Corporate Scandals

Surprise! Congress Listened to the Voting Public!

dlindorff — Tue, 30 Sep 2008 10:43:24 -0400

By Dave Lindorff

The most entertaining thing about this Wall Street crisis and the
refusal of the House of Representatives (not failure but refusal) to
pass a bailout bill negotiated by the Bush White House and the House
leadership is how shocked and upset those leaders and the pundit class
have been by the idea that members of Congress would actually heed the
wishes of their constituents!

The Founding Fathers always saw the lower house of Congress as
voice of the people—the elected body that, because its members had to
face the voters every two years, would be most responsive to public
sentiment.

Because of the power of money and the role of the corporate media
in filtering the information that voters get about what is actually
going on, that close connection between public and public servant in
the House has long ago broken down. This time, however, because the
crisis hit within five weeks of the national election, and because the
crisis involved something that everyone cares about—their money—it
worked.

The public is paying attention, and most of us got it. It was
obvious that Congress and the White House were out to screw us out of
our money in order to protect the millionaire and billionaire traders
and conmen who have been running the Wall Street casino for the last
decade and a half without any adult supervision.

Now that people are paying attention, it will be interesting to see
how these corrupt leaders, Democrat and Republican, will fashion that
bailout and get it passed. Once aroused from their TV-induced slumber,
the American public may not be willing to get rolled. If the anger
grows, and the calls and emails to Congress—which brought down the
Capitol website Monday and jammed the switchboard for several days
beginning last week—continue to flood in threatening an electoral
Armageddon for those who back a bailout, Congress may yet be unable to
pass a bill.

It doesn’t get any better than this.

Now let’s make something clear. The stock market crash that
happened on Monday was no crisis. The market can rise and fall with
little or no significant impact on the broader economy, or even on
those who have their retirement income invested in equities. While
Treasury Secretary Hank Paulson, Fed Chairman Ben Bernanke and House
leaders like Speaker Nancy Pelosi or Minority Leader John Boehner may
point frantically to the falling Dow as a dire warning to members of
Congress to take action, it is all just scaremongering.

The real issue is not the stock market—it’s the credit markets. And
these have been shut down to borrowers—both individuals and
corporates—for months. Which means that there is no sudden urgency to
pass a lousy, rip-off bailout bill in days without proper hearings and
investigations into what is really needed.

The Bush Administration’s whole idea here from the start was to use
scare-mongering and high-pressure tactics honed in the 2002 campaign to
gin up a war against Iraq to get a bill through Congress that would
make a virtual dictator out of the Treasury Secretary, and to siphon a
trillion dollars or more out of taxpayers’ accounts and into the
pockets of the already stunningly rich financial class. It was to be
one final wrecking ball by the Bush/Cheney gang launched at the
American economic and political system, allowing the people who have
run the country into the ground over the last eight years, and their
financial backers to walk away with all the cookies.

It could still happen if the public doesn’t stay fired up and
angry. But for now, it’s at least exciting and deeply satisfying to see
the Administration, and the cowards who run the so-called Democratic
opposition in Congress, scrambling frantically to come up with a scheme
to get this ripoff passed.

What should happen? Congressional Democrats should put a hold on any action until after Election Day, which after all is only five weeks off. They should say that the voters must be heard on this critical national issue of how to rescue the economy and fix the financial system. Hearings should be scheduled in the relevant committees—oversight, banking, securities regulation, housing, the elderly, health and human services, etc. (yes, Rep. Dennis Kucinich is right in observing that given that most bankruptcies in the US are caused by medical emergencies, if the US had national healthcare, we wouldn’t have the housing foreclosure crisis)—and a special prosecutor should be established to look into the corruption behind all the recent financial sector failures. The real victims of the deregulatory orgy need to be heard, as do some of the 200 economists (including at least three nobel laureates) who have opposed this bailout. Then when the true nature and extent of the crisis and its causes have been laid out in clear public view, along with some real solutions for real people, appropriate legislative reforms should be drawn up, debated and voted upon, to be finally enacted into law.

No rush to judgment! No short-circuiting of the critical process of hearings!

The economy will survive this process.

What we cannot survive is a continuation of secret government, backroom deals and trillion-dollar bailouts.

BACK TO THE PHONES!
_______________________
DAVE LINDORFF is a Philadelphia-based journalist and columnist. His
latest book is “The Case for Impeachment” (St. Martin’s Press, 2006 and
now available in paperback edition). His work is available at www.thiscantbehappening.net

What Nobody's Saying: The Bailout Will Kill the Dollar

dlindorff — Mon, 22 Sep 2008 15:05:01 -0400

By Dave Lindorff

What nobody in the corporate media is mentioning amid all the
blather about the $700-billion Paulson bailout proposal is the impact
it will have on the US dollar.

We are told that this huge gift to the financial sector—the
assumption, at top dollar, of all the bad debt they’ve piled up--will
be at taxpayer expense, but that’s only the half of it. (Really only
the quarter of it because since the US government is technically
bankrupt already, spending more than it takes in each year, all that
money will be borrowed, and will be added to the national debt, meaning
that just as the real cost of the $500-billion Iraq War is closer to $2
trillion, the real cost of the $700 billion bailout will be more like
$1.5-2.5 trillion.)

But besides the direct bill handed to taxpayers for this gigantic
con, there is the fact that adding that much to the national debt is
also going to drive the dollar down precipitously against foreign
currencies. We’re already seeing that happen, even while they’re just
talking about the bailout. The dollar is falling against all major
currencies—the Euro, the Yen, the Renminbi and the British pound. And
it will continue to fall as the details of the bailout come out.

This will add to already powerful pressures in countries like Saudi
Arabia and China, which hold huge quantities of US dollars and US
dollar-denominated debt, to shift out of dollars and into other
currencies—particularly the Euro and the Yen. Last week, an article in
China’s People’s Daily, which like Pravda in the old Soviet Union, is
the official voice of the leadership in China, called for just such a
move. Russia is also calling for an end to the dollar as the
underpinning of the global economy.

For some years now, many economists have been predicting an end to
the dollar as the world’s reserve currency, but this latest plan by the
US Treasury will push such a shift forward from “some day” to “now.”

As long as the dollar has been the reserve currency—the currency in
which key commodities like gold or oil were priced, and the currency
that exporting nations stocked in their treasuries as a store of value
– it was protected against collapse. But once it loses that status,
there will be nothing to prop it up any longer, and it will quickly
slide to a value that it deserves. We got an inkling of what is going to happen today, as crude oil
prices leapt in the course of one hour by 25%, the biggest jump in the
history of the oil market. This was purely a move caused by loss of
confidence in the dollar. There was no oil supply disruption. In fact,
demand for oil has been sinking as the economic crisis grows. Oil
producers and traders simply realized that the dollar is going poof, so
they radically jacked up the cost of oil in dollars.

If you want to see what where the dollar is headed,, look to the
currencies of the debtor nations—countries like Mexico or perhaps
Mozambique. A nation that makes almost nothing, and that imports most
of its needs, cannot have a strong currency.

This might not matter much if we had a functioning domestic
economy, where people could find the goods and services they needed
without turning to sources from abroad. A big country like the US could
simply turn inward and function on by its own domestic economic
standards.

I remember back when the former Soviet Union was in a state of
economic and political free fall in the early and mid 1990s, the
currencies of the constituent countries, like Russia, Ukraine and
Belarus had had collapsed to virtual worthlessness on the international
market. A Byelorussian friend, an engineering professor from Minsk,
living and working near me in China at the time, explained that
although when he traveled the world, he felt like a pauper, things
weren’t so bad back home Belarus, where he and his family would go in
the summer. “My apartment only costs a few dollars a month to rent,” he
explained, “and our food is bought on the local market using rubles, so
it is very affordable.” The same was true for other needs, like
clothing and books for school, he explained. The only problem was
buying gas for his Russian Volga. “Gas,” he explained, “is priced as an
international commodity, so it takes me one month’s wages in Belarus to
buy the gas to drive once to and from our country dacha.”

You can start to see the problem. Since agriculture has been killed
off in most of the US, in favor of giant agribusiness enterprises
situated in the western part of the country and some parts of the
Midwest, most people elsewhere will not have local produce available,
and the cost of transporting food from California to places like New
York or Pennsylvania will be prohibitive once the dollar collapses,
since oil is priced internationally. Meanwhile, goods like TV sets,
computers, phones, cars (or at least the key components of cars),
clothing, etc., are no longer even made in the US, and will thus be
completely unaffordable. As for the service jobs that are supposed to
have replaced our old manufacturing sector, no one will be interested
in buying what they’re offering, because they’ll be scrimping just to
buy the key staples they need to survive, so of course joblessness will
soar.

Eventually, of course, entrepreneurially minded people will begin
establishing local farms again where they once flourished generations
ago, and small factories will be built to provide key essentials, but
all this will take time, and will have to cater to a market of people
operating at a much lower standard of living.

The banking sector, meanwhile, which is the proximate cause of this
monumental disaster, won’t mind any of this, for it will continue
operating on the international stage, shifting its focus to lending
money (no longer dollars, though), to growing economies in Asia and
Latin America and eastern Europe. And this is what, in truth, the
“rescue” of Wall Street is all about.

It’s not about saving Main Street, as Paulson claims. Main Street,
under the bailout, is toast. It’s about helping the banks and
investment banks and insurance companies that brought on this crisis to
ride it out in style, their astronomical losses bankrolled or absorbed
by the American public, so that they can shift their operations
overseas and continue with their rape and pillage of the global economy.

The US will be left behind, a smoking ruin, with Americans, like
Weimar Germans before them, going shopping with wheelbarrows full of
worthless green paper to exchange for a few days’ groceries.
_____________

DAVE LINDORFF is a Philadelphia-based journalist and columnist.
His latest book is "The Case for Impeachment" (St. Martin's Press, 2006
and now available in paperback edition). His work is available at www.thiscantbehappening.net

Hang On to Your Wallet! The Government is About to Rescue Us

dlindorff — Fri, 19 Sep 2008 09:55:19 -0400

by Dave Lindorff

When the financial markets started coming undone earlier this week,
the Treasury Secretary and the Federal Reserve stepped in, and with $85
billion of our money (actually our children's money,
since they borrowed it from China and Saudi Arabia), bought foundering
AIG, the world's largest insurance company, and assumed its colossal
pile of crap debt.

That didn't help, and the stock market crashed further, falling to
levels not seen in three years. Banks, meanwhile, stopped lending,
figuring to just hold onto their money and try to weather the crash.
The US Treasury and the Fed stepped in again, this time pumping nearly
$300 billion more of our money into foreign money markets, and getting
European and other governments to do the same in an effort to get the
credit markets open again and to stop the stock market swoon. That was
on top of some $700 billion already spent on bailouts.

It didn't work. Thursday, the markets continued to fall, well into
the afternoon, and it looked like another seriously down day. But then
Treasury Secretary Henry Paulson came up with a new idea. He said he
and the Bush administration were considering setting up a new agency to
assume all the bad debt of the banking sector--meaning all those bad
loans they made, and that they lured unsuspecting consumers into taking
out, by way of deceptive marketing techniques and outright fraud.

Note that we're talking about perhaps half a trillion dollars
here--of our money again. And remember, much or even most of this money
will never get repaid, and we're talking about money that could have
funded reduced class sizes in every school in America, a national
healthcare system, a crash R&D program into non-carbon energy and (not or) a strengthened Social Security and Medicare program.

The drones in the Democratic Party leadership in Congress
immediately jumped on the bandwagon, with House Speaker Nancy Pelosi
(D-CA) urging her charges to act quickly to get some kind of a bill out
there to facilitate the bail-out, which could cost anywhere from $600
billion to $1 trillion, but most estimates.

The thing to remember here is that this is not a rescue of the
little guy (though the Democrats say their rescue plan, when it
appears, will include some kind of relief for people unable to pay
their mortgages). Don't hold your breath. Odds are those people facing
foreclosure will still be unable to pay their mortgages, and besides,
there's no way there will be relief for the majority of homeowners who aren't missing their mortgage payments, but who are struggling mightily to meet them each month.

Primarily, who gets helped by this enforced taxpayer largesse are
the fat cats who own all the stock in these financial institutions, all
the executives who pay themselves outsize salaries each year for their
lousy management records, all these hotshot traders who make the deals
that later turn sour, long after they've run off to another job taking
their bonuses with them.

We ordinary people, who live from check to check, will feel the
pain of this "rescue" in the form of higher taxes in coming years, and
in a devalued dollar--because you can bet that all that money they're
printing, and all that added debt they're piling on to the mountain of
debt already out there is going to make the rest of the world pretty
queasy about holding onto dollar-denominated debt, or about buying any
more of it.

When you hear a banker say he's going to help you, it pays to hang
onto your wallet. When you hear a politician say he's going to help
you, hang onto your wallet. If they're both saying the same thing, and
especially if one of them is the head of the Federal Reserve Bank, then
you better really hang on tight.

Not that that will do any good.

The real answer to this crisis is, firstly, a massive dose of
trust-busting, so that no bank or investment bank or insurance company
is so big that its failure becomes a threat to the financial system,
and thus the government has to rescue it with taxpayer money, and
secondly, a return to the era of Glass-Steagall, when it was illegal
for banks to also be in the investment banking busiiness.

All the talk of "efficiencies" and of "better service to the
customer" that has been endlessly parroted to justify mergers like
Citicorp and Travelers, or JP Morgan and Chase Bank, or now Bank of
America and Merrill Lynch is fraudulent. Just to give an example, my
bank, once known as Willow Grove Bank, a small family-owned
institution, was bought by another bank and became Willow Financial.
Almost immediately the staffing levels went down. Recently, the
combined entity, which ran into trouble, was bought by another
institution, Harleyville Bank. Now there are half as many tellers most
of the time. As one teller confided, "Every time we get bought, they
lay people off."

Of course they do. That's what mergers always do. To recoup the
costs of the merger, management cuts back on service and employment.

The truth is, for all the talk about the efficiencies of bigness,
getting a mortgage today isn't any cheaper than it was in the 1950s,
when there wasn't even any such thing as a national bank that would be
"too big to fail."

The real reason we have mega financial institutions is that mega
financial institutions pay mega bucks to managers and make mega
donations to the campaign coffers of politicians. They also get to put
some of those mega-buck managers into key advisory positions in each
administration, Republican and Democrat, to ensure that government
polices allow them to get even bigger and even richer--and to ensure
that when they screw it up, they get rescued at the taxpayers' expense.
__________________

Bush/Cheney and special contracts with Big Oil in Iraq - ENOUGH IS ENOUGH!!!

seandiego — Thu, 03 Jul 2008 02:32:23 -0400

THE FOLLOWING ARTICLE APPEARED IN THE SAN DIEGO UNION TRIBUNE TODAY (7/2/08). THE AMERICAN PEOPLE MUST UNITE TO SHOW THE WORLD WE DID NOT SUPPORT OR APPROVE OF THE INJUSTICES OF THIS ADMINISTRATION AND THE CRIMES IT COMMITTED AGAINST IRAQ, THE CITIZENS OF THE UNITED STATES AND THE WORLD. TO REGAIN OUR STATURE IN THE WORLD, WE MUST CHARGE BUSH AND CHENEY WITH WAR CRIMES BEFORE THE REST OF THE WORLD DOES IT FOR US. CONTACT YOUR CONGRESSPERSONS TODAY!

Opening Iraq's oil fields to Big Oil

By Bob Herbert
THE NEW YORK TIMES

July 2, 2008

It's getting harder and harder to remain deluded. With each day comes new facts to drag our heads out of the sand.

Two weeks ago, The New York Times reported that four Western oil giants were on the verge of signing no-bid contracts that would return them to Iraq, the third-most bountiful petroleum playground on the planet. It was the kind of news that big oil lives for.

Giddy executives singing “Oh Happy Day” could be heard in the corporate offices of Exxon Mobil, Shell, Total and BP, which had been shut out of Iraq for three and a half decades.

We also learned this week that a group of American advisers, led by a team from the State Department, played a key role in drawing up the contracts between the companies and the Iraqi government. Chevron and several smaller oil companies also got contracts.

President Bush and Vice President Cheney, both former oil company executives, have long tried to tell us this war was about terrorism, about weapons of mass destruction, about bringing freedom and democracy to the Iraqi people, about anything but oil.

Said Bush: “We cannot wait for the final proof: the smoking gun that could come in the form of a mushroom cloud.”

He didn't wait. It didn't matter that Saddam Hussein posed no imminent threat to the United States. Or that Iraq had nothing to do with the attacks of Sept. 11, 2001. The troops were sent into battle in early 2003 and there is still, after more than five years and more than 4,000 American deaths, no end to the war in sight.

One of the starkest examples of U.S. priorities came during the eruption of looting that followed the fall of Baghdad. With violence and chaos all about, U.S. troops were ordered to protect one particularly treasured target – the Iraqi Oil Ministry. As David Rieff wrote in The New York Times Magazine in November 2003:

“This decision to protect only the Oil Ministry – not the National Museum, not the National Library, not the Health Ministry – probably did more than anything else to convince Iraqis uneasy with the occupation that the United States was in Iraq only for the oil.”

How convenient that the peculiar perspective of the oil-obsessed Bush administration can now be put to use advising the Iraqi government on its unusual no-bid contracts with big oil.

The contracts themselves are not huge. They are like the keys on a coveted ring that will begin opening the doors to Iraq's vast oil reserves. As the Times reported Monday, “At a time of spiraling oil prices, the no-bid contracts, in a country with some of the world's largest untapped fields and potential for vast profits, are a rare prize to the industry.”

A prize, yes. But at what cost?

In addition to the terrible toll of Americans and Iraqis killed and wounded, the war in Iraq has diverted attention and resources from critical problems here in the United States, where the housing market has been crippled, the stock market has tanked, gasoline has soared past $4 per gallon, unemployment is increasing and an extraordinary number of debt-ridden working families are staring into a financial abyss.

Even as oil companies are enjoying staggering profits, many Americans – in July! – are already worried sick about the potentially ruinous cost of heating their homes next winter.

And then there's the so-called war on terror.

The latest news is that al-Qaeda, the terror network that actually did attack the United States, has successfully regrouped in the tribal areas of Pakistan and has reconstituted its ability to institute terror attacks from the region.

For an administration joined at the hip to the oil industry, the lure of Iraq's enormous reserves was stronger even than the impulse to conquer an enemy that murdered more than 2,700 civilians on Sept. 11, a toll greater than the number of Americans killed by the Japanese at Pearl Harbor.

Referring to al-Qaeda members who regrouped in Pakistan, the Times reported on Monday:

“Current and former military and intelligence officials said that the war in Iraq consistently diverted resources and high-level attention from the tribal areas. When American military and intelligence officials requested additional Predator drones to survey the tribal areas, they were told no drones were available because they had been sent to Iraq.”

Who knows how long it will be before the United States disengages in any significant way from Iraq. What you can take to the bank is that this country will not make any major advances in energy policy, in health coverage, in rebuilding its infrastructure, in improving its public schools or in curtailing runaway public and private debt until our open-ended commitment to this catastrophic multitrillion-dollar war comes to an end.

How long will it take before that finally sinks in?

A Manchurian Candidate in the White House?

dlindorff — Thu, 28 Feb 2008 08:34:28 -0500

By Dave Lindorff

With a viral campaign underway via email, right-wing radio, and on the street suggesting that Barack Obama is a black “Manchurian Candidate,” secretly trained as a Muslim fanatic who will insinuate himself into the White House, thence to undermine all that we hold dear, perhaps it is time to look at the Manchurian Candidate we already have in the White House, who, together with his handler over in Blair House, has pretty much done all the damage already.

George Bush came to office in 2001 promising a new era of integrity, civility and “compassionate conservatism,” an era of humble American foreign policy, and a bi-partisan approach to government.

What did we actually get?

Once in office, this chameleon president almost immediately set out to embroil the country in a major war in the Middle East against the nation of Iraq. The game plan was laid out at the president’s first National Security Council meeting, attended by Vice President Dick Cheney (the man holding Bush’s controller), Donald Rumsfeld, Condoleezza Rice, and Treasury Secretary Paul O’Neal (who later spilled the beans about the session).

Bush also famously ignored all warnings about the imminent attack on the World Trade Center and the Pentagon. How much he and the rest of the administration knew about that attack in advance, or whether elements within the administration may have even helped it along, remains the subject of considerable interest and investigation and may never be answered, but it is clear that there were ample warnings about it, and he did nothing—even rudely blowing off a briefer who tried to alert him to the danger. Moreover, it is known that Israeli Mossad agents (who we know have close ties to both the US intelligence apparatus and to the Neocons who infest the Bush White House) did indeed have advance knowledge, and were set up across New York Harbor with a video camera to tape the attack on the Twin Towers (they were subsequently arrested by New Jersey police, only to be later released and sent back to Israel, through intercession by the US government). As well, we know that unidentified people made a killing by placing negative bets, called “puts,” on the stocks, several days before 9-11, of the two airlines that were hijacked, American and United, and of two investment banks that would be seriously hurt by the building collapses, Merrill Lynch and Morgan Stanley. (The puts were placed through an investment bank, Alex Brown, which until a year earlier had been headed by a man who moved over to become the number three person in the CIA.) It’s hard to escape the conclusion that the Bush/Cheney administration, at a minimum, wanted an attack on American soil, and a national disaster that would put the country on a war footing.

Certainly instead of rallying the public and defending the nation’s democratic traditions and its Constitution, Bush and his handlers after 9-11 immediately set in motion a concerted scare campaign to undermine both. While urging the public to buy sheets of plastic and duct tape to construct “safe rooms” in their homes, they rammed through Congress a deceitfully named measure, the so-called Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (USA PATRIOT Act), which effectively undermined most of the articles of the Bill of Rights (and which appeared, suspiciously, fully drawn up in bill form, only days after the attacks).

At the same time, the president, only one week after the attacks, obtained an Authorization for Use of Military Force for a military attack on the Taliban government in Afghanistan and on Al Qaeda forces in that country, which he subsequently interpreted broadly as an authorization for a global “war” on terror which he then claimed made him effectively a dictator with absolute power both at home and abroad (the so-called “unitary executive” theory). Under this claim of absolute power as commander in chief in time of war, Bush went on to order the use of torture against captives, foreign and domestic, including US citizens, to strip even US citizens of the right of habeas corpus—that is, the right to have their arrest and detention brought before a federal court—and to establish secret torture centers around the globe and on military installations in Iraq, Afghanistan and at Guantanamo Bay on the island of Cuba.

As well, even before the 9-11 attacks, the president began a sweeping program of electronic spying, run through the super-secret National Security Agency, on Americans’ telephone and internet activities. It was and remains a program that deliberately avoids seeking warrants and court approval even by the secret Foreign Intelligence Surveillance Act court—a body that has only rejected some five requests for warrants out of hundreds of thousands sought since its establishment in 1978.

Finally, in a perhaps fatal undermining of the Constitution, the president after 9-11 began a practice of simply refusing to enact or obey laws passed by the Congress, effectively rendering the legislative branch an impotent debating club.

Not content to simply explode or dismantle the legal foundations of the American government and rule of law, Bush and his handlers also went about systematically destroying the country’s basic institutions and even its economy.

The education system was fatally ensnared in a test-driven system called “No Child Left Behind,” which has in short order dumbed down public education to an extent shocking even to this already anti-intellectual society, with many schools simply giving up the teaching of art, literature or history, in order to focus desperately on math and reading in order that their students would do well enough on standardized tests to keep the schools from losing their funding.

The dollar has been cast adrift to become the new Lira as the government has gone on an unprecedented borrowing spree to fund endless war and ever-larger military budgets, while erasing the taxes on the wealthy, the super-rich, and corporations. Banks were given free rein to enter into all manner of risky ventures, leading to the current collapse in credit. Corporations were encouraged to ship their production and jobs overseas. Homeowners were encouraged to spend, spend, spend and to mortgage their homes to the hilt and then some. Towns, cities and pension funds were encouraged to invest in fantastic “structured” products that were actually towering card houses. Domestic car manufacturers were encouraged to build every larger, ever more voraciously gas-guzzling vehicles, pumping out ever larger quantities of carbon into the already overstressed atmosphere.

The nation’s infrastructure—its roads, dams, bridges, levies, airports, veterans hospitals etc.--were left to decay, with predictable results, the most dramatic of which was the loss of an entire city, New Orleans, to a routine Category 3 hurricane (after which, the president did nothing to rescue the survivors or fund a recovery).

Surveying at the appalling wreckage left after eight years of the Bush administration, it is hard to recognize the country that he started out with in 2001. A once proud nation—one that only a few years ago was admired around the world and that now is viewed as a pariah and a rogue state—today trembles before a handful of turbaned fanatics holed up in caves in the Hindu Kush, its trillion-dollar high-tech military colossus fought to a standstill in Iraq and Afghanistan by a few thousand brave men and women armed with RPGs, antique AK-47s and home-made roadside bombs. A nation that once was the envy of the world for its free society now has scientists afraid to report their findings, university professors afraid to support outspoken colleagues, members of Congress afraid to defend their Constitution, citizens afraid of their neighbors, journalists afraid of government criticism, lawyers afraid to defend clients...

Hey, this place starts to look and feel an awful lot like the China I lived in back in 1991!

Forget all the nonsense about Barack Obama being a closet Muslim. We already have our Manchurian Candidate in the White House, and he has largely accomplished what he was programmed to do: destroy the country.

The truth is this: If at the end of their second term, Bush and Cheney were to hop on a plane and fly off to a hideout in the mountains on the Afghan-Pakistan border, leaving a "Nya-nya!" note on the White House dining room table, few people would really be very surprised.
_____________________

DAVE LINDORFF is a Philadelphia-based investigative journalist and columnist. His most recent book is “The Case for Impeachment” (St. Martin’s Press, 2006, and now available in paperback edition). His work is available at www.thiscantbehappening.net

Two Brothers and Two Scandals

dlindorff — Thu, 15 Nov 2007 12:38:52 -0500

By Dave Lindorff

The State Department’s top internal investigator, Inspector General Howard Krongard, revealed in a House Oversight and Government Reform Committee hearing Tuesday, that his brother, Alvin B. Krongard, was a member of the advisory board of Blackwater, the very private mercenary company whose bloody, murderous behavior the IG office was supposed to be investigating.

Unmentioned in reports on this tainted relationship was the fact that Alvin Krongard, the former third-ranking leader of the CIA from 2001-2004, has also been the subject of some speculation regarding possible foreknowledge of the 9-11 attacks by some within the intelligence establishment.

Alvin Krongard joined the CIA in 1998, leaving a post at Bankers Trust, which, in 1997 acquired the venerable investment-banking house of Alex Brown. Prior to the acquisition, Krongard had been CEO and chairman of the board of Alex Brown. In the merged firm, he became head of private banking for Bankers Trust, where he was responsible for the bank’s relations with extremely wealthy (and extremely private) clients.

What makes this history of particular interest is that Alex Brown was the investment bank that handled most of the suspicious short-selling “puts” that were placed on the stocks of four companies—United Airlines, American Airlines, Morgan Stanley Dean Witter and Merrill Lynch—that were pummeled by the 9-11 attacks.

As has been reported in Bloomberg Financial News Service reports and in the San Francisco Chronicle, in the several days preceding September 11, 2001, unidentified investors placed an unusual number of “puts” on the stocks of the two airlines whose planes were hijacked that day, as well as on the two investment banks, one of which occupied 22 floors of one of the World Trade Center towers and the other of which owned a building directly across the street which was significantly damaged and forced to close down.

According to news reports, between Sept. 6 and Sept. 9, some 4744 put orders were placed on United Airlines, compared to just 393 calls (bets that the stock would rise). On September 10, 4516 puts were placed for American Airlines stock, vs. only 748 calls. These orders were six times the normal volume of puts and calls on the Chicago Board Options Exchange for those firms. Moreover, there were no such puts placed on any other airlines, and there was no news justifying such orders at the time. In the three days prior to 9/11, 2151 puts were placed on Morgan Stanley shares, and 12,115 puts on Merrill Lynch, companies that also were not at the time the subjects of any negative news.

The stocks of those four companies, following the attacks and the collapse of the Twin Towers, subsequently tanked, making the combined puts worth about $16 million.
According to the San Francisco Chronicle, no one collected the $2.5 million in profits from the puts placed on United Airlines. The identities of the investors in the put orders have never been disclosed by Alex Brown.

Incredibly, there was never any serious investigation of these peculiar and suspicious investments, though they clearly suggest that someone knew something was going to happen that would make those four companies’ stocks plunge in value.

The US corporate news media has never pursued this story or in many cases even reported it, nor was it seriously investigated by the FBI or the 9-11 commission.

Could Krongard, in his role as executive director of the CIA, have had inside information in the days ahead of the attacks, that an attack on the World Trade Center, involving the hijacking of planes operated by UAL and American Airlines, was imminent? Could he have supplied that information to clients of Bankers Trust and its subsidiary Alex Brown, so that the put investments could be made? If so, who else in the federal government knew?

We can’t know, because, amazingly, nobody’s dragged Krongard or officials of the bank before a congressional panel and demanded answers under oath.

So now we see that the Krongard brothers have a level of integrity that is down in the sewer, with one working for a murderous mercenary outfit that has been slaughtering innocent Iraqis in the course of providing “protection” to State Department officials in Iraq, and the other pretending to investigate the activities of that private firm, never mentioning the grotesque conflict of interest of having his brother working for the very firm he’s supposedly investigating.

Maybe, given this sorry picture, House Oversight Committee Chair Rep. Henry Waxman will finally see fit to call Alvin Krongard and other witnesses in to question them under oath about whether he also had a conflict of interest in serving as a top ranking CIA executive while perhaps maintaining links with Alex Brown, and whether he had anything to do with those peculiar puts.
___________________

DAVE LINDORFF is a Philadelphia-based investigative reporter and columnist. His latest book, co-authored by Barbara Olshansky, is "The Case for Impeachment" (St. Martin's Press, 2006 and now available in paperback). His work is available at www.thiscantbehappening.net

For Your Consideration

Marvin_Jones — Mon, 29 Oct 2007 11:46:02 -0400

Destroying Right Wing Ideology

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&add...

How the Bush Administration Is Turning the USA into a Subprime Borrower

Heather Wokusch — Mon, 27 Aug 2007 12:47:01 -0400

"Our enemies are innovative and resourceful, and so are we. They never stop thinking about new ways to harm our country and our people, and neither do we." - George W Bush

Much in the same way that US investors were “steered” into rip-off mortgage loans, the entire country has been “steered” into an economic crisis. The question is how to get out of it.

In the subprime loan scandal, unscrupulous brokers conned home buyers with poor credit histories into deals designed to profit lenders and bleed borrowers. Contract “teasers” hid ballooning monthly payments while a lack of regulation allowed the scam to continue unabated. Millions more Americans now face losing their homes.

The Bush administration similarly used promises of cakewalks and increased security to con the US public into wars with Iraq and Afghanistan. US taxpayers have spent over $450 billion on Iraq alone, while Bush/Cheney cronies continue making a killing from military contracts. Meanwhile, global security has degenerated and over 4,100 US service members have died in Iraq and Afghanistan, along with an untold number of coalition troops, contractors and civilians.

Bush’s military adventurism, not to mention his administration’s exorbitant tax cuts for the wealthy, gutted the surplus of $128 billion Clinton handed him in 2001 into a deficit of well over $200 billion today. And Bush has simultaneously increased the national debt by over $3 trillion (to roughly $9 trillion), effectively nailing each and every US citizen with a bill for almost $30,000.

While heavy borrowing from Asia has mopped up some stateside red ink, there’s an inherent threat: China, for example, has an estimated $900 billion in US bonds and can increasingly call the shots on the US economy and foreign policy.

Just weeks ago, Beijing warned that if the Bush administration pushed for a revaluation of the Chinese currency, then Beijing would sell dollars, thereby threatening the greenback’s reserve currency status. Washington backed down. It had little other option.

In other words, the US itself has become as vulnerable to its lenders as any other subprime borrower.

Overall, the US debt situation looks so dire that the non-partisan Government Accountability Office Comptroller recently warned, America is on a path toward an explosion of debt. And that indebtedness threatens our country’s, our children’s, and our grandchildren’s futures. With the looming retirement of the baby boomers, spiraling health care costs, plummeting savings rates, and increasing reliance on foreign lenders, we face unprecedented fiscal risks.”

Financial analysts say credit markets are facing a Minsky moment – the inevitable downward spiral when over-leveraged investors have to sell valued assets just to pay back their loans. Some analysts have even coined a new term, suggesting we are in a “Minsky meltdown” – the prelude to a wider market crash.

But it looks more like a “Minsky massacre,” not an unavoidable economic downturn but rather a coldly-calculated hit, with the intention of transferring wealth from the lower and middle classes to an unaccountable few at the top.

Bottom line, this economic downturn isn’t hurting everyone. Select brokers and lenders made a fortune off the backs of subprime borrowers, and now that the related hedge funds are collapsing, well-leveraged private equity firms can buy assets at fire-sale prices.

And as Jim Hightower recently noted, a “hands-off regulatory ideology” is complicit: “There are no less than five financial agencies at the federal level that could have protected people, yet the subprime surge was allowed to proceed .... The Federal Reserve Board, for example, has direct authority under the Home Ownership and Equity Protection Act to ‘prohibit acts or practices in connection with mortgage loans that the board finds to be unfair, deceptive or ... associated with abusive lending practices, or that are otherwise not in the interest of the borrower.’ The Fed simply ignored this law.”

The US has been down this road before. The Savings and Loan (S&L) crisis of the late 1980s was also characterized by loose lending requirements, lax regulation, obscene profits for the few - and US taxpayers left holding the bag for $125 billion.

Ironically, the Bush family was involved in that scandal too, with Bush Jr.’s brother Neil serving on the board of the disgraced Silverado Savings and Loan, which went bust and stuck US taxpayers with a $1.3 billion debt. Regulators accused Neil of "multiple conflicts of interest" but he never did jail time – thanks at least in part to the S&L bail out engineered by his father, Bush Sr., who happened to be President at the time.

Just as in the S&L crisis, the poor and middle class have borne the brunt of the current subprime disaster, an especially nasty fact given the nation’s huge wealth gap. As Inequality.org points out, “The richest one percent of U.S. households now owns 34.3 percent of the nation's private wealth, more than the combined wealth of the bottom 90 percent. The top one percent also owns 36.9 percent of all corporate stock.”

It’s probably no coincidence that terms associated with both corporate and developing country indebtedness are being used to discuss the US subprime meltdown (payment defaults, vulture funds, distressed debt, etc). Perhaps the US hasn’t reached banana republic status yet, but the increasing wealth gap, not to mention ballooning budget deficits, low capital spending and reliance on foreign capital are disturbing signs.

Doesn’t help either that the Federal Reserve stopped releasing M3 money-supply data in 2006. M3 data (covering Eurodollars, repurchase agreements and large-denomination time deposits) is critical in determining how fast the Fed is printing money, which in turn impacts inflation.

So, what further fallout from the subprime scandal can be expected? Millions more Americans will lose their homes, and as The New York Times recently reported, “for the first time since federal housing agencies began keeping statistics in 1950,” the median price of homes in the US will fall.

Ratings agencies, such as Standard & Poor's and Moody's, will take some heat for their role in the scandal, but the Bush administration will focus on bailing out predatory lenders rather than helping Americans keep their homes. Congress and most presidential candidates will protect financial services campaign donors by not pursuing true reform.

Meanwhile, Asia and Europe will continue “decoupling” from increasingly volatile US markets, threatening the dollar’s reserve currency status even more. Fresh off its recent war games with China and four Central Asian republics, Russia will more actively confront the US on the world stage. The Bush administration will move closer to a war with Iran.

Of course, these dire predictions don’t have to materialize - we can regroup and fight back. One avenue is by urging Congress members to take action, such as changing foreclosure rules to protect homeowners and supporting Rep. Barney Frank’s (D-MA) National Affordable Housing Trust Fund Act (H.R. 2895). Rep. Ron Paul’s (R-TX) push to have the Fed start releasing M3 data again (H.R.4892 ) is also urgent.

At the very least, we must frame the Bush administration’s war-making as a direct threat to the US economy, not to mention national security, and just like maxed out home buyers, confront our nation’s culture of debt.

Action Tips:

1. For online videos about the subprime issue and “Money as Debt,” visit Brasscheck TV (www.brasschecktv.com/page/135.html)
2. Check out two groups working on affordable US housing: the Community Land Trust (www.iceclt.org/clt/) and the National Housing Trust Fund (www.housingmatters.net)
3. Learn more about “America’s growing economic divide” Inequality.org (www.demos.org/inequality/index.cfm)
4. Concerned about predatory lending? So is The Center for Responsible Lending (www.responsiblelending.org/).

Heather Wokusch is the author of The Progressives’ Handbook series (www.progressiveshandbook.com)

State Farm, Partner, RICO: What a Racket!

Ana Maria — Fri, 22 Jun 2007 11:03:10 -0400

I’m not talking tennis either. The whirlwind of news swirling about is almost dizzying. Shortly after Katrina hit the Mississippi Gulf Coast and breached the New Orleans’ levees, rumors floated around implying that the insurance companies would rig their claims process to wiggle out of paying what was owed to Paula and Peter Policyholders.

I thought to myself how criminal and cruel, heartless and calculating the people running a corporation would have to be to actually pull off something like this.

I envisioned a set of companies passing back and forth among themselves responsibility for the Katrina claims. I had thought this would be a way to shift its costs to other companies depending on which of them had the flood insurance policies. I was unaware that the private insurance corporations had bailed out of the flood insurance business some forty years ago.

I didn’t realize that our U.S. Government was taking care of what the private market neglected. When corporations failed to fill the market needs of American families and business owners, the federal government stepped in. Indeed, a lesson in the absurdity of arguing in favor of straight up laissez faire economics.

What I had envisioned was in the right direction of what occurred. I just didn’t realize that the US taxpayers would get stuck with the private corporations’ bill.

Courageous Whistleblowers Step Forward
Thankfully, two courageous women—Cori and Kerri Rigsby—blew the whistle on what has turned out to be a scenario worse than imagined. These very brave Rigsby sisters came forward with evidence that allegedly proves that State Farm defrauded policyholders by manipulating engineers' reports so that claims could be denied.

Photo of Cori and Kerri Rigsby

ABC News was able to obtain a copy from State Farm files of the original FAEC damage report, which included the image of an attached "Post-it" note that read, "Put in wind file - do not pay bill - do not discuss"

Below is a post it note on a file that appears to embody the essence of the allegations.

Cori and Kerri Rigsby turned to attorney Richard Scruggs to represent them. A few years back, Scruggs had won his fight against Big Tobacco costing the cigarette industry a “$246 billion settlement to help states defray Medicaid costs for smoking-related illnesses.”

The sisters say they ultimately printed out and copied roughly 15,000 pages of claims records. In addition to providing the material to Scruggs, they say they gave copies to Mississippi Attorney General Jim Hood and U.S. Attorney Dunn Lampton's offices on June 5, the same day they told a supervisor they were cooperating with Scruggs. For eight years, Cori and Kerri Rigby had managed State Farm claims adjuster teams.

Of course, State Farm is doing everything it can to suppress the use of this information in any legal proceeding. Doesn’t this sound just like they took a page straight out of the playbook for their Republican buddies in the White House?

Remember how the Administration went ballistic when we learned that someone in Bush’s employ had leaked the identity of CIA undercover operative? The White House wasn’t upset that someone had betrayed the country and put at risk Valerie Plame’s life and all those with whom she was associated as well as compromised her work on weapons of mass destruction. No ma’am. Bush and his team were upset that they had been caught. Well, this is the same game State Farm seems to be playing.

Racketeering
On Wednesday, June 20,2007, the Scruggs Katrina Group filed a federal lawsuit against State Farm and its corporate partners alleging the corporations were violating the Racketeer Influenced Corrupt Organization Act, which most of us have heard of as RICO. State Farm worked with “Forensic Analysis & Engineering Corp. of Raleigh, N.C., and E.A. Renfroe Co. Inc. of Hoover, Ala. Forensic's engineers inspected homes for State Farm, while Renfroe helped the company adjust claims.”

The Scruggs Katrina Group characterized the complaint as "a story of how State Farm and its web of surrogate companies conspired to deny claims that should be paid by State Farm and to shift liability to the federal-funded flood insurance program. Actions taken by State Farm and conspirators included:

threatening experts who disagreed with their desired result
concealing information that would work in the policyholder's favor destroying or falsifying reports
placing pressure on engineers to use scientifically inaccurate and deceptive language
firing engineers who refused to be corrupted inventing a new policy to exclude all hurricane damage
using their strength and size to intimidate policyholders in the mediation process

My God alive! Racketeering charges against an insurance company that is known for its jingle claiming “just like a good neighbor, State Farm is there.”

“I've never seen a smoking gun this good, even in the tobacco litigation when I'd thought I'd seen it all,” Scruggs said in an interview. “They collaborated to defeat valid homeowner claims through rigged engineering reports and biased adjusting.”

Boy oh boy. This is sounding more and more like the Bush Administration’s kind of friends. For an analysis of the obscene amount of money the insurance industry invests in Republican candidates, see Soaking U.S. Taxpayers.

Where’s the Federal Probe?
The Rigsby sisters had turned over their documentation to both the state attorney general and the U.S. Attorney. Just over a week ago, Mississippi’s Attorney General Jim Hood, a good Democrat, filed a lawsuit against State Farm for breach of contract. [See State Farm Paying Attorney Fee for Miss. Insurance Commissioner]. As part of that contract, Hood had agreed to drop the state’s criminal probe into State Farm. With State Farm’s alleged breach, Hood has not ruled out reopening the criminal probe.

The Sun Herald reported that the U.S. Attorney’s Office has subpoenaed records from Nationwide Insurance, State Farm, and Allstate. The paper also reported “records indicate a grand jury is hearing evidence. Grand jury proceedings are secret and don't necessarily result in criminal charges.”

I feel the public is in good hands with Attorney General Jim Hood and attorney groups like the Scruggs Katrina Group. But I have reservations when it comes to the federal probe.

In September 2001, George W. Bush appointed Dunn Lampton, a Republican, as U.S. Attorney for the Southern District of Mississippi. The Clarion-Ledger reported that Lampton was allegedly on a White House 2005 hit list for canning U.S. Attorneys. When asked why he would be on the list, Lampton said, “I don’t have a clue.”

How’s about this for a clue, Mr. Lampton? Your office has subpoenaed documents from three of the big insurance companies: State Farm, Allstate, and Nationwide. Your office has convened a grand jury in the federal probe of these companies … and if that isn’t plenty enough, you just successfully concluded the criminal conviction of “reputed Klansman James Ford Seale [for] kidnapping and conspiracy in the 1964 deaths of two black teenagers in southwest Mississippi.”

I applaud you for bringing justice to the families who have endured immense and unthinkable pain for the last 33 years. Bush’s lapdog Gonzales and his minions found out that you were not one of them. I’m quite sure that the compassionless folks in the White House do not share your sense of justice, your values. I think it’s probably quite safe to say that you are a bit out of sync with the Republican leadership, and once again, for this, I applaud you. You have brought justice to these families and a sense of closure for their wounds.

I hope that you will pursue with equal vigor your probe into the alleged criminal behavior of the corporations that have brought a different kind of unthinkable pain and suffering to the families of all racial and ethnic backgrounds here along the Mississippi Gulf Coast.

To top it all off, Mr. Lampton, you’ve stirred up a hornets nest with pursuing a public campaign for gun control. Bravely, you yourself were featured in this public service television spot. As I’ve already stated twice and now shall do so for a third time, I applaud you, Mr. Lampton. This was the right thing to do. However, the Bushies do not share your values, sir. Even though you are a Republican, this may be yet another reason that your name was on Gonzales’ hit list for the political purging of the Justice department.

Be strong, Mr. Lampton. The people of South Mississippi, and for that matter throughout this country, need an honest to God federal investigation into the insurance racket.

Whether it’s the White House once again squirming out of taking responsibility for its own wrongdoing in the political firings of U.S. Attorneys or one of the Bush Administration’s partner industries spinning its PR to cover up their corporate corruption, we need strong public leadership.

What the insurance companies have done to the people of Mississippi and New Orleans will continue to happen to anyone of us anywhere in the country until we bring together every resource to end what is essentially a legal mob ring.

While the legal eagles are taking care of their responsibilities in our grand democratic scheme of government, we can also do our part to put all of our families on safer ground after natural disasters.

Since the insurance companies are obviously bowing out of taking care of the customers, the ultimate remedy is to expand the federal government’s flood insurance program to include all natural perils. Gulf Coast Congressman Gene Taylor (D-MS) introduced the Multiple Peril Insurance Act of 2007. (The bill is H.R. 920.)We can partner with Congressman Taylor to take the wind out of the insurance industry. You know what that means! It's political hell raising time again. We can call and email our own congressional representatives to request that they co-sponsor the Multiple Peril Insurance Act of 2007.

Taking these steps is how we begin to break up this insurance racket so that each of us and our families will truly be in good hands. ____________________________________________________________________________________

Ana Maria authors A.M. in the Morning!, dispatches from Katrina's ground zero . . . a distinctly progressive political perspective. In March, this native daughter drove from her home in Silicon Valley, Calif., to surprise her mother with a visit to their family home in Bay St. Louis—ground zero for Katrina’s devastation. The surprise was on Ana Maria.

She launched her blog in May 2007 and added podcasts in June 2007 to express her dismay and provide detailed, poignant, on-the-ground accounts of what the people of the Gulf Coast are still experiencing nearly two years after Katrina’s devastation. She is committed to using her blog to reinvigorate the discussion and generate a renewed national sense of purpose to efficiently and effectively rebuild the area. The blog includes the Center for Political Hell Raising, which provides phone scripts and email letters readers may use when contacting whoever is the lucky one Ana Maria targets.

Not for the faint of heart, A.M. in the Morning!, provides first-hand accounts of post Katrina life written in a scathing style redolent of the region's famous cuisine--hot, strong, and spicy. Nobody escapes Ana Maria's wrath whether they are the bumbling leadership of FEMA, do-nothing politicians, or incompetent government contractors.

State Farm Paying Attorney Fee for Miss. Insurance Commissioner

Ana Maria — Wed, 20 Jun 2007 08:23:55 -0400

While I’ve been busy the last few weeks sanding baseboards and crown molding and painting ceilings for family members’ homes, Mississippi Deputy Insurance Commissioner David Lee Harrell was busy preparing for his deposition in one of the big insurance cases. The fee for his attorney? State Farm funded that.
Yes, you read that correctly.

State Farm is paying the attorney fee for the lawyer helping the Mississippi Deputy Insurance Commissioner prepare for his testimony under oath and representing him at the proceedings in one of the large lawsuits that Mississippi policy holders are bringing against . . . State Farm.

Can you believe it?! Talk about the fox guarding the hen house!! But this is really more like a criminal defense team paying the salary of the local prosecuting attorney assigned to its case. What a whopper of a conflict of interest. Here’s a guide to the deposition and links to the deposition itself. http://www.scruggskatrinagroup.com/harrell_deposition_guide.asp.

The insurance commission claims that it got approval from the Attorney General and that there is some kind of law permitting this conflict of interest. I've seen horrifyingly disgusting relationships between regulators and those they are to regulate. Clearly, this example is quite troubling. The Insurance Transparency Project agrees.

It’s not as if the Mississippi Insurance Commission sent out a press release or held a press conference to inform the state’s good citizens of this obvious fox/hen house relationship.

The only reason that we even know about this unsavory tryst is because courageous policyholders, regular Jane and John Q. Citizens here in Katrina Land, have hired one of the sets of pit bull attorneys, the Scruggs Katrina Group, who is determined to ensure that the insurance companies make good on their legal obligations to these policyholders.

Praise God for trial lawyers!

Even Senate Republican Whip Trent Lott (MS), who also lost his family home in Katrina, has seen the light about the importance of a good trial lawyer. Bloomberg News wrote

“Lott, a longtime critic of trial lawyers, went to court with the aid of his brother-in-law, Richard Scruggs, who in 1998 wrested a $206 billion settlement out of the tobacco industry.”

Lott has also seen the light on the corruption of the insurance industry with which he had been so closely aligned for many decades. Bloomberg News reported

“"Lott says he is willing to work with the industry, though his words would seem to leave little room for compromise. ``These are venal people,'' he says."

I never thought I’d see the day when Trent Lott and I would agree on something of substance. Yet here we are. U.S. Senator Mary Landrieu, a good democrat from New Orleans, Louisiana, summed it up quite nicely. “Disasters make for strange bedfellows."

The online Merriam-Webster Dictionary defines ‘venal’ as “capable of being bought or obtained for money or other valuable consideration : PURCHASABLE; especially : open to corrupt influence and especially bribery : MERCENARY.” You know, like the Bush White House.

Now, let’s get this straight.

The Mississippi Insurance Commission licenses and regulates the practices of all insurance companies and agents. State Farm and its agents are among the companies that the Mississippi Insurance Commission, a state government agency, regulates. State Farm is paying the fees of the outside attorney that the government commission hired to help it prepare for testimony under oath in a lawsuit against State Farm. Well if that don’t beat all!

To top it all off, on Monday, June 11th, Mississippi Attorney General Jim Hood (another good Democrat) filed a lawsuit against State Farm for breach of contract. Apparently, State Farm did not live up to its legal obligations under the court sanctioned agreement. Does this sound familiar, this failure of a corporation to live up to its legal obligations?

Can we say . . . Enron? Halliburton?

Thankfully, Attorney General Hood is hauling State Farm back to court to ensure that the insurance company lives up to its responsibilities to Mississippi policyholders.

Attorney General Hood is “asking that $50 million be set aside to pay Coast policyholders for Katrina damage and an unspecified amount for damages they suffered because State Farm has breached its agreement. He also is seeking an unspecified amount of punitive damages, designed to deter bad behavior.”

Good. That is the point of these kinds of lawsuits. First to make whole the parties who were injured. In this instance, that would be the citizens to whom State Farm refused to pay its obligations under the terms of their insurance policies.

The second point of these lawsuits is punishment. With big corporations like State Farm, Enron, and Halliburton, the only way to assist them in becoming good corporate citizens is to punish them in ways that they understand: depleting their profits.

Corporations are legal entities that are neither moral nor immoral. However, the men and women who run the corporations, those members of the boards of directors, they demonstrate their moral core—or lack thereof—through the policies they propose and implement. Their god is the Almighty Dollar. Eagerly, they bow down to the Almighty Dollar’s Altar of Greed.

In their pursuit of big boons from their god, Almighty Dollar, should we, our family members, our friends and neighbors, or our coworkers be hurt in the process, well, greed is their god and ruthlessness is their rapture. ruthlessness is their rapture. In our civil court system, paying money, taking away their scandalous profits made at our expense is the way to make these creatures pay for wronging us. Punitive damages is about punishing wrong doers so that we can protect the next person from being victimized.
This is what the Mississippi Attorney General is doing: protecting the citizens of the state against a major corporation that is victimizing its policyholders.

Dale, DINO, Lieberman
The Mississippi Insurance Commissioner, an elected officer just as the Attorney General also has this same obligation. Apparently, Mississippi’s Insurance Commissioner George Dale is a DINO, Democrat in Name Only. Mississippi’s Democratic Party Officials voted to prohibit Dale from running as a Democrat because he had supported Bush’s campaign in 2004.

Dale went to court over the Democratic leaders’ decision and hired “Greg Copeland, an attorney who is a longtime lobbyist for the insurance industry” to represent him. When asked about it, Dale retorted, "I don't see any conflict." Oh, I see. The man must think we’re stupid.

Dale’s lawyer asserted that the bad press had hurt Dale’s ability to run as a Democrat and asked that he be allowed to run as an Independent. Yes, Dale has the distinct honor of being a poster child for turncoat Democrats, a Mississippi Lieberman, if you will. Hell, if Dale likes the Republican values so much, why doesn’t he just come out of the closet and declare himself to be one?!
Copeland “has been a registered lobbyist for the American Insurance Association since 2000.” The website for his firm, Copeland, Cook, Taylor & Bush, states that CCTB “serves as general counsel to Mississippi's largest property and casualty insurer and as local counsel for numerous other insurance companies. The American Insurance Association selected the head of the firm's insurance practice group to serve as Mississippi counsel for the Association. . . . The Mississippi Department of Insurance . . . and numerous other insurance-related organizations utilize the services of the insurance practice group.”

Excuse me?! More conflicts of interest?! Holy Moly.

Since the judge ordered that Dale be put on the ballot to run as a Democrat in the primary this August, hopefully Mississippi Democratic voters will elect a real Democrat as insurance commissioner rather than putting back into office George Dale who has obviously developed toooo cozy of a relationship with the folks he is supposed to regulate.

Insurance commissioners doesn’t have to be this way
Let’s contrast Mississippi’s insurance commissioner with California’s former insurance commissioner John Garamendi, who won his race for Lt. Governor in last November’s election. Garamendi has a fierce reputation for defending California’s policyholders and going up against insurance companies like State Farm. About a year ago, Garamendi went public “accusing California's largest auto insurers of using political extortion to get him to delay implementing laws that would save California motorists money.”

San Francisco’s CBS television station reported that Garamendi received a phone call in which “he was offered a take it or leave it deal. [Garamendi] says a lobbying group that represents the state's top auto insurers threatened to spend over $2 million in a negative ad campaign unless he delayed new insurance regulations - regulations that require auto insurance companies to give more weight to how people drive rather than where they live, a practice known as red lining.”

Garamendi said the lobbying group behind the threats “is funded by State Farm, Farmers, Safeco, Allstate and other top insurers.” The San Francisco television station reported that “State Farm confirmed to CBS 5 that the phone call to Garamendi did take place, but they denied blackmail or coercion.” State Farm sure is busy these days, and apparently not with taking great care of its policyholders.

Rather than buckling under the weight of the alleged blackmail and extortion, Garamendi went public. View news clip. He also turned the matter over to the FBI and state officials. Read Garamendi’s letter to the FBI and state officials.

Garamendi is proof positive that standing up to corporate bullies can be successfully accomplished. All it takes is courage, character, and commitment to the public good. I am proud to have cast my ballot for Garamendi for California’s Lt. Governor and proud that he won the election. Garamendi is the kind of public servant we need all over this country. We need the likes of him from the local court house straight through to the White House, from one side of this country to the other—including my homestate of Mississippi.

I’m proud, too, of Mississippi’s Attorney General Jim Hood for doing his job in the face of what must be enormous political pressure to back down. He is keeping his promise to the citizens of Mississippi to "strictly enforce our consumer protection laws [and] advocate for the rights of victims." Between Hood’s efforts and those of pit bull attorneys like the Scruggs Katrina Group, State Farm will be forced to live up to its PR and become a good corporate neighbor.

Of course, the ultimate remedy is to expand the federal government’s flood insurance program to include all natural perils. Gulf Coast Congressman Gene Taylor (D-MS) introduced the Multiple Peril Insurance Act of 2007 (The bill is H.R. 920.)

We can partner with Congressman Taylor to take the wind out of the insurance industry. You know what that means! It's political hell raising time again. We can call and email our own congressional representatives to request that they co-sponsor the Multiple Peril Insurance Act of 2007.

That way next time a natural disaster befalls any of the “55 percent of the U.S. population already living within 50 miles” of our nation’s coastlines, we can be assured we will be treated fairly . . . just like a good neighbor. _________________________________________________________________________