Forget Ivan Boesky and Mike Milken, the 1980s Junk Bond Kings who went to jail for marketing tens of millions of dollars of next-to-worthless securities. Forget Bernie Madoff, the trusted financier who took his clients for some $50 Billion and will be going to jail, once his lawyers' stalling tactics run out. No, by far the biggest swindler in history is former U.S. Treasury Secretary Henry Paulson -- and, just imagine, he appears to have gotten away with bilking American taxpayers out of something like a trillion dollars! Indeed, in some circles Hank Paulson seems to still be a respected former Bush official. Why he is not being actively prosecuted is a major mystery.
Hank Paulson, who came from Wall Street and undoubtedly will return there in some fashion once the smoke clears, took America for some trillion dollars, if one combines his now-notorious TARP bailout of the financial sector with the giveaways to AIG, Lehman Brothers, Goldman Sachs and other firms which preceded TARP. True, some of the TARP money has not yet been distributed, but it is still on the books, and undoubtedly there are plenty of greedy palms waiting to receive it. AIG, for example, wants another thirty or so billion dollars to keep that so-called insurer afloat until the next round at the pig trough. They, alone, will then have gotten nearly $200 Billion, and are likely to ask for even more.
When the TARP bailout was first passed, I wrote the U.S. Treasury Department repeatedly, first to Secretary Paulson and Neel Kashkari, whose office actually handled the distribution of over $700 Billion of federal money, to find out just what was being done with those funds. I wrote in the capacity of an economist and retired financial services manager for a worldwide securities firm. Upon their ignoring of my inquiries, I wrote to the Office of the Inspector General at the Treasury Department, pointing out that my inquiries had been ignored and that it was the Inspector General's responsibility to police the Treasury Department on behalf of the public.
Perhaps not surprisingly, the Office of the Inspector General also ignored my inquiries, and made no response to my complaints about Paulson and Kashkari. There is a term which describes such misconduct on their part; it is called malfeasance, which refers to officials who do not do their jobs properly. In the case of the vaunted Treasury Office of the Inspector General, they did not do their jobs at all. They were, indeed, worthless.
What could and should have been done about AIG, for example, would have been a government takeover with the feds offering the same insurance as AIG to the same clients for the same premiums, for starters. That would have cost far less than nearly $200 billion; America might even have made money on the situation, if we had competent people running the show.
We all hope that the new rounds of financial bailouts, under our new National Sheriff, have the transparency and accountability so sadly lacking under the Old Sheriff, George W. Bush, and his cronies like Hank Paulson. It is a mite telling that Bush went through several Treasury Secretaries, who left in part over policy differences with his administration. Indeed, it took some effort to find someone like Paulson, who was ready, willing, and able to swindle America and Americans out of nearly a trillion dollars. There is a parable about the Emperor who had no clothes; but this former Emperor of the U.S. Treasury does not need any clothes; he can bask in the admiration of all of his former and future cronies, who got that trillion bucks out of us. There is also a term for those who are bilked in this manner: suckers!
