Don Williams comments

Ah, look at all the golden parachutes, as Bush socializes the losses

by Don Williams

Everybody sing along.

We're all socialists now,

We're all socialists now.

Dubya's nationalized the economy,

We're all socialists now.”

(With apologies to Garrison Keillor.)

OK, that's misleading. It's only socialism for the super-rich.

Welcome to full-blown oligarchy-government that socializes the losses of big business while privatizing the profits and promoting corporate welfare through good-old-boy contracts for military build-ups, outdated energy plans and tax breaks for the wealthy. It's a form of government not unlike, um, well, dare I say… oh, never mind, comparisons are odious. Google oligarchy and come up with your own. Examples abound.

Actually, as this is written, the proposed $700 billion bailout of Wall Street is not a done deal, thanks to cantankerous House Republicans. I admit to a grudging respect for them, even if their plan is cockeyed, coming complete with a cut in capital gains taxes. They also promise to knock golden parachutes out of the sky, though it's too late in many cases.

According to the Sept. 26 issue of The Guardian, “When Merrill Lynch's Stan O'Neal was ditched last year for encouraging a culture of risk which led to $12bn (£6.6bn) of losses on mortgage-related securities, he took $161 million of stock and options with him into retirement. Citigroup's Chuck Prince, who went a similar way, took $39.5 million. Even Lehman's Dick Fuld, whose bank has actually gone bust, received $35 million to reward him for his wonderful work last year. About the only one who could truly claim he had a successful year was Goldman Sachs' boss, Lloyd Blankfein, who duly scooped $68.5 million, as the bank profited by betting that lots of struggling families would lose their homes.”

And despite cantankerous Republicans and an angry electorate, it's likely a matter of time before our leaders turn the biggest bailout teat of all time Wall Street's way. It's probably already happened, even as you read this.

Snuggle up, honey-bunch.

We'd best keep a sense of humor as long as possible, and laugh at the irony. The administration that most loudly touted free enterprise, the “ownership society” and deregulation, while lambasting anyone who disagreed, has squandered more national treasure in collectivist enterprises than any single leader in the history of the known universe, I'd wager.

Expenses related to the U.S. military-maybe the most collectivist enterprise in history-will have cost the taxpayers at least $10 trillion by the end of the Bush presidency, counting annual budgets and our on-going War in Iraq, which cost at least $3.3 trillion, before the recent bailouts.

Nobel Prize-winning economist Joseph Stiglitz makes the case that this economic meltdown should be considered part of the cost of that war, which he says soaked up much of the economy's liquidity, dampened oil production, transferred American wealth to Iraq, drastically increased the national debt and prompted acts of artificial liquidity in the markets through lower interest rates and less regulation the past seven years.

I've been amazed at the restraint many in media showed early on by not assigning Bush more blame. I'm not one of them. When considering the blame Bush bears, take time to read a hugely suppressed story that appeared at www.projectcensored.org before the latest Wall Street debacle. The story is about the fall of Eliot Spitzer. You remember Spitzer, former governor of New York busted for consorting with prostitutes after the government used the Patriot Act to inspect his personal bank records? Spitzer's more pertinent crime might've been his efforts to expose Bush's mendacity and corruption in support of predatory lenders, according to the story quoted below…

On February 14, the Washington Post published an editorial by Spitzer titled, “Predatory Lenders' Partner in Crime: How the Bush Administration Stopped the States From Stepping In to Help Consumers,” which charged, “Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.”

In this editorial, Spitzer explained:

The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC).… For 140 years, the OCC examined the books of national banks to make sure they were balanced… but a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules… When my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation.”

The editorial appeared the day after Spitzer's ill-fated rendezvous with the prostitute at the Mayflower Hotel. With that article, some Washington insiders believe, Spitzer signed his own political death warrant. On March 4, 2008, Spitzer furthermore proposed legislation that would have imposed penalties for mortgage fraud and predatory lending.

In the words of Spitzer, “When history tells the story of the sub-prime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably . . . it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits….”

On the bright side, this whole crisis has the potential to give Barack Obama the padding necessary to prevent another stolen or fumbled election. Watch my blog at www.Knoxvoice.com for more on this crucial and under-reported issue.