding institutions that tolerated if
not enabled an environment of criminality.
Alan Greenspan and Ben Bernanke were repeat-
edly warned by underlings at the Federal Reserve
Bank about pervasive predatory practices in the
mortgage and Subprime markets and they chose
to do nothing. Now Greenspan acknowledges per-
vasive fraud but decries the lack of enforcement
while Bernanke wants to run a Consumer Protec-
tion Agency after ignoring consumer complaints for
years. Even as the FBI denounced “an epidemic of
mortgage fraud” in 2004, their white-collar crime
units were downsized.
Fifth, the media has been complicit, seduced,
bought off and compromised. The housing bubble
mushroomed in the very period that the media was
forced to downsize. Dodgy lenders and credit card
companies pumped billions into advertising in ra-
dio, television and the internet almost insuring that
8
The PO
LICY
Mar
ch 2
011
there would no undue media investigations.
Financial journalists increasingly embedded them-
selves in the culture and narrative of Wall Street
by hyping stocks and CEOs. The “guests” routinely
chosen by media outlets to explain the crisis were
often part of it.
Foxes guarding the chicken coop
“Many of the ‘experts’ whom I read or see on TV
seem clueless, [and] full of hot air. Many of their
predictions turn out wrong even when they seem
so self-assured and well-informed in making them,”
writes Jim Hightower,
His advice: “Don’t be deterred by the finance indus-
try’s jargon (which is intended to numb your brain
and keep regular folks from even trying to figure out
what’s going on).”
Sixth, politicians and corporate lawyers fashioned
settlements of abuses that were exposed rather
than prosecutions. The government benefited by
getting large fines while businessmen avoided jail.
Financial executives were often rewarded with bo-
nuses and huge compensation for practices that
skirted or crossed the line of criminality.
Intentional violations of the spirit and letter of laws
were justified because “everyone does it” by high
priced legal firms that often doubled as lobby-
ists. Conflicts of interest were sneered at. Judges,
dependent on industry donations for reelection
looked the other way.
Seventh, as the economy changed and industries
that were once separated began working togeth-
er, laws were not updates. Financial institutions
worked closely with Insurance companies and real
estate firms. Yet law enforcement did not recog-
nised this new reality.
Financial crime was still seen almost entirely under
the framework of securities laws that are designed
to protect investors, not workers or homeowners
who suffered far more in the collapse. Cases are
framed against individuals with a high standard of
proving intent, not under other kinds of laws used
to prosecute organised crime and conspiracies.
By defining crimes narrowly, prosecutions became
few and far between.
“Cases against Wall Street executives can be dif-
ficult to prove to the satisfaction of a jury because of
the mind-numbing volume of emails, prospectuses,
and memos involved in documenting a case,” Re-
uters news agency reported.
Criminal minds
Convicted financial criminal Sam Antar who ap-
pears in my film Plunder is contemptuous of how
government tends to proceed in these cases, in
part because they don’t seem to understand how
calculated these crimes and their cover-ups are.
“Our laws—innocent until proven guilty, the codes
of ethics that journalists like you abide by limit your
behavior and give the white-collar criminal freedom
to commit their crimes, and also to cover up their
crimes,” he said.
“We have no respect for the laws. We consider
your codes of ethics, and your laws, weaknesses
to be exploited in the execution of our crimes. So
the prosecutors, hopefully most prosecutors, are
honest if they’re playing by the set of the rules;
they’re hampered by the illegal constraints. The
white-collar criminal has no legal constraints. You
subpoena documents, we destroy documents;
you subpoena witnesses, we lie. So you are at a
disadvantage when it comes to the white-collared
criminal. In effect, we’re economic predators. We’re
serial economic predators; we impose a collective
harm on society, time is always on our side, not on,
not on the side of justice, unfortunately.”
Eighth, even as the economy globalises, and US fi-
nancial firms spread their footprint worldwide, there
was little internationalisation of financial rules and
regulations.
Today, even as the French and the Germans pro-
pose such rules, Washington still opposes a tough
global regime of codes of conduct.
Overseas, in Greece and England, and other
parts of Europe, there has been an indictment of
American corporate predators, especially Goldman
Sachs. They are being denounced as “financial
terrorists” and discussed in terms of their links to
various elite business formations like the Bilderberg
Group.
Ninth, With the exception of softball inquiries by a
financial crisis inquiry commission, there has been
no intensive investigations in the United States
even like the tepid 9/11 Commission.
While Senator Carl Levin of Michigan did spend a
day aggressively grilling Goldman Sachs on one
deceptive practice, their defense was more telling
about the real nature of the problem: “everyone did
it”.
The case for criminality has still not achieved critical
mass as an issue to become a dominant explana-
tion for why the economy collapsed. In fact, it is still
being sneered at or ignored.
Finally, tenth, a big problem in my countdown, are
the progressive critics of the crisis who also largely
ignore criminality as a key factor and possible focus
for an organizing effort.
They treat the crisis as if they are at a financial
seminar at Harvard, focusing on the complexities
of derivatives, credit default swaps and structured
financial products in language that ordinary people
rarely can penetrate. They argue that banks should
not be too big to fail, but rarely they are not too
big to jail.
Few progressive activist groups stress the immo-
rality of these practices, much less their criminality
after all these years! There is little active solidarity
even in the progressive community with the newly
homeless or jobless.
Where is the active empathy, compassion and the
caring for the victims of the financial crimes?
A populist response to the crisis has been muted.
There is little pressure from below on the Admin-
istration and Justice Department—which has now
created a financial crimes task force—to take real
action. It is as if this crime crisis within the financial
crisis does not exist.
Curiously, as they refuse to discuss the pervasive
fraud that did occur, the Obama administration is
considering a “global settlement” of all housing
fraud to get the issue off the table. They a propos-
ing a $20bn dollar deal to bury the problem.
By all means, workers should rally to protect their
jobs and pensions as they have in Wisconsin, but
they should realise that it is the banks who are ulti-
mately to blame for the financial pressures behind
the attack on them. Pension funds have lost billions
because of Wall Street scams. State governments
have taken a big hit.
Why have the unions and leftist groups been mostly
silent on these issues?
Even after the markets melted down, even after Wall
Street bonus scandals and bailout disgraces, Wall
Street has hardly been humbled. It is still spending
9
ww
w.di
gino
w.ne
t
While Bernie Madoff languishes in jail, bankers continue
to profit as the poor lose their homes
and hope.
a fortune on PR and political gun slinging with 25
lobbyists shadowing every member of Congress to
scuttle real reform.
Its arrogance is evident in an email the Financial
Times reported was “pinging around” trading
desks. It reads in part:
“We are Wall Street: It’s our job to make money.
Whether it’s a commodity, stock, bond, or some
hypothetical piece of fake paper, it doesn’t mat-
ter. We would trade baseball cards if it were profit-
able… Go ahead and continue to take us down, but
you’re only going to hurt yourselves. What’s going
to happen when we can’t find jobs on the Street
anymore? Guess what: We’re going to take yours...
We aren’t dinosaurs. We are smarter and more vi-
cious than that, and we are going to survive.”
Perhaps it’s not surprising, that in an act of preemp-
tive anticipation, some years ago, Wall Street firms
began financing the construction and administra-
tion of privatised jails. They know how to profit from
incarceration too.
When will we call a crime a crime? When will we
demand a jail-out, not just more bail-outs. Unless
we do, and until we do, the people who created the
worst crisis in our time will, in effect, get away with
the biggest rip-off in history.
News Dissector Danny Schechter made the film
Plunder The Crime of our Time. Parts of this essay
appear in his companion book The Crime of Our
Time (Disinfo Books).
10
The PO
LICY
Mar
ch 2
011
Thank you, Bernie, for breaking your silence - even if you are still clinging
to that cover-up mode you adopted since you took the entirety of the blame for your crimes.
What is clear is that ripping off the rich is punished far more severely than ripping off the poor. The lengthy sentence you were given spared countless other greedsters and goniffs from facing the music - what music there is.
In an interview - with a reporter from The New York Times who is writing a book to cash in on a man who has already cashed out - we learn, in the vaguest terms, that Mr M believes the banks he did his crooked business with “should have known” his fig-ures did not figure. Keeping with the deceit that has served him well over the years, he names no names.
That said, how right he may be. There were many who should have known and done something about it. The Securities and Exchange Commission (SEC) and other regulators for one. Perhaps The New York Times for another. Remember, it was Madoff’s confession to his sons that started him on his way to his new 12’ x 12’ home from home - in a federal correctional in-stitute, where he may dream of his seized penthouse, homes and yachts - rather than any press expose.
For years, he went undetected by business journalists, who knew - or should have known - what he was up to. There are even questions about the speed with which he was sentenced, preventing him from being tried - a process which, through diligent cross-examination, would have brought
us more information on the details of his dirty deals.
Do not believe all you readEven The New York Times interview is be-ing disputed, reports the New York Post: “The trustee representing thousands of Bernard Madoff’s victims disputed a report that he personally grilled the Ponzi mon-ster in prison.”
“There has been no direct communica-tion between them,” said David Sheehan, the chief counsel for the court-appointed trustee, Irving Picard, after The New York Times reported that Picard and Madoff had met over the summer.
“The Times later changed a quote from Madoff and altered some text online that had implied Picard personally visited Ber-nie in the Butner, NC, lockup where he is serving a 150-year sentence. Picard did not dispute that his legal team met with Madoff.”
Madoff is also still not coming clean about the web of alliances he had internationally, as well as in New York. We live in a global economy after all. We now know of Swiss and Austrian connections - but what about Israel, where this ingratiating handler was well known for his connections with Jew-ish philanthropists and institutions? So far, that story has yet to be told.
At the same time, the people investigating Madoff are making a small fortune. Accord-ing to the Financial Times: “The army of lawyers and consultants helping to recover funds from Bernard Madoff’s $19.6bn fraud stand to earn more than $1.3bn in fees, ac-
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cording to new figures that detail the cost of liquidating the huge Ponzi scheme.”
The comments of readers to The Times ap-pear to be more insightful than the paper’s own reports. Here is one from Texas: “I ac-tually, sort of, feel sorry for this man. He was just doing what many investment firms were doing at the same time. He has been imprisoned as a scapegoat - yet many peo-ple since then - and to this day - are doing the same thing. Where are the indictments against the thousands of other people who did the same thing - and knowingly led this country into financial disaster?”
Banks close ranksThe best reporting on this subject is not in the mainstream press but in a music maga-zine, Rolling Stone, where Matt Taibbi in-vestigates why the whole of Wall Street is not in jail: “Financial crooks brought down the world’s economy - but the feds are do-ing more to protect them than to prosecute them,” he charges.
Madoff also believes the banks who ser-viced him did not want to know about his Ponzi scheme which, unfortunately, is probably true - and an attitude coming not just from the banks.
The Times report added: “He spoke with great intensity and fluency about his deal-ings with various banks and hedge funds, pointing to their ‘willful blindness’ and their failure to examine discrepancies be-tween his regulatory filings and other in-formation available to them.
“’They had to know,’ Mr Madoff said. ‘But the attitude was sort of: “If you’re do-
ing something wrong, we don’t want to know.”’”
Yves Smith of NakedCapitalism.com quips: “This sounds credible - but it also seems more than a tad self-serving.”
Andrew Leonard asks in Salon: “Should we trust him? After all, if there is one thing we know about Bernie Madoff, it is that he is one hell of a liar. But as evidence emerg-es that bank executives were exchanging emails wondering about Madoff’s amazing investment record, the possibility that the banks were purposefully looking the other way is not inconceivable.”
The truth is that many of us still do not re-ally want to know - because, if we did, we would have to do something about it.
By their actions, both Democrats and Re-publicans clearly appear to prefer the most simplistic understandings - or misunder-standings.
The Financial Crisis Inquiry Commission (FCIC), like the 9/11 and Warren Com-missions before it, avoided key issues. The FCIC inquiry did not call for a criminal indictment of wrongdoers. While informa-tive, its report was ultimately a dud - telling us mostly what we knew, although there were some disclosures that our tepid press still missed.
Now the Republicans want to water down the regulations on derivatives in the Dodd-Frank financial ‘reform’ legislation, claim-ing they will lead to a loss of jobs. This is predictable: Every effort to defend big busi-ness is always couched in terms of helping the public.
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The New York Times reported: “Represen-tative Stephen Lynch, Democrat of Mas-sachusetts, warned: ‘You think regulation is costly? How about the $7trillion we just lost from not regulating the derivatives markets?’”
There was no response from his colleagues.
So who will do anything about it?The political right prefers to change the subject, while the left does not seem to have the time or energy to make economic justice its principal concern - even as polls show the economy is the number one prob-lem for most in the US.
Progressives should hang their heads in shame at the minimal amount of activism taking place against the banks and the es-calating numbers of foreclosures. Homes and hope are being stolen from people for whom the term “depression” now has a personal, as well as economic, meaning.
The other day, economist Jeff Sachs - who has a lot of atoning to do for his own mis-guided, destructive economic advice to Russia after the fall of the Soviet Union - warned that little is being done about eco-nomic inequity and the growing ranks of the poor in the US. He asks if people who run things in the US want “another Egypt”. He is a policy wonk, not an activist - and likely fears the idea.
Many activists say they want to emulate the Egyptians, but who will organise anything as effective - even in a land that used to be known for people’s movements - to raise hell? In Egypt, young people used the in-
ternet to organise and mobilise for change. In the US, the internet seems to function more as an escape valve, consuming hours of our time and giving us another way to talk to each other - and ventilate against the government. Social media here seems to be more for socialising.
The government supports internet freedom abroad - but restricts it and spies on it at home. Obama has already supported a law allowing him to shut it down here in a na-tional emergency.
The passivity of the public is one result of the inundation by middle-of-the-road me-dia and effective information deprivation.
As Noam Chomsky puts it: “The popula-tion in the United States is angry, frustrat-ed and full of fear and irrational hatreds. And the folks not far from you on Wall Street are just doing fine. They’re the ones who created the current crisis. They’re the ones who were called upon to deal with it. They’re coming out stronger and richer than ever. But everything’s fine - as long as the population is passive.”
That is our problem, Bernie. Even if the people want to know, it is not that easy to find out. Let us thank the media and our government for that.
News dissector Danny Schechter edits Me-diachannel.org. His new film, Plunder: The Crime of Our Time, tells the story of the financial crisis as a criminal tale.
He can be reached at:[email protected]
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WHO CONTROLS YOU?
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Perhaps you’re familiar with Clarence Thomas, the Long-Dong-Silver-loving US Su-
preme Court Justice. With a new term beginning on The Court, he has just passed the five-year mark for not only saying nothing of val-ue while hearing cases, but noth-ing at all.
Yes, you read that correctly—while no US Supreme Court Jus-tice in over two centuries has gone even a single term without speak-ing from the bench during argu-ments, Thomas has managed to do it for five in a row.
To quote Stephen Colbert, “the man is a rock…in that he could be replaced by a rock and I’m not sure anyone would notice.”
Sadly, it shouldn’t really come as much of a surprise that if some-one were going to set this record, it would be Justice Thomas. He
certainly never even approached being “the most qualified” person in the land to sit on the Supreme Court, as President George H.W. Bush, who nominated him to the High Court, said after offering his name.
I’m quite sure that Bush didn’t even believe that himself, unless he was limiting the field of com-petition to Thomas, then-vice president Dan Quayle, and his namesake offspring. But if he was clearly unworthy then—and he was—he is now about as appropri-ate a judge as Newt Gingrich is a marriage counselor.
Politicised justiceWhile he doesn’t seem to even want to participate in his day job, Thomas certainly does engage in the kind of partisan politicking that is not only unseemly, but sets
a terrible precedent in a democra-cy. And at least in theory, the judi-ciary is supposed to be impartial, and therefore above politics.
Yet, in only the past few weeks, a number of embarrassing episodes have not only turned the Legal Tracheotomy into a punch line for late night comics, but have quite honestly raised questions about whether any fully-functioning democracy would allow him to continue rendering judgments so important in deciding not only the law, but values of our society.
First, there was the fact that Thom-as, whose wife has earned almost $700,000 for—as far as I can tell—being his wife, finds government disclosure forms to difficult to fill out that he accidentally put $0 where $700,000 was supposed to be under “spousal income”.
That’s right, for a guy who is sup-
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posed to decide how to interpret our Constitution, apparently reporting the bounty his wife pulled in through the right-wing welfare system of think tank sti-pends and Tea Party activism is somewhat more difficult than making jokes about body hair and coca cola to co-workers of a female persuasion. As this is a family news outlet, you’re just going to have to go look up the rest yourself.
But wait, there’s more! As report-ed over the past week, the good-government group Common Cause has caught ole Clarence in what those in the legal profession might call a “lie”.
Monied interestsThomas attended a meeting of wealthy corporate barons on the West Coast, not long before join-ing his fellow deluded, activist conservative judges in overturn-ing roughly 100 years of settled law to claim that corporations should be able to buy and sell de-mocracy on the free market, like equities or an Emmy.
And as such, these corporate “people” can spend pretty much whatever they want on election-eering, a wonderful little valen-tine to a republic that is supposed to be defined by “one person, one vote”.
The problem, of course, is those wealthy conservatives with whom Thomas ate pigs-in-a-blanket and likely fantasised about replacing the social safety net with breakaway glass stood to directly benefit from these changes to our law, contained in the infamous Citizens United case.
So Thomas went ahead and lied about how much time he spent at that retreat held by the infamous Koch Brothers, the sugar daddies
of the supposedly power-to-the-people Tea Party movement. While according the The New York Times, “a court spokes-woman said Justice Thomas had made a ‘brief drop-by’ at the event in Palm Springs, Califor-nia, in January 2008 and had given a talk,” in that darn finan-cial disclosure report that keeps getting him in trouble, Thomas reported that he was reimbursed by the right-wing Federalist So-ciety for having spent “four days” at this very same event.
Four days, or a few hours? You say tomato. I say tomahto.
Past performanceThis is all on top of all the rea-sons he never should have made it to the Supreme Court in the first place, such as sexually ha-rassing Anita Hill and appar-ently other young women who’ve come forward in the years since.
Along these lines, a couple of in-teresting anecdotes were recently shared with me by famed attor-ney Guy Saperstein, who started the largest plaintiffs civil rights law firm in America and success-fully prosecuted the largest race, sex and age discrimination class actions in American history.
Saperstein was co-counsel with Thomas for a race discrimina-tion case against State Farm back in the 1980s, when he was representing private plaintiffs and Thomas was doing the same for the Equal Employment Op-portunity Commission (EEOC). While Saperstein, as was com-mon practice, wanted to ask the judge for a hiring order, which would solve the problem in the future, Thomas did not. Ideolo-gy, then as now, trumped sound judgment.
Saperstein also recalls attending the American Bar Association
Convention in Florida, shortly after Thomas was nominated to the High Court. Saperstein walked into a reception late, and was called over by a group of the top defense lawyers in the coun-try, whom he had befriended, even though they represented opposite sides in court. These men stood to benefit greatly if Thomas was sworn in, as they represented the kind of big busi-ness interests to which Thomas had sworn fealty.
When they asked Saperstein what he thought of the nomina-tion, he replied that he thought, “it was an insult to every compe-tent lawyer in America.” He ex-pected this notion to be met with an argument, but instead, every single member of this group agreed. Not only that, but to a man, they offered (in public no less) that not one of them would hire him to join their firms, so little did they think of his mind and abilities as a lawyer.
Then Senate Judiciary Chairman and current Vice President Joe Biden, as well as other Democrats who allowed this man to become a member of the Supreme Court should be supremely embar-rassed to this day (as should ev-ery Republican, but I won’t hold my breath on that).
Yet, how about addressing this mistake. Thomas has shown no moral compass, judicial ethics, intellectual rigor and under-standing of his duties. For this, Supreme Court Justice Clarence Thomas should be impeached.
Cliff Schecter is the president of Libertas, LLC, a progressive pub-lic relations firm, the author of the 2008 bestseller The Real Mc-Cain, and a regular contributor to The Huffington Post.
Cliff Schecter On Twitter: @Cliffschecter
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22 February 2011
The death toll from a devastating earthquake in Christchurch, New Zealand’s second biggest city, has risen to 75, up from the previ -
ous total of 65. The city’s mayor Bob Parker said almost 300 people were listed as missing but cautioned that the number trapped in
collapsed buildings was not known. However, 15 survivors who had been trapped in a six-storey office building since Tuesday’s quake
were rescued on Wednesday morning.
Seventy-five people confirmed dead and almoSt 300 miSSing, a day after a 6.3 magnitude tremor rocked chriStchurch
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The death toll from a devastating earthquake in Christchurch, New Zealand’s second biggest city, has risen to 75, up from the previ -
ous total of 65. The city’s mayor Bob Parker said almost 300 people were listed as missing but cautioned that the number trapped in
collapsed buildings was not known. However, 15 survivors who had been trapped in a six-storey office building since Tuesday’s quake
were rescued on Wednesday morning.
Seventy-five people confirmed dead and almoSt 300 miSSing, a day after a 6.3 magnitude tremor rocked chriStchurch
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The Other Side Of The WORLD
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The death toll from a devastating earthquake in Christchurch, New
Zealand’s second biggest city, has risen to 75, up from the pre-
v ious total of 65. The city’s mayor Bob Parker said almost 300
people were listed as missing but cautioned that the number trapped
in collapsed buildings was not known. However, 15 survivors who had
been trapped in a six-storey office building since Tuesday’s quake were
rescued on Wednesday morning.
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The death toll from a devastating earthquake in Christchurch, New Zea-
land’s second biggest city, has risen to 75, up from the previous total
of 65. The city’s mayor Bob Parker said almost 300 people were listed
as missing but cautioned that the number trapped in collapsed buildings
was not known. However, 15 survivors who had been trapped in a six-storey
office building since Tuesday’s quake were rescued on Wednesday morning.
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The Other Side Of The WORLD
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The death toll from a devastating earthquake in Christchurch,
New Zealand’s second biggest city, has risen to 75, up from
the previous total of 65. The city’s mayor Bob Parker said
almost 300 people were listed as missing but cautioned that the
number trapped in collapsed buildings was not known. However,
15 survivors who had been trapped in a six-storey office building
since Tuesday’s quake were rescued on Wednesday morning.
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AFTER THEEARTHQUAKEIN NEWZEALAND
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For decades, even centuries, the peoples of the Arab world have
been told by Europeans and, later, Americans that their societies
were stagnant and backward. According to Lord Cromer, author
of the 1908 pseudo-history Modern Egypt, their progress was “ar-
rested” by the very fact of their being Muslim, by virtue of which
their minds were as “strange” to that of a modern Western man “as
would be the mind of an inhabitant of Saturn”.
The only hope of reshaping their minds towards a more earthly dis-
position was to accept Western tutelage, supervision, and even rule
“until such time as they [we]re able to stand alone,” in the words of
the League of Nations’ Mandate. Whether it was Napoleon claim-
ing fraternité with Egyptians in fin-de-18e-siècle Cairo or George W.
Bush claiming similar amity with Iraqis two centuries later, the mes-
sage, and the means of delivering it, have been consistent.
Ever since Abd al-Rahman al-Jabarti, the great Egyptian chronicler
of the French invasion of Egypt, brilliantly dissected Napoleon’s
epistle to Egyptians, the peoples of the Middle East have seen
through the Western protestations of benevolence and altruism
to the naked self-interest that has always laid at the heart of great
power politics. But the hypocrisy behind Western policies never
stopped millions of people across the region from admiring and
fighting for the ideals of freedom, progress and democracy they
promised.
Even with the rise of a swaggeringly belligerent American foreign
policy after September 11 on the one hand, and of China as a vi-
able economic alternative to US global dominance on the other, the
US’ melting pot democracy and seemingly endless potential for re-
newal and growth offered a model for the future.
Trading places
But something has changed. An epochal shift of historical momen-
tum has occurred whose implications have yet to be imagined, nev-
er mind assessed. In the space of a month, the intellectual, political
and ideological centre of gravity in the world has shifted from the
far West (America) and far East (China, whose unchecked growth
and continued political oppression are clearly not a model for the
region) back to the Middle - to Egypt, the mother of all civilization,
and other young societies across the Middle East and North Africa.
Standing amidst hundreds of thousands of Egyptians in Tahrir
Square seizing control of their destiny it suddenly seemed that our
own leaders have become, if not quite pharaohs, then mamluks,
more concerned with satisfying their greed for wealth and power
than with bringing their countries together to achieve a measure of
progress and modernity in the new century. Nor does China, which
has offered its model of state-led authoritarian capitalist develop-
ment coupled with social liberalisation as an alternative to the de-
veloping world, seem like a desirable option to the people risking
death for democracy in the streets of capitals across the Arab world
and Iran.
Instead, Egyptians, Tunisians and other peoples of the region fight-
ing for revolutionary political and economic change have, without
warning, leapfrogged over the US and China and grabbed history’s
reins. Suddenly, it is the young activists of Tahrir who are the ex-
ample for the world, while the great powers seem mired in old think-
ing and outdated systems. From the perspective of “independence”
H i s t o r y ’ s s h i f t i n g s a n d sThe revolutions sweeping the Arab world indicate a tectonic shift in the global bal-ance of people power.
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squares across the region, the US looks ideologically stagnant and
even backwards, filled with irrational people and political and eco-
nomic elites incapable of conceiving of changes that are so obvi-
ous to the rest of the world.
Foundations sinking into the sands?
Although she likely did not intend it, when Hillary Clinton, the US
secretary of state, warned Arab leaders in early January that they
must “reform” lest their systems “sink in the sand” her words were
as relevant in Washington as they were in Tunis, Tripoli, Cairo or
Sanaa. But Americans - the people as much as their leaders - are
so busy dismantling the social, political and economic foundations
of their former greatness that they are unable to see how much they
have become like the stereotype of the traditional Middle Eastern
society that for so long was used to justify, alternately (and some-
times simultaneously) supporting authoritarian leaders or impos-
ing foreign rule.
A well known Egyptian labour organiser, Kamal Abbas, made a
video telling Americans from Tahrir that “we and all the people of
the world stand on your side and give you our full support”. It is a
good thing, because it is clear Americans need all the support they
can get. “I want you to know,” he continued, “that no power can
challenge the will of the people when they believe in their rights.
When they raise their voices loud and clear and struggle against
exploitation.”
Aren’t such lines supposed to be uttered by American presidents
instead of Egyptian union activists?
Similarly, in Morocco activists made a video before their own ‘day
of rage’ where they explained why they were taking to the streets.
Among the reasons, “because I want a free and equal morocco for
all citizens,” “so that all Moroccans will be equal,” so that education
and health care “will be accessible to everyone, not only the rich,”
in order that “labour rights will be respected and exploitation put to
an end,” and to “hold accountable those who ruined this country”.
Can one even imagine millions of Americans taking to the streets in
a day of rage to demand such rights?
“Stand firm and don’t waiver .... Victory always belongs to the people
who stand firm and demand their just rights,” Kamal Abbas urged
Americans. When did they forget this basic fact of history?
From top to bottom
The problem clearly starts from the top and continues to the grass
roots. Barack Obama campaigned for the presidency on the slogan
“Yes we can!” But whether caving in to Binyamin Netanyahu, the Is-
raeli prime minister, on settlements, or standing by as Republicans
wage a jihad on the working people of Wisconsin, the president
has refused to stand up for principles that were once the bedrock
of American democracy and foreign policy.
The American people are equally to blame, as increasingly, those
without healthcare, job security or pensions seem intent on drag-
ging down the lucky few unionised workers who still have them
rather than engage in the hard work of demanding the same rights
for themselves.
The top one per cent of Americans, who now earn more than the
bottom 50 per cent of the country combined, could not have script-
ed it any better if they had tried. They have achieved a feat that
Zine El Abidine Ben Ali, Hosni Mubarak and their fellow cleptocrats
could only envy (the poorest 20 per cent of the population in Tunisia
and Egypt actually earn a larger share of national income than does
their counterpart in the US).
The situation is so desperate that a well known singer and activist
contacted me in Cairo to ask organisers of Tahrir to send words of
support for union workers in Wisconsin. Yet “Madison is the new
Tahrir” remains a dream with little hope of becoming reality, even
as Cairenes take time out from their own revolution proudly to order
pizza for their fellow protesters in Wisconsin.
The power of youth and workers
In Egypt, workers continue to strike, risking the ire of the military
junta that has yet to release political prisoners or get rid of the
emergency law. It was their efforts, more than perhaps anyone else,
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that pushed the revolution over the top at the moment when people
feared the Mubarak regime could ride out the protests. For their
part, Americans have all but forgotten that the “golden years” of
the 1950s and 1960s were only golden to so many people because
unions were strong and ensured that the majority of the country’s
wealth remained in the hands of the middle class or was spent on
programmes to improve public infrastructure across the board.
The youth of the Arab world, until yesterday considered a “demo-
graphic bomb” waiting to explode in religious militancy and Islamo-
fascism, is suddenly revealed to be a demographic gift, providing
precisely the vigour and imagination that for generations the people
of the region have been told they lacked. They have wired - or more
precisely today, unwired - themselves for democracy, creating vir-
tual and real public spheres were people from across the political,
economic and social spectrum are coming together in common
purpose. Meanwhile, in the US it seems young people are chained
to their iPods, iPhones and social media, which has anesthetised
and depoliticised them in inverse proportion to its liberating effect
on their cohorts across the ocean.
Indeed, the majority of young people today are so focused on sat-
isfying their immediate economic needs and interests that they are
largely incapable of thinking or acting collectively or proactively.
Like frogs being slowly boiled alive, they are adjusting to each new
setback - a tuition increase, here, lower job prospects there - des-
perately hoping to get a competitive edge in a system that is in-
creasingly stacked against them.
Will Ibn Khaldun be proved right?
It now seems clear that hoping for the Obama administration to
support real democracy in the Middle East is probably too much
to ask, since it cannot even support full democracy and economic
and social rights for the majority of people at home. More and more,
the US feels not just increasingly “irrelevant” on the world stage,
as many commentators have described its waning position in the
Middle East, but like a giant ship heading for an iceberg while the
passengers and crew argue about how to arrange the deck chairs.
Luckily, inspiration has arrived, albeit from what to a ‘Western’ eye
seems like the unlikeliest of sources. The question is: Can the US
have a Tahrir moment, or as the great Arab historian Ibn Khaldun
would have predicted, has it entered the irreversible downward
spiral that is the fate of all great civilizations once they lose the
social purpose and solidarity that helped make them great in the
first place?
It is still too early to say for sure, but as of today it seems that the
reins of history have surely passed out of America’s hands.
Mark LeVine is a professor of history at UC Irvine and senior visiting
researcher at the Centre for Middle Eastern Studies at Lund Uni-
versity in Sweden. He has authored several books including Over-
throwing Geography: Jaffa, Tel Aviv and the Struggle for Palestine
(University of California Press, 2005) and An Impossible Peace: Is-
rael/Palestine Since 1989 (Zed Books, 2009).
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The
POLICYo f t h e Wor l d
