$16 Trillion in Secret Bailouts!

According to Senator Bernie Sanders, the first top-to-bottom audit of the Federal Reserve took place, implying that the Federal Reserve is audited, as the Comprehensive Annual Financial Report (CAFR) shows, however, that audit doesn't go far enough. Anyway, Senator Sanders said this audit uncovered "a whopping $16 trillion in secret loans to bail out American and foreign banks and businesses during the worst economic crisis since the Great Depression."

"As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders. "This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."

"No agency of the United States government should be allowed to bailout a foreign bank or corporation without the direct approval of Congress and the president," Sanders said.

From the Silver Bear Cafe:

The list of institutions that received the most money from the Federal Reserve can be found on page 131 of the GAO Audit and are as follows..

Citigroup: $2.5 trillion ($2,500,000,000,000)
Morgan Stanley: $2.04 trillion ($2,040,000,000,000)
Merrill Lynch: $1.949 trillion ($1,949,000,000,000)
Bank of America: $1.344 trillion ($1,344,000,000,000)
Barclays PLC (United Kingdom): $868 billion ($868,000,000,000)
Bear Sterns: $853 billion ($853,000,000,000)
Goldman Sachs: $814 billion ($814,000,000,000)
Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)
JP Morgan Chase: $391 billion ($391,000,000,000)
Deutsche Bank (Germany): $354 billion ($354,000,000,000)
UBS (Switzerland): $287 billion ($287,000,000,000)
Credit Suisse (Switzerland): $262 billion ($262,000,000,000)
Lehman Brothers: $183 billion ($183,000,000,000)
Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)
BNP Paribas (France): $175 billion ($175,000,000,000)
and many many more including banks in Belgium of all places

The GAO Report

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Banks are Robbing Us Blind

Bank fees, something we're all familiar with, generate lots of revenue for the banking industry, and as the fees multiply and become more expensive, it is also getting harder to get them reversed. I thought the banking industry was "robbing" us, but were doing so under the law. Not so, says the GAO.

Lack of a clear and conspicuous fee schedule violates the 1991 Truth in Savings Act and Federal Reserve Regulation DD. But while banking regulators cited firms for ignoring fee disclosure rules 1,674 times between 2002 and 2006, the GAO found that significant consequences for violations are rare. Only twice did regulators undertake formal enforcement actions.

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The Fear of Appearing Soft on Defense is What's Soft.

The pentagon’s budget this year, adjusted for inflation, is the highest it's been in 60 years. By the end of this year, the US will have spent ¾ of a trillion dollars on defense.

Despite huge military inefficiency, no one has ever lost an election by promising to "strengthen" our defense by spending more. On the other hand, if a political candidate tells the truth, and claims he can make keep our defense strong, possibly making it stronger by spending less on the defense budget, he appears "soft" on defense. Living with the constant fear of appearing soft on defense is what is soft, especially when that taxpayer money literally does nothing but waste time and money, building up the military industrial complex.

Let’s say one of the Bush twins bought $5,000 of Lockheed Martin stock - biggest defense contractor in America - on September 10, 2001; her initial investment would be worth over $20,000 today. Lockheed Martin, along with other defense contractors, bank on the US government spending most of its federal budget on military projects, some of which have turned out to be totally useless, and the amount spent could have easily funded universal health care a few times over.

Take the F22 Fighter jet program, the most expensive jet in history, with a $330 million price tag, originally designed to fight the Soviets. According to Government Accountability Office (GAO), the original plan scheduled the first aircraft to be operationally deployed in 1996. After 25 years of expensive development, this jet has finally reached what the US defense department calls “full operational capability", meaning it’s ready to go to war.

Well, it's a little late as we have not used the F-22 fighter jet and have no plans to do so further down the road. The best part of all is that F-22 Fighter Jet Program is still very much alive and kicking.

Why is the F-22 program, which has already cost taxpayers $65 billion dollars, still kicking? The answer, as is the answer to many programs we needlessly spend money on, is political clout.

"Lockheed Martin represents tens of thousands of employees in 45 out of 50 states. When you have political clout like that behind you, it’s pretty simple to convince members of congress that continuing a program like that is important to their constituencies. – Christopher Helman, an analyst at the Center for Arms Control

Winslow Wheeler, forced to step down as a staffer on the Senate budget committee after he published an article on bloated defense spending in 2002, reported the GAO recommended no further funding for the F-22 Program until the Department of Defense can provide relevant justification which it could not do.

Many budget analysts estimate big ticket items will drive and make up more than half of the pentagon's budget. However most of these big-ticket programs (missle defense, naval destroyer, submarines,) provide no real value for counter terrorism operations, so these big ticket security projects become priority when they don’t enhance our security.

I don't think anyone would refer to President Eisenhower as soft on defense, yet a few days after he was inaugurated, he promoted deep cuts to defense spending,

“To amass military power without regard to our economic capacity would be to defend ourselves against one kind of disaster by inviting another.“ – President Eisenhower in 1953

So, why is it that "we the people" equate military strength with dollars spent without demanding accountability for how that money is spent, and more importantly if all that money we hand over does make our military stronger?

Currently, with reports of troops in Iraq and Afghanistan lacking proper armor, equipment shortages, not to mention, shortage of troops overall; it's very obvious that higher defense dollars, does not equal a stronger defense.

Miriam Pemberton, a Research Fellow at the Institute for Policy Studies and Peace and Security Editor for Foreign Policy In Focus, after crunching the numbers, found that the Pentagon could easily fund troops, equipment, maintenance, modernization and even add money for diplomacy, humanitarian aid, and other measures of preventative security and cut the defense budget by 10%.

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