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The Rich Have Stolen The Economy

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Bloomberg reports that Treasury Secretary Timothy Geithner's closest aides earned millions of dollars a year working for Goldman Sachs, Citigroup and other Wall Street firms. Bloomberg reports that none of these aides faced Senate confirmation. Yet, they are overseeing the handout of hundreds of billions of dollars of taxpayer funds to their former employers.

The gifts of billions of dollars of taxpayers' money provided the banks with an abundance of low cost capital that has boosted the banks' profits, while the taxpayers who provided the capital are increasingly unemployed and homeless.

JPMorgan Chase announced that it has earned $3.6 billion in the third quarter of this year.

Goldman Sachs has made so much money during this year of economic crisis that enormous bonuses are in the works.
London Evening Standard reports that Goldman Sachs' "5,500 London staff can look forward to record average payouts of around 500,000 pounds ($800,000) each. Senior executives will get bonuses of several million pounds each with the highest paid as much as 10 million pounds ($16 million)."

In the event the banksters can't figure out how to enjoy the riches, the Financial Times is offering a new magazine--"How To Spend It." New York City's retailers are praying for some of it, suffering a 15.3% vacancy rate on Fifth Avenue. Statistician John Williams (shadowstats.com) reports that retail sales adjusted for inflation have declined to the level of 10 years ago: "Virtually 10 years worth of real retail sales growth has been destroyed in the still unfolding depression."

Meanwhile, New York City's homeless shelters have reached the all time high of 39,000, 16,000 of whom are children.

New York City government is so overwhelmed that it is paying $90 per night per apartment to rent unsold new apartments for the homeless. Desperate, the city government is offering one-way free airline tickets to the homeless if they will leave the city and charging rent to shelter residents who have jobs. A single mother earning $800 per month is paying $336 in shelter rent.

Long-term unemployment has become a serious problem across the country, doubling the unemployment rate from the reported 10% to 20%. Now hundreds of thousands more Americans are beginning to run out of extended unemployment benefits. High unemployment has made 2009 a banner year for military recruitment.

A record number of Americans, more than one in nine, are on food stamps. Mortgage delinquencies are rising as home prices fall. According to Jay Brinkmann of the Mortgage Bankers Association, job losses have spread the problem from subprime loans to prime fixed-rate loans. On a Wise, Virginia, fairgrounds, 2,000 people waited in lines for free dental and health care.

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While the
US speeds plans for the ultimate bunker buster bomb and President Obama prepares to send another 45,000 troops into Afghanistan, 44,789 Americans die every year from lack of medical treatment. National Guardsmen say they would rather face the Taliban than the US economy.

Little wonder. In the midst of the worst unemployment since the Great Depression, US corporations continue to offshore jobs and to replace their remaining US employees with lower paid foreigners on work visas.

The offshoring of jobs, the bailout of rich banksters, and war deficits are destroying the value of the US dollar. Since last spring the US dollar has been rapidly losing value. The currency of the hegemonic superpower has declined 14% against the Botswana pula, 22% against Brazil's real, and 11% against the Russian ruble. Once the dollar loses its reserve currency status, the US will be unable to pay for its imports or to finance its government budget deficits.

Offshoring has made Americans heavily dependent on imports, and the dollar's loss of purchasing power will further erode American incomes. As the Federal Reserve is forced to monetize Treasury debt issues, domestic inflation will break out. Except for the banksters and the offshoring CEOs, there is no source of consumer demand to drive the US economy.

The political system is unresponsive to the American people. It is monopolized by a few powerful interest groups that control campaign contributions. Interest groups have exercised their power to monopolize the economy for the benefit of themselves, the American people be damned.
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Dr. Roberts was Assistant Secretary of the US Treasury for Economic Policy in the Reagan Administration. He was associate editor and columnist with the Wall Street Journal, columnist for Business Week and the Scripps Howard News Service. He is a contributing editor to Gerald Celente's Trends Journal. He has had numerous university appointments. His book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is available here. His latest book,  How America Was Lost, has just been released and can be ordered here.

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I have seen a lot since I learned how we really ha... by Steven G. Erickson on Friday, Oct 16, 2009 at 11:19:49 PM
I tip my hat to you.The future of this country an... by Bob Gormley on Saturday, Oct 17, 2009 at 9:46:33 AM
Agree with you Steve. The America that it is noW i... by Patricia Ryans on Saturday, Oct 17, 2009 at 3:55:18 PM
I have followed this trend. I have long held that ... by Paul Kruger on Saturday, Oct 17, 2009 at 11:53:06 AM
I agreed with you up until you got into the univer... by Mad Jayhawk on Saturday, Oct 17, 2009 at 10:25:47 PM
In a nation where nearly everyone commits multipl... by WML on Sunday, Oct 18, 2009 at 8:37:46 AM
They couldn't CARE LESS about 45000 deaths due to ... by weslen1 on Saturday, Oct 17, 2009 at 12:00:23 PM
A root principle of our capitalist system is that ... by Richmond Shreve on Saturday, Oct 17, 2009 at 2:16:29 PM
I think the only thing that willkill this excessiv... by Erik Jones on Saturday, Oct 17, 2009 at 2:54:14 PM
Tax the bastards to death. Take a history lesson ... by daveys on Saturday, Oct 17, 2009 at 3:19:02 PM
Yes, the rich have stolen the economy. For a histo... by Charles Andrews on Saturday, Oct 17, 2009 at 5:19:08 PM
It isn't them.It is us.We are distracted by balloo... by zonie on Saturday, Oct 17, 2009 at 5:36:48 PM
Sorry, but if check, you will find the guns and am... by Tom Johnson on Saturday, Oct 17, 2009 at 9:36:11 PM
Hahaha........thinking of a reloader myself.......... by zonie on Sunday, Oct 18, 2009 at 1:44:27 PM
Our economic disaster today is a consequence of t... by Richard Lee on Saturday, Oct 17, 2009 at 5:56:00 PM
The "Founding Fathers" actually set up this govern... by Bryan Emmel on Saturday, Oct 17, 2009 at 8:01:53 PM
"The offshoring of jobs, the bailout of rich banks... by Mad Jayhawk on Saturday, Oct 17, 2009 at 8:13:26 PM
October 16, 2009 By Paul Craig RobertsThe Rich Hav... by liecatcher on Saturday, Oct 17, 2009 at 8:52:52 PM
"Behind every great fortune lies a great crime." H... by Edward Ulysses Cate on Saturday, Oct 17, 2009 at 9:00:11 PM
What has changed is the laws. Today, if you have g... by PrMaine on Monday, Oct 19, 2009 at 10:09:54 AM
A timely article from the Washington Examiner.The ... by Perry Logan on Sunday, Oct 18, 2009 at 4:44:58 AM
To those bastards who stooped to broadcasting her ... by zonie on Sunday, Oct 18, 2009 at 1:59:36 PM
Much of what has happened in America over the last... by PrMaine on Sunday, Oct 18, 2009 at 8:05:57 AM
You know by the time you can eat solid food that t... by Margaret Bassett on Sunday, Oct 18, 2009 at 4:22:55 PM
You know by the time you can eat solid food that t... by Margaret Bassett on Sunday, Oct 18, 2009 at 4:23:25 PM