Tamara Keith of National Public Radio reported, on Tuesday, April 16th, that "Congress moved to undo large parts of the STOCK [Stop Trading On Congressional Knowledge] Act last week." This had been the law that was passed just a year ago, and which President Obama signed into law at a White House ceremony with TV cameras on and great fanfare. The law - which had been pushed by progressive Democrats since 2006, and which finally became law on 4 April 2012 - required members of Congress and their staffs, and the Executive Branch, to avoid insider trading. Until this law was passed, buying or selling stock on the basis of insider information had been fully legal for these federal officials, but not for anyone else; and the STOCK Act was supposed to end that and prohibit political insiders from buying and selling stock on the basis of their privileged knowledge of upcoming legal changes.
That investment-advantage they enjoyed had been substantial: one study by economist Alan Ziobrowski, "Abnormal Returns from the Common Stock Investments of the U.S. Senate," showed that U.S. Senators' stock-investments outperformed the general market by about 12% per year; and another study by him, "Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives," showed that U.S. Representatives' stock-investments outperformed the general market by about 6% per year. In other words, the investments of these people were growing at around twice the normal rate. Members of Congress were probably making more money from their personal investments than they did from their official salaries. The bill that Obama quietly signed into law on 15 April 2013 made the STOCK Act that he had signed the year before virtually unenforceable. Members of Congress can thus resume drawing a major part of their incomes from cheating outside investors, who don't know the things that these officials are privileged to know.
NPR continued: "In the House, Majority Leader Eric Cantor, R-Va., shepherded the bill through" at a time when "many members had already left for the weekend or were on their way out. The whole process took 30 seconds. There was no debate." Then, at the White House, "when the president signed a bill reversing big pieces of the law, the emailed announcement was one sentence long. There was no fanfare last week, either, when the Senate and then the House passed the bill in largely empty chambers using a fast-track procedure known as unanimous consent. ... 'There weren't too many members of Congress who were aware of this legislation,' says Craig Holman, the government affairs lobbyist for Public Citizen."
Basically, only the leadership knew what was happening. This included the President. He knew what was in the legislation, and that's why he signed it so inconspicuously (by contrast to the way that he had signed the STOCK Act into law a year before).
Not every government official was corrupt, but the "right" ones were. Perhaps that's how they had risen to become the "right" ones: the leaders of Congress are chosen by the members of Congress, and represent those members - nobody else (except the financial backers of their local re-election campaigns).
This is how institutionalized corruption operates. But President Obama didn't have to sign this bill; he supposedly represented the public, not the people on Capitol Hill; he could simply have vetoed it, and given that vetoing-event the same TV-fanfare exposure he had given to his signing of the STOCK Act a year earlier; this would have been a very popular thing for him to do, and it would have been in keeping with all of his campaign rhetoric, upon the basis of which he had won the White House. But corruption has instead been rampant during his Presidency; and his decisions - both personnel and policy - have largely assisted that, as happened here: he chose to help corrupt members of Congress.
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When the World Bank scored the U.S. on "Control of Corruption" in the 2009, 2010, and 2011 (or Obama-era) versions of their "Worldwide Governance Indicators," the U.S. performance wasn't even as good as it had been in the previous, 1996-2008, rankings. Whereas the U.S. had scored consistently at the bottom of the top 10% (and near the bottom of the developed countries) prior to Obama, the U.S. has scored at the bottom of the top 15% (and the very bottom of the developed countries) since Obama came into office in 2009.
A more detailed picture of the corruption-performance of the United States, internationally, is provided by the most recent rankings from the World Economic Forum, "The Global Competitiveness Report 2012-2013." That report rates 144 countries, on a wide range of factors concerning global economic competitiveness; and the U.S. scores below all other industrialized countries (of which there are about thirty) on most of the corruption-related factors. (Furthermore, that rating has likewise declined while Obama has been in office.) Here is America's international performance on the WEF factors relating to corruption:
On "Diversion of Public Funds [due to corruption]," the U.S. ranks #34 (down from #28 in their 2009-2010 report). On "Irregular Payments and Bribes" (which is perhaps an even better measure of lack of corruption) we are #42 (not rated in 2009). On "Public Trust in Politicians," we are #54 (down from #43 in 2009). On "Judicial Independence," we are #38 (down from #26). On "Favoritism in Decisions of Government Officials" (otherwise known as governmental "cronyism"), we are #59 (down from #48). On "Organized Crime," we are #87 (down from #72). On "Ethical Behavior of Firms," we are #29 (down from #22). On "Reliability of Police Services," we are #30 (down from #21). On "Transparency of Governmental Policymaking," we are #56 (down from #31). On "Efficiency of Legal Framework in Challenging Regulations," we are #37 (down from #35). On "Efficiency of Legal Framework in Settling Disputes," we are #35 (down from #33). On "Burden of Government Regulation," we are #76 (down from #53). On "Wastefulness of Government Spending," we are also #76 (down from #68). On "Property Rights" protection (the basic law-and-order measure), we are #42 (down from #30).
And here is how we perform for protecting non-elite, non-inside, investors (as opposed to insiders): On "Strength of Investor Protection," we are #5 (same as in 2009). On "Protection of Minority Shareholders' Interests," we are #33 (not rated in 2009). On "Efficacy of Corporate Boards," we are #23 (down from #20). On "Reliance on Professional Management," we are #19 (down from #11). On "Strength of Auditing and Reporting Standards," we are #37 (down from #39). On "Venture Capital Availability," we are #10 (down from #7). On "Intellectual Property Protection," we are #29 (down from #19). On "Soundness of Banks," we are #80 (up from #108). On "Regulation of Securities Exchanges," we are #39 (up from #47). On "Country Credit Rating," we are #11 (not rated in 2009). On "Government Debt [as a % of GDP]," we are #136 (down from #114). On "Effectiveness of Anti-Monopoly Policy," we are #17 (down from #11). On "Extent of Market Dominance," we are #9 (down from #7).
The U.S. is down on 19 of these WEF factors, up on 2, and unchanged on 1, during the period while Obama has been in office. This overall finding, of declining U.S. performance, is entirely in line with the similar findings from the World Bank: Corruption in the United States is increasing significantly during Obama's Presidency.
That's the forest, and here are some of its trees:
The great investigative financial journalist Pam Martens, at her "Wall Street On Parade" website, headlined on April 16th, "The Foreclosure Settlement Scandal: It's All About Paying Former Regulators Billions," and she reported that the sub-contractor that the Obama Administration had allowed Bank of America to hire in order to evaluate the harms that the bank had done to defrauded mortgagees, and in order to calculate how much these victims should be compensated by the bank for their illegally foreclosed homes, etc., "is chock full of dozens of former regulators," such as Mary Schapiro, former chair of the Securities and Exchange Commission, and Eugene Ludwig, former general counsel to the Office of Comptroller of the Currency, which is another major mega-bank "regulator." Consequently, "Today, online forums are exploding with comments from outraged foreclosure victims who have just received $300 or $500 [compensation from the bank, as negotiated by the Obama Administration] after losing all the equity in their homes in bogus foreclosures." That's a tree in Obama's corruption forest.
Here's another: The "Dealbook" blog of The New York Times headlined on March 28th, "Once More Through the Revolving Door for Justice's Breuer," and reported that Lanny Breuer, who had overseen all of the decisions regarding investigating, and regarding whether or not to prosecute, the heads of the mega-banks that U.S. taxpayers have thus far bailed out for trillions of dollars of losses that had been suffered by the inside investors in their firms, is now returning to his old law firm of Covington and Burling, in order to make an estimated $4 million in his first year back. He "will now shift to defending large corporations." which he had always actually been doing, especially when Barack Obama, and Breuer's fellow Covington and Burling corporate-defense lawyer Eric Holder, hired Breuer, to protect the banksters from the public. So: another tree has fallen.
Here is how Barack Obama had put this matter, when he secretly met with the banksters inside the White House on 27 March 2009: "My administration ... is the only thing between you and the pitchforks." He has kept his promise to them. That is the reason why "online forums are exploding with comments from outraged foreclosure victims," and why outraged outside investors in the mega-banks' fraudulent mortgage-backed securities investments are likewise treated as being "pitchforks," instead of as being victims.
Furthermore, Martens documented on April 12, under the headline, "Elizabeth Warren's Foreclosure Settlement Bombshell: Banks Determined the Number of Victims of Their Own Foreclosure Frauds," that the mega-banks even determined whether, and how much, to pay to compensate each one of their victims, individually. The great bankster-crime prosecutor, and Senator from Massachusetts, Elizabeth Warren, had extracted this stunning information during Senate testimony, on April 11th. Martens then phoned the relevant bank-regulating agency, the Office of the Comptroller of the Currency, and they confirmed to her that this was, indeed, so.
On 15 November 2011, Syracuse University's authoritative latest periodic count of federal prosecutions of white-collar crimes was published, headlining "Criminal Prosecutions for Financial Institution Fraud Continue to Fall," and it reported that whereas the number of these prosecutions was a rather steady 3,000 per year until George W. Bush came into office, these numbers have fallen steadily each year since then, and had gotten down to around a thousand per year under Obama, and were still falling, as of 2011. Lots of trees have been falling.
The rot certainly starts at the top. I am a proud Democrat who can tell a phony one clearly, especially when it's demonstrated by four years of remarkably consistent criminal (and profoundly conservative) decisions by him. Obama is a phony Democrat. He is, at best, Romney-light. Maybe he is, in some ways, even Bush-heavy. As regards non-prosecutions of financial fraudsters, the data show him to be Bush-heavy.
So, with President Obama being a highly skillful accessory after the fact, regarding the massive outburst of financial crimes that had occurred under George W. Bush - with a person like this, being now at the very top of the American Executive Branch, including of the "Justice" Department, to prosecute these mega-crooks or else not - how much of a rigged game is the U.S. economy, really?
The answer to that question is starkly shown in those international ratings.
And, now, Obama wants the future recipients of Social Security, Medicare, and Medicaid, to pay part of the price for those crimes, so as to "share the burden," with the defrauded former homeowners, and the defrauded outside investors in "toxic assets." All of these non-"elite" people are just "pitchforks," to this President. He represents the "elite," no such riff-raff. He protects that elite from us, not us from them.
If congressional Democrats don't kill his Republican "entitlements" plan (which even Republicans are now afraid to endorse), then the Democratic Party will effectively have ended, right here and now.
But even more than this will be needed: repudiation of Obama, personally, by the Democratic Party. He is a historic stain upon the Party, much like George W. Bush is upon the Republicans; and the later that this stain is cleansed by our Party, the worse it will be for our Party, and not just for our nation. Republicans don't repudiate Bush, because he represents them. Does Obama represent us? Really?
The rot is on both sides now. Let's see if our side will clamp down against it - as Senator Warren obviously wishes to do. Are we with her, or are we with Obama? That question does not concern a white woman versus a black man; it concerns a nation of equality under law, versus a champion of "Too Big To Fail." In fact, Obama has been disastrous for Blacks, and not just for the rest of "the 99%."
The Democratic Party will have to show where it stands - and with whom, and for whom.
The Republican Party has already failed its test regarding Bush. Will the Democratic Party fail its test regarding Obama?
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Investigative historian Eric Zuesse is the author, most recently, of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST'S VENTRILOQUISTS: The Event that Created Christianity.