Interesting Links to the 21st Century

2009 H1N1 Flu (Swine Flu) - CDC's latest info regarding H1N1. Last week, influenza ctivity, now widespread in 46 states ( FluView), continued to increase in the US as reported in. Flu-related hospitalizations and deaths continue to increase nation-wide and are above what is expected for this time of year.

ACE - a database of song titles licensed by ASCAP in the US. For each title, you can find the names of the songwriters, contact persons, and addresses and, in most cases, phone numbers of publishers to contact if you want to use the work.

Center For Economic Research and Forecasting - Forecasts are not always the most pleasant news, but to be successful, you need to follow the facts and not your feelings.


Center For Plain Language - Plain Language is a Civil Right. Plain language is more than just short words and short sentences ...When you create material in plain language, you consider the audience...the readers.


The Electoral Map - The intersection of politics and geography. A blog where maps tell the story behind the votes — the culture, economics, demographics, history, sports and the stories that influence the map.


New America Foundation - This site emphasizes work that is responsive to the changing conditions and problems of 21st C info- age economy...transforming innovation and wealth creation in an era of shortened job tenures, longer life spans, mobile capital, financial imbalances and rising inequality.


Networking-the info.net -- Social networking information.


New Geography - "Where we live and how to make it better". In addition to the subjects: Economics; Demographics; Politics; Urban Issues; Suburbs; Housing; this site features sections on: Best Cities 2009; Obama's America; Financial Crisis; New Deal 75th Anniversary Series.


Politico - In addition to all the latest political news and headlines, this site includes "a living diary of the Obama Presidency".

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Healthcare Insurance, Baseball and Antitrust Laws.

The insurance industry has everything to lose from real health care reform, that is, reforming the health care industry to serve we, the people, in the most efficient and effective way. The reason is obvious: profit. The better our health care system facilitates and benefits the health of we, the people, the less the insurance industry gains.

Americans United for Change, a grassroots organization working to return America to the "traditional progressive values that have defined America – economic fairness, opportunity, national and economic security and democratic leadership" released a TV ad airing on cable stations in Washington, D.C. noting that Major League Baseball (MLB) and health insurance companies are two of the few organizations exempted from antitrust laws.

"When baseball players fix the games, they get in trouble. When health insurance executives fix the game, they get … rich."

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Same-Sex Marriage in USA

Government recognition of same-sex marriage is presently available in seven countries and five U.S. states. Currently, however, gay married couples fork over $467,000 more than straight married couples in the US.

Upwards of $467,000, when you account for the 1138 federal rights and benefits afforded to heterosexual couples that are denied to same-gender couples. That's how much the Times estimates a gay couple will pay -- in a worst case scenario -- over the span of their lifetimes for extra costs related to health care, legal affairs, and other issues.

The Respect for Marriage Act introduced in September by Rep. Jerrold Nagler (D-NY) and has 91 co-sponsors would fully repeal DOMA.
Although similar to marriage, a domestic partnership does not confer any of the 1,138 rights afforded to married couples by the federal government.

The following is a review of a 1997 and 2004 government report that outlined the specific benefits afforded married couples in the United States. These are benefits and rights denied gay and lesbian couples taken from the website Equality Matters:

Right to many of ex- or late spouse's benefits, including:

-- Social Security pension
-- veteran's pensions, indemnity compensation for service-connected deaths, medical care, and nursing home care, right to burial in veterans' cemeteries, educational assistance, and housing
-- survivor benefits for federal employees
-- survivor benefits for spouses of longshoremen, harbor workers, railroad workers
-- additional benefits to spouses of coal miners who die of black lung disease
-- $100,000 to spouse of any public safety officer killed in the line of duty
-- continuation of employer-sponsored health benefits
-- renewal and termination rights to spouse's copyrights on death of spouse
-- continued water rights of spouse in some circumstances
-- payment of wages and workers compensation benefits after worker death
-- making, revoking, and objecting to post-mortem anatomical gifts

Right to benefits while married:

-- employment assistance and transitional services for spouses of members being separated from military service; continued commissary privileges
-- per diem payment to spouse for federal civil service employees when relocating
-- Indian Health Service care for spouses of Native Americans (in some circumstances)
-- sponsor husband/wife for immigration benefits

Larger benefits under some programs if married, including:

-- veteran's disability
-- Supplemental Security Income
-- disability payments for federal employees
-- medicaid
-- property tax exemption for homes of totally disabled veterans
-- income tax deductions, credits, rates exemption, and estimates

Joint and family-related rights:

-- joint filing of bankruptcy permitted
-- joint parenting rights, such as access to children's school records
-- family visitation rights for the spouse and non-biological children, such as to visit a spouse in a hospital or prison
-- next-of-kin status for emergency medical decisions or filing wrongful death claims
-- custodial rights to children, shared property, child support, and alimony after divorce
-- domestic violence intervention
-- access to "family only" services, such as reduced rate memberships to clubs & organizations or residency in certain neighborhoods
-- Preferential hiring for spouses of veterans in government jobs
-- Tax-free transfer of property between spouses (including on death) and exemption from "due-on-sale" clauses.
-- Special consideration to spouses of citizens and resident aliens
-- Spouse's flower sales count towards meeting the eligibility for Fresh Cut Flowers and Fresh Cut Greens Promotion and Information Act
-- Threats against spouses of various federal employees is a federal crime
-- Right to continue living on land purchased from spouse by National Park Service when easement granted to spouse
-- Court notice of probate proceedings
-- Domestic violence protection orders
-- Existing homestead lease continuation of rights
-- Regulation of condominium sales to owner-occupants exemption
-- Funeral and bereavement leave
-- Joint adoption and foster care
-- Joint tax filing
-- Insurance licenses, coverage, eligibility, and benefits organization of mutual benefits society
-- Legal status with stepchildren
-- Making spousal medical decisions
-- Spousal non-resident tuition deferential waiver
-- Permission to make funeral arrangements for a deceased spouse, including burial or cremation
-- Right of survivorship of custodial trust
-- Right to change surname upon marriage
-- Right to enter into prenuptial agreement
-- Right to inheritance of property
-- Spousal privilege in court cases (the marital confidences privilege and the spousal testimonial privilege)

Spousal income and assets are counted in determining need in many forms of government assistance, including:

-- veteran's medical and home care benefits
-- housing assistance
-- happy birthday housing loans for veterans
-- child's education loans
-- educational loan repayment schedule
-- agricultural price supports and loans
-- eligibility for federal matching campaign funds
-- Ineligible for National Affordable Housing program if spouse ever purchased a home:
-- Subject to conflict-of-interest rules for many government and government-related jobs
-- Ineligible to receive various survivor benefits upon remarriage

There are some laws that either benefit or penalize married couples over single people, depending upon their own circumstances:

-- Marriage penalty/bonus
-- Someone working for their spouse cannot be defined as an "employee"
-- Someone cannot change beneficiaries in a retirement plan or from waiving the joint and survivor annuity form of retirement benefit, without the written consent of his or her spouse
-- Wages can be garnished at a maximum of 60% (instead of the normal 25% limit) if the garnishing is for alimony or child support

The Netherlands was the first country to authorize same-sex marriage in 2001, and now Belgium, Canada, South Africa, Spain, Norway, Sweden, and in the US: Massachusetts, Connecticut, Iowa, Vermont, New Hampshire, and Maine.

New York, Rhode Island, District of Columbia (DC) and New Mexico do not allow same-sex marriages to be performed, but do recognize such marriages performed elsewhere.

In the US, domestic partnership is a city, county, state, or employer-recognized status that may be available to same-sex and, sometimes, opposite-sex couples. Domestic partnerships in the United States are determined by each state or local jurisdiction, so there is no nationwide consistency on the rights, responsibilities, and benefits accorded domestic partners.

Related Headlines:

Outcome Over Gay Marriage in Maine is a Toss-up.

Gay marriage question focus of Maine TV debate

Focus of Gay-Marriage Fight Is Maine

A marriage equality bill that respects religious objectors

In Battle Over Gay Marriage, Timing May Be Key
NY Sen. Schumer-Gay Marriage in All 50 States is Goal

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Achieving Transparency through Plain Language

What is the cost of obscurity? The cost of wordy, unclear, pompous, and dull? Well, the VA saved $40,000 per year from rewriting one standard letter in plain language. The Navy reduced reading time by 17-23% and saved $350 million per document. GE saved up to $500,000 by reducing help desk staff costs by rewriting a software manual. That's just a few examples of what clear and effective communication can save in time and money.

Experts claim we can easily cut 25% from our writings. Think of this in the context of saving disk space on computers or shelf space in reference libraries. How many fewer sheets of paper would the Department of Defense use were it to reduce all texts by one fourth? On the NPR website is an article which tells of a 1989 study of Naval Officers who took 17% to 23% less time to read a plain language version of a document versus the document in its original form. Furthermore, their comprehension increased after reading the clearer text. By placing dollar figures on the results using an average hourly pay figure for officers, the study determined the Navy would save from $27 million to $37 million on the low end and $57 million to $73 million on the high end just from the time saved reading plain language documents. If all Navy personnel read plain language documents, then the saving would be in excess of $250 million each year!

Yet, anyone who has read a credit card disclosure , mortgage contract, or any legal contract for that matter, can tell you it's almost impossible to comprehend, even for the most learned Americans, in some cases, let alone, the average citizen with an 8th grade reading level. And let's not even start on the unintelligible entangled monstrosities that are credit derivatives...the ones that brought our economy to its knees.

So, why can't we, the people demand the right to understand what we pay for, vote for, and depend on a daily basis? Why is it legal that corporations and institutions can obscure documents and disclosures on purpose, clearly, for their own gain? After all, the U.S. Constitution states the role of the federal government is to "promote the general welfare". That is, government should provide a level playing field that allows every citizen the chance to take advantage of what the United States has to offer.

However, a confused American is very profitable American, and that's the name of the game -- profits before people. The objective is clearly to make most Americans feel powerless and stupid. The profit makers/power brokers know very well that no one likes to admit their failure to comprehend the tax code, real estate papers, statutes, executive orders, affidavits, jury instructions, insurance contracts, investment contracts, 16 page credit card agreements (printed on tissue paper in microscopic type, written on the "twenty-seventh" grade reading level) and all consumer-finance contracts and anything and everything written in legalese. Confusion is the best way to maintain the vast inequity built into our education and socioeconomic system.

There is no excuse. It's been proven that complex subjects can be translated into plain language with no loss of accuracy or precision. It's been proven that plain language saves time, money, and most importantly, sanity. As it states in the Principles for Long-term Credit Card Reform, "all the forms and statements that credit card companies send out have to have plain language that is in plain sight"...that this should apply to all government and private documents, from every industry so that all Americans are given the opportunity to comprehend and understand without hiring specialists that charge excessive fees that most of us cannot afford.

Links:

Center for Plain Language - wants government and business documents to be clear and understandable. They support those who use plain language, train those who should use plain language, and urge people to demand plain language in all the documents they receive, read, and use.

71-year old Chrissie Maher found the Plain English Campaign, 30-years ago, waging war on confusing language.

2009 Center for Plain Language Symposium -
National Press Club, Washington, D.C., October 30, 2009

The Plain Language Action and Information Network (PLAIN)

From slam poetry to plain language for health care

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Are the Credit Card Companies Asking Us to Intervene?

Currently, the relationship between credit card companies and we, the consumers clearly puts the card companies in the car jacker's driver's seat. Despite the The Credit Card Accountability, Responsibility, and Disclosure (CARD) Act, due to go into effect, February 2010, the banksters are making sure that we, the people continue on, hostage to their demands.

That's right. As predicted, the banksters are rushing ahead of the new restrictions coming their way. They are changing the rules faster than Gov. Rick Perry can tie a lynch knot. Some banks plan to either charge annual fees for customers who pay off their credit cards every month, who, by the way, have excellent credit ratings, or charge customers who don’t use their cards enough, or charge customers for not using them at all (inactivity fees). Overdraft fees are another way that banks are looking to raise revenue.

Keep in mind, the Fed is giving the banks money at 0% interest.

Bank of America will start charging an annual fee from $39 - $99 to some of their best customers.

Citigroup will start charging a fee of an unspecified amount to customers who charge less than a certain amount every year. And the amount that's been batted around is about $2,400 a year. So if you spend less than $2,400 a year on your credit card, you might be hit with a fee, for not spending enough. Citigroup has also raised interest rates to 29.99% for many cardholders.

Clearly, the banksters are crying out for debtor's revolt an intervention. The poor things...they're addicted -- to greed. It's gotten to the point where they need our help. Just as a drug addict doesn't often directly ask for help, the banksters cannot articulate their request in words, but they don't need words as their actions speak louder than words ever could. They are begging us to save them from themselves. Tough love is our only option.

Links:

Dodd: Freeze Interest Rates Now. The House Financial Services Committee last week approved a bill that would move up provisions of the Credit Card Accountability Responsibility and Disclosure Act to Dec. 1 from Feb. 22. Rep. Barney Frank, D-Mass. and the committee chairman, has said an earlier date would prevent banks from "taking advantage of the delay" by raising rates, but the Senate is seen as unlikely to follow suit amid complaints from banks that they need more time to comply with the new rules.

Credit Card with a 79.9% interest rate - The offer is for a Premier card from First Premier Bank, which is based in South Dakota (no maximum or usury restriction in South Dakota and Delaware). The issuer "focuses on individuals who have less than perfect credit but are actually still creditworthy."

Act fast to cash in credit card rewards - If you have a Home Depot Rewards MasterCard--and have been counting on tapping that line of credit for a big job--you need to go shopping, and fast. Citi, which issues the card, has announced that cardholders can use them to make purchases only through Saturday, Oct. 31. And Rewards Points must be redeemed by Jan. 31, 2010, or they expire.

Understanding the Credit Card Accountability Responsibility and Disclosure Act

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The US Chamber of Commerce Is Our Enemy.

The White House has taken on the US Chamber of Commerce and with very good reason; it's an enemy of the United States of America and everything this country stands. The Chamber is the biggest lobbying operation in the US, spending billions of dollars to ensure the rights of big business and huge corporations over the rights of individuals and small business. At a time when unemployment rates are at an all time high, we can't afford to allow this monstrosity to continue to work against the interests of the American people and small business, the engine that drives job creation.

Under Chamber President Tom Donohue,

"the chamber transformed. Its annual budget quadrupled in a few years to $200 million today. And it became more aggressive politically, developing such a fearsome reputation that Rahm Emanuel, now the White House chief of staff, told a reporter in 2006 that the group worried him more than the Republican Party did."

Currently, the Chamber is spending more than $100 million to defeat initiatives to protect the environment and provide affordable health care to everyone.

Not only that, the Chamber has deliberately lied, and portrayed the Washington Post as backing a candidate in the North Virginia race for governor, when, in fact, The Post skewered this candidate's "plan, both in that editorial and in a half-dozen others since then, as a sham whose torrent of words tries to mask the fact that it would produce little new money for roads -- this as the state's spending on secondary and urban roads in Northern Virginia is fast approaching zero."

"So not only is the Chamber of Commerce indifferent to the truth; it's also hostile to the business community in the most populous and economically dynamic part of the state. In positioning itself as an arm for the Republican Party, the Chamber has cast doubt on its own credibility."

Links:

Stop the Chamber

"Preaching Principle, Enabling Excess: How Tom Donohue Compromised the Credibility of the U.S. Chamber of Commerce."

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Goldman Sachs Takes Advantage of Taxpayers Underpinning Financial System

Goldman's big profits and megabonuses, came as the US federal budget deficit hit $1.4 trillion - the highest since 1945. However that doesn't seem to concern Lloyd Blankfein - who, in 2007, when the economy was melting down, as chairman of Goldman Sachs, was paid a bonus of $67.9 million, and whose bonus this year could top that number - spoke at a Fortune magazine breakfast a few weeks ago, and he said, re. accepting TARP funds:

“If I had known it was as pregnant with this kind of potential for backlash, then of course I would have really not have liked it.”

These huge payouts, almost 50% of Goldman's revenue, would not be possible without the billions of dollars from taxpayers that have propped up the financial system. In addition, as George Soros said, "Banks are actually getting hidden subsidies of enormous amounts because of their ability to borrow at effectively zero, and buy 10-year government bonds at 3.5 per cent. So those earnings are not the achievement of risk-takers. These are gifts, hidden gifts, from the Government, so I don't think those monies should be used to pay bonuses."

Oh, and speaking of getting paid for nothing, Goldman Sachs continues to get paid for swaps on redeemed bonds.

New Jersey taxpayers are sending almost $1 million a month to a partnership run by Goldman Sachs Group Inc. for protection against rising interest costs on bonds that the state redeemed more than a year ago.

How much longer should we allow these superbanks to feed off the American public?
As long as we allow the existence of financial institutions that are too big to fail, the banks will continue to suck the life out of each and every one of us.

There are people who want to change things, for instance, Paul Volcker, who wants to break up the giant banks, so why isn't President Obama listening to Paul Volcker?

"People say I'm old-fashioned and banks can no longer be separated from nonbank activity. That argument brought us to where we are today." -- Paul Volcker

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Trafficking In Human Beings for Removal of Organs

In the fast-growing human trafficking web, most of us are aware of the exploitation of the poverty stricken for sex, however, impoverished human beings are also trafficked for the removal of their organs.

This illegal trade in body parts is largely dominated by kidneys - 10% of kidney transplants are from trafficked organs - because they are in greatest demand. China, India, Pakistan, Egypt, Brazil, Philippines, Russia are some of the world's leading providers of trafficked organs.

Trafficked organs are either sold domestically, or exported to be transplanted into patients from the US, Europe, the United Arab Emirates, Saudi Arabia, and especially Israel.

A new, binding international treaty is needed to prevent trafficking in organs, tissues and cells (OTC), protect victims and prosecute offenders in this exploitation of the deeply impoverished, according to a joint study launched today by the United Nations and the Council of Europe.

It calls for the prohibition of financial gain from the human body or its parts as the basis of all legislation on organ transplants, adding that organ donation should be promoted to increase availability, with preference given to OTC donation from the deceased.

Secretary-General Ban Ki-moon’s Special Adviser on Gender Issues and Advancement of Women Rachel Mayanja said she hoped the UN General Assembly would lay the groundwork for such a treaty expeditiously.

“This is the study that we have just launched, we hope that the study will be presented to the Assembly, and that the issue will be put on the agenda so that they can start working and debating this issue,” she told a news briefing in New York. “We would like, of course, to see work on a convention, a binding convention, start as soon as possible.”

Arthur Caplan, co-author of the study and Chair of the Department of Medical Ethics and Director of the Center for Bioethics of the University of Pennsylvania, stressed that money for body parts exploited the poor, who do not improve their situation post-sale or work their way out of poverty.

“The poor person is usually illiterate, not given any choice in the sense that they have no other job or occupation to make the sale, they wind up sicker, they wind up with no one paying attention to them, they sometimes wind up dead, they usually wind up regretting from the studies that we’ve seen that they did the sale because they have no follow-up,” he said.

“What looks like perhaps a chance to take somebody out of poverty winds up being a situation in which the deeply impoverished are exploited for the sale, because there is no other way for them to make a living, they can only do it once, and the people who deal with the sellers don’t care about them,” he added. “Then it violates medical ethics to be involved in practices where you harm people just so they can sell a body part.”

Summing up the legal pillars of a proposed treaty, co-author and Public Prosecutor of Austria Carmen Prior said: “Prevention, protection and prosecution.”

Trafficking in OTC should be clearly distinguished from trafficking in human beings for the removal of organs, a small part of the wider problem, the report says, pointing to widespread confusion in the legal and scientific communities between the two types of trafficking, which require different solutions.

It notes the possibility of a high number of unreported cases of both crimes, due to low risks and huge profits for perpetrators. OTC trafficking often takes the form of what is known as “transplant tourism”, with recipients travelling, usually from wealthier nations, to acquire organs in countries where measures to prevent the crime or protect live donors are not in place or not implemented.

It is estimated that 5 per cent to 10 per cent of kidney transplants performed annually around the world are the result of trafficking.

The report calls for the collection of reliable data on trafficking in OTC and in human beings for organ removal, separated by sex to assess if the problem impacts women and men differently.

The Council of Europe Convention on Action against Trafficking in Human Beings, and the UN Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, already contain appropriate measures to combat trafficking in human beings for organ removal.

Trafficking in organs, tissues and cells and trafficking in human beings for the purpose of the removal of organs (pdf)

The Human Trafficking Project - A site dedicated to raising awareness of modern day slavery and exploring innovative solutions to stop it

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Poverty in the US is Trending Upwards

Poverty in the United States: 2008

Under the official poverty definition, an average family of four was considered poor in 2008 if its pre-tax cash income for the year was below $22,025. It's hard to imagine a family of four existing on twice that amount today.

In 2008, 39.8 million people were counted as poor in the United States—an increase of 2.6 million persons from 2007, and nearly the largest number of persons counted as poor since 1960. The poverty rate, or percent of the population considered poor under the official definition, was reported at 13.2%; up from 12.5% in 2007, and the highest rate since 1997. The recent increase in poverty reflects the worsened economic conditions since the onset of the economic recession in December 2007. Many expect poverty to rise further next year, and it will likely remain comparatively high even after the economy begins to recover. The incidence of poverty varies widely across the population according to age, education, labor force attachment, family living arrangements, and area of residence, among other factors.

Income, Poverty, and Health Insurance Coverage in the United States: 2008

Data presented in this report indicate the following:

• Real median household income fell between 2007 and 2008, and the decline was widespread. Median income fell for family and nonfamily households, native-and
foreign-born households, households in 3 of the 4 regions, and households of each race categoryand those of Hispanic origin. These declines in income coincide

• The poverty rate increased between 2007 and 2008.

• The percentage of uninsured in 2008 was not statistically different from 2007, while the number.

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We Must Tolerate the Inequality?

Despite the fact that a trained chimp could perform as well as Goldman Sachs, given all the help (TARP; $13 billion from AIG, because it was a counter party; free access to credit from the Federal Reserve; FDIC guaranteed debt...) they've received since the collapse of our economy, not to mention, the welfare recipients have not returned the favor by issuing credit to we, the people and to small business, the engine of job creation...despite all of that, they tell us we should tolerate the inequality...that it is good for all of us.

But, should we really be grateful to Reagan? And for all of those people responsible for the financialization (the increase in the size and significance of financial markets and financial institutions) of our economy? The Reagan revolution that helped to create the greatest state of inequality in the history of our nation? Is Wall Street really, "all that"? And one has to wonder, did people at Goldman Sachs know what was coming down the pike? More than that, did they knowingly push us into this crisis, knowing they could milk it for all its worth, while we, the suckers take it on the chin?

Well, it's hard to believe otherwise as they rake in their great fortunes at our expense. But hey, they claim inequality is good for us. Let's see if they're right.

We already know that Goldman Sachs Group Inc boasted third-quarter profits of $3.19 billion a few days ago. We know that Goldman Sachs Group Inc., set aside $16.7 billion for compensation and benefits in the first nine months of 2009, which is up 46% from a year earlier. We know that Goldman Sachs is cashing in like crazy.

And now we know, at a discussion panel titled, "What is the Price of Morality in the Marketplace?" a Goldman Sachs international adviser defended what can only be called over-the-top compensation in the finance industry, as his company plans a near-record year for pay, explaining that putting all this money in the pockets of the men who brought this economy down will help boost the economy.

“We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all.”

Mayor Michael Bloomberg, it seems, would agree:

“They may be an enormous amount of money for one person, but they are how our people in the city in all industries get paid, whether you drive a cab, work in a restaurant, work in a store, whether you are a municipal employee.

All of this gets filtered down through our economy. No matter what you think about the propriety of any individual person’s bonus, we want companies in the city, and we are dependent on Wall Street finance, to do well.” - Mayor Bloomberg

So, is Wall Street performance really, as Mayor Bloomberg said, beneficial to us? Or is Wall Street simply a big myth? Does it really serve the function of allocating credit in the economy?

* Not according to the graph (left), which shows the percentage of capital expenditures by U.S. non-financial companies that was raised in U.S. financial markets from 1952 to 2006.

In other words, while it's true the dollar volume of financial trading has increased by an enormous amount - over three trillion dollars traded in U.S. financial markets each day - almost none of it is directed to toward creating real wealth.

The second graph (Private Investment in Capital Equipment as a Percent of GDP), shows that non-financial companies (NFC) do not use the stock market to raise funds for capital improvement programs.usury, speculation

"Figure 5.3 shows net funds raised through equity issuance, this time as a percent of capital expenditures ...It is evident that the stock market has not historically been a major source of NFC funds. On a quarterly basis, its contribution never exceeds 18 percent of capital expenditures. On average its contribution has been below 10 percent, even in the 1952-1980 period before (the increase in stock buybacks. However, there is a dramatic change in the relationship between the stock market and the NFCs starting in the early 1980s. Except for brief periods, in the post-1980 era the net equity issuance of the NFCs has been negative and often large. The NFCs have indeed been buying back their own stocks. The stock market has turned into an institution through which NFCs channel funds to financial markets, not the other way around."

The bottom line is that Wall Street and the financial elites, over the last three decades, have convinced us that we are here to serve money, that money is "god". However the opposite is true, money is here to serve us, to serve humanity. Money is nothing without us. In fact, considering money is created with one keystroke, it is nothing with us. We, the people, including atheists, if they believe in and use our monetary system, worship what amounts to nothing. We've been had.

* The Economic Populist

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Goldman Sachs, Ayn Rand, Going Galt and the American People.

Now that Goldman Sachs posted a profit of $3.19 billion, and plans to divvy up record breaking bonuses between them, despite their enormous part in collapsing our economy last year, which continues to leave the rest of us struggling, with no signs of recovering in sight - the unemployment and foreclosure rates are still escalating - it's only fitting that Goldman-Backed, Ayn Rand-Inspired Fund (Roark Capital Group) will invest a record amount at this time. Of course, the fund’s investors include Goldman Sachs Group Inc.

But why on earth is Ayn Rand, Greenspan's hero, more popular than ever amongst average, everyday people?

After all, Rand, worshipper of sociopathic killers, apparently, shares the same view of the common man as Goldman Sachs...that average people were "ugly, stupid and irrational." This quote, taken from her first book, We the Living, "What are your masses...but mud to be ground underfoot, fuel to be burned for those who deserve it?" pretty much sums up her view of humanity, with the exception of the elite, of course.

“On the same day that you saw stories about these bonuses, you saw a story about how wages are at a 19-year low,” -- David Axelrod a senior adviser to President Barack Obama.

Goldman Sachs embodies the Randian philosophy so closely the entity should be called The Ayn Rand Corporation. But wait. Isn't most of the population ready to string Goldman Sachs up by their...well, their sachs? Yet, Rand's greatest selling book "Atlas Shrugged" had an all-time record year in 2008, and 2009 sales should shatter even last year's numbers.

It's more than ironic that this woman who preached the virtue of selfishness, and self-interest - the very thing that almost brought the world's economy to collapse - as man’s greatest moral responsibility, and altruism as a vice, who strongly believed that markets work best when corporations are free to pursue their own selfish interests, who believed the the wealthy and the powerful are the oppressed, and whose Objectivist philosophy equated unfettered capitalism with absolute morality is the same woman people are looking to as their savior.

Excerpt from Michael Prescott's blog:

"Was Ayn Rand "a narcissistic, manipulative sociopath" - or at least a borderline case?

Well, consider the portrait of Rand drawn by two biographies - Nathaniel Branden's My Years with Ayn Rand and Barbara Branden's The Passion of Ayn Rand - and by Jeff Walker's The Ayn Rand Cult. These are, admittedly, hostile sources, but in the absence of any biography by Rand's admirers, they are the only ones we have.

Anyone judging by these books would have to say that Rand was narcissistic in the extreme. She lacked empathy. She could be intensely charming (charm and charisma are common features of sociopathy) but was also prone to outbursts of rage and frustration.

She exploited young, emotionally vulnerable people and frequently sabotaged their self-image with her vindictive cruelty. She claimed to love her husband but carried on an affair with a younger man right in front of him, a situation that drove her husband to alcoholism.

She was a hypochondriac. She showed signs of paranoia. She had an addictive personality, smoked two packs of cigarettes daily, and gobbled handfuls of diet pills (amphetamines).

She despised "average" people, whom she regarded as ugly and stupid and irrational, while viewing herself in exalted terms as the greatest writer in history and the greatest philosopher since Aristotle.

She was concerned with no one's needs or wants or suffering except her own. She was able to claim in print that no one had ever helped her, when in fact she had benefited for years from the charity and goodwill of relatives and business associates and friends. She alienated nearly all her friends and allies by the end of her life, and died nearly alone.

She literally drove people crazy; ex-Objectivist Edith Efron once remarked that if you spent any time with Rand, you had to ask yourself if you were insane, or if she was (quoted in Walker). She was a megalomaniac. She was probably manic-depressive. She created heroic fictional characters who are deeply repressed, incapable of normal human interaction, and typically angry or disgusted with the world.

This is hardly a person who should be seen as the epitome of rationality and benevolence - yet this is how her followers do see her. In my Objectivist years I once hesitantly suggested to a fellow Objectivist that there might be a few character flaws to be found in Rand, only to be met with a blank stare and the appalled question, "Character flaws - in Ayn Rand?!" In Objectivist dogma it is always other people who were at fault in their dealings with "Miss Rand" (as they like to call her). Somehow it was always those irrational others who abused, deceived, and hurt Ayn Rand, and her rages and bitterness were entirely justified, entirely rational. How could they not be? Rand was the personification of reason, so by definition whatever she thought, felt, or did just had to be rational - Q.E.D.

When I look at the portrait of Ayn Rand drawn by a variety of people who knew her best, I see a person who is certainly larger and more theatrical than the run-of-the-mill sociopaths in Martha Stout's book, different from them in degree - but not very different in kind.

And I wonder how a movement founded by a woman with such serious disorders could ever have been seen as a way to personal happiness or to a better world."

Greed was calculated by comparing average incomes with the total number of inhabitants living beneath the poverty line.

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Purposely Reordering Customer Charges to Maximize Overdraft Fees

45% of the nation’s banks and credit unions collect more in overdraft services than they make in profits. This year alone, banks are expected to bring in $27 billion from overdraft fees alone. They allow customers to continually make purchases on their debit cards, once their checking account is overdrawn, which then automatically sets off a cascade of fees, at up to $39 a pop, sometimes for purchases less than $5, continuously. When the customer calls to complain that they've been charged over $300 in fees, they tell the customer that they are doing him or her a favor by not embarrassing them. That's what Wachovia told me when I went into the branch to complain.

Apparently, I'm not the only one.

When Peter Means returned to graduate school after a career as a civil servant, he turned to a debit card to help him spend his money more carefully.So he was stunned when his bank charged him seven $34 fees to cover seven purchases when there was not enough cash in his account, notifying him only afterward. He paid $4.14 for a coffee at Starbucks — and a $34 fee. He got the $6.50 student discount at the movie theater — but no discount on the $34 fee. He paid $6.76 at Lowe’s for screws — and yet another $34 fee. All told, he owed $238 in extra charges for just a day’s worth of activity.

Mr. Means, who is 59 and lives in Colorado, figured employees at his bank, Wells Fargo, would show some mercy since each purchase was less than $12. In addition, a deposit from a few days earlier would have covered everything had it not taken days to clear. But they would not budge.

Banks and credit unions have long pitched debit cards as a convenient and prudent way to buy. But a growing number are now allowing consumers to exceed their balances — for a price.

Banks market it as overdraft protection, and the fees it generates have become an important source of income for the banking industry at a time of big losses in other operations. This year alone, banks are expected to bring in $27 billion by covering overdrafts on checking accounts, typically on debit card purchases or checks that exceed a customer’s balance.

In fact, banks now make more covering overdrafts than they do on penalty fees from credit cards.

But because consumers use debit cards far more often than credit cards, a cascade of fees can be set off quickly, often for people who are least able to afford it. Some banks further increase their revenue by manipulating the order of a customer’s transactions in a way that causes more of them to incur overdraft fees.

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Is the Transfer of Wealth Complete?

Well, if there is any truth to Goldman Sachs plan to deliver total pay and bonuses in excess of $22 billion, after profits more than tripled last quarter, it appears the transfer, if not complete, is well on its way. Reducing interest rates to near zero, bolstering big banks with taxpayer money, guaranteeing billions of dollars of financial institutions’ debts helped set the stage for this new era of Wall Street wealth,
as if they really needed it.

Is there any doubt that we, the taxpayers have been scammed on the most massive scale ever to occur in history? We, the taxpayers, who bailed them out, saving them from facing the consequences of their own criminal behavior can't afford housing, can't afford health care, can't afford to pay our bills, can't find a job, meanwhile, the guilty parties are getting ready to divvy up billions of dollars.

But, are we, the taxpayers totally innocent? Not really. Although most of us did not directly participate in creating this systemic ponzi scheme that makes Madoff's devious contrivance look like child's play, we did cultivate the environment, over the last 30 years, that made it possible for these banksters, corporate criminals and our own government to get away with sucking the wealth of our country into their greedy paws.

Decades ago, when we bought into trickle down, supply side Reaganomics, that scapegoats the so-called "welfare queen", we made the decision that the value of money trumps all other values, and encouraged young minds to follow the money, and only the money, rather than allowing the endogenous process to occur - regarding education and career choice - that would facilitate true laissez-faire equilibrium, we planted the "seeds" of destruction. By promising a world of perpetually increasing returns, "we the people" promoted a "Gordon Gekko" value system where "greed is good", because the only fuel this promised "world" required was greed.

Take the increasing flow of graduates from top colleges into the world of finance. According to Laurence Katz , professor of economics at Harvard University and former chief economist at the U.S. Department of Labor, in 1970, three to five percent of Harvard graduates went into the finance industry. That percentage grew to fifteen percent in 1990, and in 2006, a whopping forty percent of Harvard grads pursued a career in finance. Why was there such a dramatic increase? Because, Harvard graduates who chose careers in finance made three times the pay of their peers.

So, what's the problem? Well, lack of diversification, for one. Rather than innovating products and services that actually contribute to society, all of the educated brainpower collects to create and develop monstrously complex financial products, that are, for the most part, worthless, mostly because the process of finding out their true value is close to impossible. These "financial frankenstiens" are often composed of so many layers of different investments - each one with a whole new set of rules, that operate in opposing and convoluted ways - that it would take an infinite amount of time to unravel their worth.

In good times, these monstrosities consume themselves or decompose, however, in times of crisis, these extraordinarily complicated debt securities are more like bundles of tiny little pieces of Styrofoam, plastic, disposable diaper fill, fiberglass, aluminum, and every other non-biodegradable material you can imagine, all twisted, entangled and knotted together. These exotic "brainchilds" - not understood by regulators, buyers, or even their inventors - have only served one purpose: to clog up the financial arteries of our economic system.

In addition to Wall Street and the financial industry - with so much money on the table - collecting brainiacs, like Dick Cheney collects arterial plaque, the entire credit derivatives market was deregulated. The melding of greed, an abundance of brainpower, and deregulation blurs...no, erases the lines between legitimate business and crime or criminal behavior; in effect, institutionalizing crime within the "mainstream" economy.

So, is it any surprise that the "Frankenstein" economy emerged? Not really. But, that doesn't mean it's too late, but we better act fast because it's only a matter of time before we, the taxpaying people, find ourselves in a third world country, pledging our allegiance to the United States under Goldman Sachs.

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Open Law Source.

Electronic Code of Federal Regulations - is a currently updated version of the Code of Federal Regulations (CFR). It is not an official legal edition of the CFR.

PreCYdent legal search engine searches the "web of law" (from 04-01-1759 to current) for all US Supreme Court cases and US Court of Appeals cases going back to the 1950s, and ranks results by "authority".

The Public Library of Law is the largest free law library in the world, because we assemble law available for free scattered across many different sites.

SCOTUS cast - audio broadcast series provides expert commentary on U.S. Supreme Court cases as they are argued and issued.

U.S. Code Collection -

Unfiltered Orange - The latest from Orange Legal Technologies.

WEX - is a collaboratively built, freely available legal dictionary and encyclopedia sponsored and hosted by the Legal Information Institute at the Cornell Law School.

100 Best Websites By Lawyers For Lawyers

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Dead Children: The Consequences of Corporate and Wall Street Greed

Currently, food aid is now at its lowest in 20 years. Tens of millions of the world's poor will starve as rich nations cut or cancel food aid funding in the next few weeks.

Big business and the enormous influence of corporate lobbyists not only undermines democracy, its overwhelming authority often results in dead children (must read) around the globe.

Why? U.S. food aid policy lines the pockets of corporate America - the agricultural and the shipping industry - instead of feeding the starving populations they are supposed to serve.

Current policy requires that at least 75% of food aid has to be grown and packaged in the U.S., and then transported using U.S. vessels. Most countries donate cash as food aid as it offers greater flexibility and enables the recipient populations to get more for their money.

While it's no secret that our economic system is based on profit motive, even when it comes to basic necessities, it's unsettling, to say the least, that profit motivation is the driving force behind programs created to help starving people around the world.

"We prefer cash donations as they offer us greater flexibility -- with cash donations we can purchase locally, enjoy greater flexibility and also speed things up. We can get more for the money if we have cash. We can do the job faster as cash lets us buy the right food we need at the right time." - Richard Lee, a spokesman for the United Nation's World Food Programme.

In 2007, humanitarian and food advocacy organizations called on Congress to rewrite food aid policy. Even George W. Bush proposed that 25% of the food aid be cash, available to buy crops locally for the people who need it. Congress failed to act, fully embodying MLK's description of the kind of men our economic system, that - as he says, "permits necessities to be taken from the many to give luxuries to the few" - produces: "...small hearted men to become cold and conscienceless so that, like Dives before Lazarus, they are unmoved by suffering, poverty-stricken humanity."

Sharp increases in global food prices and shipping costs, doubling over the last two years, the impact on food aid groups has been enormous.

"U.S. farm and shipping lobbyists have stifled efforts to simplify aid deliveries, leaving Africans to starve when they might have been saved." -- Andrew Natsios, a professor at Georgetown University in Washington who led USAID, the Agency for International Development, from 2001 to 2006.

The UN Food and Agriculture Organization reports the minimum for avoiding malnourishment is 1,800 calories per day. The food supply that finally arrived "was enough to supply about 1,300 calories a day for a month." To put it in perspective, the average American consumes more than 3,700.

Many fear a return to the conditions of 1984 and 1985, when famines in Ethiopia killed more than 1 million people. During that time, according to Haylar Ayako, the Ethiopian farmer, who recently lost seven grandchildren, “Some people survived eating the wastes of their cattle, some even the skins of their cattle.”

Well, at least, as a Christian country, we live up to Christian principles, such as taking from the poverty-stricken to provide for the greedy, wealthy evil-doers. That is what Jesus preached, right?

The World Food Programme feeds nearly 100 million people a year.

There is some hope: Plumpy'nut . A French scientist trying to fight malnutrition discovered the answer at his own breakfast table.

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Higher Premiums for Elderly Under Comprehensive Health Care Reform?

One of the central goals of comprehensive health care reform is to eliminate discrimination by health status in order to reduce the financial burdens associated with poor health. Congress has discussed eliminating health-status discrimination, although there is much debate about whether it’s fair to charge people who are different ages different rates for insurance. Older adults tend to use more health care, so the question becomes, is it fair to set higher premiums for the same coverage for older Americans?

The Urban Institute calculated the financial implications of age-based premiums under three different scenarios (5:1, 2:1, and 1:1) for households of different ages, incomes, and sizes. Some have proposed allowing premiums for the older adults to be as much as 5 times as high as those for younger adults (5:1 rating), while others would limit the highest premiums to be twice that of the lowest (2:1 rating).

They found that the affordability of health care costs (premiums plus out-of-pocket expenses after government subsidy) will be strongly related to the age-based premium rating.

The full analysis, Age Rating Under Comprehensive Health Care Reform: Implications for Coverage, Costs, and Household Financial Burdens Timely Analysis of Immediate Health Policy Issues, can be found here.

This analysis uses the Health Insurance Policy Simulation Model (HIPSM) to compare the financial implications of the premium rating choice

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Recovery for Who?

How is it that economic recovery is well underway, when we have an unemployment rate of 9.8%, possibly headed toward double digits? That rate doesn't even include the underemployed: those who are working less hours, for less money, those too discouraged to look...the long-term unemployed, etc. President Obama assures us that the unemployment rate is a lagging indicator and it will catch up. But will it? And if so, when?

So, who is recovering? Why, Wall Street, of course, and the wealthiest wealthy Americans...the only ones who count, apparently.

Well, there's got to be a better way.

A New Way Forward is a movement of citizens representing the call for reform.

Their mission is to transform the public's relationship to the monetary and economic policies that govern our lives. Their platform is structural reform of the financial industry. They want to change the American financial industry from one that skirts and dictates laws to reap false profits for the few at the expense of the many into one that takes its proper place as a facilitator of general prosperity. They demand a financial industry that does not actively work against the interests of the public but that is stable and secure, prudent in risk, and manageable in failure.

We want Congress to step up to the plate and restructure the financial system. We demand an end to taxpayer bailouts without solutions for working-class America; policies that address the problem of too big to fail; reorganization so that the financial elite who managed us into this crisis are not in charge as we try to fix it, and we believe banks should be broken up—decentralized—and sold back to the private market with strong new regulatory and antitrust rules in place.

NATIONALIZE: Experts agree -- Insolvent banks that are too big to fail must incur a temporary FDIC intervention - no more taxpayer handouts.

REORGANIZE: Current CEOs and board members must be removed and bonuses wiped out. The financial elite must share in the cost of what they have caused.

DECENTRALIZE: Banks must be broken up and sold back to the private market with new antitrust rules in place-- new banks, managed by new people.

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Get Out There And Make Obama Do It.

An audience member attending the 2009 Brooklyn Book Festival, stood up and questioned the book panel, tackling the subject of "The Great Repression" if he should continue to maintain his faith in President Obama. Naomi Klein immediately responded with, "Obama needs your pressure, not your faith". She then shared the following anecdote she heard about FDR:

Eleanor Roosevelt said that when FDR would meet with civil rights leaders who would make demands that he didn’t think was politically possible at the time, he would respond, paraphrasing FDR: "That sounds like a great idea - I want to do it. Now get out there and make me do it. Create the conditions in which I can do it.”that's "that's a good idea, now get out there and MAKE me do it!"

Faith is defined as a belief that is not based on proof. President Obama is not God, therefore cannot perform miracles, so our faith, in and of itself, does not help him achieve what he has promised.

Do you think the banksters, the corporate elite, the international power brokers, etc. rely on their faith in Obama to get what they want? Hell no! They harass, and continuously exert as much force as they can muster. So, it's absolutely essential that we, the people, get off our collective ass and counter that force by organizing and creating independent movements that can offset the power and wealth of that infinitesimally small group of elites, who can only hope we, the people never rise up and challenge them. They will cave when the only alternative is revolution.

Breaking up the banks, who caused the meltdown, and ensuring that they never are allowed to get so big that they distort our politics and take down the economy would be a good start.

This applies not only to our economy, but to all the issues President Obama addressed while campaigning, including education, health care, and equal rights for GLBT citizens.

Politicians cannot afford to appear weak when campaigning, therefore they make promises that sound as if they can handle it as long as they have our support, because they would never get elected if they campaigned by telling the public, "I promise....but, only if you force me to do it." So, especially in times like these, it's not enough to place our hope in President Obama, we must make him do it. That's not only what Obama desires, it's something he requires.

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Who Gets Treasury Secretary Tim Geithner's Attention?

Why, the Wall Street clowns, of course. And not just any clowns....only a select few earn his undivided attention. According to Tim Geithner's phone records (the Associated Press did a review of Geithner's calendar under the Freedom of Information Act), JP Morgan Chase, and Citigroup make up the small group of all-too-powerful Wall Street bankers lucky enough to have Geithner's ear on demand.

Geithner had more contacts with Citigroup than he did with Rep. Barney Frank, D-Mass., the lawmaker leading the effort to approve Geithner’s overhaul of the financial system. Geithner's contacts with Blankfein [CEO of Goldman Sachs Group] alone outnumber his contacts with Sen. Christopher Dodd, D-Conn., chairman of the Senate Banking Committee.

Looks like the banksters who got us into this mess, are the ones who are supposedly leading our way out of this mess. Is it any wonder, considering Geithner, who was the chairman of the Federal Reserve Bank of New York - which oversees the institutions that make up the heart of U.S. financial activity - at the time of the crisis, therefore responsible for the regulating that didn't happen on Wall Street, was appointed Treasury Secretary?

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Betting On the Profit Potential of a Movie

Investments can kill you, or so says The Motley Fool, so beware. However, the following sounds fairly benign, or is it?

We know Wall Street can create an investment vehicle for just about anything and everything, and that includes the movies. That's right, futures trading on box office returns. Soon, betting on the profit potential of a movie will become reality as the second film business applied to US regulators to set up a “movie derivatives” exchange. The Commodity Futures Trading Commission (CFTC), began seeking comment on an application by privately-held Veriana Networks to operate Media Derivatives as an “electronic exchange for contracts based on box office movie revenues”.

Wait. What about Domestic Box Office Receipt Futures (DBOR Futures), from Cantor Exchange, a subsidiary of Cantor Fitzgerald, L.P.?

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Wall Street Clowns Are At It Again.

Persistency is a fool's best asset, as someone once said, and if that's true, on Wall Street, fools abound. The only ones more foolish, are we, the people, who pave their way.

Out-of-control greed is the name of their game. Even after financial meltdown, they persist. They take their game to a new level. This should come as no surprise, considering the main culprits responsible for our current financial crisis, not only knew (... two years before the meltdown: Bloomberg News reports that shortly after leaving Wall Street as Goldman Sachs' CEO, Henry Paulson was at Camp David warning the president and his staff of "over-the-counter derivatives as an example of financial innovation that could, under certain circumstances, blow up in Wall Street's face and affect the whole economy.") about the potential danger prior to collapse, they avoided repercussions by transferring those consequences to we, the people, but continued to reward themselves at our expense, all the while, innovating new ways to steal our wealth, setting up the next crash.

That's right; it's not enough that the banksters already contributed to one major disaster, and that their efforts "to prevent the financial system from collapsing wound up creating so much liquidity that it has now spawned another financial bubble", the banksters and Washington's 41,000 special-interest lobbyists continue to do just about anything to keep the status quo banks and encourage the Wall Street clowns to create and inflate shiny, bright, brand new combustible balloons to take to market.

In fact, Wall Street is breathing their hot air into one of those balloons right now. They are tapping into the $26 trillion life insurance industry, and creating a new financial product called "life settlements", or life-insurance securitizations.Credit Suisse

The bankers plan to buy “life settlements,” life insurance policies that ill and elderly people sell for cash — $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to “securitize” these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.

The earlier the policyholder dies, the bigger the return — though if people live longer than expected, investors could get poor returns or even lose money.

Either way, Wall Street would profit by pocketing sizable fees for creating the bonds, reselling them and subsequently trading them. But some who have studied life settlements warn that insurers might have to raise premiums in the short term if they end up having to pay out more death claims than they had anticipated.

In addition to the bright and shiny "life settlement" balloon, the clowns have created re-remics (re-securitization of real estate mortgage investment conduits) which repackage their money-losing securities into higher-rated ones, very possibly outside the jurisdiction of the SEC. Morgan Stanley says at least $30 billion in residential re-remics have been done this year.


And let's not forget about the "carry trade" balloons, which at present, are carrying our Illustrious Wall Street clowns to "bubble profits and bubble bonuses".

The excess liquidity is even being used to finance a new "carry trade" in which global investors borrow at U.S. rates and buy government bonds in places like Australia, where prevailing rates are higher. Because the carry trade involves exchanging dollars for foreign currencies, it has been a major contributor to the recent decline in the dollar.

Naturally, this has been a blessing for Wall Street's biggest banks, whose trading desks have not only made big money executing and financing the investment strategies of others, but have also been trading actively for their own accounts. And with bubble profits come bubble bonuses.

The banksters are still operating the same way, lining their own pockets, inventing and marketing exotic waste products, focusing on short-term profits at the expense of long term sustainability, etc, at the cost of possibly, our nation. America's foundation is crumbling, our economy is melting down, our education system ranks lower than most industrialized nations, as well as our health care system, and a child poverty rate much higher than most other developed countries. Are we on the brink of becoming the richest third world country in the world? If we're not there already, considering the state of our nation?

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The Calculated Dishonesty That Caused Financial Meltdown

Bill Moyers interviews William K. Black, the former senior regulator who cracked down on banks during the savings and loan crisis of the 1980s. about the financial crisis.



Transcript:

BILL MOYERS: Welcome to the Journal.

For months now, revelations of the wholesale greed and blatant transgressions of Wall Street have reminded us that "The Best Way to Rob a Bank Is to Own One." In fact, the man you're about to meet wrote a book with just that title. It was based upon his experience as a tough regulator during one of the darkest chapters in our financial history: the savings and loan scandal in the late 1980s.

WILLIAM K. BLACK: These numbers as large as they are, vastly understate the problem of fraud.

BILL MOYERS: Bill Black was in New York this week for a conference at the John Jay College of Criminal Justice where scholars and journalists gathered to ask the question, "How do they get away with it?" Well, no one has asked that question more often than Bill Black.

The former Director of the Institute for Fraud Prevention now teaches Economics and Law at the University of Missouri, Kansas City. During the savings and loan crisis, it was Black who accused then-house speaker Jim Wright and five US Senators, including John Glenn and John McCain, of doing favors for the S&L's in exchange for contributions and other perks. The senators got off with a slap on the wrist, but so enraged was one of those bankers, Charles Keating — after whom the senate's so-called "Keating Five" were named — he sent a memo that read, in part, "get Black — kill him dead." Metaphorically, of course. Of course.

Now Black is focused on an even greater scandal, and he spares no one — not even the President he worked hard to elect, Barack Obama. But his main targets are the Wall Street barons, heirs of an earlier generation whose scandalous rip-offs of wealth back in the 1930s earned them comparison to Al Capone and the mob, and the nickname "banksters."

Bill Black, welcome to the Journal.

WILLIAM K. BLACK: Thank you.

BILL MOYERS: I was taken with your candor at the conference here in New York to hear you say that this crisis we're going through, this economic and financial meltdown is driven by fraud. What's your definition of fraud?

WILLIAM K. BLACK: Fraud is deceit. And the essence of fraud is, "I create trust in you, and then I betray that trust, and get you to give me something of value." And as a result, there's no more effective acid against trust than fraud, especially fraud by top elites, and that's what we have.

BILL MOYERS: In your book, you make it clear that calculated dishonesty by people in charge is at the heart of most large corporate failures and scandals, including, of course, the S&L, but is that true? Is that what you're saying here, that it was in the boardrooms and the CEO offices where this fraud began?

WILLIAM K. BLACK: Absolutely.

BILL MOYERS: How did they do it? What do you mean?

WILLIAM K. BLACK: Well, the way that you do it is to make really bad loans, because they pay better. Then you grow extremely rapidly, in other words, you're a Ponzi-like scheme. And the third thing you do is we call it leverage. That just means borrowing a lot of money, and the combination creates a situation where you have guaranteed record profits in the early years. That makes you rich, through the bonuses that modern executive compensation has produced. It also makes it inevitable that there's going to be a disaster down the road.

BILL MOYERS: So you're suggesting, saying that CEOs of some of these banks and mortgage firms in order to increase their own personal income, deliberately set out to make bad loans?

WILLIAM K. BLACK: Yes.

BILL MOYERS: How do they get away with it? I mean, what about their own checks and balances in the company? What about their accounting divisions?

WILLIAM K. BLACK: All of those checks and balances report to the CEO, so if the CEO goes bad, all of the checks and balances are easily overcome. And the art form is not simply to defeat those internal controls, but to suborn them, to turn them into your greatest allies. And the bonus programs are exactly how you do that.

BILL MOYERS: If I wanted to go looking for the parties to this, with a good bird dog, where would you send me?

WILLIAM K. BLACK: Well, that's exactly what hasn't happened. We haven't looked, all right? The Bush Administration essentially got rid of regulation, so if nobody was looking, you were able to do this with impunity and that's exactly what happened. Where would you look? You'd look at the specialty lenders. The lenders that did almost all of their work in the sub-prime and what's called Alt-A, liars' loans.

BILL MOYERS: Yeah. Liars' loans--

WILLIAM K. BLACK: Liars' loans.

BILL MOYERS: Why did they call them liars' loans?

WILLIAM K. BLACK: Because they were liars' loans.

BILL MOYERS: And they knew it?

WILLIAM K. BLACK: They knew it. They knew that they were frauds.

WILLIAM K. BLACK: Liars' loans mean that we don't check. You tell us what your income is. You tell us what your job is. You tell us what your assets are, and we agree to believe you. We won't check on any of those things. And by the way, you get a better deal if you inflate your income and your job history and your assets.

BILL MOYERS: You think they really said that to borrowers?

WILLIAM K. BLACK: We know that they said that to borrowers. In fact, they were also called, in the trade, ninja loans.

BILL MOYERS: Ninja?

WILLIAM K. BLACK: Yeah, because no income verification, no job verification, no asset verification.

BILL MOYERS: You're talking about significant American companies.

WILLIAM K. BLACK: Huge! One company produced as many losses as the entire Savings and Loan debacle.

BILL MOYERS: Which company?

WILLIAM K. BLACK: IndyMac specialized in making liars' loans. In 2006 alone, it sold $80 billion dollars of liars' loans to other companies. $80 billion.

BILL MOYERS: And was this happening exclusively in this sub-prime mortgage business?

WILLIAM K. BLACK: No, and that's a big part of the story as well. Even prime loans began to have non-verification. Even Ronald Reagan, you know, said, "Trust, but verify." They just gutted the verification process. We know that will produce enormous fraud, under economic theory, criminology theory, and two thousand years of life experience.

BILL MOYERS: Is it possible that these complex instruments were deliberately created so swindlers could exploit them?

WILLIAM K. BLACK: Oh, absolutely. This stuff, the exotic stuff that you're talking about was created out of things like liars' loans, that were known to be extraordinarily bad. And now it was getting triple-A ratings. Now a triple-A rating is supposed to mean there is zero credit risk. So you take something that not only has significant, it has crushing risk. That's why it's toxic. And you create this fiction that it has zero risk. That itself, of course, is a fraudulent exercise. And again, there was nobody looking, during the Bush years. So finally, only a year ago, we started to have a Congressional investigation of some of these rating agencies, and it's scandalous what came out. What we know now is that the rating agencies never looked at a single loan file. When they finally did look, after the markets had completely collapsed, they found, and I'm quoting Fitch, the smallest of the rating agencies, "the results were disconcerting, in that there was the appearance of fraud in nearly every file we examined."

BILL MOYERS: So if your assumption is correct, your evidence is sound, the bank, the lending company, created a fraud. And the ratings agency that is supposed to test the value of these assets knowingly entered into the fraud. Both parties are committing fraud by intention.

WILLIAM K. BLACK: Right, and the investment banker that — we call it pooling — puts together these bad mortgages, these liars' loans, and creates the toxic waste of these derivatives. All of them do that. And then they sell it to the world and the world just thinks because it has a triple-A rating it must actually be safe. Well, instead, there are 60 and 80 percent losses on these things, because of course they, in reality, are toxic waste.

BILL MOYERS: You're describing what Bernie Madoff did to a limited number of people. But you're saying it's systemic, a systemic Ponzi scheme.

WILLIAM K. BLACK: Oh, Bernie was a piker. He doesn't even get into the front ranks of a Ponzi scheme...

BILL MOYERS: But you're saying our system became a Ponzi scheme.

WILLIAM K. BLACK: Our system...

BILL MOYERS: Our financial system...

WILLIAM K. BLACK: Became a Ponzi scheme. Everybody was buying a pig in the poke. But they were buying a pig in the poke with a pretty pink ribbon, and the pink ribbon said, "Triple-A."

BILL MOYERS: Is there a law against liars' loans?

WILLIAM K. BLACK: Not directly, but there, of course, many laws against fraud, and liars' loans are fraudulent.

BILL MOYERS: Because...

WILLIAM K. BLACK: Because they're not going to be repaid and because they had false representations. They involve deceit, which is the essence of fraud.

BILL MOYERS: Why is it so hard to prosecute? Why hasn't anyone been brought to justice over this?

WILLIAM K. BLACK: Because they didn't even begin to investigate the major lenders until the market had actually collapsed, which is completely contrary to what we did successfully in the Savings and Loan crisis, right? Even while the institutions were reporting they were the most profitable savings and loan in America, we knew they were frauds. And we were moving to close them down. Here, the Justice Department, even though it very appropriately warned, in 2004, that there was an epidemic...

BILL MOYERS: Who did?

WILLIAM K. BLACK: The FBI publicly warned, in September 2004 that there was an epidemic of mortgage fraud, that if it was allowed to continue it would produce a crisis at least as large as the Savings and Loan debacle. And that they were going to make sure that they didn't let that happen. So what goes wrong? After 9/11, the attacks, the Justice Department transfers 500 white-collar specialists in the FBI to national terrorism. Well, we can all understand that. But then, the Bush administration refused to replace the missing 500 agents. So even today, again, as you say, this crisis is 1000 times worse, perhaps, certainly 100 times worse, than the Savings and Loan crisis. There are one-fifth as many FBI agents as worked the Savings and Loan crisis.

BILL MOYERS: You talk about the Bush administration. Of course, there's that famous photograph of some of the regulators in 2003, who come to a press conference with a chainsaw suggesting that they're going to slash, cut business loose from regulation, right?

WILLIAM K. BLACK: Well, they succeeded. And in that picture, by the way, the other — three of the other guys with pruning shears are the...

BILL MOYERS: That's right.

WILLIAM K. BLACK: They're the trade representatives. They're the lobbyists for the bankers. And everybody's grinning. The government's working together with the industry to destroy regulation. Well, we now know what happens when you destroy regulation. You get the biggest financial calamity of anybody under the age of 80.

BILL MOYERS: But I can point you to statements by Larry Summers, who was then Bill Clinton's Secretary of the Treasury, or the other Clinton Secretary of the Treasury, Rubin. I can point you to suspects in both parties, right?

WILLIAM K. BLACK: There were two really big things, under the Clinton administration. One, they got rid of the law that came out of the real-world disasters of the Great Depression. We learned a lot of things in the Great Depression. And one is we had to separate what's called commercial banking from investment banking. That's the Glass-Steagall law. But we thought we were much smarter, supposedly. So we got rid of that law, and that was bipartisan. And the other thing is we passed a law, because there was a very good regulator, Brooksley Born, that everybody should know about and probably doesn't. She tried to do the right thing to regulate one of these exotic derivatives that you're talking about. We call them C.D.F.S. And Summers, Rubin, and Phil Gramm came together to say not only will we block this particular regulation. We will pass a law that says you can't regulate. And it's this type of derivative that is most involved in the AIG scandal. AIG all by itself, cost the same as the entire Savings and Loan debacle.

BILL MOYERS: What did AIG contribute? What did they do wrong?

WILLIAM K. BLACK: They made bad loans. Their type of loan was to sell a guarantee, right? And they charged a lot of fees up front. So, they booked a lot of income. Paid enormous bonuses. The bonuses we're thinking about now, they're much smaller than these bonuses that were also the product of accounting fraud. And they got very, very rich. But, of course, then they had guaranteed this toxic waste. These liars' loans. Well, we've just gone through why those toxic waste, those liars' loans, are going to have enormous losses. And so, you have to pay the guarantee on those enormous losses. And you go bankrupt. Except that you don't in the modern world, because you've come to the United States, and the taxpayers play the fool. Under Secretary Geithner and under Secretary Paulson before him... we took $5 billion dollars, for example, in U.S. taxpayer money. And sent it to a huge Swiss Bank called UBS. At the same time that that bank was defrauding the taxpayers of America. And we were bringing a criminal case against them. We eventually get them to pay a $780 million fine, but wait, we gave them $5 billion. So, the taxpayers of America paid the fine of a Swiss Bank. And why are we bailing out somebody who that is defrauding us?

BILL MOYERS: And why...

WILLIAM K. BLACK: How mad is this?

BILL MOYERS: What is your explanation for why the bankers who created this mess are still calling the shots?

WILLIAM K. BLACK: Well, that, especially after what's just happened at G.M., that's... it's scandalous.

BILL MOYERS: Why are they firing the president of G.M. and not firing the head of all these banks that are involved?

WILLIAM K. BLACK: There are two reasons. One, they're much closer to the bankers. These are people from the banking industry. And they have a lot more sympathy. In fact, they're outright hostile to autoworkers, as you can see. They want to bash all of their contracts. But when they get to banking, they say, ‘contracts, sacred.' But the other element of your question is we don't want to change the bankers, because if we do, if we put honest people in, who didn't cause the problem, their first job would be to find the scope of the problem. And that would destroy the cover up.

BILL MOYERS: The cover up?

WILLIAM K. BLACK: Sure. The cover up.

BILL MOYERS: That's a serious charge.

WILLIAM K. BLACK: Of course.

BILL MOYERS: Who's covering up?

WILLIAM K. BLACK: Geithner is charging, is covering up. Just like Paulson did before him. Geithner is publicly saying that it's going to take $2 trillion — a trillion is a thousand billion — $2 trillion taxpayer dollars to deal with this problem. But they're allowing all the banks to report that they're not only solvent, but fully capitalized. Both statements can't be true. It can't be that they need $2 trillion, because they have masses losses, and that they're fine.

These are all people who have failed. Paulson failed, Geithner failed. They were all promoted because they failed, not because...

BILL MOYERS: What do you mean?

WILLIAM K. BLACK: Well, Geithner has, was one of our nation's top regulators, during the entire subprime scandal, that I just described. He took absolutely no effective action. He gave no warning. He did nothing in response to the FBI warning that there was an epidemic of fraud. All this pig in the poke stuff happened under him. So, in his phrase about legacy assets. Well he's a failed legacy regulator.

BILL MOYERS: But he denies that he was a regulator. Let me show you some of his testimony before Congress. Take a look at this.

TIMOTHY GEITHNER: I've never been a regulator, for better or worse. And I think you're right to say that we have to be very skeptical that regulation can solve all of these problems. We have parts of our system that are overwhelmed by regulation.

Overwhelmed by regulation! It wasn't the absence of regulation that was the problem, it was despite the presence of regulation you've got huge risks that build up.

WILLIAM K. BLACK: Well, he may be right that he never regulated, but his job was to regulate. That was his mission statement.

BILL MOYERS: As?

WILLIAM K. BLACK: As president of the Federal Reserve Bank of New York, which is responsible for regulating most of the largest bank holding companies in America. And he's completely wrong that we had too much regulation in some of these areas. I mean, he gives no details, obviously. But that's just plain wrong.

BILL MOYERS: How is this happening? I mean why is it happening?

WILLIAM K. BLACK: Until you get the facts, it's harder to blow all this up. And, of course, the entire strategy is to keep people from getting the facts.

BILL MOYERS: What facts?

WILLIAM K. BLACK: The facts about how bad the condition of the banks is. So, as long as I keep the old CEO who caused the problems, is he going to go vigorously around finding the problems? Finding the frauds?

BILL MOYERS: You--

WILLIAM K. BLACK: Taking away people's bonuses?

BILL MOYERS: To hear you say this is unusual because you supported Barack Obama, during the campaign. But you're seeming disillusioned now.

WILLIAM K. BLACK: Well, certainly in the financial sphere, I am. I think, first, the policies are substantively bad. Second, I think they completely lack integrity. Third, they violate the rule of law. This is being done just like Secretary Paulson did it. In violation of the law. We adopted a law after the Savings and Loan crisis, called the Prompt Corrective Action Law. And it requires them to close these institutions. And they're refusing to obey the law.

BILL MOYERS: In other words, they could have closed these banks without nationalizing them?

WILLIAM K. BLACK: Well, you do a receivership. No one -- Ronald Reagan did receiverships. Nobody called it nationalization.

BILL MOYERS: And that's a law?

WILLIAM K. BLACK: That's the law.

BILL MOYERS: So, Paulson could have done this? Geithner could do this?

WILLIAM K. BLACK: Not could. Was mandated--

BILL MOYERS: By the law.

WILLIAM K. BLACK: By the law.

BILL MOYERS: This law, you're talking about.

WILLIAM K. BLACK: Yes.

BILL MOYERS: What the reason they give for not doing it?

WILLIAM K. BLACK: They ignore it. And nobody calls them on it.

BILL MOYERS: Well, where's Congress? Where's the press? Where--

WILLIAM K. BLACK: Well, where's the Pecora investigation?

BILL MOYERS: The what?

WILLIAM K. BLACK: 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.

BILL MOYERS: What do you mean?

WILLIAM K. BLACK: 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.

BILL MOYERS: Yeah. Are you saying that 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?

WILLIAM K. BLACK: Absolutely.

BILL MOYERS: You are.

WILLIAM K. BLACK: 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.

BILL MOYERS: But what might happen, at this point, if in fact they keep from us the true health of the banks?

WILLIAM K. BLACK: Well, then the banks will, as they did in Japan, either stay enormously weak, or Treasury will be forced to increasingly absurd giveaways of taxpayer money. We've seen how horrific AIG -- and remember, they kept secrets from everyone.

BILL MOYERS: A.I.G. did?

WILLIAM K. BLACK: What we're doing with -- no, 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.

BILL MOYERS: Even though Goldman Sachs had a big vested stake.

WILLIAM K. BLACK: 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.

BILL MOYERS: Yeah, like a conflict of interest, it seems.

WILLIAM K. BLACK: Massive conflict of interests.

BILL MOYERS: So, how did he get away with it?

WILLIAM K. BLACK: 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.

BILL MOYERS: Who's going to get the facts?

WILLIAM K. BLACK: We need some chairmen or chairwomen--

BILL MOYERS: In Congress.

WILLIAM K. BLACK: --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.

BILL MOYERS: And we have to know that, in order to know what?

WILLIAM K. BLACK: To know everything. 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.

BILL MOYERS: So, you're saying that people in power, political power, and financial power, act in concert when their own behinds are in the ringer, right?

WILLIAM K. BLACK: That's 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."

BILL MOYERS: Yeah, and this week in New York, at this conference, you described this as more than a financial crisis. You called it a moral crisis.

WILLIAM K. BLACK: Yes.

BILL MOYERS: Why?

WILLIAM K. BLACK: 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.

BILL MOYERS: This wound that you say has been inflicted on American life. 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, right?

WILLIAM K. BLACK: Right.

BILL MOYERS: It was relatively a handful of people.

WILLIAM K. BLACK: 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.

BILL MOYERS: When you wake in the middle of the night, thinking about your work, what do you make of that? What do you tell yourself?

WILLIAM K. BLACK: There's a saying that we took great comfort in. It's actually by the Dutch, who were fighting this impossible war for independence against what was then the most powerful nation in the world, Spain. And their motto was, "It is not necessary to hope in order to persevere."

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.

So stop that current system. We're hiding the losses, instead of trying to find out the real losses. Stop that, because you need good information to make good decisions, right? Follow what works instead of what's failed. Start appointing people who have records of success, instead of records of failure. That would be another nice place to start. There are lots of things we can do. Even today, as late as it is. Even though they've had a terrible start to the administration. They could change, and they could change within weeks. And by the way, the folks who are the better regulators, they paid their taxes. So, you can get them through the vetting process a lot quicker.

BILL MOYERS: William Black, thank you very much for being with me on the Journal.

WILLIAM K. BLACK: Thank you so much.

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