State of Obama: Immunity for Wall Street

by BAR executive editor Glen Ford

President Obama hoped to announce a monetary “settlement” of massive banker criminality in housing foreclosures that would grant banks immunity from prosecution.” But he was thwarted by a small group of state attorneys general that wanted real investigations, forcing the president into setting up a toothless enforcement unit of his own. For Wall Street banksters, impunity and immunity are the continuing states of the union.

State of Obama: Immunity for Wall Street

by BAR executive editor Glen Ford

Every action he has taken as president has been to protect the innocents on Wall Street.”

Empire and the banks. President Obama’s State of the Union address, bracketed by imperial bombast, made actual news with yet another administration maneuver to protect Wall Street from the wrath of the states. The remainder of his speech was mainly a rehash of previous policies, heavy on tax tinkerings that would have made a previous generation of moderate Republicans – a now extinct breed – proud.

The only newsworthy item, the creation of a “special unit of prosecutors” that the president announced would “expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis,” is not an Obama initiative, but a response to unwanted pressures. Up until almost the moment of the presidential address, the administration has been bullying state attorneys general to drop their independent investigations into banker criminality in the 2008 meltdown and the foreclosure of millions of Americans’ homes. The so-called “robo-signing” scandal calls into question the fundamental legality of Wall Street mortgage securities practices – what some have described as the “crime of the century.” The small group of attorneys general – variously numbered between 5 and 15 – have been buttressed by a vocal Campaign for a Fair Settlement, made up of consumer and labor groups and activist organizations such as MoveOn.

Obama had hoped to roll over the recalcitrant attorneys general in time to make the settlement the centerpiece of his State of the Union.”

Obama’s operatives have doggedly pressed for a settlement that would effectively give banks immunity from prosecution. Instead, home owners would be “compensated” from a paltry fund of no more than $25 billion – a drop in the bucket, considering the trillions in housing values that disappeared into illegally securitized air in the catastrophe, and much of the money might not even come out of the bankers’ own accounts. Obama had hoped to roll over the recalcitrant attorneys general in time to make the settlement the centerpiece of his State of the Union.

The “special unit of prosecutors,” officially dubbed the Unit on Mortgage Origination and Securitization Abuses, is to be co-chaired by New York Attorney General Eric Schneiderman, whom the White House had booted out of a negotiating committee because of his opposition to Obama’s banker protection racket. Last night, at the joint session of Congress, Obama sat Schneiderman in the First Lady’s box, to give the impression that he and the obstinate New Yorker had been on the same page all the time. Nothing could be farther from the truth. Obama was trying to shut down the attorney generals’ probes into banker criminality, and was finally forced to set up a federal unit of his own. However, with the “investigation” now in Obama’s hands, de facto banker immunity may have been achieved, and the puny “settlement” could soon be announced. Wall Street will be pleased, and no doubt reciprocate with hundreds of millions in campaign contributions.

With the ‘investigation’ now in Obama’s hands, de facto banker immunity may have been achieved.”

U.S. Attorney Eric Holder, the former corporate lawyer, has been a good soldier. His own investigations of the meltdown and its aftermath – if they actually existed – have resulted in not a single corporate bad actor going to jail. Although Obama told the Congress and the people that what happened when the “house of cards collapsed” was “wrong,” he has also opined that most of what the bankers did was “not illegal.” Every action he has taken as president has been to protect the innocents on Wall Street.

We’ve put in place new rules to hold Wall Street accountable, so a crisis like that never happens again,” said the president. Nonsense. Obama fought tooth and nail to defend the fatal derivatives market from serious tampering by progressive Democrats. The crisis of 2008 was set off by the multiplier effect of derivatives on the collapse of toxic mortgage securities. At the time, at least $600 trillion dollars in derivatives loomed over the planet. Today, derivatives have rebounded to…over $600 trillion. The banks that were “too big to fail” are even bigger, and there are fewer of them – meaning, capital is more concentrated than before. Obama’s “new rules” have preserved and further consolidated the hegemony of finance capital over U.S. economic and political life. The world economy teeters on the brink.

But, “America is back!” says the president. It is the “indispensable nation” – the one that treats the rest of the planet, and most of its own citizens, as entirely dispensable. Hail to the Chief!

BAR executive editor Glen Ford can be contacted at [email protected].


His Council on Jobs and Competitives -- the jobs offshoring crew

Unfortunately, with all his talk of jobs, he's managed to gather, but with several exceptions, those individuals most responsible for offshoring the most jobs in America and making so many unemployed for the foreseeable future:

Jeffrey Immelt, General Electric chief executive

(see “Secret History of GE”)

James W. Owens, head of Caterpillar

(On boards of the Peterson Institute – whose long-time agenda has been the offshoring of all American jobs, the privatization of Social Security, Medicare/Medicaid, and is the baby of Peter G. Peterson, LBO pirate, and on board of Business Roundtable)

Robert Wolf, chairman and CEO of UBS Group Americas

(Oh great, a guy from the major Swiss bank!)

Mark Gallogly, founder and managing partner at Centerbridge Partners L.P.

(formerly with Blackstone Group, world’s largest private equity LBO firm, Centerbridge is also a private equity, leveraged buyout firm)

Penny Pritzker, chair and founder of Pritzker Realty Group and Classic Residence by Hyatt

(Member of the ultra-rich Pritzker family, questionable bank ownership w/involvement in subprime industry, and you do know about all the anti-labor and criminal behavior at Hyatt, right?)

John Doerr, partner at Kleiner, Perkins, Caufield & Byers

(Doerr has a mixed background, but while he was with Intel, he appeared to strongly support the jobs offshoring program --- Intel lost over $1 billion in the chip project in India, which they belatedly relocated back to America.  Doerr also appears to support the privatizing of American education.)

Monica C. Lozano, Director of Bank of America

(BofA director, what more need be said? That she was also on the BoD of Walt Disney Corporation, and the Tenet Healthcare Corporation [from a wiki entry:  In the early 1990s as National Medical Enterprises, the company was accused of committing fraud by admitting thousands of psychiatric patients who did not need hospitalization and then charging these patients inflated prices. In 1991, the federal government investigated the company for fraud and conspiracy. In 1993, offices of the company were raided by law enforcement in an attempt to show that the company was defrauding patients and insurance companies. In 1994, the company paid $2.5 million to settle lawsuits from 23 patients at its psychiatric hospitals. Again in 1994, National Medical Enterprises settled fraud charges with the United States and 28 states involving payments of a record $380 million USD at the time and federal guilty pleas on eight criminal counts by two of its units. The company also agreed to a 5-year corporate integrity agreement with the U.S. Department of Health and Human Services.]  Also on BoD of a Mitsubishi financial subsidiary.)

Charles E. Phillips, Jr., president of Infor.

(former managing director with Morgan Stanley)

Richard L. Trumka, president of the AFL-CIO

Austan Goolsbee, chairman of Council of Economic Advisers

(Told the Canadian press, during Obama’s first presidential campaign, that all the talk against NAFTA was purely political, and not to be concerned.  Goolsbee’s wife is a former management consultant at McKinsey & Company, historically the major PR/mouthpiece for the global banking cartel. Also Yale Skull & Bones)

Christina Romer, former chairperson of Council of Economic Advisers

(Submediocre economist, questionable papers on causes for the Great Depression, not that far removed from Bernanke’s submediocre papers on the Great Depression.)

William H. Donaldson, former Securities and Exchange Commission chairman

(Nixon and Geo. W. Bush administrations, Skull & Bones – also, I believe Donaldson is a member of THE Donaldson family, which married into and became part of the ultra-rich DuPont family.)

Laura D'Andrea Tyson, former Chair of the Council of Economic Advisers during the Clinton Administration

(Long-time position on Board of Directors of Morgan Stanley)

Martin Feldstein, former chief economic advisor to President Ronald Reagan,

(Feldstein was a director at HCA when they paid the largest out-of-court settlement for Medicare/Medicaid fraud, Feldstein was a director at Eli Lilly when they had to pay the largest criminal penalty in history for falsely marketing a drug which killed a number of people (over $1 billion penalty), and Feldstein was a director at AIG’s Financial Products group when they were involved in the largest insurance swindle in US history (selling $460 billion worth of credit default swaps without keeping the necessary capital on hand --- received over $333 billion in government bailouts, and still counting, had billions also written off from their losses by the US gov’t – you may have heard of them???)

Roger W. Ferguson, Jr., President and Chief Executive Officer of the Teachers Insurance and Annuity Association - College Retirement Equities Fund (TIAA-CREF)

(Former partner with McKinsey & Company, member of the Group of Thirty, the international group of financiers, created by the Rockefeller Foundation in 1978, which pushed for the removal of “legal risk” in the widespread adoption of credit derivatives, i.e., the primary cause and platform for debt leveraging resulting in asset-price inflation, in other words, massive wealth transfer to the plutocracy.  Majority of Group of Thirty members also belong to Peter G. Peterson’s Peterson Institute, also referred to as the International Institute for Economics.)

David F. Swensen, CIO at Yale University

(Former SVP at Lehman Brothers, specializing in swaps.)

The majority of these people also are familiar and socialize frequently with one another as they hold trustee positions at the same, and interlocking, organizations, as well as various BoD positions also at the same institutions.

Obama: Delusions vs. reality

Excellent article--and excellent, informative comment by Sgt. Doom.

As Doug Henwood has observed in The Left Business Observer,

...Neither he nor his party are spineless betrayers—they’re partisans of capital who sometimes have to pretend otherwise for electoral reasons. But that won’t stop loyalists from scratching their heads and wondering why the Dems are the way they are—only to stop and reassure you that the Republicans are so much worse.

Lending vigor to that indulgent urge is an unfortunate sequencing. Bush’s administration was unusually cretinous, and Bush himself one of our most philistine presidents ever.  He was succeeded by one of the smoothest and most cerebral politicians imaginable. Liberals are ... overjoyed that the president can speak in grammatical sentences that show more than trace levels of thought and wit.