This week, the New York Times detailed Goldman Sachs' machinations in Greece's project to obscure billions in debt, as the country skirted the budgetary limits it was obliged to meet as a member of the European Union. Sordid as it was, it was only one more example of the extraordinary and lucrative influence of the firm that's earned the nickname Government Sachs, for its web of power and interlocking relationships spanning from Wall Street to Washington to Athens and every other major financial capital. Here in the U.S., Goldman not only helped create our financial mess, but former Goldman executives, newly ensconced in various and, as is now clear, even mysterious positions of government power, enabled their firm, and likely themselves, to profit greatly from the supposed cleanup. It's easy to understand why Americans now sharply question whether their interests were really being served in the bailout process. Â
Goldman's elusive role in government decision-making is a stark example of a fundamental problem of our era, one that Janine Wedel has raised in her recently released book, Shadow Elite. She examines a new breed of power brokers who use shifting roles in and out of government to further their own agenda, often at the direct expense of the public. During the bailout of the fall of 2008, we see a tawdry episode involving a handful of Wall Street-government policy "deciders", whose interests "coincide" at the highest echelons of power, while their maneuverings remain largely beyond the reach of traditional monitors.
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Consider the critical meetings in the offices of (now-Treasury Secretary) Timothy Geithner, then the head of the New York Federal Reserve Bank, that ended with the decision to pay, in full, the counterparties of the Financial Products division of the insurance giant A.I.G. This decision overwhelmingly favored the interests of Goldman Sachs, and it is interesting that so many recent "alumni" of that firm were a part of this process. Among the decisions taken were to install a Goldman board member to be the new head of A.I.G. who, in turn, immediately agreed to disperse billions to, you guessed it, Goldman Sachs. Â It is telling that A.I.G.'s regulator, hapless though it was, was neither consulted nor represented throughout these discussions and ensuing decisions.
Perhaps, as all the parties involved have repeated ad nauseam since that day, the bailout had to happen. Â But how or why should the public believe them? The process was deeply flawed and far from transparent, the parties most directly involved had substantial conflicts of interest, and they will likely never be asked to account for their decisions. After all that has occurred, it does not take a deep understanding of economics to suspect that the shadow elite has, as Wedel argues, a tendency to prioritize the wealth of themselves and their networks at the expense of the public interest and the taxpayer.
To manage the crisis, then-Treasury Secretary and ex-Goldman chief Henry Paulson, brought in several recently "retired" Goldman bankers. One of the most intriguing, although lesser known, is Dan Jester. Hired as a "contractor" just that September, all reports suggest that he was effectively deputized by Paulson to be his representative in several of these highly-sensitive and, for a recent Goldman banker, highly conflicted negotiations - including the decision to bailout A.I.G. As a contractor, Jester was never appointed by Congress or otherwise vetted before taking up his role as the Treasury's de facto central player in the crucial decisions that marked that fall's bailout of Wall Street. In an article in the New York Times, former investment banker turned journalist William Cohan notes that Tim Geithner spoke on the phone with Jester 103 times; only Paulson spoke with Geithner more often. Â
Jester is the quintessential "flexian" described by Wedel in Shadow Elite . Â His inscrutable agenda and influence (clearly substantially more than the sum of his multiple roles) far surpass any official title. They also enabled him to transcend the traditional checks and balances designed to protect the public. Â As a contractor to the Treasury, rather than an employee, Jester could work with far fewer "sunshine" rules than is normal for government employees; virtually no one was, or ever will be, privy to how his actions did, or did not, work in his own interest or to the interests of persons with whom he is friendly. Â He has, according to reports, kept his sizeable portfolio of Goldman stock, which happily is doing rather well in no small part as a consequence of his efforts on the part of .... whom? Â Taxpayers? Â Goldman Sachs? Â Wouldn't we like to know?
Goldman's influence will surely continue even as the bailouts fade from memory. Rather than "change you can believe in," Obama's first year featured the appointment of several of the most deeply conflicted Clintonistas to senior economic policy-making positions. Â In two memorable articles, Rolling Stone reporter Matt Taibbi and MIT economics professor Simon Johnson each remarked upon the pantheon of former Goldman Sachs employees holding so many senior regulatory and Treasury positions. Lloyd Blankfein, the current head of Goldman Sachs, noted at the close of Financial Times reporter Gillian Tett's insightful book on J.P. Morgan that that firm has recently made a conscious decision to ensure that in the near future, its "alumni" will become as well-positioned as former Goldmanites in government circles. We can only groan as we eagerly await their "contribution."
Right now, Greece and European markets continue to shudder from Goldman's 'contribution' to their economy. Deals that helped Greece avoid some painful fiscal truths were hidden from public view. More proof, as if we needed any more, that the financial power elite needs to be forced out from the shadows.
Edited by Linda Keenan.
2 - Like Arriana says - Move your money.
With or without the politicians
Instead of that, we hire the thieves to run the Treasury.
It's certainly crime and it's certainly organized.
A case study that contains all these elements on a smaller scale is 1950's Cuba. The Jewish, Italian, and Cuban syndicates, along with the fledgling CIA. were desperate to keep Batista in power -- a dictator whose power was merely that of a puppet-face for the aforementioned (and who died in luxury retirement in his US Taxpayer-funded Miami mansion).
Ultimately seeing El Che -- "The Peoples Liberator" as a growing threat -- the CIA and various SA Right-Wing Nationalists chased him down and murdered him, but not before he left some pretty damning accounts in his diary of how things really transpired.
A portent of the future?
The artificial growth hormones athletes were taking were nothing compared to their financial counterparts on Wall Street during the 90s and after (it's still going on, they're just slightly off the cycle at the moment). While the ballplayers juiced and commanded our rapt attention, our pockets were being picked, our futures looted, and cuffs were being put on us by the "juicers" of the financial world.
And this is what we'll all be remembered for.
As a young medical student, Guevara traveled throughout Latin America and was transformed by the endemic poverty he witnessed.[5] His experiences and observations during these trips led him to conclude that the region's ingrained economic inequalities were an intrinsic result of:
monopoly capitalism,
neocolonialism,
and imperialism.
This belief prompted his involvement in Guatemala's social reforms under President Jacobo Arbenz Guzmán, whose eventual CIA-assisted overthrow solidified Guevara's resolve. Later, while living in Mexico City, he met Raúl and Fidel Castro, joined their 26th of July Movement, and invaded Cuba aboard the Granma with the intention of overthrowing U.S.-backed Cuban dictator Fulgencio Batista.
Additionally, he was a prolific writer and diarist, composing a seminal manual on guerrilla warfare, along with a best-selling memoir about his youthful motorcycle journey across South America. Guevara left Cuba in 1965 to incite revolution in Bolivia, where he was captured by Central Intelligence Agency-assisted Bolivian forces and executed.
It doesn't have to stay that way.
In Mexico in the mid-'90s Wall Street engineered a currency coup that tripled the debt owed by small businesses and family farms and also allowed for them to be massively ratejacked on top of it. Mexicans consequently formed the "el Barzon" movement and pushed back Wall Street and deposed their ruling party of 60+ years. In this country YouTube phenom Ann Minch has already declared the debtors' revolt and begun going after them http://www.revoltstartsnow.com.
If you've been pushed under, you can read my book for free: http://www.scribd.com/doc/25443175/Debt-Hope-Down-and-Dirty-Survival-Strategies-Evaluation-Version-Complete
When this sleeping giant of a citizenry finally wakes up, they'll find nothing left in old Mother Hubbard's cupboard. It will be bare. We will have no one but ourselves to blame.
Tell me, what other country ships jobs to other labor markets, puts millions out of work, and still expects its citizens will be able to fund the nation's coffers? Seriously......how short-sighted of these bastards, but then again, they don't care about you, me, or any of us as long as they get theirs.
Talk about entitlement mentalities. I've never seen such myopic avarice.
SO WELL SAID.
Right you are!.
If Americans would just put aside their differences and come together in these huge areas in which we have the same interests. Then we'd have numbers too big for Congress to ignore and make some very positive change that would benefit us all.
But the bankers are laughing at us as so many fools continue to fight and call each other names. The status quo interests and corporate media have so successfully diverted Americans into fighting amongst themselves over the small stuff, that many Americans don't even notice until it's too late and the large interests have already walked off with the treasury, economy and middle class!
The only way to stop the madness is to stop the flow of money. If anyone, ANYONE had any doubts about who really runs this country, the first bailout in the Fall of 2008 should've been the national flying brick to our collective head.