I just want to be fair. We're not getting out of this mess if we just point fingers.  What really need to do is put biases aside and work together to clean this up.  So spread love, peace and truths.  Really take the time and check out these two videos and read below. Basically, please be informed:
 
 
Click here: YouTube - TheMouthPeace's Channel
 
Second video:
Take 3 minutes to view this video :  And note that there is no 'opinion,' just direct video.
   http://www.bercasio.com/movies/dems-wmd-before-iraq.wmv
 
Here is a quick look into 3 former Fannie Mae executives who have brought down Wall Street.
Franklin Raines was a Chairman and Chief Executive Officer at Fannie Mae.  Raines was forced to retire from his position with Fannie Mae  when auditing discovered severe irregulaties in Fannie Mae's accounting activities. At the time of his departure The Wall Street Journal noted, ' Raines, who long defended the company's accounting despite mounting evidence that it wasn't proper, issued a statement late Tuesday conceding that 'mistakes were made' and saying he would assume responsibility as he had earlier promise d. News reports indicate the company was under growing pressure from regulators to shake up its management in the wake of findings that the company's books ran afoul of generally accepted accounting principles for four years.'  Fannie Mae had to reduce its surplus by $9 billion.
Raines left with a 'golden parachute valued at $240 Million in benefits. The Government filed suit against Raines when the depth of the accounting scandal became clear. http://housingdoom.com/2006/12/18/fannie-charges/ . The Government noted, 'The 101 charges reveal how the individuals improperly manipulated earnings to maximize their bonuses, while knowingly neglecting accounting systems and internal controls, misapplying over twenty accounting principles and misleading the regulator and the public. The Notice explains how they submitted six years of misleading and inaccurate accounting statements and inaccurate capital reports that enabled them to grow Fan nie Mae in an unsafe and unsound manner.'  ; These charges were made in 2006.  The Court ordered Raines to return $50 Million Dollars he received in bonuses based on the miss-stated Fannie Mae profits.
Tim Howard -  Was the Chief Financial Officer of Fannie Mae. Howard 'was a strong internal proponent of using accounting strategies that would ensure a 'stable pattern of earnings' at Fannie. In everyday English - he was cooking the books.  The Government Investigation determined that Chief Financial Officer, Tim Howard, failed to provide adequate oversight to key control and reporting functions within Fannie Mae,'
On June 16, 2006, Rep. Richard Baker, R-La., asked the Justice Department to investigate his allegations that two former Fannie Mae executives lied to Congress in October 2004 when they denied manipulating the mortgage-finance giant's income statement to achieve management pay bonuses. Investigations by federal regulators and the company's board of directors since concluded that management did manipulate 1998 earnings to trigger bonuses. Raines and Howard resigned under pressure in late 2004.
Howard's Golden Parachute was estimated at $20 Million!
Jim Johnson -   A former executive at Lehman Brothers and who was later forced from his position as Fannie Mae CEO.   A look at the Office of Fed eral Housing Enterprise Oversight's May 2006 report on mismanagement and corruption inside Fannie Mae, and you'll see some interesting things about Johnson. Investigators found that Fannie Mae had hidden a substantial amount of Johnson's 1998 compensation from the public, reporting that it was between $6 million and $7 million when it fact it was $21 million.'   Johnson is currently under investigation for taking illegal loans from Countrywide while serving as CEO of Fannie Mae. 
Johnson's Golden Parachute was estimated at $28 Million.
 
WHERE ARE THEY NOW?
FRANKLIN RAINES? Raines works for the Obama Campaign as Chief Economic Advisor
TIM HOWARD?  Howard is also a Chief Economic Advisor to Obama
JIM JOHNSON?  Johnson hired as a Senior Obama Finance Advisor and was selected to run Obama's Vice Presidential Search Committee
 
IF OBAMA PLANS ON CLEANING UP THE MESS - HIS ADVISORS HAVE THE EXPERTISE - THEY MADE THE MESS IN THE FIRST PLACE.   Would you trust the men who tore Wall Street down to build the New Wall Street ?

by CW Blanchett (0 articles, 0 quicklinks, 0 diaries, 34 comments) on Thursday, Oct 2, 2008 at 8:31:31 AM

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I too have been yelling and screaming:  "What a great

Opportunity for Liberals, now that Wall Street is writhing

around on the ground!"   The question of course is:  are

there any Liberals left with enough moxie to seize this

moment.

I particularly liked your paragraph:

In a perverse way, Henry Paulson and his co-conspirators have done the public a great favor. He has told us that, Yes, the federal government can come up with $700-plus billion, in an instant, if the health of the nation demands it. He has expanded the fiscal scope of the domestic political conversation, so that it may encompass projects of transformational size. Never again can the corporate class speak of socially valuable projects being so large as to "break the bank" or the budget. Popular forces are now free to think large, too, without being ridiculed from the corporate Right.

Exactly.  But where are these popular forces?  I think Ms McKinney, who I

admire, have met, and plan to vote for, could lead us.

I have written three articles about the concept of a "Free Vote", and

plan to write another, which I hope Rob will publish.  Please look for

it, and support it.

Best wishes,   Alan McConnell

by alan17b0 (15 articles, 0 quicklinks, 0 diaries, 51 comments [2 recommended, 0 rejected]) on Thursday, Oct 2, 2008 at 8:37:09 AM

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I look at these articles on the economic bailout and the responses thereto and I shake my head. Any country that idolizes the pursuit of money should seriously consider that greed may not the end all and be all of life. Also any country that can create military budgets that exceed the sum total of all the  other countries in the world  is seriously deranged. Please don't lambast Congress for delivering funding to save Wall Street when you don't lift a finger to stop the worst hemorraging of the people's cash into the pentagon ON A YEARLY BASIS.

by Archie (0 articles, 0 quicklinks, 0 diaries, 1750 comments [111 recommended, 0 rejected]) on Thursday, Oct 2, 2008 at 8:20:46 PM

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Now that even Bush, Paulson, et al are saying the economic system is on the verge of collapse, we have a decisive refutation of the claim that capitalism had found a way to avoid depressions and keep itself in power permanently with Keynesian economic policies.  The crisis is here to refute all their predictions.

Since those who have the money, i.e. the ruling class, always have the means for influencing the government, it was only to be expected that the capitalists would repeal the restrictions put on them by the New Deal as the Great Depression of the 1930's became a distant memory.  The exotic financial instruments that enabled the present crisis were made legal by the repeal of the Glass-Steagall Act in 1999.  Before, when banks loaned money, the people who received the money paid it back to the bank.  The bank thus had a strong motivation to assure that the people they loaned money to could pay it back.  Even if the original maker of the loan sold it to another institution, that other institution had the same motivation to assure that the loan was good before they bought it.  The repeal of Glass- Steagall made it possible to combine many loans into one instrument.  The original loan maker could combine both good and bad loans into one instrument and sell it to another financial institution.  They would get their quick cash payback when they sold the financial instrument and would not have to worry about whether the borrower could pay it back.  It became possible to issue loans with variable and escalating interest rates that the borrower had no prospect of repaying and lump these bad loans in with other good loans and sell the whole amalgam to another financial institution who in turn could sell it to a third institution, etc.

Someone could argue that capitalism could have avoided this crisis if only we had not repealed Glass-Steagall.  But the point is that the ruling class will always lobby for the repeal of the legal restrictions on their financial manipulation when the crisis that led to their adoption has become a distant enough memory.  And they will do this even if the repeal is not in the interest of the capitalist system as a whole.  In an analogue to The Tragedy of the Commons, individual financial high rollers will benefit from the repeal of any restrictions on their behavior although it may threaten the welfare of the capitalist class as a whole.

And if anyone doubts that the possessors of great wealth or the ruling class can always obtain what they want from the government, they need only remind themselves that it takes hundreds of millions of dollars to run for President with any prospect of winning.  The only way to get large sums of money is to go to those who have large sums of money.  And they are not just contributing to political campaigns for their health; they are unlikely to give money to any candidate who will legislate against their interests.

Another example is the savings and loan crisis.  A single financial institution could not by law be both a bank and a savings and loan.  This was one of the New Deal reforms during the Depression to enable more people to own homes.  These legal restrictions were repealed and the savings and loan crisis followed a few years later.

A second argument about why capitalism has to eventually fail comes from examining the series of crises that resulted from exorbitant loans to third world countries.  When a series of Asian countries defaulted on their loans, there was concern that the capitalist system might not be able to contain the crisis.  Earlier, there were similar concerns when a series of Latin American countries defaulted.  This series of crises demonstrates that capitalism is like a high wire walker threatening continually to loose their balance.  They may regain their balance this time and the next time and the next, etc.  But is is a statistical certainty that eventually there will be a fatal plunge to earth.

You may as well admit it.  You can not avoid an eventual economic meltdown if you retain capitalism and it is past time to replace an uncoordinated system of production for individual profit with a socialist system of production for human needs.

Robert Halfhill

by rhalfhill (3 articles, 0 quicklinks, 0 diaries, 325 comments) on Friday, Oct 3, 2008 at 12:55:43 AM

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