Beware of Schumer's AIG Bonus Outrage


"If you don't return it on your own, we will do it for you," Senator Charles E. Schumer warned the AIG bonus recipients, as he joined in the public outrage against AIG's executive bonuses of $165 million. After receiving $170b in US taxpayer money, AIG announced these scandalous bonuses for their executives in the financial products unit which sold derivatives that cratered the company and the entire financial system.

The grandstanding by the senator from Wall Street, as Mr. Schumer is known because of his close links to the financial services industry, seems to be designed to deflect public anger and scrutiny from the real scandal and the main culprits of collapse of AIG and other financial institutions--the politicians in Washington. For years, as the Wall Street cheerleader on Capitol Hill, the senator joined his other corrupt colleagues in preventing any regulation of the financial weapons of mass destruction such as credit default swaps (CDS) and collaterlized debt obligations (CDO) in exchange for millions of dollars in campaign contribution from Wall Street.

Mr. Schumer led the Democratic Senatorial Campaign Committee for the last four years, raising a record $240 million while increasing donations from Wall Street by 50 percent, according to the New York Times. That money helped the Democrats gain power in Congress, elevated Mr. Schumer’s standing in his party and increased the industry’s clout in the capital.

Schumer gathered support and donations by embracing the industry’s free-market, deregulatory agenda more than almost any other Democrat in Congress, even backing measures now blamed for contributing to the financial crisis.

While other lawmakers took the lead on efforts like deregulating the complicated financial instruments called derivatives, it was Mr. Schumer, a member of the Banking and Finance Committees, who repeatedly took other steps to protect industry players from government oversight and tougher rules, a review of his record shows. Over the years, he has also helped save financial institutions billions of dollars in higher taxes or fees, according to the New York Times.

On the nature of deregulated credit default swaps (CDS) that caused the collapse of AIG and financial markets, a recent CBS 60 Minutes segment explained, "In retrospect, giving Wall Street immunity from state gambling laws and legalizing activity that had been banned for most of the 20th century should have given lawmakers pause, but on the last day and the last vote of the lame duck 106th Congress, Wall Street got what it wanted when the Senate passed the bill unanimously." Though CNN has only picked Senator Phil Gramm as one its top 10 Culprits of Collapse, the entire US Congress shares responsibility for it.

The American people need to put the AIG bonus issue in proper perspective to channelize their genuine and deep anger and resentment against the corrupt political-industrial elite who are the real culprits of collapse. The bonus amount of $165m is an extremely tiny fraction of the trillions of dollars of losses in retirement savings and home values suffered by Americans because of the Wall Street misdeeds, committed with the collaboration of Schumer and his fellow politicians in Washington. It's also a small fraction of the tens of billions of dollars of US aid for Israel, the biggest recipient of US aid, that Sen. Schumer continues to champion as a staunch supporter of Israel on the Hill. The anger of the nation in severe distress should be used to force reforms in Washington. The first steps toward serious reform should include grassroots campaign for major curbs on political campaign contributions by the lobbyists followed by an open, public trial of Senators Charles Schumer, Chris Dodds, Phil Gram and their Democratic and Republican colleagues on the US Senate's Finance and Banking Committees to hold them to account.

Related Links:

Buffet Warns of Financial weapons of Mass Destruction

Will American Capitalism Survive?

China's Nuclear Option

Senator Schumer: The Champion of Wall Street on the Hill

Pay to Play is the Name of the Game in Washington

Are Jews Culprits of Collapse on Wall Street?

Keynes on Jews

Democrats and Republicans Share Blame for Financial Collapse

Jewish Network in US Congress

Jewish Power Dominates at Vanity Fair

Jewish Power Grows in US Congress

Did Schumer and Emanuel Sink Freeman?

Comments

Riaz Haq said…
Recent focus on the alleged misdeeds of Goldman Sachs that contributed to the financial melt-down have caused cries of "antisemitism" by American Jewish groups. Here's an excerpt from a recent NPR interview with Michael Kinsley who is a Jewish American:

CONAN: And you begin with the question: when, if ever, are such accusations of anti-Semitism fair?

Mr. KINSLEY: Yes. The purpose of this piece I wrote was not to accuse anyone of anti-Semitism. And in fact, I haven't heard anything that I would call anti-Semitic but to help you think through how to recognize it when you hear it and more importantly how not to recognize it when you don't hear it.

CONAN: Mm-hmm.

Mr. KINSLEY: And - because I think there's a real problem in our politics today of umbrage. People are very quick to take umbrage at things other people say. And politician use this to, I think, make bigger deals of things than they ought to.

Abe Foxman, who is the - he's the head of the B'nai B'rith Anti-Defamation League, says that virtually any reference to Goldman Sachs alone in the context of this scandal smacks of anti-Semitism, because he says, you know, what about Morgan Stanley and other firms that aren't Jewish? I think that goes much too far.

CONAN: And indeed, there can be an inference that just as if some people say, well, we can't make any criticism of Barack Obama without being accused of being a racist, you can't make any criticism of Goldman Sachs without being accused of being an anti-Semite.

Mr. KINSLEY: Right. I think that's true.

CONAN: There is also - you say you haven't read anything that you would take as anti-Semitic. Probably the most controversial thing was a quote in - by Matt Taibbi in a much quoted article about Goldman Sachs...

Mr. KINSLEY: Right.

CONAN: ...where he said that the world's most powerful investment bank is a great vampire squid wrapped around the face of humanity relentlessly jamming its blood funnel into anything that smells like money - a phrase that set off alarm bells.

Mr. KINSLEY: Well, it's a heck of piece. And it's really written with brio. That passage, which has been widely quoted, comes very close to the line, because, you know, it never uses the word Jewish but it invokes a lot of images that are familiar in classic anti-Semitism: the bloodsucking monster, this -the other. And it's smothering the normal life of normal people. All of that has - Jews have been victimized - and I should add - I should mention that I am Jewish - Jews have been victimized by that kind of imagery for centuries.
Riaz Haq said…
The Long History of Political Idiocy in #America. #presidentialdebate #Trump2016 #Huckabee #TedCruz2016

http://nyti.ms/1KNm2Q2


WE are currently enjoying a master class in the art of political stupidity. Donald J. Trump has been schooling us for some time, but the Iran nuclear deal has touched off a new race to the bottom. Mike Huckabee said the agreement with Iran would “take the Israelis and march them to the door of the oven.” Ted Cruz called the Obama administration “the world’s leading financier of radical Islamic terrorism.” Let’s not even get started on the Affordable Care Act, which Ben Carson once called “the worst thing that has happened in this nation since slavery.”

It’s tempting to rail against the media’s ability to elicit and amplify such stupidity. But none of this is new. Politicians have always resorted to dumb claims, blatant insults, bold exaggerations and baldfaced lies to gain press coverage and win votes. Indeed, Americans of the 19th century invented a name for it. The word “bunkum” — the origin of the word “bunk” — dates from the 1820s, a product of the over-the-top speechifying of Representative Felix Walker, who forewarned his congressional colleagues to ignore a blustery grandstand speech because it was intended only for the folks back home in Buncombe County, N.C. Then as now, raising hackles before the eyes of the press was a play for power; politicians who displayed their fighting-man spunk were strutting their suitability as leaders.

Such grandstanding was particularly blatant in the mid-19th century, an era with a political climate much like our own. The nation was becoming increasingly polarized because of the debate over the spread of slavery in new states born of Western expansion. At a time of enormous change, a sense of do-or-die extremism was in the air. New technologies, like the steam-powered printing press and the telegraph, were dramatically reshaping the power of the press.

Congress was particularly newsworthy in the 1840s, ’50s and ’60s. A typical newspaper had an extended account of debates in both houses, commentary on those debates and a “letter” from a Washington reporter (thus the term “correspondent”) filled with gossip about congressional doings. Legislators who went to extremes were virtually guaranteed press coverage. As Senator Franklin Pierce of New Hampshire griped in 1838, the visitors’ galleries were empty during debates on “great measures of policy,” but became “crowded almost to suffocation” when personal insults were expected.

Some men were known for such performances. Take Representative Henry A. Wise, a congressman from Virginia from 1833 to 1844. Like many purveyors of bunk, Wise was by no means a stupid man, however problematic his politics. (After his congressional career, he went on to become governor of Virginia, and signed the abolitionist John Brown’s death warrant.)

Wise loved grandstanding of all kinds: the swaggering threat, the mocking taunt, the over-the-top insult. He even took an occasional swing at an opponent. In 1842, he demonstrated his pro-slavery credentials by threatening to assault John Quincy Adams, an opponent of slavery, who had returned to the House after serving as president. “If the Member from Massachusetts had not been an old man, protected by the imbecility of age,” Wise warned, “he would not have enjoyed, as long as he has, the mercy of my mere words.” A horrified Adams wrote in his diary that night that Wise made “a threat of murdering me in my seat.”

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Perhaps polarized times require such grandstanding. They certainly invite it. But, as now, some politicians in the 1850s recognized the risks and voiced their concerns. They understood that extreme claims and violent words have escalating consequences. The tossing of verbal “missiles” in Congress could cause bloodshed, one congressman presciently warned in July 1856.

In recent weeks, by contrast, we haven’t heard much talk of the consequences of political flame-throwing, save some hand-wringing by President Obama.

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