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Posts Tagged ‘BUSINESS REGULATION’

LOAN-TEST CEOS LIKE WELFARE APPLICANTS: PART TWO (END)

In Bureaucracy, Business, History, Law, Politics, Social commentary on April 4, 2018 at 1:26 am

Robert Benmosche, the CEO of American International Group (AIG) had some blunt advice to college graduates searching for work.

“You have to accept the hand that’s been dealt you in life,” Benmosche said in a 2013 interview on Bloomberg Television. “Don’t cry about it. Deal with it.”

As is typical of one-percenters, Benmosche blamed willing-to-work college graduates for the refusal of rich employers to offer jobs instead of excuses.

AIG’s way of “accepting the hand that’s been dealt you in life” was to go crying to the Federal Government for a bailout loan—which eventually ballooned to $182 billion.

If college graduates should “deal with” the hardships of finding a responsible, hiring-inclined employer with a stiff upper lip, as Benmosche advised, the same advice should work wonders on greed-fueled CEOs.

Greed-test CEOs for future government loans.

After all, drug-testing welfare recipients has become the new mantra for Republicans.

Some bills have even targeted people who seek unemployment insurance and food stamps, despite scanty evidence that the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to CEOs of the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

In 2008, Alan Greenspan, the former chairman of the Federal Reserve, testified before Congress about the origins of the Wall Street “meltdown.”

He admitted that he was “shocked” at the breakdown in U.S. credit markets and said he was “partially” wrong to resist regulation of some securities.

“Those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity—myself especially—are in a state of shocked disbelief,” said Greenspan, who had ruled the Fed from 1987 to 2006. 

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Alan Greenspan

As a disciple of the right-wing philosopher, Ayan Rand, Greenspan had fiercely held to her belief that “The Market” was a divine institution. As such, “it” alone knew what was best for the nation’s economic prosperity.

“Enlightened self-interest,” he believed, would guarantee that those who dedicated their lives to making money would not allow mere greed to steer them—and the country—into disaster.

As he saw it, any attempt to regulate greed-based appetites could only harm that divine institution.

This had been the prevailing attitude among businessmen prior to the 1929 Wall Street crash that brought on the Great Depression. It proved wrong then.

And it proved wrong for Greenspan—and the country—in 2008. And the nation will be literally paying for such misguided confidence in profit-addicted men for decades to come.

So if Republicans want to protect the “poor, oppressed taxpayer,” they should demand background investigations for those whose addiction truly threatens the economic future of this country.

That is: The men (and occasionally women) who run the nation’s most important financial institutions, such as banks, insurance and mortgage companies.

Thus, in the future, all CEOs—and their families and topmost executives—of financial institutions seeking Federal bailouts should be required to:

  • Undergo “full field investigations” by the FBI and IRS.
  • Submit full financial disclosure forms concerning not only themselves but all members of their immediate families.
  • Be subject to Federal prosecution for perjury if they provide false information or conceal evidence of criminal violations.
  • Periodically submit themselves for additional background investigation.
  • Be subject to arrest, indictment and prosecution if the background investigation turns up evidence of criminal activity.

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In addition:

  • If a bailout-seeking financial institution refuses to comply with these criteria, it should be refused the loan.
  • If a CEO and/or other top officials are judged ineligible for a loan, the company should be asked to replace those executives with others who might qualify.
  • Those alternative executives should be subject to the same background investigation requirements as just outlined.
  • If the institution refuses to replace those executives found ineligible, the Government should refuse the loan.
  • If the Government is forced to take over a troubled financial institution, its CEO and top executives should be replaced with applicants who have passed the required security screening.

The United States has a long and embarrassing history in worshiping wealth for its own sake. Part of this can be traced to the old Calvinistic doctrine that wealth is a proof of salvation, since it shows evidence of God’s favor.

“The man who builds a factory,” eulogized President Calvin Coolidge, “builds a temple. And the man who works there, worships there.”

Another reason for this worship of mammon is the belief that someone who is wealthy is automatically endowed with wisdom and integrity. If that were true, Mafia bosses would be the moral equivalent of Saint Augustine.

Following these beliefs to their ultimate conclusion will transform the United States into a plutocracy—a government of the wealthy, by the wealthy, for the wealthy.

Every day—from President Donald Trump on down—we see fresh evidence of the destruction wrought by the unchecked greed of wealthy, powerful men.

When they—and their paid shills in Congress—demand, “De-regulate business,” it’s essential to remember what this really means.

It means: “Let criminals be criminals.”

LOAN-TEST CEOS LIKE WELFARE APPLICANTS: PART ONE (OF TWO)

In Bureaucracy, Business, History, Law, Politics, Social commentary on April 3, 2018 at 12:13 am

The late Robert Benmosche, then CEO of American International Group (AIG), had some blunt advice to college graduates searching for work in a tight job market.

Robert Benmosche

“You have to accept the hand that’s been dealt you in life,” Benmosche said in a 2013 interview on Bloomberg Television. “Don’t cry about it. Deal with it.”

Typical advice from a one-percenter whose company, AIG, suffered a liquidity crisis when its credit ratings were downgraded below “AA” levels in September, 2008.

So how did AIG “deal with” its own crisis?  It went crying to its Uncle Sugar, the United States Government, for a bailout.

Which it promptly got.

The United States Federal Reserve Bank, on September 16, 2008, made an $85 billion loan to AIG to meet increased collateral obligations resulting from its credit rating downgrade–and thus saving it from certain bankruptcy.

In return, the Government took an 80% stake in the firm.

(The bailout eventually ballooned to $182 billion in exchange for a 92% stake.)

College graduates, said Benmosche, needed to seize the opportunities that become available to them, even if their options are limited.

“They want me to talk to the students and give them a sense of encouragement, especially with the high unemployment,” said Benmosche.

“My advice will be, ‘Whatever opportunity comes your way, take it. Take it and treat it as if it’s the only one that’s coming your way, because that actually may be the truth.’” 

Yes, if you have the opportunity to cry yourself into a multi-billion dollar loan from the Federal Government, by all means, do so.

Of course, willing-to-work college graduates who can’t find willing-to-hire employers won’t be able to count on a generous bailout from the Federal Government.

To which most of them will owe hundreds of thousands of dollars in student loans.

It’s long past time to apply to “untouchable” CEOs like Robert Benmosche the same criteria that Right-wing Republicans demand be applied to welfare recipients.

Republican lawmakers have vigorously pursued welfare drug-testing in Congress and more than 30 states.

Some bills have even targeted people who claim unemployment insurance and food stamps, despite scanty evidence the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

For example:

  • The Troubled Asset Relief Program (TARP) has invested $118.5 billion in restoring liquidity to the financial markets.
  • Federal Reserve rescue efforts: $1.5 trillion invested.
  • Federal stimulus programs designed to save or create jobs and jumpstart the economy from recession. $577.8 billion invested.
  • American International Group: Multifaceted bailout to help insurers through restructuring, minimize the need to post collateral and get rid of toxic assets. $127.4 billion invested.
  • FDIC bank takeovers: Cost to FDIC fund that insures losses depositors suffer when a bank fails. $45.4 billion invested.
  • Other financial initiatives designed to rescue the financial sector. $366.4 billion invested.
  • Other housing initiatives designed to rescue the housing market and prevent foreclosures. $130.6 billion invested.

According to the Special Inspector General for the TARP bailout, the total commitment of government is $16.8 trillion dollars with the $4.6 trillion already paid out. 

And it’s equally important to remember that welfare recipients did not:

  • Hold CEO positions at any of the banks so far bailed out;
  • Run such insurance companies as American International Group (AIG);
  • Administer the Federal Home Loan Mortgage Corporation, known as Freddie Mac;
  • Command the Federal National Mortgage Association, known as Fannie Mae.

The 2010 documentary Inside Job chronicles the events leading to the 2008 global financial crisis. One of its most insightful moments occurs at a party held by then-Treasury Secretary Henry Paulson.

“We can’t control our greed,” the CEO of a large bank admits to his fellow guests. “You should regulate us more.”

Greed is defined as an excessive desire for wealth or goods. At its worst, greed trumps rationality, judgment and concern about the damage it may cause.

Greed begins in the neurochemistry of the brain. A neurotransmitter called dopamine fuels our greed. The higher the dopamine levels in the brain, the greater the pleasure we experience.

Cocaine, for example, directly increases dopamine levels. So does money.

Harvard researcher Hans Breiter has found, via magnetic resonance imaging studies, that the craving for money activates the same regions of the brain as the lust for sex, cocaine or any other pleasure-inducer.

Dopamine is most reliably activated by an experience we haven’t had before. We crave recreating that experience.

But snorting the same amount of cocaine, or earning the same sum of money, does not cause dopamine levels to increase. So the pleasure-seeker must increase the amount of stimuli to keep enjoying the euphoria.

In time, this incessant craving for pleasure becomes an addiction. And feeding that addiction–-with ever more money–becomes the overriding goal.

Thus, the infamous line—”Greed is good”—in the 1987 film, Wall Street, turns out to be both false and deadly for all concerned. 

But the situation need not remain this way.

EVERYTHING’S BIGGER IN TEXAS–INCLUDING HYPOCRISY

In Business, History, Politics, Social commentary on August 30, 2017 at 1:54 am

On August 25, Hurricane Harvey smashed into Texas with torrential rain and winds of 130 mph. 

Within three days, thousands of homes were flooded and hundreds had to be rescued from rising flood waters.

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Rain-flooded streets in South Texas

And Texas United States Senator Rafael Edward “Ted” Cruz quickly requested full-fledged Federal relief for his state.

But in 2012, Cruz voted three times against federal aid for victims of Hurricane Sandy.

Then he reversed himself in 2013, by seeking “all available resources” for victims of the April 17 explosion at a fertilizer plant in West, McLennan County, Texas.

The blast killed 13 people, wounded about 200 others, and caused extensive damages to surrounding homes.

In October, 2012, Hurricane Sandy had killed about 150 people and caused an estimated $75 billion in damage across the Northeast.

The Republican legislator stood foursquare against the Sandy Aid Relief bill, claiming that it was loaded with “pork”:

“Hurricane Sandy inflicted devastating damage on the East Coast, and Congress appropriately responded with hurricane relief,” said Cruz.

“Unfortunately, cynical politicians in Washington could not resist loading up this relief bill with billions in new spending utterly unrelated to Sandy.

“Emergency relief for the families who are suffering from this natural disaster should not be used as a Christmas tree for billions in unrelated spending, including projects such as Smithsonian repairs, upgrades to National Oceanic and Atmospheric Administration airplanes, and more funding for Head Start.”

Another Republican, Rep. Bill Flores, who represented West,  McLennan County, also voted against the Sandy relief package. But this didn’t stop him from requesting federal aid for the disaster in his home district.

Image result for Images of U.S. Senator Rafael Edward Cruz

U.S. Senator Ted Cruz (R-Texas)

According to PolitiFact, “A big portion of the $17 billion in ‘immediate’ assistance, more than $5 billion, went to replenish FEMA’s disaster relief fund, which may fund relief from future disasters.”

Furthermore, Rick Ungar, writing at Forbes, pointed out that the “pork” came from having to bribe red state Republicans-–including Texas—to get the package passed over their filibuster:

“However, as it turns out, the pork portions of the Senate bill were not earmarked to benefit Democratic members of the upper chamber of Congress….

“The answer can be found in a quick review of the states that are set to benefit from the Senate’s extra-special benevolence—states including Alabama, Mississippi, Texas and Louisiana.” All of these have solid Republican constituencies.

In fact, Texas had the most FEMA-declared disasters since the start of 2009, according to a September 29, 2011 article in iWatch News

“Eleven Republican U.S. senators who represent the states with the most FEMA-declared disasters since the start of 2009 voted against a bill designed to keep the agency’s disaster relief fund from running out of cash.”

“The top two states, Texas and Oklahoma, combined for more than a quarter of the Federal Emergency Management Agency’s declared disasters since Jan. 1, 2009.”

Yet the hypocrisy didn’t end there.

“The nation’s number one resource is its workers,” said Keith Wrightson, safety expert at Public Citizen, a nonprofit consumer advocacy group. “But the agency that’s charged with protecting them is not given the resources to do it. I think it’s worrisome for the nation.”

The West Fertilizer Company facility hadn’t been inspected by the Labor Department’s Occupational Safety and Health Administration (OSHA) since 1985, when the company was fined $30. Why did the facility go for almost 30 years without further inspections from OSHA?

As a small employer, the fertilizer facility may have been exempt from some forms of OSHA scrutiny. Years ago, Congress attached a rider to agency funding that forbids OSHA to perform inspections of workplaces with 10 or fewer employees and whose industries have low injury rates.

Lawmakers reasoned that small businesses shouldn’t have to shoulder the same costs of compliance as larger ones.

But smaller worksites aren’t necessarily less dangerous.  According to safety advocates, small companies often  have fewer resources to invest in worker safety and, with less government oversight, even less incentive.

On April 20, 2013, the damning news broke in a Reuters story:

“The fertilizer plant that  exploded on Wednesday, obliterating part of a small Texas town  and killing at least 14 people, had last year been storing 1,350 times the amount of ammonium nitrate that would normally trigger safety oversight by the U.S. Department of Homeland Security (DHS).”

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Explosion at a fertilizer plant in West, McLennan County, Texas

According to Reuters, West Fertilizer, the company that owned the plant, did not tell DHS about the potentially explosive fertilizer as it was required to do.

The DHS is a major regulator of ammonium nitrate-–which can also be used in bomb making. Thus, it was left totally unaware of the potential danger posed by the plant..

Fertilizer plants and depots must report to the DHS when they hold 400 lb or more of the substance. Filings this  year with the Texas Department of State Health Services, which  weren’t shared with DHS, show the plant had 270 tons of it on hand in 2012. 

Recently called out for his efforts to deny aid to Hurricane Sandy victims, Cruz replied: “Well, you know, look. There’s time for political sniping later. I think our focus needs to be on this crisis.” 

In short, it’s a crisis when it happens in his state, not when it happens elsewhere.

GREED-TESTING FOR CEOs

In Bureaucracy, Business, History, Politics, Social commentary on May 15, 2015 at 12:01 am

Robert Benmosche, the CEO of American International Group (AIG) had some blunt advice to college graduates searching for work in a tight job market.

Robert Benmosche

“You have to accept the hand that’s been dealt you in life,” Benmosche said in an interview on Bloomberg Television. “Don’t cry about it. Deal with it.”

Typical advice from a one-percenter whose company, AIG, suffered a liquidity crisis when its credit ratings were downgraded below “AA” levels in September, 2008.

And how did AIG “deal with” its own crisis?  It went crying to its Uncle Sugar, the United States Government, for a bailout.

Which it promptly got.

The United States Federal Reserve Bank, on September 16, 2008, made an $85 billion loan to the company to meet increased collateral obligations resulting from its credit rating downgrade–and thus saving it from certain bankruptcy.

In return, the Government took an 80% stake in the firm.

(The bailout eventually ballooned to $182 billion in exchange for a 92%  stake.)

College graduates, said Benmosche, needed to seize the opportunities that become available to them, even if their options are limited.

“They want me to talk to the students and give them a sense of encouragement, especially with the high unemployment,” said Benmosche.

“My advice will be, ‘Whatever opportunity comes your way, take it. Take it and treat it as if it’s the only one that’s coming your way, because that actually may be the truth.’”

Of course, willing-to-work college graduates who can’t find willing-to-hire employers won’t be able to count on a generous bailout from the Federal Government.

To which most of them will owe hundreds of thousands of dollars in student loans.

It’s long past time to apply to “untouchable” CEOs like Robert Benmosche the same criteria that right-wing Republicans demand be applied to welfare recipients.

Throughout the past year Republican lawmakers have pursued welfare drug-testing in Congress and more than 30 states.

Some bills have even targeted people who claim unemployment insurance and food stamps, despite scanty evidence the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

For example:

  • The Troubled Asset Relief Program (TARP) has invested $118.5 billion in restoring liquidity to the financial markets.
  • Federal Reserve rescue efforts: $1.5 trillion invested.
  • Federal stimulus programs designed to save or create jobs and jumpstart the economy from recession. $577.8 billion invested.
  • American International Group: Multifaceted bailout to help insurers through restructuring, minimize the need to post collateral and get rid of toxic assets. $127.4 billion invested.
  • FDIC bank takeovers: Cost to FDIC fund that insures losses depositors suffer when a bank fails. $45.4 billion invested.
  • Other financial initiatives designed to rescue the financial sector. $366.4 billion invested.
  • Other housing initiatives designed to rescue the housing market and prevent foreclosures. $130.6 billion invested.

Total of federal monies invested: $3 trillion.

It’s important to note that these figures–supplied by the Federal Reserve, Treasury Department, Federal Deposit Insurance Corporation, Congressional Budget Ooffice and the White House–date from November 16, 2009.

And it’s equally important to remember that welfare recipients did not

  • hold CEO positions at any of the banks so far bailed out;
  • run such insurance companies as American International Group (AIG);
  • administer the Federal Home Loan Mortgage Corporation, known as Freddie Mac;
  • command the Federal National Mortgage Association, known as Fannie Mae.

The 2010 documentary Inside Job chronicles the events leading to the 2008 global financial crisis. One of its most insightful moments occurs at a party held by then-Treasury Secretary Henry Paulson.

“We can’t control our greed,” the CEO of a large bank admits to his fellow guests.  “You should regulate us more.”

Greed is defined as an excessive desire for wealth or goods. At its worst, greed trumps rationality, judgment and concern about the damage it may cause.

Greed begins in the neurochemistry of the brain. A neurotransmitter called dopamine fuels our greed. The higher the dopamine levels in the brain, the greater the pleasure we experience.

Cocaine, for example, directly increases dopamine levels. So does money.

Harvard researcher Hans Breiter has found, via magnetic resonance imaging studies, that the craving for money activates the same regions of the brain as the lust for sex, cocaine or any other pleasure-inducer.

Dopamine is most reliably activated by an experience we haven’t had before. We crave recreating that experience.

But snorting the same amount of cocaine, or earning the same sum of money, does not cause dopamine levels to increase. So the pleasure-seeker must increase the amount of stimuli to keep enjoying the euphoria.

In time, this incessant craving for pleasure becomes an addiction. And feeding that addiction–-with ever more money–becomes the overriding goal.

Thus, the infamous line–”Greed is good”–in the 1987 film, Wall Street, turns out to be both false and deadly for all concerned.

HYPOCRITES UNITED

In Bureaucracy, History, Politics, Social commentary on May 23, 2013 at 12:37 am

Ted Cruz voted against federal aid for victims of Hurricane Sandy–three times.

But the United States Senator from Texas quickly announced he would seek “all available resources” to assist victims of the April 17 explosion at as fertilizer plant in West, McLennan County, Texas.

The blast killed 13 people, wounded about 200 others, and caused extensive damages to surrounding homes.

Last October, Hurricane Sandy killed around 150 people and caused an estimated $75 billion in damage across the Northeast.

The Republican legislator stood foursquare against the Sandy Aid Relief bill, claiming that it was loaded with “pork”:

“Hurricane Sandy inflicted devastating damage on the East Coast, and Congress appropriately responded with hurricane relief,” said Cruz.

“Unfortunately, cynical politicians in Washington could not resist loading up this relief bill with billions in new spending utterly unrelated to Sandy.

“Emergency relief for the families who are suffering from this natural disaster should not be used as a Christmas tree for billions in unrelated spending, including projects such as Smithsonian repairs, upgrades to National Oceanic and Atmospheric Administration airplanes, and more funding for Head Start.

“This bill is symptomatic of a larger problem in Washington–an addiction to spending money we do not have. The United States Senate should not be in the business of exploiting victims of natural disasters to fund pork projects that further expand our debt.”

Another Republican, Rep. Bill Flores, who represents West, also voted against the Sandy relief package.  But this didn’t stop him from requesting federal aid for the disaster in his home district.

Such hypocrisy.

U.S. Senator Ted Cruz (R-Texas)

Cruz and Flores are not alone in their fiscal hypocrisy.

Oklahoma’s two U.S. Senators– Jim Inhofe and Tom Coburn, both right-wing Republicans–have also repeatedly voted against funding disaster aid for other parts of the country.

Oklahoma U.S. Senators Jim Inhofe and Tom Coburn

They have also opposed increased funding for the Federal Emergency Management Agency (FEMA), which administers federal disaster relief.

Both Inhofe and Coburn backed a plan to slash disaster aid to victims of Hurricane Sandy.

In a December, 2012 press release, Coburn said that the Sandy Relief bill contained “wasteful spending,” and identified a series of items he objected to, including “$12.9 billion for future disaster mitigation activities and studies.”

Inhofe, a Republican, argued that the Hurricane Sandy bill was loaded with  pork.

“They had things in the Virgin Islands. They were fixing roads there, they  were putting roofs on houses in Washington, D.C. Everybody was getting in and  exploiting the tragedy that took place. That won’t happen in Oklahoma,” Inhofe  said on MSNBC.

The Sandy relief bill initially contained money for projects outside of areas damaged by Sandy–as bribes to Republicans to get it through Congress.

But Federal relief aid is a different matter entirely to Inhofe when the victims come from his own state.

A May 20, 2-mile-wide tornado ravaged the Oklahoma City suburb of Moore, killing at least 51 people while destroying entire tracts of homes and trapping two dozen school children beneath rubble.

For Inofe, aiding his constituents would be “totally different” from providing aid to Sandy victims.

“Everyone was getting in and exploiting the tragedy that took place,” he said. “That won’t happen in Oklahoma.”

As for Coburn: In a statement, he said that “as the ranking member of Senate committee that oversees FEMA, I can assure Oklahomans that any and all available aid will be delivered without delay.”

For Rep. Peter King (R-New York this hypocrisy is simply too much to swallow quietly.

“I think there’s a lot of hypocrisy involved here, Inhofe saying Sandy aid was corrupt but Oklahoma won’t be,” said King, whose state was devastated last October by Sandy.

For King, natural disasters such as Hurricane Sandy and the Oklahoma tornado are not “local issues”: “It’s an American issue, we have an obligation to come forward.”

He said that he didn’t plan to exact revenge on those who had denied New Yorkers aid after Sandy.

“I won’t hold it against anyone,” King said. “I don’t want suffering people in Oklahoma to be held hostage while we engage in political fights, saying ‘I told you so.’ I want to deal with it on the merits.”

All of which highlights how the principle of YIMBY–Yes In My Back Yard–is very much alive, even for alleged fiscal hawk Republicans.  At least, when their own constituents are the victims in need.

Because needy constituents who go unaided quickly become angry constituents who remember that lack of aid at the next election.

It’s something to remember the next time right-wingers take a hard line on spending bills to help the poor or victims of natural disasters.

GREED-TESTING FOR CEOS: PART TWO (END)

In Bureaucracy, Business, History, Politics on May 22, 2013 at 12:34 am

Robert Benmosche, the CEO of American International Group (AIG) recently offered some blunt advice to college graduates searching for work.

“You have to accept the hand that’s been dealt you in life,” Benmosche said in an interview on Bloomberg Television. “Don’t cry about it. Deal with it.”

As is typical of one-percenters, Benmosche blames willing-to-work college graduates for the refusal of rich employers to offer jobs instead of excuses.

AIG’s way of “accepting the hand that’s been dealt you in life” was to go crying to the Federal Government for a bailout loan–which eventually ballooned to $182 billion.

If college graduates should “deal with” the hardships of finding a responsible, hiring-inclined employer with a stiff upper lip, as Benmosche advises, the same advice should work wonders on greed-fueled CEOs.

Greed-test CEOs for future government loans.

After all, drug-testing welfare recipients has become the new mantra for Republicans.

Some bills have even targeted people who seek unemployment insurance and food stamps, despite scanty evidence that the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to CEOs of the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

In 2008, Alan Greenspan, the former chairman of the Federal Reserve, testified before Congress about the origins of the Wall Street “meltdown.”

He admitted that he was “shocked” at the breakdown in U.S. credit markets and said he was “partially” wrong to resist regulation of some securities.

“Those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity–myself especially–are in a state of shocked disbelief,” said Greenspan, who had ruled the Fed from 1987 to 2006.

As a disciple of the right-wing philosopher, Ayan Rand, Greenspan had fiercely held to her belief that “The Market” was a divine institution. As such, “it” alone knew what was best for the nation’s economic prosperity.

“Enlightened self-interest,” he believed, would guarantee that those who dedicated their lives to making money would not allow mere greed to steer them–and the country–into disaster.

As he saw it, any attempt to regulate greed-based appetites could only harm that divine institution.

Greenspan proved wrong. And the nation will be literally paying for such misguided confidence in profit-addicted men for decades to come.

So if Republicans want to protect the “poor, oppressed taxpayer,” they should demand background investigations for those whose addiction truly threatens the economic future of this country.

That is–the men (and occasionally women) who run the nation’s most important financial institutions, such as banks, insurance and mortgage companies.

Thus, in the future, all CEOs–and their topmost executives–of financial institutions seeking Federal bailouts should be required to:

  • Undergo “full field investigations” by the FBI and IRS.
  • Submit full financial disclosure forms concerning not only themselves but all members of their immediate families.
  • Be subject to Federal prosecution for perjury if they provide false information or conceal evidence of criminal violations.
  • Periodically submit themselves for additional background investigation.
  • Be subject to arrest, indictment and prosecution if the background investigation turns up evidence of criminal activity.

In addition:

  • If a bailout-seeking financial institution refuses to comply with these criteria, it should be refused the loan.
  • If a CEO and/or other top officials are judged ineligible for a loan, the company should be asked to replace those executives with others who might qualify.
  • Those alternative executives should be subject to the same background investigation requirements as just outlined.
  • If the institution refuses to replace those executives found ineligible, the Government should refuse the loan.
  • If the Government is forced to take over a troubled financial institution, its CEO and top executives should be replaced with applicants who have passed the required security screening.

The United States has a long and embarrassing history in worshipping wealth for its own sake. Part of this can be traced to the old Calvinistic doctrine that wealth is a proof of salvation, since it shows evidence of God’s favor.

Another reason for this worship of mammon is the belief that someone who is wealthy is automatically endowed with wisdom and integrity.

Following these beliefs to their ultimate conclusion will transform the United States into a plutocracy–a government of the wealthy, by the wealthy, for the wealthy.

Every day we see fresh evidence of the destruction wrought by the unchecked greed of wealthy, powerful men.

When they–and their paid shills in Congress–demand, “De-regulate business,” it’s essential to remember what this really means.

It means: “Let criminals be criminals.”

GREED-TESTING FOR CEOS: PART ONE (OF TWO)

In Bureaucracy, Business, History, Politics, Social commentary on May 21, 2013 at 1:28 am

Robert Benmosche, the CEO of American International Group (AIG) has some blunt advice to college graduates searching for work in a tight job market.

“You have to accept the hand that’s been dealt you in life,” Benmosche said in an interview on Bloomberg Television. “Don’t cry about it. Deal with it.”

Typical advice from a one-percenter whose company, AIG, suffered a liquidity crisis when its credit ratings were downgraded below “AA” levels in September 2008.

And how did AIG “deal with” its own crisis?  It went crying to its Uncle Sugar, the United States Government, for a bailout.

Which it promptly got.

The United States Federal Reserve Bank, on September 16, 2008, made an $85 billion loan to the company to meet increased collateral obligations resulting from its credit rating downgrade–and thus saving it from certain bankruptcy.

In return, the Government took an 80% stake in the firm.

(The bailout eventually ballooned to $182 billion in exchange for a 92%  stake.)

College graduates, said Benmosche, need to seize the opportunities that become available to them, even if their options are limited.

“They want me to talk to the students and give them a sense of encouragement, especially with the high unemployment,” said Benmosche.

“My advice will be, ‘Whatever opportunity comes your way, take it. Take it and treat it as if it’s the only one that’s coming your way, because that actually may be the truth.’”

Of course, willing-to-work college graduates who can’t find willing-to-hire employers won’t be able to count on a generous bailout from the Federal Government.

To which most of them will owe hundreds of thousands of dollars in student loans.

It’s long past time to apply to “untouchable” CEOs like Robert Benmosche the same criteria that right-wing Republicans demand be applied to welfare recipients.

Throughout the past year Republican lawmakers have pursued welfare drug-testing in Congress and more than 30 states.

Some bills have even targeted people who claim unemployment insurance and food stamps, despite scanty evidence the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

For example:

  • The Troubled Asset Relief Program (TARP) has invested $118.5 billion in restoring liquidity to the financial markets.
  • Federal Reserve rescue efforts: $1.5 trillion invested.
  • Federal stimulus programs designed to save or create jobs and jumpstart the economy from recession. $577.8 billion invested.
  • American International Group: Multifaceted bailout to help insurers through restructuring, minimize the need to post collateral and get rid of toxic assets. $127.4 billion invested.
  • FDIC bank takeovers: Cost to FDIC fund that insures losses depositors suffer when a bank fails. $45.4 billion billion invested.
  • Other financial initiatives designed to rescue the financial sector. $366.4 billion invested.
  • Other housing initiatives designed to rescue the housing market and prevent foreclosures. $130.6 billion invested.

Total of federal monies invested: $3 trillion.

It’s important to note that these figures–supplied by the Federal Reserve, Treasury Department, Federal Deposit Insurance Corporation, Congressional Budget Ooffice and the White House–date from November 16, 2009.

And it’s equally important to remember that welfare recipients did not

  • hold CEO positions at any of the banks so far bailed out;
  • run such insurance companies as American International Group (AIG);
  • administer the Federal Home Loan Mortgage Corporation, known as Freddie Mac;
  • command the Federal National Mortgage Association, known as Fannie Mae.

The 2010 documentary “Inside Job” chronicles the events leading to the 2008 global financial crisis. One of its most insightful moments occurs at a party held by then-Treasury Secretary Henry Paulson.

“We can’t control our greed,” the CEO of a large bank admits to his fellow guests.

“You should regulate us more.”

Greed is defined as an excessive desire for wealth or goods. At its worst, greed trumps rationality, judgment and concern about the damage it may cause.

Greed begins in the neurochemistry of the brain. A neurotransmitter called dopamine fuels our greed. The higher the dopamine levels in the brain, the greater the pleasure we experience.

Cocaine, for example, directly increases dopamine levels. So does money.

Harvard researcher Hans Breiter has found, via magnetic resonance imaging studies, that the craving for money activates the same regions of the brain as the lust for sex, cocaine or any other pleasure-inducer.

Dopamine is most reliably activated by an experience we haven’t had before. We crave recreating that experience.

But snorting the same amount of cocaine, or earning the same sum of money, does not cause dopamine levels to increase. So the pleasure-seeker must increase the amount of stimuli to keep enjoying the euphoria.

In time, this incessant craving for pleasure becomes an addiction. And feeding that addiction–with ever more money–becomes the overriding goal.

Thus, the infamous line–”Greed is good”–in the 1987 film, “Wall Street,” turns out to be both false and deadly for all concerned.

But the situation need not remain this way.

ENTITLEMENT, TEXAS STYLE

In Bureaucracy, Business, Law, Law Enforcement, Politics on April 23, 2013 at 12:01 am

Ted Cruz voted against federal aid for victims of Hurricane Sandy–three times.

But the United States Senator from Texas quickly announced he would seek “all available resources” to assist victims of the April 17 explosion at a fertilizer plant in West, McLennan County, Texas.

The blast killed 13 people, wounded about 200 others, and caused extensive damages to surrounding homes.

Last October, Hurricane Sandy killed about 150 people and caused an estimated $75 billion in damage across the Northeast.

The Republican legislator stood foursquare against the Sandy Aid Relief bill, claiming that it was loaded with “pork”:

“Hurricane Sandy inflicted devastating damage on the East Coast, and Congress appropriately responded with hurricane relief,” said Cruz.

“Unfortunately, cynical politicians in Washington could not resist loading up this relief bill with billions in new spending utterly unrelated to Sandy.

“Emergency relief for the families who are suffering from this natural disaster should not be used as a Christmas tree for billions in unrelated spending, including projects such as Smithsonian repairs, upgrades to National Oceanic and Atmospheric Administration airplanes, and more funding for Head Start.

“This bill is symptomatic of a larger problem in Washington–an addiction to spending money we do not have. The United States Senate should not be in the business of exploiting victims of natural disasters to fund pork projects that further expand our debt.”

Another Republican, Rep. Bill Flores, who represents West,  McLennan County, also voted against the Sandy relief package.  But this didn’t stop him from requesting federal aid for the disaster in his home district.

U.S. Senator Ted Cruz (R-Texas)

But, according to PolitiFact, “A big portion of the $17 billion in ‘immediate’ assistance, more than $5 billion, went to replenish FEMA’s disaster relief fund, which may fund relief from future disasters.”

Furthermore, Rick Ungar, writing at Forbes, pointed out that the “pork” came from having to bribe red state Republicans–including Texas–to get the package passed over their filibuster:

“However, as it turns out, the pork portions of the Senate bill were not earmarked to benefit Democratic members of the upper chamber of Congress….

“The answer can be found in a quick review of the states that are set to benefit from the Senate’s extra-special benevolence—states including Alabama, Mississippi, Texas and Louisiana.”

In fact, according to a September 29, 2011 article in iWatch News: Texas had the most FEMA-declared disasters since the start of 2009:

“Eleven Republican U.S. senators who represent the states with the most FEMA-declared disasters since the start of 2009 voted against a bill designed to keep the agency’s disaster relief fund from running out of cash.”

“The top two states, Texas and Oklahoma, combined for more than a quarter of the Federal Emergency Management Agency’s declared disasters since Jan. 1, 2009.”

Click here: As FEMA funds run out, senators from states with most disasters oppose funding bill  The Center for Public Integrity

Yet the hypocrisy doesn’t end there.

“The nation’s number one resource is its workers,” said Keith Wrightson, safety expert at Public Citizen, a nonprofit consumer advocacy group. “But the agency that’s charged with protecting them is not given the resources to do it. I think it’s worrisome for the nation.”

The West Fertilizer Company facility hadn’t been inspected by the Labor Department’s Occupational Safety and Health Administration (OSHA) since 1985, when the company was fined $30. Why did the facility go for almost 30 years without further inspections from OSHA?

As a small employer, the fertilizer facility may have been exempt from some forms of OSHA scrutiny.  Years ago, Congress attached a rider to agency funding that forbids OSHA to perform inspections of workplaces with 10 or fewer employees and whose industries have low injury rates.

Lawmakers reason that small businesses shouldn’t have to shoulder the same costs of compliance as larger ones.

But smaller worksites aren’t necessarily less dangerous.  According to safety advocates, small companies often  have fewer resources to invest in worker safety and, with less government oversight, even less incentive.

On April 20, the damning news broke in a Reuters story:

“The fertilizer plant that  exploded on Wednesday, obliterating part of a small Texas town  and killing at least 14 people, had last year been storing 1,350 times the amount of ammonium nitrate that would normally trigger  safety oversight by the U.S. Department of Homeland Security (DHS).”

Explosion at as fertilizer plant in West, McLennan County, Texas

Yet a source told Reuters that West Fertilizer, the company that owns the plant, did not tell DHS about the potentially explosive fertilizer as it is required to do.

The DHS is a major regulator of ammonium nitrate–which can also be used in bomb making.  Thus, it was left totally unaware of the potential danger posed by the plant..

Fertilizer plants and depots must report to the DHS when they hold 400 lb or more of the substance. Filings this  year with the Texas Department of State Health Services, which  weren’t shared with DHS, show the plant had 270 tons of it on hand last year.

In short, this situation offers the ultimate combination of disaster-producing circumstances:

  • A state with lax regulation of corporate businesses.
  • A plant crammed full of highly explosive materials.
  • Hypocritical U.S. Senators callously ignoring the hardships nature inflicts on other states while greedily demanding the lion’s share of emergency resources for their own constituents.
  • A state–Texas–whose governor has openly threatened secession greedily sucking at the tit of the otherwise despised Federal Government.

RESTORING TRUST IN THE TREASURY – PART TWO (END)

In Business, Politics, Social commentary on January 11, 2013 at 12:10 am

All those who have written upon civil institutions demonstrate…that whoever desires to found a state and give it laws, must start with assuming that all men are bad and ever ready to display their vicious nature, whenever they may find occasion for it. 

If their evil disposition remains concealed for a time, it must be attributed to some unknown reason; and we must assume that it lacked occasion to show itself.  But time, which has been said to be the father of all truth, does not fail to bring it to light.

–Niccolo Machiavelli, The Discourses

The Treasury Department fears that widespread public anger at some of its major economic programs–such as the bank bailout–will deter government officials from intervening in future crises.

As a result, the Treasury Department hopes to regain the public’s trust by issuing a series of economic charts.

Unfortunately, the Treasury’s chart-topping effort will go for nothing.

Emotionally-charged matters–such as child molestation or government bailouts to the rich–don’t lend themselves to “appeals to reason.”

But a different approach might well salvage some public faith in the Treasury Department’s judgment: Greed-test CEOs for future government loans.

After all, drug-testing welfare recipients has become the new mantra for Republicans.

Some bills have even targeted people who seek unemployment insurance and food stamps, despite scanty evidence that the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound. But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to CEOs of the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

In 2008, Alan Greenspan, the former chairman of the Federal Reserve, testified before Congress about the origins of the Wall Street “meltdown.”

He admitted that he was “shocked” at the breakdown in U.S. credit markets and said he was “partially” wrong to resist regulation of some securities.

“Those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity–myself especially–are in a state of shocked disbelief,” said Greenspan, who had ruled the Fed from 1987 to 2006.

As a disciple of the right-wing philosopher, Ayan Rand, Greenspan had fiercely held to her belief that “The Market” was a divine institution. As such, “it” alone knew what was best for the nation’s economic prosperity.

“Enlightened self-interest,” he believed, would guarantee that those who dedicated their lives to making money would not allow mere greed to steer them–and the country–into disaster.

As he saw it, any attempt to regulate greed-based appetites could only harm that divine institution: The Market.

Greenspan was proved wrong. And the nation will be literally paying for such misguided confidence in profit-addicted men for decades to come.

So if Republicans want to protect the “poor, oppressed taxpayer,” they should demand background investigations for those whose addiction truly threatens the economic future of this country.

That means the men (and occasionally women) who run the nation’s most important financial institutions, such as banks, insurance and mortgage companies.

Thus, in the future, all CEOs–and their topmost executives–of financial institutions seeking Federal bailouts should be required to:

  • Undergo “full field investigations” by the FBI and IRS.
  • Submit full financial disclosure forms concerning not only themselves but all members of their immediate families.
  • Be subject to Federal prosecution for perjury if they provide false information or conceal evidence of criminal violations.
  • Periodically submit themselves for additional background investigation.
  • Be subject to arrest, indictment and prosecution if the background investigation turns up evidence of criminal activity.

In addition:

  • If a bailout-seeking financial institution refuses to comply with these criteria, it should be refused the loan.
  • If a CEO and/or other top officials are judged ineligible for a loan, the company should be asked to replace those executives with others who might qualify.
  • Those alternative executives should be subject to the same background investigation requirements as just outlined.
  • If the institution refuses to replace those executives found ineligible, the Government should refuse the loan.
  • If the Government is forced to take over a troubled financial institution, its CEO and top executives should be replaced with applicants who have passed the required security screening.

The United States has a long and embarrassing history of worshipping wealth for its own sake. Part of this can be traced to the old Calvinistic doctrine that wealth is a proof of salvation, since it shows evidence of God’s favor.

Another reason for this worship of mammon is the belief that someone who is wealthy is automatically endowed with wisdom and integrity.

By that criteria, the capos of the Mafia must be presumed to be saints and geniuses.

Following these beliefs to their ultimate conclusion will transform the United States into a plutocracy–a government of the wealthy, by the wealthy, for the wealthy.

Every day we see fresh evidence of the destruction wrought by the unchecked greed of wealthy, powerful men.

When they–and their paid shills in Congress–demand, “De-regulate business,” it’s essential to remember what they really mean.

It means: “Let criminals be criminals.”

RESTORING TRUST IN THE TREASURY – PART ONE (OF TWO)

In Business, Politics, Social commentary on January 10, 2013 at 12:10 am

The Treasury Department fears that widespread public anger at some of its major economic programs–such as the bank bailout–will deter government officials from intervening in future crises.

The public has fused the $700 billion Wall Street bailout with the $787 billion stimulus–and had fiercely attacked the latter.

As a result, the Treasury Department hopes to regain the public’s trust by issuing a series of economic charts.

The new Treasury charts are intended to underscore:

  • the severity of the economic dip;
  • the recovery has been happening faster than many people realize;
  • the lower-than-expected costs of the financial stability programs; and
  • the country has a long way to go to recover from the recession.

Alas, the Treasury’s chart-topping effort will go for nothing.

Emotionally-charged matters–such as child molestation or government bailouts to the rich–don’t lend themselves to appeals to reason.

It was the Wall Street bailout that ignited the Tea Party movement.  And Tea Partiers won’t stop demanding the firing of Treasury Secretary Timothy Geithner just because his agency draws up a few pie-charts.

Yet the Treaasury Department might yet salvage at least some part of the public trust.

The solution: Greed-testing for CEO’s.

Throughout 2012r Republican lawmakers pursued welfare drug-testing in Congress and more than 30 states.

Some bills even targeted people who claim unemployment insurance and food stamps, despite scanty evidence the poor and jobless are disproportionately on drugs.

The concept of background screening is actually sound.  But Republicans are aiming it at the wrong end of the economic spectrum.

Since 2008, the government has handed out billions of dollars in bailouts to the wealthiest corporations in the country.

The reason: To rescue the economy from the calamity produced by the criminal greed and recklessness of those same corporations.

For example:

  • The Troubled Asset Relief Program (TARP) has invested $118.5 billion in restoring liquidity to the financial markets.
  • Federal Reserve rescue efforts: $1.5 trillion invested.
  • Federal stimulus programs designed to save or create jobs and jumpstart the economy from recession. $577.8 billion invested.
  • American International Group: Multifaceted bailout to help insurers through restructuring, minimize the need to post collateral and get rid of toxic assets. $127.4 billion invested.
  • FDIC bank takeovers: Cost to FDIC fund that insures losses depositors suffer when a bank fails. $45.4 billion billion invested.
  • Other financial initiatives designed to rescue the financial sector. $366.4 billion invested.
  • Other housing initiatives designed to rescue the housing market and prevent foreclosures. $130.6 billion invested.

Total of federal monies invested: $3 trillion.

It’s important to note that these figures–supplied by the Federal Reserve, Treasury Department, Federal Deposit Insurance Corporation, Congressional Budget Ooffice and the White House–date from November 16, 2009.

And it’s equally important to remember that welfare recipients did not

  • hold CEO positions at any of the banks so far bailed out;
  • run such insurance companies as American International Group (AIG);
  • administer the Federal Home Loan Mortgage Corporation, known as Freddie Mac;
  • command the Federal National Mortgage Association, known as Fannie Mae.

The 2010 documentary “Inside Job” chronicles the events leading to the 2008 global financial crisis. One of its most insightful moments occurs at a party held by then-Treasury Secretary Henry Paulson.

“We can’t control our greed,” the CEO of a large bank admits to his fellow guests.

“You should regulate us more.”

Greed is defined as an excessive desire for wealth or goods. At its worst, greed trumps rationality, judgment and concern about the damage it may cause.

Greed begins in the neurochemistry of the brain. A neurotransmitter called dopamine fuels our greed. The higher the dopamine levels in the brain, the greater the pleasure we experience.

Cocaine, for example, directly increases dopamine levels. So does money.

Harvard researcher Hans Breiter has found, via magnetic resonance imaging studies, that the craving for money activates the same regions of the brain as the lust for sex, cocaine or any other pleasure-inducer.

Dopamine is most reliably activated by an experience we haven’t had before. We crave recreating that experience.

But snorting the same amount of cocaine, or earning the same sum of money, does not cause dopamine levels to increase. So the pleasure-seeker must increase the amount of stimuli to keep enjoying the euphoria.

In time, this incessant craving for pleasure becomes an addiction. And feeding that addiction–with ever more money–becomes the overriding goal.

Thus, the infamous line–”Greed is good”–in the 1987 film, “Wall Street,” turns out to be both false and deadly for all concerned.

But the situation need not remain this way.

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