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“Who Says Crime Doesn’t Pay?”: The Bottom Line Is Crime Can Actually Pay — If It’s Big Enough

Hey, can we all just stop complaining that our government coddles Wall Street’s big money-grubbing banks?

Sure, they went belly-up and crashed our economy with their frauds, rigged casino games, and raw greed. And, yes, the Bush and Obama regimes rushed to bail them out with trillions of dollars in our public funds, while ignoring the plight of workaday people who lost jobs, homes, businesses, wealth, and hope. But come on, Buckos, have you not noticed that the feds are now socking the bankers with huuuuuge penalties for their wrongdoings?

Wall Street powerhouse Goldman Sachs, for example, was recently punched in its corporate gut with a jaw-dropping $5 billion for its illegal schemes.

Wow, $5 billion! That’s a stunning amount that Goldman Sachs has agreed to pay to settle federal criminal charges over its shameful financial scams that helped wreck America’s economy in 2008. That’s a lot of gold, even for Goldman Sachs. It’s hard to comprehend that much money, so think of it like this: If you paid out $100,000 a day, every day for 28 years, you’d pay off just one billion dollars. So, wow, imagine having to pull Five Big B’s out of your wallet! That’s enough to make even the most arrogant and avaricious high-finance flim-flammer think twice before risking such scams, right? Thus, these negotiated settlements between the Justice Department and the big banks will effectively deter repeats of the 2008 Wall Street debacle… right?

Actually, no.

The chieftains of the Wall Street powerhouse say they are “pleased” to swallow this sour slug of medicine. It’s not because they’re contrite and eager to make amends.  Wall Street bankers don’t do contrite. They are pleased (even thrilled) because this little insider secret: Thanks to Goldman’s backroom dealing with prosecutors, the settlement is riddled with special loopholes that could eliminate nearly $2 billion from the publicized “punishment.”

For example, the deal calls for the felonious bank to put a quarter-billion dollars into affordable housing, but generous federal negotiators put incentives and credits in the fine print that will let Goldman escape with paying out less than a third of that. Also, about $2.5 billion of the settlement is to be paid to consumers hurt by the financial crisis. But the deal lets the bank deduct almost a billion of this payout from its corporate taxes — meaning you and I will subsidize Goldman’s payment. As a bank reform advocate puts it, the problem with these settlements “is that they are carefully crafted more to conceal than to reveal to the American public what really happened here.”

Also, notice that the $5 billion punishment is applied to Goldman Sachs, not the “Goldman Sackers.” The bank’s shareholders have to cough up the penalty, rather than the executives who did the bad deeds. Goldman Sachs’ CEO, Lloyd Blankfein, just awarded himself a $23 million paycheck for his work last year. That work essentially amounted to negotiating the deal with the government that makes shareholders pay for the bankers’ wrongdoings — while he and other top executives keep their jobs and pocket millions. Remember, banks don’t commit crimes — bankers do.

One more reason Wall Street bankers privately wink and grin at these seemingly huge punishments is that even paying the full $5 billion would only be relatively painful. To you and me, that sounds like a crushing number — but Goldman Sachs raked in $33 billion in revenue last year, so it’s a reasonable cost of doing business. After all, Goldman sold tens of billions of dollars in the fraudulent investment packages leading to the settlement, so the bottom line is that crime can actually pay — if it’s big enough.

 

By: Jim Hightower, Featured Post, The National Memo, May 4, 2016

May 5, 2016 Posted by | Big Banks, Corporate Crime, Financial Crisis, Wall Street | , , , , , , , | Leave a comment

“The Utter Nastiness Of Ted Cruz”: What Sets Cruz Apart Is The Malice He Exudes

When Sen. Ted Cruz (R-Tex.) last month mocked Donald Trump’s “New York values,” it wasn’t entirely clear what he was implying.

This week we got a clue: For Cruz, “New York” is another way of saying “Jewish.”

At an event in New Hampshire, Cruz, the Republican Iowa caucuses winner, was asked about campaign money he and his wife borrowed from Goldman Sachs. Cruz, asserting that Trump had “upward of $480 million of loans from giant Wall Street banks,” said: “For him to make this attack, to use a New York term, it’s the height of chutzpah.” Cruz, pausing for laughter after the phrase “New York term,” exaggerated the guttural “ch” to more laughter and applause.

But “chutzpah,” of course, is not a “New York” term. It’s a Yiddish — a Jewish — one. And using “New York” as a euphemism for “Jewish” has long been an anti-Semitic dog whistle.

I followed both Cruz and Trump this week at multiple campaign events across New Hampshire. It was, in a sense, a pleasure to see them use their prodigious skills of character assassination against each other. It was demagogue against demagogue: lie vs. lie. Both men riled their supporters with fantasies and straw men.

But there were discernible differences. Trump owned anger. Cruz, by contrast, had a lock on nastiness. Trump is belligerent and hyperbolic, with an authoritarian style. But while Trump fires up the masses with his nonstop epithets, Cruz has Joe McCarthy’s knack for false insinuation and underhandedness. What sets Cruz apart is the malice he exudes.

Cruz jokes that “the whole point of the campaign” is that “the Washington elites despise” him. But Cruz’s problem is that going back to his college days at Princeton, those who know him best seem to despise him most. Not a single Senate colleague has endorsed his candidacy, and Iowa’s Republican governor urged Cruz’s defeat, then called his campaign “unethical.”

Ben Carson, who rarely has a bad word to say about anybody in the GOP race, accused Cruz of “deceit and dirty tricks and lies” this week after the Texan’s campaign spread the false rumor during the Iowa caucuses that Carson was quitting the race. Two former rivals who also appeal to religious conservatives, Mike Huckabee and Rick Santorum (who endorsed Sen. Marco Rubio of Florida), have questioned Cruz’s truthfulness, too.

Sarah Palin, whose support for Cruz in 2012 helped get him elected to the Senate, this week denounced him after a Cruz surrogate accused her of accepting payment from Trump to back him. She, too, accused Cruz’s campaign of “lies,” a “dirty trick” and “typical Washington tactics.”

Cruz, in Nashua, slashed back at his onetime benefactor: “It seems if you spend too much time with Donald Trump, strange things happen to people.” Somebody in the crowd shouted “Fire Palin!” and the audience cheered.

The Iowa secretary of state, a Republican, issued a statement before the caucuses accusing Cruz’s campaign of “false representation” because of a mailing to voters charging them with a “voting violation” and assigning them and their neighbors phony grades.

After Cruz’s caucus-night skullduggery — a campaign email to supporters and a tweet by a Cruz national co-chairman suggesting Carson was quitting the race — his response continued the deception. Though he apologized to Carson, he said that “our political team forwarded a news story from CNN” and “all the rest of it is just silly noise.” But CNN said nothing about Carson dropping out.

After Trump, in his overblown way, accused Cruz of stealing the election, Cruz replied, righteously, that “I have no intention of insulting him or throwing mud.”

No? He accused Trump of “a Trumpertantrum.” He said Trump as president “would have nuked Denmark.” He said Trump “doesn’t have any core beliefs.” He mischaracterized several of Trump’s positions, saying “he wants to expand Obamacare,” that “for his entire life, 60 years, he has been advocating for full-on socialized medicine” and that Trump favors “amnesty” for illegal immigrants and “wants to deport people that are here illegally but then let them back in immediately and become citizens.” He speculated that Trump may have “billions” in loans and said the concept of repaying loans is “novel and unfamiliar to Donald.”

The misrepresentation isn’t limited to Trump. In a single speech in Nashua last week, he mischaracterized things said by, among others, Jimmy Carter, Chris Wallace, guests on Sean Hannity’s show, Atlanta’s mayor, Rubio and, of course, President Obama.

I asked the Cruz campaign Thursday evening to substantiate several of these claims. After this column was published online Friday afternoon, the campaign provided citations that didn’t back up what Cruz had alleged. Unsurprising: Cruz’s purpose is not to inform but to insinuate.

 

By: Dana Milbank, Opinion Writer, The Washington Post, February 5, 2016

February 8, 2016 Posted by | Ben Carson, Donald Trump, New York Values, Ted Cruz | , , , , , , , , | 3 Comments

“Donald Trump, The Hater Is Now A Loser”: Can He Survive Becoming His Most Famous And Frequently Used Epithet?

In Iowa, the hater became a loser.

In the first contest of the Republican nomination, Donald Trump, the man who predicated his entire campaign on his ability to win everything and everywhere, suffered a devastating Iowa defeat to Sen. Ted Cruz. He now faces a second major problem: the surging Sen. Marco Rubio, who finished third, is now the clear establishment favorite, and poses a real threat to Trump in next week’s New Hampshire primary.

Absent policy expertise, his bluster about achieving foreign and domestic “wins” constituted the entire sustaining force of his campaign. As he once said on Twitter, quoting the golfer Walter Hagen, “No one remembers who came in second.” It was a triumphant attitude based on polling leads that continually defied expectations and a successful career in real estate that he elevated to mythological proportions.

Trump was unstoppable, he continually insisted, and faced only an endless string of victories that were all but assured.

That all changed Monday night as a visibly-deflated Trump gave brief remarks to supporters in Iowa. Absent was the swagger of Trump events past: “I think we’re going to be proclaiming victory, I hope,” Trump said of the New Hampshire primary.

It was perhaps his most magnanimous speech of the campaign. He congratulated Cruz on the win in Iowa and repeated over and over again that he loved the people of Iowa.

“I think I might come here and buy a farm,” Trump said, as he closed his speech. To put that in perspective, back in October he insisted to the people that if he lost the Hawkeye State he would “never speak to you people again.”

Polling conducted in the days leading up to the Iowa caucuses showed Trump with the lead over Cruz—but the defining question was whether political amateur Trump had the organization in the Hawkeye State to turn out his supporters. Early entrance polling showed that 4 in 10 Republicans had never attended a caucus before, and veteran Republicans in the state expected a record turnout that would boost Trump.

The businessman has also gone after Cruz with a vengeance—while they had once held a joint campaign event, the bromance ended in recent months, as Trump raised questions about Cruz’s eligibility to be president and criticized him for taking an unreported loan from Goldman Sachs, his wife’s then-employer, to finance his 2012 Senate campaign.

Cruz’s victory defied the odds, proving that his much-vaunted ground game in the first presidential contest was the key to victory.

Over 12,000 volunteers worked for Cruz, both from within Iowa and from nearly three dozen other states. At the event Cruz held for his Iowa supporters Monday evening, women line danced as they celebrated a substantial margin of victory.

Volunteers from across the country braved accommodations in college dorms—with the moniker “Camp Cruz”—to go door-knocking and make phone calls. “Let’s put it this way: It was not a four-star hotel,” said JoAnn Fleming, the co-chair of the “Texas Strike Force” that brought volunteers from out of state to support the Texas senator.

“You can spend money on an air campaign but there’s nothing like dedicated volunteers that will spend their own money to go thousands of miles… That’s something money can’t buy,” Fleming said.

Cruz opened his victory speech with a nod to his Christian faith he’s continually referenced since the start of the campaign. “Let me first of all say, to God be the glory,” he said as the crowd roared.

And he wasn’t shy about invoking Psalm 30, which is about David’s soul being lifted up from Sheol, to describe the final months of President Obama’s time in office.

“While Americans will continue to suffer under a president who’s set an agenda that’s causing millions to hurt across this country, I want to remind you of the promise of scripture,” he said. “Weeping may endure for a night, but joy cometh in the morning.”

Cruz’s speech lasted for quite some time, but attendess seemed to stay in high spirits through the 30-minute-plus talk. As he talked about his 18-hour days on the trail, a fan in the crowd yelled “You’re not tired!”

Cruz smiled. “We’re not tired at all.”

His backers couldn’t help but gloat that Trump had, at long last, been vanquished. “He’s not gonna win everywhere. It’s already over. He may win in some places, but he’s not going to win everywhere,” said Ken Cuccinelli, a Cruz surrogate and the former attorney general of Virginia.

After tonight’s victory, Cruz is the first Republican to survive a head-to-head confrontation with Trump: Other GOP challengers—Ben Carson and Jeb Bush—wilted away after Trump mocked them. Cruz survived and triumphed.

In typical Trump fashion, the mogul had broken all the rules of campaigning—making fun of Carson’s story about a purported childhood stabbing attempt, and mocking Iowa voters as his grip on the polls slipped a little late last year.

“How stupid are the people of Iowa?” Trump asked. “How stupid are the people of the country to believe this crap?”

Just months ago, Trump was considered a political punchline—pundits predicted that Republican primary voters would soon get over their infatuation with the buffoonish businessman after the “Summer of Trump.”

But the seemingly invincible billionaire rode through controversy after controversy—instead of melting away, he has taken advantage of his celebrity status to dominate news cycles. He lost the lead in Iowa just to regain it again and again.

Trump resilience continued to confound political observers. He made countless comments that would have destroyed the candidacies of other politicians: He characterized Mexican immigrants as “rapists” at his campaign launch event; promised to ban all Muslims from entering the United States; disparaged former prisoner of war Sen. John McCain, saying he liked “people who weren’t captured”; doxxed Sen. Lindsey Graham’s cellphone number; and said of newscaster Megyn Kelly’s debate questions that “you could see there was blood coming out of her eyes… blood coming out of her wherever.” All of these statements were seen as campaign-ending gaffes.

But for months, despite the predictions of pollsters and pundits, it never hurt his numbers. He rode in to Iowa as the man to beat, the guy poised to run the table against all his Republican opponents and secure the biggest primary victory of any candidate in modern times.

Instead Trump barely cleared second place in a remarkable defeat. And while it may be too soon to officially declare that the Trump Train has finally gone off the rails, the man who has led the Republican field since early last summer suddenly finds himself in a profoundly difficult battle to regain momentum before New Hampshire.

Trump has withstood mocking from the media and dismissive insults from his opponents. The question now is whether he can survive becoming his most famous and frequently used epithet: loser.

 

By: Tim Mak and Betsy Woodruff, The Daily Beast, February 1, 2016

February 3, 2016 Posted by | Donald Trump, GOP Primaries, Iowa Caucuses | , , , , , , | Leave a comment

“No Guns Allowed, Punk”: New York Values; What Tiny Ted Cruz Will Never Understand About The Big City

Exactly what does Ted Cruz mean when he sneers about “New York values” as a reason to reject Donald Trump? Disparaging New York has long been a favorite trope for reactionary loudmouths, always with an ugly undertone of bigotry against racial, ethnic, religious and, more recently, sexual minorities.

Demagogues denigrating New York come and go with boring predictability — and the nation’s greatest city will continue to thrive long after the Texas senator is merely an unpleasant memory. But in the meantime, his cheap insult tells us much more about him than about his target.

For someone who went to the very best schools – and flaunted his academic elitism until that no longer served his ambition – Cruz is remarkably narrow in his outlook, or at least he pretends to be. While he reeks of phoniness, perhaps he truly is so small-minded that he cannot comprehend just how large New York really is, in every way.

Despite the city’s well-deserved liberal reputation, its tolerance for the broadest possible variety of opinions, faiths, and lifestyles is its deepest strength. Conservatives are welcome in New York, birthplace of the Conservative Party and home of the National Review, its late founder William F. Buckley, Jr., and so many who followed in his wake. They could have gone anywhere, but they took Manhattan – just as David Koch and scores of other influential right-wingers do today.

Those rightward-leaning New Yorkers include significant supporters and donors to the Cruz campaign, although one can hope they will reconsider that choice now. Either way, his remark suggests that Cruz is one of those oh-so-clever people who assume that everyone else is stupid. He seems to believe that nobody will notice how eagerly he sucks up to New Yorkers who can benefit him, even as he seeks to inflame prejudice against their hometown.

Of course slurring New York has always served as a thin scrim for traditional anti-Semitism, which is what Cruz evoked with his remark about “money and media” at the Republican debate on Thursday evening. He must think nobody noticed that his wife works for Goldman Sachs – or that he took a big fat loan from that very Jewish-sounding Wall Street outfit when he first ran for the Senate.

In Trump’s response, he spoke angrily and eloquently of 9/11 — a moment when most of the nation rallied around the city, with admiration for the resilience and solidarity displayed by its people. Later, New Yorkers learned how shallow that support could be, notably among Republicans in Congress who resisted approving the aid they always expect when their own districts confront disaster, and even sought to deny assistance to suffering first responders. At worst, support for New York turned into an excuse for hatred of Muslims and immigrants.

But the aftermath of 9/11 represented a perfect expression of real New York values: tolerance and charity across all boundaries of ethnicity, religion, lifestyle, class, and occupation; decency and justice toward those who have the least, suffered the most, and sacrificed for all; cooperation and collaboration in the face of tragedy; and the kind of knowing toughness that is sometimes mistaken for cynicism. Only a rube thinks that New York is about money and media alone; it is much, much bigger than that. New York values have always been the most enduring American values.

Now along comes Ted Cruz, who wants to grub New York money and then insult New Yorkers by suggesting they are somehow less upstanding than he claims to be. Since he’s such a tough guy — blustering on about assault weapons and carpet-bombing innocent people far away – he should try running his mouth about New York on the streets of Queens or Brooklyn, and see how that works out. (But no guns allowed, punk.)

 

By: Joe Conason, Editor in Chief, Editor’s Blog, Featured Post, The National Memo, January 15, 2016

January 16, 2016 Posted by | Donald Trump, New York, Ted Cruz | , , , , , , , , , , | Leave a comment

“Wall Street’s Threat To The American Middle Class”: Do We Really Need To Be Reminded About What Happened Six Years Ago?

Presidential aspirants in both parties are talking about saving the middle class. But the middle class can’t be saved unless Wall Street is tamed.

The Street’s excesses pose a continuing danger to average Americans. And its ongoing use of confidential corporate information is defrauding millions of middle-class investors.

Yet most presidential aspirants don’t want to talk about taming the Street because Wall Street is one of their largest sources of campaign money.

Do we really need reminding about what happened six years ago? The financial collapse crippled the middle class and poor — consuming the savings of millions of average Americans, and causing 23 million to lose their jobs, 9.3 million to lose their health insurance, and some 1 million to lose their homes.

A repeat performance is not unlikely. Wall Street’s biggest banks are much larger now than they were then. Five of them hold about 45 percent of America’s banking assets. In 2000, they held 25 percent.

And money is cheaper than ever. The Fed continues to hold the prime interest rate near zero.

This has fueled the Street’s eagerness to borrow money at rock-bottom rates and use it to make risky bets that will pay off big if they succeed, but will cause big problems if they go bad.

We learned last week that Goldman Sachs has been on a shopping binge, buying cheap real estate stretching from Utah to Spain, and a variety of companies.

If not technically a violation of the new Dodd-Frank banking law, Goldman’s binge surely violates its spirit.

Meanwhile, the Street’s lobbyists have gotten Congress to repeal a provision of Dodd-Frank curbing excessive speculation by the big banks.

The language was drafted by Citigroup and personally pushed by Jamie Dimon, CEO of JPMorgan Chase.

Not incidentally, Dimon recently complained of being “under assault” by bank regulators.

Last year JPMorgan’s board voted to boost Dimon’s pay to $20 million, despite the bank paying out more than $20 billion to settle various legal problems going back to financial crisis.

The American middle class needs stronger bank regulations, not weaker ones.

Last summer, bank regulators told the big banks their plans for orderly bankruptcies were “unrealistic.” In other words, if the banks collapsed, they’d bring the economy down with them.

Dodd-Frank doesn’t even cover bank bets on foreign exchanges. Yet recent turbulence in the foreign exchange market has caused huge losses at hedge funds and brokerages.

This comes on top of revelations of widespread manipulation by the big banks of the foreign-exchange market.

Wall Street is also awash in inside information unavailable to average investors.

Just weeks ago a three- judge panel of the U.S. court of appeals that oversees Wall Street reversed an insider-trading conviction, saying guilt requires proof a trader knows the tip was leaked in exchange for some “personal benefit” that’s “of some consequence.”

Meaning that if a CEO tells his Wall Street golfing buddy about a pending merger, the buddy and his friends can make a bundle — to the detriment of small, typically middle-class, investors.

That three-judge panel was composed entirely of appointees of Ronald Reagan and George W. Bush.

But both parties have been drinking at the Wall Street trough.

In the 2008 presidential campaign, the financial sector ranked fourth among all industry groups giving to then candidate Barack Obama and the Democratic National Committee. In fact, Obama reaped far more in contributions from the Street than did his Republican opponent.

Wall Street also supplies both administrations with key economic officials. The treasury secretaries under Bill Clinton and George W. Bush – Robert Rubin and Henry Paulson, respectfully, had both chaired Goldman Sachs before coming to Washington.

And before becoming Obama’s treasury secretary, Timothy Geithner had been handpicked by Rubin to become president of Federal Reserve Bank of New York. (Geithner is now back on the Street as president of the private-equity firm Warburg Pincus.)

It’s nice that presidential aspirants are talking about rebuilding America’s middle class.

But to be credible, he (or she) has to take clear aim at the Street.

That means proposing to limit the size of the biggest Wall Street banks;  resurrect the Glass-Steagall Act (which used to separate investment from commercial banking); define insider trading the way most other countries do – using information any reasonable person would know is unavailable to most investors; and close the revolving door between the Street and the U.S. Treasury.

It also means not depending on the Street to finance their campaigns.

 

By: Robert Reich, The Robert Reich Blog, January 26, 2015

February 2, 2015 Posted by | Big Banks, Campaign Financing, Wall Street | , , , , , , , , | Leave a comment

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