Obama’s Perpetual Farewell Tour

By Pam Martens: January 19, 2017

Hopeless -- Barack Obama and the Politics of Illusion (Book Jacket photo)The man who was compared to a Messiah when he won the presidential election in 2008 has been on an excruciatingly long goodbye tour. First there was his farewell speech to the United Nations in September. Next came his farewell tour across Europe in November – the Messiah’s last foreign trip. Then there was his farewell speech in the U.S. Yesterday, there was a tortuously vacuous farewell press conference, which toward the end, had the feeling that actors from central casting had replaced real journalists in the press room in order to memorialize the greatness of this President.

Whenever I think about this President, I think of Bruce Dixon, the Managing Editor of the Black Agenda Report in 2008 during Obama’s first presidential campaign. The Black Agenda Report writes for black Americans. Dixon wrote the following in February 2008:

“Whether it is truly possible to hold elected officials accountable in a political system where big money, big media, big corporations and the very rich call all the  shots is uncertain.  But we have tried and will keep trying.  So will others.  The stakes are too high not to…

“The 2008 Obama presidential run may be the most slickly orchestrated marketing machine in memory. That’s not a good thing. Marketing is not even distantly related to democracy or civic empowerment. Marketing is about creating emotional, even irrational bonds between your product and your target audience. From its Bloody Sunday 2007 proclamation that Obama was the second coming of Joshua to its nationally televised kickoff at Abe Lincoln’s tomb to the tens of millions of dollars in breathless free media coverage lavished on it by the establishment media, the campaign’s deft manipulation of hopeful themes and emotionally potent symbols has led many to impute their own cherished views to Obama, whether he endorses them or not.”

We were also not among the converted as a result of spending months conducting a forensic examination of Obama’s campaign accounts. In May of 2008, we wrote the following:

“The Wall Street plan for the Obama-bubble presidency is that of the cleanup crew for the housing bubble: sweep all the corruption and losses, would-be indictments, perp walks and prosecutions under the rug and get on with an unprecedented taxpayer bailout of Wall Street. (The corporate law firms have piled on to funding the plan because most were up to their eyeballs in writing prospectuses or providing legal opinions for what has turned out to be bogus AAA securities. Lawsuits naming the Wall Street firms will, no doubt, shortly begin adding the law firms that rendered the legal guidance to issue the securities.) Who better to sell this agenda to the millions of duped mortgage holders and foreclosed homeowners in minority communities across America than our first, beloved, black president of hope and change?

“Why do Wall Street and the corporate law firms think they will find a President Obama to be accommodating? …vetting included his remarkable ‘yes’ vote on the Class Action Fairness Act of 2005, a five-year effort by 475 lobbyists, despite appeals from the NAACP and every other major civil rights group. Thanks to the passage of that legislation, when defrauded homeowners of the housing bubble and defrauded investors of the bundled mortgages try to fight back through the class-action vehicle, they will find a new layer of corporate-friendly hurdles.”

CounterPunch was also not among the converted. It published an anthology of articles on the red flags in the Obama candidacy, titled Hopeless: Barack Obama and the Politics of Illusion. CounterPunch editors, Jeffrey St. Clair and Joshua Frank, describe the books as follows:

“The election of Barack Obama sparked long-dormant tingles of optimism in even the most entrenched political cynics. But the promise of an Obama revolution fizzled out even before his inauguration, as the president-in-waiting stocked his cabinet with corporate hacks, cut secret deals with Wall Street titans and plotted a bloody escalation of the senseless war in Afghanistan. Let this book stand as a painful reminder to those who think anything less than social struggle will net tangible gain.”

Obama’s farewell press conference yesterday evoked images of his first press conference on November 7, 2008 as President-elect. On Obama’s right stood Larry Summers. On his left stood Robert Rubin. The President-elect was bookended by the very men who had played outsized roles in the events leading to the Wall Street financial collapse that was happening at that very moment. Summers and Rubin were standing there to symbolize that they would play important roles in shaping Obama policy. It gave new meaning to failing up.

Both Rubin and Summers had served as U.S. Treasury Secretary in the Bill Clinton administration. Both had pushed for the repeal of the Glass-Steagall Act and deregulation of derivatives, two key events that led to the epic crash of the U.S. financial system in 2008. Rubin had gone directly from the U.S. Treasury to the Board of Citigroup, the prime beneficiary of the deregulation, and collected over $125 million in compensation over the next decade. Citigroup is where Rubin went. Where Rubin had come from was Goldman Sachs, following a 26-year career there. (Goldman Sachs’ headquarters is currently under protest as a result of its tentacles extending broadly into every nook and corner of the Donald Trump administration.)

Today, the opinion pages of Bloomberg News carries a harsh assessment of Obama’s eight years with this headline: “Obama’s Failing Was a Lack of Ambition.” But that’s not what happened at all.

As we now know through the hard evidence of emails leaked by WikiLeaks, Obama was the sock puppet of Wall Street. (See related articles below.) Trump’s Goldman Sachs administration is simply the cleanup crew – and we don’t mean that in a good way.

Related Articles:

WikiLeaks: Citigroup Exec Gave Obama Recommendation of Hillary for State, Eric Holder for DOJ

WikiLeaks Bombshell: Emails Show Citigroup Had Major Role in Shaping and Staffing Obama’s First Term

Changing the Culture of Wall Street Requires Ending Continuity Government in Washington

Political Revolution Sprouts New Shoots Outside Goldman Sachs

By Pam Martens and Russ Martens: January 18, 2017

Protester Wears a Swamp Creature Costume Outside Goldman Sachs Headquarters, January 17, 2017

Protester Wears a Swamp Creature Costume Outside Goldman Sachs Headquarters, January 17, 2017

Sometimes all it takes to win a war is a rallying cry. That cry started in the bowels of Wall Street on September 17, 2011 with the takeover of Zuccotti Park by grassroots protesters calling themselves Occupy Wall Street. The thunder clap from that movement, “we are the 99 percent,” reverberated around the world. Occupy focused the public’s attention on the insidious wealth transfer system that has been institutionalized by Wall Street on behalf of the 1 percent – a system which has minted dozens of billionaires and thousands of multi-millionaires while collapsing the U.S. economy from 2008 to 2010 and leaving millions of Americans homeless and jobless. (See our past coverage of Occupy in related articles below.)

Yesterday, green shoots from the Occupy movement sprouted in a light falling rain outside the headquarters of Goldman Sachs at 200 West Street in Manhattan – a building also built on the backs of taxpayers. (See Wall Street Firms Spy on Protesters in Tax-Funded Center.) Dozens of protesters from New York Communities for Change and supporting organizations turned out with signs and sleeping bags to set up an encampment to last through Donald Trump’s inauguration on Friday. The rallying cry yesterday was “Government Sachs.”

Chants targeting Goldman echoed through the crowd: “Goldman, Goldman you can’t hide, we can see your greedy side”; “Hey, hey, ho, ho, Government Sachs has got to go”; and “Hey Sachs, get off it, put people over profit.” Some protesters wore garish swamp creature masks to taunt Donald Trump over his campaign promises.

Jonathan Westin, Director, New York Communities for Change, Speaks at Goldman Sachs Protest on January 17, 2017

Jonathan Westin, Director, New York Communities for Change, Speaks at Goldman Sachs Protest on January 17, 2017

Using the same “mic check” system that was popularized by Occupy Wall Street, Jonathan Westin, Director of New York Communities for Change, explained the point of the protest. Westin told the crowd that the President-elect, Donald Trump, had run on a platform to drain the swamp. Instead, said Westin, Goldman Sachs, “the same people who crashed this economy” would be moving from “just lobbying from the outside” to “control our government. They will control Treasury; they will control the SEC; and they will control Donald Trump, unless we stop them.”

Westin was referring to the seemingly endless stream of Goldman Sachs alumni and its current President who have been appointed or nominated by Trump for top positions in his administration.

Trump nominated Steven Mnuchin, a 17-year veteran of Goldman Sachs, to be his Treasury Secretary. Mnuchin’s Senate Finance confirmation hearing, expected to be raucous, is scheduled for tomorrow, one day prior to Trump’s inauguration. Stephen Bannon, another former Goldman Sachs banker, was named by Trump as his Chief Strategist in the White House. The sitting President of Goldman Sachs, Gary Cohn, has been named by Trump as Director of the powerful National Economic Council, which sets policy for both domestic and international issues.

In a recent move that shocked even veterans on Wall Street, Trump nominated a Goldman Sachs outside lawyer, Jay Clayton of Sullivan & Cromwell, to serve as Wall Street’s top cop as Chairman of the Securities and Exchange Commission. Adding to the bad optics, Clayton’s wife currently works as a Vice President at Goldman Sachs.

And then there is also Dina Powell, President of the Goldman Sachs Foundation, who is whispering in the ear of Trump’s daughter, Ivanka Trump, a key member of Trump’s transition team. Politico reports that Powell is a “top adviser on policy and staffing” to Ivanka.

A group supporting the protesters called Shut Down Government Sachs released a statement expressing the view that Goldman Sachs “is no longer rigging the system – they are the system.” The group noted:

“From making money from home foreclosures to investing in dangerous oil pipelines like Dakota Access, Goldman Sachs has been instrumental in extracting the wealth, livelihoods, and health of black, brown, and poor communities. And they’ve gotten great at using the federal government to make it happen.

“With Trump choosing several Goldman Sachs’ veterans for his administration, they’ve officially taken over. We have to fight back harder than ever to win back a government by and for the people.”

Unfortunately, it would be naïve to believe that Goldman Sachs is the first Wall Street behemoth to supplant a democratically elected candidate with a pack of their own cronies. The WikiLeaks emails released last year showing how Michael Froman, an executive of the serially corrupt and bailed out Wall Street mega bank, Citigroup, was the invisible hand behind the cabinet appointments by President Obama,  should end the naive perception that voters have a voice in Washington. Until public financing of political campaigns replaces corporate financing and seduction of candidates, we’ll continue living under Government Sachs or Government Citigroup or Wall Street’s Government Du Jour.

Related Articles:

Police Move in on Peaceful Occupy Wall Street Protestors

May Day: Occupy Wall Street Protest Comes on Heels of Federal Lawsuit

As It Spied on Occupy Wall Street, Department of Homeland Security Fixated on Media Coverage

Occupy Wall Street to Remind America This Wednesday — Democracy Is Not a Spectator Sport

During Peaceful Occupy Wall Street Weekend, NYPD Continues Assault on Civil Rights

Michael Hudson’s New Book: Wall Street Parasites Have Devoured Their Hosts — Your Retirement Plan and the U.S. Economy

Draining the Swamp in Washington Through Community Banking

U.S. Capitol With Storm CloudsBy Pam Martens and Russ Martens: January 17, 2017

The currency of Washington’s power politics is campaign money. Much of that campaign money flows from Wall Street’s biggest banks: its lobbyists, its Political Action Committees, its employees and their spouses. After flooding the presidential campaign with money, Wall Street is then rewarded by being allowed to make cabinet hiring decisions as part of the new President’s transition team, ensuring continuity government and an incurable malignancy on American democracy. To begin the process of draining the corrupt swamp in Washington, it means cutting off the money flow from Wall Street – not looking for a new savior who is deeply indebted to the same Wall Street banks.

Tens of millions of U.S. consumers have the power to pull the plug on the swamp by moving their deposits from big Wall Street banks to their local community banks or their credit union. This would not only deplete Wall Street’s coffers to corrupt in Washington, it would provide the cash to reinvigorate the cities and towns that Wall Street has blighted through its dirty swap deals and its evil genius subprime housing bust.

Community banks have the same level of FDIC insurance as the big banks, so you’re not taking on more risk when you move your money – providing you hold your funds in FDIC-insured accounts and stay within the insurance limit. FDIC-insurance is backed by the full faith and credit of the U.S. government. (You should ask for a statement in writing from your new bank that the type of account you have selected is insured. See video below for more details. Mutual funds, municipal bonds and annuities are not FDIC-insured, even when you buy them from a bank.)

Federal credit unions have their own Federal insurance system known as the National Credit Union Share Insurance Fund (NCUSIF). See details on this program here.

According to the ICBA (Independent Community Bankers of America) community banks benefit their communities in the following ways:

Community banks fund more than half of small businesses under $1 million;

Most community bank loans benefit the neighborhoods where depositors live and work;

Community banks employ 700,000 Americans and create countless jobs thanks to their role in lending to small businesses and agricultural enterprises;

Community banks hold more than $3.9 trillion in assets, $3.1 trillion in deposits, and $2.6 trillion in loans to consumers, small businesses and the agricultural community;

Community banks make 90 percent of agricultural loans;

More than 2,500 community banks have been in business for over 100 years.

ICBA mentions one other key difference between the big Wall Street banks and the local community bank. It says: “Community banks’ boards of directors are made up of local citizens who want to advance the interests of the towns and cities where they live and where their banks do business.”

Compare that statement to one member of the Goldman Sachs Board of Directors, M. Michele Burns. In addition to serving as a Director of the sprawling global bank, which is regularly charged by its regulators with serious crimes, Burns simultaneously serves as a Director of Alexion Pharmaceuticals, Inc., Anheuser-Busch InBev, Cisco Systems, Inc. and Etsy, Inc., according to her official bio. Burns has served on the Board of Goldman Sachs since 2011.

In 2015 Goldman Sachs was sued by a shareholder over excessive compensation to its Board of Directors. Jeran Binning argued in Delaware Chancery Court that the company’s nonexecutive directors were paid an estimated $500,000 to $600,000 in 2014, far more than a peer group of big Wall Street banks. In the complaint, Burns is listed as having received compensation of $600,019 in 2014 (despite owing her loyalties to multiple corporations). Oral arguments in the case were set to be heard on December 5, 2016.

Another major benefit of draining the Wall Street swamp in Washington is to put an end to the get-out-of-jail-free card that this cozy nexus has spawned. Despite being charged with serial crimes for the past eight years, no top executives of Goldman Sachs or Citigroup or JPMorgan Chase or Bank of America have gone to jail.

Citigroup’s Michael Froman effectively controlled the staffing of President Obama’s first term and now Goldman Sachs will hold top slots in President-elect Donald Trump’s administration. Americans should have learned long ago that pinning one’s hopes on a savior is a failed strategy that is doomed to bring on more economic pain. It’s time for every American to engage before it’s too late to prevent another epic financial crash.

Related Articles:

Senate Specifics on Why Goldman Sachs’ Gary Cohn Should Not Have a Role in the U.S. Government

Goldman Sachs’ Rich Man’s Bank Backstopped by You and Me

Goldman Sachs Beats Another Fraud Rap: Can the Public Ever Get Justice in New York Courts?

If You Remove Trade Secrets from Goldman Sachs You’re Prosecuted; If You Remove Top Secret Files from the Government, You’re Good to Go

Blowing the Whistle on the New York Fed and Goldman Sachs

Occupy Goldman Sachs — Bring Pitch Fork (And Property Tax Bills)

Barofsky Book: Goldman Sachs and Morgan Stanley Would Have Failed Next

Goldman Sachs to America: F*** You!

Why A Criminal Case Against Goldman Sachs Matters and Why Charges Could Stick

Fed Chair Janet Yellen Channels Bernie Sanders in Speech to Teachers

By Pam Martens and Russ Martens: January 13, 2017 

Fed Chair Janet Yellen Addressing Teachers on January 12, 2017

Fed Chair Janet Yellen Addressing Teachers on   January 12, 2017

Last night the Federal Reserve convened a Town Hall meeting via webcast with K-12 teachers and college educators of economics and history. Federal Reserve Chair Janet Yellen delivered a speech and then took a series of questions from teachers. It was during the Q&A period that Yellen gave a sobering assessment of the long-term prospects for the U.S. At numerous points, Yellen echoed the income inequality themes that Senator Bernie Sanders raised repeatedly at his rallies around the country during the presidential primaries.

When asked about the biggest obstacles to the U.S. economy over the short and long term, Yellen said she did not have serious concerns over the short term but was worried about the longer term. In addition to productivity concerns, Yellen stated: (See video clip below.)

 “We have seen over many decades now that the returns – the wages and income – of people with more education and higher skills have continued to increase systematically relative to those with less education. By some measures, men with a high school education or less are seeing not only stagnant incomes but the disappearance of jobs that afforded them reasonably secure lives and retirements. And these are problems that really lie outside the scope of what the Federal Reserve is able to address and I think they represent longer term structural trends in the global economy.”

In a similar vein, Yellen remarked:

“I also worry a great deal about inequality and the fact that the largest share of gains from aggregate productivity growth have gone to workers at the top of the income distribution. And the gap we’re seeing, as I mentioned, between wages of those with a college education and high school or less have just continued to increase. I mean you can look at some measures that suggest that real wages of high school educated workers have essentially been stagnant for several decades and there’s some recent research that shows that a far smaller share of young people – if you think about the American Dream, that people expect their children to do better than they did, for generations to progress – a far smaller share of young people today are doing as well or better than their parents than was true for most of the post war period.”

Yellen looked particularly troubled when she cited the following research study, stating:

“Labor participation rates for prime age men have continued to move south, which is a disturbing trend. A very shocking finding, this was a finding of the individuals Angus Deaton and Anne Case – Angus Deaton won the Nobel Prize last year [he actually won the award in 2015] is that the mortality rates of high school educated whites in the 45 to 54 year age bracket are actually rising, which is an extraordinary difference from what we’ve seen in other countries and in the post war period and it seems to be related to suicide and health issues that maybe relate to substance abuse. The hypothesis is that this is a consequence in reflection of greater economic insecurity. So, obviously, those are very disturbing trends.”

The most problematic part of Yellen’s speech and the Q&A that followed is that she doesn’t seem to understand that it was brazen fraud on the part of the Wall Street banks that are supervised by the Federal Reserve that caused the epic 2007-2010 financial crash and that it was Wall Street deregulation pushed for by Alan Greenspan, during his Chairmanship of the Federal Reserve, that allowed the fraud to metastasize at every major Wall Street bank leading into the 2008 collapse.

When asked about what should be taught in college level Money and Banking courses, Yellen said information on the most recent financial crash should be included in the curriculum. But when she cited numerous causes for the crash, such as housing, subprime debt, complex securitizations, and the ratings agencies, not once did Yellen indicate that outrageous frauds on the part of the Wall Street banks were prevalent in every one of those areas.

In the case of housing, the major Wall Street banks, as we now know from whistleblowers inside those institutions, were knowingly making and/or buying liar loans that were issued to people who had no hope of being able to make their mortgage payments on a sustained basis. Then the Wall Street banks paid the rating agencies to give a triple-A rating to those fraudulently bundled loans, which were then sold to public pensions funds and other investors. These fraudulent pooled mortgages were the “complex securitizations” that Yellen benignly referred to.

Some Wall Street banks even allowed hedge funds to design the “complex securitizations” so that they would fail. With the superior knowledge that bogus mortgages were packaged in the deal and would default, the hedge funds were able to make huge profits as the unknowing investors lost all or almost all of their money. This was not some innocent quirk of complex markets – this was intentional fraud that occurred time and again under the nose of the Federal Reserve and its bank examiners.

Yellen’s reach-out to teachers around the country suggests that the Federal Reserve is attempting to foster the image that it is as wholesome as apple pie or a cuddly kitten. The harsh reality is that the Fed allowed the massive buildup of toxic practices at the banks it supervised; it failed to see the early warning signs that an epic crash was coming; and it has continued to allow the mass concentration of high risk derivatives on the books of the insured, deposit-taking units of the serially corrupt Wall Street banks, ensuring that another crash is in our nation’s future unless meaningful reforms are made very soon.

At the top of that reform list is to sever the Fed’s role of supervising the banks. Its mandate is monetary policy and it has more than convincingly shown that its cozy role with the Wall Street banks prevents it from being an effective regulator.

The most critical question that no teacher asked of Yellen is this: why are you still wearing blinders about the real reasons for the greatest financial crash since the Great Depression. Until Fed Chair Yellen deals openly and honestly with the American people on this critical point, the Fed will continue to lack the trust and confidence of the majority of Americans.


Trump, Spy Stories, Prostitutes and the U.S. Dollar

By Pam Martens and Russ Martens: January 12, 2017

Donald Trump, Speaking at a Rally in West Palm Beach, Florida on October 13, 2016

Donald Trump, Speaking at a Rally in West Palm Beach, Florida on October 13, 2016

The President of the United States is typically viewed as the person whose top job is to inspire confidence in the dignity, integrity and sanity of his leadership of the country. But the presser held by President-elect Donald Trump yesterday, the first in six months and likely viewed by world leaders around the globe, was short on confidence building and long on slandering the American media and U.S. intelligence agencies. In short order, the U.S. dollar took a dive. Trump has yet to assimilate the concept that his words no longer belong just to him but attach themselves like flypaper to the credibility of the most powerful nation on earth.

At times, the press conference felt more like an unruly street fight than a media Q&A by the man who will be sworn in as the 45th President of the United States in just nine days. Trump had his gang lined up on one side: his lawyer, the Vice President-elect, his two sons and one daughter. On the other side was the media, filled with questions on newly leaked documents about Trump’s relationship with Russia.

On Tuesday, BuzzFeed reporters Ken Bensinger, Miriam Elder and Mark Schoofs (a 2000 Pulitzer Prize winner for his work at the Village Voice) released an article that included a 35-page dossier of unsubstantiated allegations of misconduct by Trump with prostitutes in Russia and coordination between some of his campaign aides and Russian operatives. When asked about the report during his press conference, Trump used the words “sick,” “crap,” and “something that Nazi Germany would have done.” Trump also referred to one media outlet as “a failing pile of garbage,” leaving diplomats around the world shaking their heads and sending dollar traders to the exits.

As evidenced by the video clip below from the press conference, things became completely unhinged 52 minutes into the event. When asked about the report on his ties to Russia, Trump said:

“I think it was disgraceful, disgraceful that the intelligence agencies allowed any information that turned out to be so false and fake out. I think it’s a disgrace, and I say that, and I say that, and that’s something that Nazi Germany would have done and did do. I think it’s a disgrace. That information that was false and fake and never happened got released to the public. As far as BuzzFeed, which is a failing pile of garbage, writing it, I think they’re going to suffer the consequences. They already are. And as far as CNN going out of their way to build it up…”

This exchange was followed by Jim Acosta of CNN attempting to ask a question. Trump responded in a hostile fashion, saying: “Not you. Not you. Your organization is terrible.” Acosta shouted out that if his news organization was going to be picked on, he should have a chance to ask a question. Trump said: “I’m not going to give you a question. You are fake news.”

The exchange had the surreal feel of the Jerry Seinfeld Show episode with the “no soup for you!” tyrannical owner of the soup restaurant.

Today, the front page of the New York Times’ print edition has filled in more titillating details, reporting that Christopher Steele, a former spy who had worked  for the British intelligence agency, MI6, was responsible for much of the leaked dossier. After retiring from the spy games, Steele had formed Orbis Business Intelligence, a firm that conducts commercial intelligence as well as opposition research for political campaigns.

On Monday, Senator Bernie Sanders appeared on a CNN Town Hall, urging the media to focus on the critical economic issues impacting the future of America. It’s tough to see how those critical issues can now compete with a story filled with spies, prostitutes and campaign operatives in Russia.