Thursday, April 23, 2009

The Case Against Ahmedinejad

The propaganda war against Iran, mostly advanced through continuing attacks against Mahmoud Amedinejad, continued this week as the Iranian president delivered the first speech at the UN Durban Review Conference on Racism. The reason he delivered the first speech, of course, is that he was the only national president who agreed to come to the conference. Most other nations sent representatives. The United States and Israel, as expected, refused to send anyone. So the Iranian President gave his speech, and with his first remarks about Israel, some forty outraged representatives of mostly European nations, stormed out in protest. The U.S. media predictably focused on this walkout, barely giving any attention to what Ahmedinejad had said, characterizing it as “anti-semitic,” and leaving the impression that the remarks were both humanly and historically false, racist, and deeply insulting to anyone who knows the facts. This is the same treatment Ahmedinejad has received in the past, to wit, when he made his remarks about Israel that are endlessly quoted as having vowed to “wipe Israel off the map”, and hence constituting a prima facie case for Iranian aggression. But as University of Michigan professor Juan Cole and Farsi language analysts long ago pointed out, Ahmadinejad was quoting Ayatollah Khomeini, who had said the “regime occupying Jerusalem must vanish from the page of time.” Cole explained that this “does not imply military action or killing anyone at all.” Journalist Diana Johnstone further pointed out that the quote was not aimed at the Israeli people, but at the Zionist “regime” occupying Jerusalem.
            In the same way, it one takes a look at what Ahmedinejad said at this conference in the light of real rather than imagined history, one gets a different picture. First, according to’s account, Ahmadinejad accused the West of making “an entire nation homeless under the pretext of Jewish suffering ... in order to establish a totally racist government in occupied Palestine.” Well let’s see. Did not the Israeli war of 1948 force some three-quarters of a million Palestinians from their homes and make them refugees? Is that not making Palestinians homeless? And did not subsequent wars in 1967 and thereafter turn the Palestinian people who remained into an occupied people, living in refugee camps called the West Bank and the Gaza Strip? And was not the United Nations plan to give a majority of historic Palestine to the Jewish people driven in part by the moral cowardice of the Europeans and Americans, who again and again refused to admit Jewish refugees trying to escape the Holocaust, and sought to compensate for this cowardice and their historic pogroms against Jews by giving their approval and hypocritical sanction to a Palestinian homeland for European Jews in a land already occupied since time immemorial? Which is what Ahmedinejad also said:
“In fact, in compensation for the dire consequences of racism in Europe, they helped bring to power the most cruel and repressive racist regime in Palestine.”
            But you would never know that from the media’s account. For felt compelled to add its own version of the 1948 founding of Israel: “Israel was established in 1948 as a homeland for the Jewish people after the Holocaust, on land also claimed by Palestinians.” ALSO CLAIMED BY PALESTINIANS? Palestinians didn’t have to claim it: Palestine was their land. It is their land, Palestine. And it was seized by Zionist force of arms in 1948 and subsequently, as any look at maps from different historical periods or fair accounts of what happened will show. And that seizure is still going on in the form of the apartheid wall and so-called “settlements.” And that war is still going on, most recently in the invasion of Gaza by Israeli forces, sanctioned and approved by the United States, including the slaughter of 1400 Gazans, most of them defenseless women and children.
            But that bad Ahmedinejad had the nerve to call this “racism.” He put it very nicely in fact, when he said, “In fact, in compensation for the dire consequences of racism in Europe, they helped bring to power the most cruel and repressive racist regime in Palestine.” Well isn’t that true? Is not the history of Jews in Europe, and America for that matter, a history of racist oppression against a minority? And does not the status of Palestinians in Israel and the occupied territories now mirror that historic racism in the manner and methods the Zionist regime (European in origin) has consistently used to attack, oppress, disenfranchise and ethnically cleanse the original Semitic people of Palestine? But Ahmedinejad went further. He added that the Jewish national movement “personifies racism” (because what, pray, can a “Jewish state” mean other than the privileging of one people over another—as in the fact that any person of Jewish heritage even today arrives in Israel from Europe with more inherent rights than a Palestinian who has lived there for generations?) and in CNN’s words “accused Zionists of wielding economic and political resources to silence opponents.” Good lord. Does the man have no shame? Zionists use money and politics to try to silence opponents? Who ever heard of such a thing?
            Finally, this man who has been compared to Hitler by the American press had the nerve to tar the United States of America’s invasion of Iraq with the same brush:
“Wasn’t the military action against Iraq planned by the Zionists and their allies in the then-U.S. administration?”
Well, wasn’t it? To whom did Iraq present a threat? Were we to believe that the fabled Iraqi “weapons of mass destruction” threatened the continental United States? No, the real threat Iraq posed was to absolute Israeli hegemony in the Middle East. Just as now, the real threat Iran poses is a constantly hyped threat to that same absolute hegemony. And so, though they may not have been primary in promoting the attack on Iraq—for Bush and his Vice President and his Secretary of Defense seemed determined from the very outset to find an excuse to take out Iraq and Saddam Hussein—there was a cluster of Bush administration hawks, the so-called neocons, who surely played a role in promoting the Iraqi invasion: people like Paul Wolfowitz, Irving “Scooter” Libby, Eliot Abrams, Richard Perle, Douglas Feith, and many more in Congress, many with a history of strong connections with Israel, its right-wing Likud party, and the wing-nut who now rules the nation, Binyamin Netanyahu. Ah, but to call attention to that fact is dastardly, un-diplomatic, anti-semitic. And so the great moral beacons of world democracy—the representatives of white, historically racist Europe—walk out in a huff. Heaving diatribes against this upstart crow from the Middle East: as: from that bastion of equality and fairness regarding the globe’s darker peoples, Great Britain, came “offensive,” “inflammatory,” “outrageous and anti-semitic;” from France came “unacceptable,” and “heinous;” while from Canada erupted the observation that the major problems with Iran are continued threats against Israel and against the Israeli people, along with persistent nuclear ambitions. “Nuclear ambitions!” mind you. For its part, the U.S. through its State Department, ignoring the comment of Navi Pillay, the UN high commissioner for human rights that she regrets and is “shocked” by the United States’ decision to boycott, said that its decision to not attend was based in its objection to a conference document that “singles out” Israel for criticism, and conflicts with the U.S. “commitment to unfettered free speech.”
            Presumably, that right to free speech extends only to the U.S. and its allies, but not to the likes of Mahmoud Ahmedinejad, or Iran, or those “other” races in the Middle East possessed of this disturbing tendency to want to rule, and even inhabit their own part of the world.

Monday, April 20, 2009

Bankers, Bailouts, Credit Cards and Suckers

 An item on the news yesterday about the progress, or lack of it, of the “Credit Cardholders’ Bill of Rights Act of 2009” (to try to keep credit card companies, i.e. banks, from arbitrarily increasing interest rates on existing credit card balances) got me thinking about debt, credit, bankruptcy and how the laws all favor the banks until it comes time for the suckers (us) to bail them out. Especially in recent years, we suckers have all been taken for a real ride. In 2005, for example, the Bush Administration passed a law—“The Bankruptcy Abuse Prevention and Consumer Protection Act”—signed with great fanfare by President Decider, that “reformed” the bankruptcy laws, particularly governing credit card debt.  The reform was promoted as a benefit to consumers (suckers) by making it harder for the average person with consumer debt to file for Chapter 7 bankruptcy (the law now forced such persons to file a “means test,” as well as undertake “credit counseling” and education in personal financial management), thus reducing losses to lenders. Presumably, we’d all benefit because lenders wouldn’t tighten up on the credit cards all the rest of us depend on. Though the new hurdles definitely caused a sharp decline in personal bankruptcy filings—thus benefiting the banks—they also failed to stop the rise of interest rates and fees these same banks charged suckers. A Harvard Law School fellow, Mike Simkovic, did a study and put it this way:
            “The fact that after bankruptcy reform, interest rates and fees continued to rise, and grace periods continued to fall, even though credit card companies reaped tremendous gains from declining bankruptcy losses demonstrates that the credit card market is not price-competitive. This lack of price competition explains why the benefits of bankruptcy reform accrued exclusively to credit card lenders and…why bankruptcy reform was a failure.” (from “New Bankruptcy Laws Hurt Consumers,” at )
The same article cites another effect of the 2005 “reforms”:  the increase in home foreclosures and defaults—something clearly related to our current crisis. According to a study by David Bernstein, “The more stringent bankruptcy code” that limited financial relief and made it more difficult and expensive to file for bankruptcy, “appears to have increased the number of individuals walking away from their homes, their mortgages, and the other financial obligations without seeking the protection of the bankruptcy court.”
            To grant the devils their due, such restrictive measures are not, historically, as bad as the practice in ancient Greece, where bankruptcy didn’t even exist. The families of adult fathers who couldn’t pay their debts were legally liable for those debts, and so entire families could be forced into “debt slavery” until their labor discharged the debt. Many if not most of the first immigrants to the United States were debtors as well, coming to the New World as indentured servants committed to working off their debts in a few years. Thomas Jefferson, among other notables, ended his life so deeply in debt that his entire property (including about 200 slaves) went on the auction block to pay his creditors, leaving his white family penniless (his “black” family by his enslaved concubine Sally Hemings, of course, would have inherited nothing in any case). Still, according to an article in the current New Yorker Magazine, the debtor policy in the United States improved on the bankruptcy situation that had prevailed in Europe, where only traders and merchants were allowed to claim bankruptcy—European logic being that such “risk-takers” had to be protected in order for their crucial trade to continue. All others went to debtors’ prisons—for sums as small as a few shillings. In the United States, by contrast, democracy in essence demanded that all were entitled to the same protection, and so the protection of bankruptcy, usually Chapter 7, became available to anyone unable to pay his bills. This meant that though major property items could be seized, at least some “exempt” property—clothing, household goods, an older car—could be retained as the rest of the debt was discharged (except for spousal and child support, student loans and most taxes).  This was the situation that prevailed until the 2005 “reform” made bankruptcy for suckers less available.
            Since then, however, a few things have changed. Most notably, the current financial crisis has meant that now it is not those irresponsible consumers (suckers) who are going bankrupt, but the banks (mortgage brokers, investment bankers, insurance companies etc.) themselves. And, reverting to the traditional attitude that wealthy traders and merchants deserve more consideration than the workers who actually make products, our financial wizards have decreed that we taxpayers (suckers) should all agree to bail out the financiers because, after all, what they do is crucial for the rest of us. And so, in the biggest bailout in U.S. history, we’ve propped them up with trillions ($12 trillion so far?) in taxpayer dollars.
            Now that wouldn’t be quite so bad if the bastards displayed a little contrition, a little consideration for the little guy. But do they? Not on your life. First of all, these hucksters continued to pay themselves—the guys at the top—obscene bonuses. And more recently, an AFL-CIO sponsored study found that more CEOs of American companies got pay hikes than pay cuts in the year 2008. That’s right. Of 946 companies surveyed, 480 had CEOS who got pay raises, while 463 cut their CEOs pay. Moreover, median CEO salary rose 7% in 2008 (the year the economy collapsed), with their perks going up 13% to an average value of $336,246., and their average yearly compensation  reaching $5.4 million.
            Secondly, and this is the real outrage, the banks we’ve bailed out with trillions that our children will be paying for god knows how long, have chosen to stick it to us suckers in yet another way—by gouging us with credit card interest. That’s right, the same swine who have begged for  billions to keep their companies “solvent” (after they drove them and us into the ditch with their complex securitized mortgage packaging and credit default swaps all designed to make billions while the getting was good), these same hot shots have now come up with yet another swindle—sticking it to credit card debtors. It’s a foolproof game, especially now that getting bankruptcy relief for credit card debt has been made much harder (thanks to the 2005 reform cited above): just raise the rates on credit card debt arbitrarily, take it or leave it. Listen to the experience of some recent complainants to A small business owner from Southhaven, Miss wrote:
            “I have a very small business and most of our debt is on credit cards. We had a 0% annual percentage rate until January 2009 that would go up to 7.99% thereafter. A few months ago my check got there a day late. The credit card company, Advanta, increased my APR to 7.99%. I just received my current statement and the APR jumped to 25.39%. When I called, a supervisor said it was done for economic reasons. How can they do that? Is it illegal? Can I report them?”
The answer came from Kathleen Ryan O’Connor:
            “Faced with the same economic pressures as other companies affected by the ongoing recession and credit crunch, credit card companies are racing to protect themselves from the costs of more defaults by hiking interest rates and slashing credit limits, even for cardholders with excellent credit histories.”
Another small business owner had the same experience, noting that her expanding company was not only issued a lower credit card limit, but also an interest rate hike that went from 3% to 27%! The credit card company, Advanta, referred her to the terms and conditions it issues, including this one: “We may change any of your account terms, including rates and fees, at any time, for any reason.” No questions asked. Take it or leave it.
            So that’s the money game. First make a pile of money on fraudulent practices in mortgage lending and bundling the bad loans in impenetrable securitized mortgage packages to be sold to suckers the world over. Then get government bailouts (i.e. taxpayer money) to get rid of the “toxic assets” that are holding back credit and threatening to bring down the whole system. Then stick it to the taxpayers who bailed you out by raising their credit card interest so as to maintain your “profitability”—which is precisely what my credit card company, Chase, used as justification for bumping my APR over 4 percentage points. No reason needed. Take it or leave it, suckers.
            So don’t be shy about calling your Congressional reps and senators. Tell them you back the idea proposed by Vermont’s Senator Bernie Sanders: calling the practice of credit card companies “nothing less than loan sharking,” Sanders has proposed a 15% limit on all credit card interest. Period. Now that’s a proposal. So is Senator Christopher Dodd’s idea to “bar credit card companies from raising interest rates at any time for any reason.” I wouldn’t hold my breath that either proposal will pass, but some outraged calls and letters threatening a debtors’ revolt might help.
Lawrence DiStasi

Sunday, April 12, 2009

You can Bank on it

Rivers have banks
Remember the Ganges
With ashes and hankies
And Boston has the Charles
With coeds and ivies
But while rivers have banks
Our nation has bankers
Who are bred with the Brahmins
And they give us tankers and cankers
While they hide in the Caymans

We seem to be focused on the scandalous behavior of today’s bankers with regard to being dismal stewards of wealth both at home and abroad. We have marveled at their seeming limitless incompetence and greed as though it were some historical anomaly. It is not. I observed banking close up in the late seventies and early eighties while working for one. That is when bankers chaffed under the rules that limited their grasp to banking while they pleaded for license to offer other stuff like investment products and services that were then largely limited to Trust Banking. Trust Banking was a wonderful excuse for slick bank operators in the northeast to squeeze vulnerable old widows by entertaining them in Florida and selling them questionable securities and planning advice in the winter. Of course, that was a minor scam compared to today’s derivative product schemes, but the roots were well watered and established. As for incompetence, the most salient example for me was the insatiable appetite Colonial Bank of Connecticut demonstrated for international lending. The bank had a well disciplined practice of presenting domestic loans to a loan committee that was responsible for seeing that loans were balanced by geography and by industry or business concentration. Lending to too many dry cleaners or department stores or car dealers could concentrate losses due to the vagaries of the economy or weather or fire, etc. In setting up 29 international bankers in London, however, those lessons were lost and the lending risk was concentrated not only on shipping, but on Greek Oil Tankers. Geography and industry related risks were essentially doubled up and no domestic loan committee reviewed the loans. When the recession came, the tanker “owners” simply anchored their ships in Athens harbor and walked away without a care about the debt. Colonial Bank was then taken over by Bank of Boston which itself was bought out by another bank and the fiasco rolled on. I once asked one of these senior professional bankers why they would spend hundreds of dollars in overtime labor to track down the explanation for a two dollar difference at close of business to balance the books when it would be so much cheaper to simply write off the two bucks or add it as found money. His response was that banking was “precise.” When I then asked how banking could be considered precise if the bank was out of balance in the first place, I did not get an answer.

Examples beyond my personal observation exist and I want to insert some thoughts that demonstrate one item in our national history through a well researched past that has been prelude to power and control anachronistic in our representative democracy. I commend the history Rising Tide by John M. Barry as a documented description of how bankers influenced the events surrounding the catastrophic Mississippi flood of 1927. Barry documents the engineering, politics and financing that controlled the Mississippi river. His book is consistently fascinating and occasionally alarming.
That 1927 flood cost the lives of several hundred Americans and was characterized with politics and scheming from every level of our republic. It was also an interesting stew of engineering and special interests as well as bad luck in weather. Banking, however was the item that will most remind us of today’s situation where bankers have chosen high risk over common sense or commonwealth in any sense of the words.

New Orleans lies near the exit of the Mississippi into the Gulf of Mexico, but there are parishes (counties) between the Big Easy and the sea. As the flood waters moved south along the general path of the big river, it wreaked destruction all along its path and the path itself was tortuous with excursions along the way that in one breech alone exceeded 90 miles east-west by 60 miles deep. The powers of New Orleans sought to remove even the slightest doubt that the river would overtop the levees of New Orleans Parish and they sought to dynamite the levees protecting Plaquemines and St. Bernard Parishes. They went to the Governor of Louisiana and to the President of the United States asking for authority to destroy the levees south of New Orleans and were met largely with indifference and light resistance at every level. They also went to the Secretary of Commerce who was put in charge of recovery activities by President Calvin Coolidge. You may remember Herbert Hoover who later became associated with laiszez faire control of banking. Hoover was Secretary of Commerce and Coolidge could not be bothered to visit the devastation despite repeated requests from most governors and the Congress. At that time, Hoover was known as a publicity hound; skilled at spin before it became a professional art form. He would ride that barge to the White House where it sunk a few years later.

If you are at all curious as to where the power of New Orleans centered, it was not with the democratically elected officials. It was the 27 or so major bankers of the city who, even then, had also been the social elite (Boston Club) of New Orleans who sponsored and supported the major krewes of Mardi Gras. Once they decided to dynamite the levees south of the city, it was only a matter of when and how much they had to pay in reparations. That is power. Most often, these bankers chose to remain anonymous as long as they were able to present their sons and daughters as king or queen of Mardi Gras. That was an honor bestowed on few and cherished by all. It required unmentionable wealth to execute the duties of Mardi Gras, especially for the secret krewe of Comus. It was the social and economically privileged that controlled the major krewes, the banks, the politics and the levee. He who controls the levee controls the world of New Orleans including the life and death of every citizen. It is parades and parties that precede Lent each year for the masses, but it is a perennial party for the bankers of New Orleans. Barry points out that a ball gown for the queen of Comus or perhaps Rex would typically far exceed the annual salary for the governor of Louisiana.

I know that some readers may feel that the impact of privilege is overvalued, but as we fast-forward to current events in banking and finance, the parallel of our banking system to the social structure of New Orleans is curious as a minimum. Banking has little basis in performance. It has a strong basis in power; social power as well as personal wealth and it is unrelated to democratically elected positions. The “Fed” prints and controls our money and yet it is not a government function. How did we get here? Can we change the structure?

When I lived in New Orleans with my wife and kids, I felt that the city was a warm and friendly town and, indeed, that is one level of the city. Peel back the layers and it is far more interesting and perhaps even sinister because nothing is as it appears there or in our national banking system. It is a costume party and you are not invited except to stand on the street at public parades shouting, “Throw me something, Mister.” Please read Barry’s book and the recent banking essay by Larry DiStasi. Catch a trinket.

George Giacoppe
10 April 2009

Thursday, April 02, 2009

Money Ex Nihilo

Since our little economic crisis took center stage, I have been trying, vainly, to understand it, along the way trying to understand money and a little concept called “debt-based currency.” Recently, I think I’ve got it—not thoroughly, to be sure, but enough to be able to perceive a monstrous scam when I see one, thanks to an amazing little article I suggest everyone read: “Dollar Deception: How Banks Secretly Create Money,” by Ellen Brown, J.D. on . It doesn’t have to do with AIG or with credit default swaps or securitized mortgages. It has to do with the basic idea of money creation, who creates it, and how.
            Begin with some common misconceptions. 1) The Federal Reserve is the nation’s bank, a public, government entity. Wrong. The Federal Reserve is actually a consortium of private banks, which creates money and lends it to the government, to us, at a nice rate of interest. 2) The Federal Reserve, by creating its Federal Reserve notes, i.e. printing all that money we all lust after, makes most of the money supply. Also wrong. Forget paper money: most of the money that’s created is actually created by plain old banks when they make loans. 3) The money that banks create is actually backed by something substantial, like gold or silver. Wrong. The United States went off the gold standard in 1933, when Franklin Delano Roosevelt made this move to keep what money was left in the United States from fleeing to foreign banks. Since then, the legendary stash of gold in Fort Knox supposedly backing our paper dollars no longer exists. Your dollars are backed by literally nothing except the U.S. government’s pledge to honor them in some way that is not clear. It’s a bit of a magic trick, kept afloat by the faith of people and businesses (and countries like China and Saudi Arabia which hold so much U.S. debt that if they ever decided to call it in, we’d all be in the sewer).
            But let’s get back to basics. Banks create money out of thin air. Ellen Brown cites an astonishing lawsuit that illustrates this in an amazing way. In 1969, a man named Daly was about to lose his home to a bank that held a $14,000 mortgage on it. Daly, a lawyer, decided to sue the bank for not having “consideration,” or something of value, backing its loan to him. In court, the bank’s president admitted this was true, saying that the bank routinely created money “out of thin air” for its loans, which he said was standard practice in the industry. The judge, a Justice of the Peace named Mahoney, reiterated what he had heard: “Plaintiff admitted that it, in combination with the Federal Reserve Bank of Minneapolis…did create the entire $14,000 in money and credit upon its own books by bookkeeping entry. That this was the consideration used to support the note…[and that] the money and credit first came into existence when they created it. Mr. Morgan [the bank president] admitted that no United States Law or Statute existed which gave him the right to do this…” Given these facts—that the bank was actually extending credit without backing its loans with anything it actually had in its vaults—the court ruled against the bank’s foreclosure claim, and Daly kept his house.
            Now elementary banking theory seems to partially admit this. It grants that since at least the 17th century, in a practice started by goldsmiths, bankers have engaged in what is known as “fractional reserve banking.” That is, when people deposited their gold with goldsmiths, and received paper notes testifying to the amount and allowing them to redeem the gold when they needed it, the goldsmiths holding the gold noticed something. People never came all at once to redeem their gold. In fact, at any one time, only about 10 or 20% of the gold was needed to redeem the notes people presented. This meant that the goldsmith could actually lend from 5 to 10 times as much money (in notes) as they had backed with gold. This became the basis for “fractional reserve banking” and most currency: except in situations like the Depression, where everyone suddenly wants to redeem paper bank notes for gold or silver in what is known as a “run” on banks, banks could lend out—literally create—far more money than they actually had in reserves. Ellen Brown quotes some notable bankers on this. Sir Josiah Stamp, president of the Bank of England in the 1920s:
            “The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented.”
            Or Graham Towers, Governor of the Bank of Canada from 1935 to 1955:
“Banks create money. That is what they are for. . . The manufacturing process to make money consists of making an entry in a book. That is all. . . .Each and every time a Bank makes a loan . . . new Bank credit is created -- brand new money.”
Or Robert B. Anderson, Treasury Secretary under President Eisenhower:
            “[W]hen a bank makes a loan, it simply adds to the borrower's deposit account in the bank by the amount of the loan. The money is not taken from anyone else's deposit; it was not previously paid in to the bank by anyone. It's new money, created by the bank for the use of the borrower.”
            To get some idea of the amount of money that gets created this way, and its inflationary effect (creating money means more dollars (demand) chasing the same amount of goods (supply), hence prices tend to rise) Brown cites the Fed’s own money supply (M3) statistics. First of all, new money has to be created all the time, i.e. borrowed, “just to pay the interest owed to bankers. A dollar lent at 5 percent interest becomes 2 dollars in 14 years. That means the money supply has to double every 14 years just to cover the interest owed on the money existing at the beginning of this 14-year cycle. The Federal Reserve’s own figures confirm that M3 has doubled or more every 14 years since 1959. That means that every 14 years, banks siphon off as much money in interest as there was in the entire economy 14 years earlier. This tribute is paid for lending something the banks never actually had to lend, making it perhaps the greatest scam ever perpetrated…”
            Now think about it. Bankers, and especially those in the big banks like Citibank and Morgan and Chase and Wells Fargo and Bank of America, have been getting rich on this “greatest scam ever perpetrated” for years, a scam that at one time was called usury. But not content with making billions on interest, especially from the difference between the rate they pay to borrow the money from the Federal Reserve and the outrageous rate they have been allowed, since 1981, to charge their credit card customers (one of my bank credit cards just informed me that my interest rate was being raised about 4%, the difference between the essentially 1% they get it for and the 13% they now charge me being their profit, not to mention the profit they make from poorer folks whom they charge 25 and 30% for the same credit), they had to get into “subprime” mortgages and complicated securitized debt instruments as well, so they could make even more obscene profits. All of which came a cropper when the housing bubble burst and all that debt going bad (I gather that that debt or money owed them is what banks tend to use as “consideration”) threatened to take the whole financial system down with them. And which they then had the nerve to beg the Federal Government via taxpayers to rescue them from. And which the government, using taxpayer dollars, convinced the sucker public to agree to because otherwise we’d all be doomed.
            Now, with a new president to hopefully instill some root sense into the whole system, we find that his top advisers, the Summers and Geithners and Emanuels and Goolsbees, are not only “centrist” and rooted in the financial system themselves, as are all our so-called representatives who derive the bulk of their contributions from this same financial sector, but in practice determined to revive and maintain the same bankers and the same system that brought us all to the brink of financial Armageddon in the first place.
            So consider. Bankers create money out of nothing. And then charge us and the government (also us) interest on it. Not a bad way to make a living, one you’d think would be enough for these charlatans (who, by the way, pay their working-class tellers about $11 an hour to start). But no. Greed, by definition, knows no moderation, never says ‘this is enough.’ No, greed is infinite.  Until, that is, the people finally wake up and get fed up and cry “foul.” Some of that has been happening already regarding the bonuses to the AIG scoundrels. Now what one hopes is that the outrage will continue until all banks and bankers and their whole system are truly brought to heel, along with insurance companies and the rest of the Wall Street bunco artists. How this might happen is not something I’m competent to predict (Ellen Brown suggests establishing a true government bank that prints its own money but doesn’t charge itself interest; think of the savings!) But perhaps we can all find out before it’s too late. Meantime, next time you see your banker, you might let him know that you know: Money ex nihilo might sound godlike, but it’s more like what Freud said it symbolized—the doings of the other end.
Lawrence DiStasi