The New Finance Bill: A Mountain of Legislative Paper, a Molehill of Reform by Robert Reich Friday, July 16, 2010 by RobertReich.org
Thursday the President pronounced that “because of this [financial reform] bill the American people will never again be asked to foot the bill for Wall Street’s mistakes.”
As if to prove him wrong, Goldman Sachs simultaneously announced it had struck a deal with federal prosecutors to pay $550 million to settle federal claims it misled investors – a sum representing a mere 15 days profit for the firm based on its 2009 earnings. Goldman’s share price immediately jumped 4.3 percent, and the Street proclaimed its chair and CEO, Lloyd (“Goldman is doing God’s work”) Blankfein, a winner. Financial analysts rushed to affirm a glowing outlook for Goldman stock.
The American people will continue to have to foot the bill for the mistakes of Wall Street’s biggest banks because the legislation does nothing to diminish the economic and political power of these giants. It does not cap their size. It does not resurrect the Glass-Steagall Act that once separated commercial (normal) banking from investment (casino) banking. It does not even link the pay of their traders and top executives to long-term performance. In other words, it does nothing to change their basic structure. And for this reason, it gives them an implicit federal insurance policy against failure unavailable to smaller banks – thereby adding to their economic and political power in the future.
Make no mistake: As long as there’s no fundamental change in the structure of Wall Street – as long as the big banks stay as big and are allowed to grow bigger, and have every incentive to invent new financial gimmicks with which to bet other peoples’ money – they will remain too big to fail, and too politically powerful to control.
Congress labored mightily to produce a mountain of legislation, but produced a molehill of reform to prevent the wreckage Wall Street wreaked upon the nation.READ MORE: http://www.commondreams.org/view/2010/07/16-3
Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including The Work of Nations, Locked in the Cabinet, and his most recent book, Supercapitalism. His “Marketplace” commentaries can be found on publicradio.com and iTunes. Inequality Is the Real Debt Burden by Terry Link Friday, July 16, 2010 by Lansing State Journal (Michigan)
Inequality Is the Real Debt Burden by Terry Link Friday, July 16, 2010 by Lansing State Journal (Michigan)
Recent polls indicate that many Americans are as concerned about growing government debt as they are about terrorism. It’s interesting that concern about debt occurs almost rhythmically when conservatives are out of power.
Conservatives supported a $3 trillion war in the Middle East without concern for “growing debt”. Their present claim that debt that supports the unemployed, sick, and education is bad while debt that truly imperils current and future generations is acceptable is dangerous and misguided.
Policies prescribed by Milton Friedman and his followers leave a wake of growing inequality both globally and within nations that is the seed of our current and continuing malaise. We have unwittingly spent up the interest that nature provided and have been spending the capital for more than a generation. The proof is clear to the scientific world. Those convinced by the sales job of the Milton Friedmans of the world that free markets are some holy grail, ignore the environmental and social costs of doing business.
A recent study, “The Spirit Level: Why Greater Equality Makes Societies Stronger“, two British epidemiologists demonstrate overwhelmingly that the real culprit for our predicament is growing inequality. It’s way past time to start talking about our real debt – the costs of inequality we bear and pass on to our children and theirs.
Terry Link lives in Laingsburg, Michigan. READ MORE: http://www.commondreams.org/view/2010/07/16-4
Conservatism’s Death Gusher by George Lakoff Friday, July 16, 2010 by CommonDreams.org
The issue is death – death gushing at ten thousand pounds per square inch from a mile below the sea, tens of thousands of barrels of death a day. Not just death to eleven human beings. Death to sea birds, sea turtles, dolphins, fish, oyster beds, shrimp, beaches; death to the fishing industry, tourism, jobs; and death to a way of life based on the beauty and bounty of the Gulf.
Many, perhaps a majority, of the Gulf residents affected are conservatives, strong right-wing Republicans, following extremist Governors Bobby Jindal and Haley Barbour. What those conservatives are not saying, and may be incapable of seeing, is that conservatism itself is largely responsible for what happened, and conservatism is a continuing disaster for conservatives who live along the Gulf.
Conservatism is an ideology of death. It was conservative laissez-faire free market ideology – that maximizing profit comes first – that led to:
- the corrupt relationship between the oil companies and the Interior Department staff that was supposedly regulating them
- minimizing cost by not drilling relief wells;
- the principle that oil companies could be responsible for their own risk assessments on drilling;
- maximizing profit by outsourcing risk assessment that told them what they wanted to hear: zero risk!;
- maximizing profit by minimizing cost of materials;
- maximizing profit by failing to pay cleanup crews and businesses for their losses;
- focusing only on profit by failing to test the cleanup methods to be used if something went wrong;
- minimizing cost by sacrificing the health of cleanup crews, refusing to allow them to use respirator masks to protect against toxic fumes.
It is conservative profit-above-all market fundamentalism that has led other oil companies to mount a massive PR campaign to isolate BP as an anomalous “bad actor” and to argue that offshore drilling should be continued by the self-proclaimed “good actors.” Their PR fails to mention that in Congressional hearings it came out that they all outsource risk assessment to the same company that declared that BP had “zero risk.” The PR fails to mention that they all use cost-benefit analysis to maximize profits just as BP did. Cost-benefit analysis only looks at monetary costs versus benefits, case by case, not at the risk of massive death of the kind gushing out of the Gulf at present. Death, in itself, even at that scale, is not a “cost.” Only an outflow of money is a “cost.” This is what follows from conservative laissez-faire market ideology, an ideology that continues to sanction death on a Gulf scale.
Finally, there is what progressive Democrats see as a contradiction: conservative advocates of smaller and weaker government and critics of governmental power trying to pin the Death Gusher Disaster on Obama for not having and using enough government power to prevent or lessen the disaster – even though the government has no capacity to plug oil wells. Those who are not held captive by the conservative worldview recognize the causal role of conservatism in the Death Gusher in the Gulf. Many progressive do, but keep it to themselves.
Progressives have been much too kind to conservatives on this matter. They have largely accepted the Bad Actor Frame, criticizing BP but not the whole industry and its practices. No one should be drilling miles under the sea, where oil comes out at 10,000 pounds per square inch. No matter how much profit is involved.
Conservatism gushes death – and not only in the Gulf of Mexico.
George Lakoff is the author of Moral Politics, Don’t Think of an Elephant!, Whose Freedom?, and Thinking Points (with the Rockridge Institute staff). He is Richard and Rhoda Goldman Distinguished Professor of Cognitive Science and Linguistics at the University of California at Berkeley, and a founding senior fellow at the Rockridge Institute. READ MORE: http://www.commondreams.org/view/2010/07/16-5
Tim Geithner Opposes Nominating Elizabeth Warren to Lead New Consumer Agency by Shahien Nasiripour Friday, July 16, 2010 by The Huffington Post
Treasury Secretary Timothy Geithner opposes the possible nomination of Elizabeth Warren to head the Consumer Financial Protection Bureau, according to a source with knowledge of Geithner’s views.
The financial reform bill passed by the Senate on Thursday mandates the creation of a new federal entity charged with protecting consumers from predatory lenders.
But if Geithner has his way, the most prominent advocate for creating the agency may not be picked to lead it: Elizabeth Warren, a professor at Harvard Law School, one of the leading reform advocates fighting on behalf of American taxpayers.
Yet while her work on behalf of a federal unit designed solely to protect borrowers from abusive lenders has been embraced by the administration, Warren’s role as a bailout watchdog led to strained relations with the agency her panel has taken to task with brutal reports every month since Obama took office: Geithner’s Treasury Department.
Geithner’s opposition could have political implications for a White House determined to prove it’s gotten tough on Wall Street. Since March, Obama has devoted four of his weekly Saturday addresses to highlight and promote the consumer agency.
In March 2009, in response to a question during a town hall event in Southern California about the bailout for Wall Street firms and whether Obama supported tougher consumer protections on credit cards, Obama promoted Warren’s academic work.
Three months later, the administration released its blueprint for how it wanted to fix the nation’s broken financial system. Warren’s idea for a consumer agency was a heavily-promoted part of it. Warren, a Treasury Department spokesman and a White House spokesperson all declined to comment for this article. READ MORE: http://www.commondreams.org/headline/2010/07/16-3
My Two-bits On Elizabeth Warren:
A really dumb student wrote, “He was as lame as a duck. Not the metaphorical lame duck, either, but a real duck that was actually lame. Maybe from stepping on a landmine or something.”
Obama’s pretty much off on the wrong course. He appears to sprinkle “public goodies” up to and including the health care insurance and financial reform acts, which achieve limited but not system change, while shoving our government ever more firmly into corporatist pockets. He listens to Robert Rubin, Ben Bernowski, and Timothy Geithner, the corporate tools who crafted and executed the big rip-off that plunged our country into near-receivership for Bush Jr. Obama is using the same old tools to craft and execute a brand new disaster.
Geithner needs to go, he’s the lame duck who stepped on a land mine. Treasury Secretary Timothy Geithner is trying to block President Obama from appointing one of the best consumer watchdogs in the nation to lead the new Consumer Financial Protection Bureau created by Congress to rein in Wall Street. Elizabeth Warren challenges him because she doesn’t accept his b.s. and neither should Obama.
Water as Human Right Threatens to Split World Body by Thalif Deen Friday, July 16, 2010 by Inter Press Service
UNITED NATIONS – A long outstanding proposal to recognise the right to water as a basic universal human right is threatening to split the world’s rich and poor nations.
Opposition to the proposal is coming mostly from Western nations, says Maude Barlow, a global water advocate and a founder of the Canada-based Blue Planet Project.
“Canada is the worst. But Australia, the United States and Great Britain are also holding up the process,” she said.
If the draft resolution is eventually adopted by the 192- member U.N. General Assembly, “it would be one of the most important things the United Nations has done since the Universal Declaration of Human Rights,” she said.
“International and local community groups fighting for water justice have long been calling for leadership from the U.N. in clearly recognizing that water and sanitation are human rights,” said one source. Whether the provision of water and sanitation is carried out by public or private actors is not relevant to the status of water and sanitation as a human right.
Meanwhile, a coalition of international non-governmental organisations (NGOs), including the Council of Canadians, Food and Water Europe, Corporate Europe Observatory and the Blue Planet Project, has appealed to members of the European Parliament seeking their political support, “in light of the European Union’s recognition of water as a human right, the EU can play a key role in promoting this key resolution at the United Nations.” READ MORE: http://www.commondreams.org/headline/2010/07/16-7
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“If someone takes the time to etch a poem on a plaque, you’d better take it seriously, particularly if it rhymes.” Muriel, Courage the Dog.