Global corporate elite seeks to destroy democracy

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RebLem
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Global corporate elite seeks to destroy democracy

Post by RebLem » Wed Apr 21, 2010 5:45 am

Democracy a loser in trade free-for-all

March 29, 2010 | Sydney (NSW, Australia) Morning Herald
By Kenneth Davidson, senior columnist at The Age


There is a crisis in global governance. The Westphalia system that emerged from Europe's 30-year war in the mid-17th century saw the demise of the barons and the Catholic Church as global powers, replaced by the sovereignty of the secular nation state, which became the absolute reference point in global relations.

This came under threat during the 1980s when the spread of cheap communications and international transport allowed trans-national corporations to globalise the production of goods and services.

This dwarfed the impact of the earlier globalisation of trade in terms of its social and economic impacts. Importantly, the globalisation of trade enhanced the powers of governments while the globalisation of production enhanced the power of trans-national corporations at the expense of government.

Free trade in goods could be sold as a benefit to people. The new globalisation wave in the form of free trade in production, where even labour is treated as a commodity, is promoted by leading industrial nations - Japan, the US and Europe - according to how it advances the interests of their trans-national corporations.

The uneven development of the new wave of globalisation - fast in finance, technology transfer, skilled labour movements and international terrorism and slow in governance, social attitudes, international regulation and the fight against global warming, crime, terrorism and disease - has created winners and losers both within countries as well as between countries.

It is not surprising that the winners want to eliminate the old rules governing trade and commerce and replace them with rules that enhance market relations at the expense of government mediation.

The new trade agreements are fundamentally undemocratic. The negotiations are conducted in secret and the agreements are structured in a way that will make it virtually impossible for future governments to rescind agreements that are found to be unpopular.

Behind the mantra of the superiority of the market - reinforced by privatisation, low taxes and small government - is the aim of shifting the decision-making process from the one-person, one-vote democratic formula to the one-dollar, one-vote market formula.

Hence the secrecy surrounding the negotiations of the new Trans-Pacific Partnership Agreement (TPPA), which began in Melbourne two weeks ago. The agreement is designed to replace a number of individual bilateral free trade agreements with an agreement embracing Australia, the US, NZ, Chile, Singapore, Brunei, Peru and Vietnam.

As the Australian Fair Trade and Investment Network - which represents a wide range of union, church, health, environment and pensioner groups - points out, US business wants to dismantle the Pharmaceutical Benefits Scheme, local-content rules for the media, labelling of GE food, regulation of foreign investment and government purchasing policies that support local employment. They also want an investor complaints process that will give special rights to international corporations to sue governments for damages if legislation to protect the environment or human health undermines profitability.

The government says that all these issues ''are on the table for negotiation''. Why? Well, that's a secret. Further, any agreement made under this process will be signed off by cabinet before it is presented to parliament as a fait accompli apart from ''procedural'' matters requiring parliament legislation.

The Howard government put Australian conditions restricting the right of employers to bring to Australia temporary skilled and semi-skilled workers on the auction block to be negotiated away in return for market access for Australian exports at the Doha round of multinational trade negotiations in 2005. These negotiations are now in abeyance.

Specifically, the official position is that Australia is prepared to remove the requirement for employers to search for skilled and semi-skilled labour before seeking 457 temporary visas for this kind of labour.

The unions justifiably saw this as a union-busting exercise and extracted a promise from the then Labor opposition to remove this proposal from the Australian offer to the stalled Doha round.

Prime Minister Kevin Rudd agreed to this request and it was written into the ALP platform before the election.

Under the influence of the Department of Foreign Affairs and Trade, the government has made a policy decision that it will not withdraw the offer on the grounds that it would amount to ''bad faith'' if it were to do so.

A former Australian prime minister, John Gorton, said that the department was infected by the puppy dog syndrome, that is: roll over and get your tummy tickled. It still is.

As this assault on national sovereignty continues, the question is whether the ''market system'' can fill the vacuum as the power of the state withers away. Certainly markets require the rule of law to function otherwise they become mafia systems, as has occurred in Eastern Europe.

Meanwhile, there's an uneasy feeling that nobody is in charge. The global financial crisis occurred for this reason.

http://www.smh.com.au/opinion/politics/ ... -r536.html
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BWV 1080
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Re: Global corporate elite seeks to destroy democracy

Post by BWV 1080 » Wed Apr 21, 2010 10:28 am

unless the anti-liberalization crowd can address this:


Image


I will continue to ignore their stupid rantings

you are aware that the last 20 years has seen the largest movement out of extreme poverty in all human history, all due to global capitalism

Kevin R
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Re: Global corporate elite seeks to destroy democracy

Post by Kevin R » Wed Apr 21, 2010 11:27 am

BWV 1080 wrote:unless the anti-liberalization crowd can address this:


Image


I will continue to ignore their stupid rantings

you are aware that the last 20 years has seen the largest movement out of extreme poverty in all human history, all due to global capitalism
Steve,

So true. But you know the nutty left; facts will not dissuade them from their prepared narrative against free market capitalism.
"Free trade, one of the greatest blessings which a government can confer on a people, is in almost every country unpopular."

-Thomas Macaulay

BWV 1080
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Re: Global corporate elite seeks to destroy democracy

Post by BWV 1080 » Wed Apr 21, 2010 1:33 pm

Image

Image

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HoustonDavid
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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Wed Apr 21, 2010 4:06 pm

I am delighted to see the world catching up to the wealthier countries of the world. That
is very encouraging, but:

What about our huge shift in wealth from the middle class to the wealthiest class over the
last 30 years? It looks like the old adage "the rich get richer and the poor - in this case, the
middle class - get poorer, much poorer. When I graduated from University in 1972, I was
offered a salary of $10,000/year by my first employer, including the usual benefits like free
health insurance and retirement account, amounting to an added benefit estimated at 25%.
My wife was able to stay at home and raise our two adopted boys, and we added a daughter
to the family mix a year later. We sometimes struggled, but my salary kept pace with inflation
and I had generous promotions, which allowed us to continue as a one-earner family for
several more years.

Now, thanks to a lovely system of trickle-down economics introduced in the '80s, almost no
family can subsist on a one-earner income. Thanks to NOW and Women's Liberation, ladies
could join the labor force in ever-growing numbers, and supplement the family income to keep
pace with inflation and requirements for family sustenance. It has become a necessity, not a
luxury for both partners to work. How does your economic model answer the income reduction
enforced by the "rich get rich" model we are currently living under here in the United States,
Canada, and the European Union? We can't all get a seat on the exchange and draw multi-
million dollar bonuses, even if we wanted to.
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

BWV 1080
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Re: Global corporate elite seeks to destroy democracy

Post by BWV 1080 » Wed Apr 21, 2010 4:26 pm

David,

There is no doubt that the income distribution has become more unequal over the past 40 years (in the context of gains in income for all groups). But I question the ability of elected policy makers to have changed that outcome. The loophole-ridden extremely high marginal after WW2 (90% until JFK cut it to 70% where it stayed until Reagan) discourage productive investment. American manufacturing would have declined in the face of Asian competition regardless of any policy response from Washington. The decline and move toward service jobs was a primary driver of the lower growth in real per capita income for lower wage groups. Business regulation quickly becomes captive to special interests rather than the public as a whole, so you have tariffs for sugar farmers or steel makers that actually hurt the overall economy (there were far more american business that consume steel than manufacture it, so Bush's steel tariff was simply corporate welfare for one group at the expense of others). What is clear is that globalization has offered a path out of abject poverty for millions around the world. As there is no absolute poverty to speak of in the US or any other Western country, the cost of this has not been significant in human terms.

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piston
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Re: Global corporate elite seeks to destroy democracy

Post by piston » Wed Apr 21, 2010 4:33 pm

And the current dual realities of a struggling recession-level economy in the USA, as shown in unemployment, part-time employment with no benefits, house foreclosures, on one hand, and Wall Street investors recovering nicely, thank you, signals that the future belongs to investors! As for workers, well, that's another story.....
In the eyes of those lovers of perfection, a work is never finished—a word that for them has no sense—but abandoned....(Paul Valéry)

HoustonDavid
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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Wed Apr 21, 2010 4:43 pm

I'm glad my adequate salaries over the years have allowed me a modest but healthy retirement,
and Social Secuity, Medicare and subsidized housing meet my needs and take care of my cat Sadie.
I can even afford and occasional addition to my DVD and CD music collections. :D I am worried
about my now-grown children and their future, however; my daughter lives in Canada, so she is
probably OK, but my sons have it a lot tougher with weak job skills and an even weaker job market.
Their future is bleak, and their legacy from my estate will be my DVDs and CDs, God bless 'em.
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

piston
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Re: Global corporate elite seeks to destroy democracy

Post by piston » Wed Apr 21, 2010 5:39 pm

I am worried
about my now-grown children and their future, however; my daughter lives in Canada, so she is
probably OK, but my sons have it a lot tougher with weak job skills and an even weaker job market.
Their future is bleak, and their legacy from my estate will be my DVDs and CDs, God bless 'em.
Same here. The greater the number of children and grand-children, the more intense the worries.
In the eyes of those lovers of perfection, a work is never finished—a word that for them has no sense—but abandoned....(Paul Valéry)

HoustonDavid
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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Wed Apr 21, 2010 9:12 pm

The problem with "investors" is they produce nothing but money, which they seem disinclined
to loan or share - so much for "trickle down". The banks are raking it in but not giving it out,
and there are only so many seats on the stock exchange and I hear they are very expensive.
Let's see, if all of us quit working and became at-home investors instead of producers of what-
ever stripe, "playing" the stock market, what are the chances we will all get millions of dollars in
bonuses? What would happen to the economy if everyone quit their real jobs and became
"investors"? Somehow - I have no idea how - I don't think that would work. :mrgreen:
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

DavidRoss
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Re: Global corporate elite seeks to destroy democracy

Post by DavidRoss » Thu Apr 22, 2010 5:09 pm

HoustonDavid wrote:The problem with "investors" is they produce nothing but money, which they seem disinclined
to loan or share - so much for "trickle down". The banks are raking it in but not giving it out,
and there are only so many seats on the stock exchange and I hear they are very expensive.
Let's see, if all of us quit working and became at-home investors instead of producers of what-
ever stripe, "playing" the stock market, what are the chances we will all get millions of dollars in
bonuses? What would happen to the economy if everyone quit their real jobs and became
"investors"? Somehow - I have no idea how - I don't think that would work. :mrgreen:
Investment is what provides the wherewithal for businesses to start, to grow, to take risks, to create jobs and the goods and services that are the substance of the economy. If you have a pension plan, if you have shares in a mutual fund, or an insurance annuity, or buy bonds or CDs or even put money into a savings account, you are an investor.
"Most men, including those at ease with problems of the greatest complexity, can seldom accept even the simplest and most obvious truth if it would oblige them to admit the falsity of conclusions which they have delighted in explaining to colleagues, which they have proudly taught to others, and which they have woven, thread by thread, into the fabric of their lives." ~Leo Tolstoy

"It is the highest form of self-respect to admit our errors and mistakes and make amends for them. To make a mistake is only an error in judgment, but to adhere to it when it is discovered shows infirmity of character." ~Dale Turner

"Anyone who doesn't take truth seriously in small matters cannot be trusted in large ones either." ~Albert Einstein
"Truth is incontrovertible; malice may attack it and ignorance may deride it; but, in the end, there it is." ~Winston Churchill

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Chalkperson
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Re: Global corporate elite seeks to destroy democracy

Post by Chalkperson » Thu Apr 22, 2010 5:21 pm

DavidRoss wrote:
HoustonDavid wrote:The problem with "investors" is they produce nothing but money, which they seem disinclined
to loan or share - so much for "trickle down". The banks are raking it in but not giving it out,
and there are only so many seats on the stock exchange and I hear they are very expensive.
Let's see, if all of us quit working and became at-home investors instead of producers of what-
ever stripe, "playing" the stock market, what are the chances we will all get millions of dollars in
bonuses? What would happen to the economy if everyone quit their real jobs and became
"investors"? Somehow - I have no idea how - I don't think that would work. :mrgreen:
Investment is what provides the wherewithal for businesses to start, to grow, to take risks, to create jobs and the goods and services that are the substance of the economy. If you have a pension plan, if you have shares in a mutual fund, or an insurance annuity, or buy bonds or CDs or even put money into a savings account, you are an investor.
Yep, that's the truth all right, i'm incredibly conservative with our Corporate Pension Plan, we worked so hard for so many years that the idea of "gambling" it makes me very concerned, I have no choice but to put a certain amount in some kind of investment plan, personaly i'm much happier to keep it in gold..my friend Peter is Pink Floyd's Publisher, I have known him more than 35 years, he always had his money in gold, when I was young I thought he had it in a vault...hahaha...now I know differently... :wink:
Sent via Twitter by @chalkperson

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Re: Global corporate elite seeks to destroy democracy

Post by jbuck919 » Thu Apr 22, 2010 5:27 pm

Chalkperson wrote: Yep, that's the truth all right, i'm incredibly conservative with our Corporate Pension Plan, we worked so hard for so many years that the idea of "gambling" it makes me very concerned, I have no choice but to put a certain amount in some kind of investment plan, personaly i'm much happier to keep it in gold..my friend Peter is Pink Floyd's Publisher, I have known him more than 35 years, he always had his money in gold, when I was young I thought he had it in a vault...hahaha...now I know differently... :wink:
He keeps it under his bed?

There's nothing remarkable about it. All one has to do is hit the right keys at the right time and the instrument plays itself.
-- Johann Sebastian Bach

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Re: Global corporate elite seeks to destroy democracy

Post by Chalkperson » Thu Apr 22, 2010 5:35 pm

jbuck919 wrote:
Chalkperson wrote: Yep, that's the truth all right, i'm incredibly conservative with our Corporate Pension Plan, we worked so hard for so many years that the idea of "gambling" it makes me very concerned, I have no choice but to put a certain amount in some kind of investment plan, personaly i'm much happier to keep it in gold..my friend Peter is Pink Floyd's Publisher, I have known him more than 35 years, he always had his money in gold, when I was young I thought he had it in a vault...hahaha...now I know differently... :wink:
He keeps it under his bed?
Actually it's all coins that are under his mattress, he says it makes sleeping very uncomfortable... :lol:
Sent via Twitter by @chalkperson

HoustonDavid
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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Thu Apr 22, 2010 5:48 pm

I'm not unaware of "basic" economics, David. My post was intended as a rather cynical view of
that very same economy. In fact, "little guy" investors - like Chalkie - generally lost a shirt or
two in the economic downturn (although gold seems to have been safe). "Investors" as defined
by Wall Street brokers didn't exactly suffer and the Main Street "investors" took it in the shorts.
The surge in stock prices is encouraging for all investors, large and small, but where are the
investment dollars that should be going to the "businesses to start, to grow, to take risks, to
create jobs and goods and services that are the substance of the economy."??? And Chalkie,
hasn't the value of gold reached the level where buying more is a poor investment???
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

JackC
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Re: Global corporate elite seeks to destroy democracy

Post by JackC » Thu Apr 22, 2010 5:53 pm

HoustonDavid wrote:
.... but where are the investment dollars that should be going to the "businesses to start, to grow, to take risks, to create jobs and goods and services that are the substance of the economy."???

Haven't you been keeping up???? Obama is going to get all of those dollars from the fat cat rich so he can pay for Obamacare. :lol:

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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Thu Apr 22, 2010 5:56 pm

I have a hunch Chalkie will keep his mattress stuffed.
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

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Re: Global corporate elite seeks to destroy democracy

Post by Chalkperson » Thu Apr 22, 2010 6:05 pm

HoustonDavid wrote:I'm not unaware of "basic" economics, David. My post was intended as a rather cynical view of
that very same economy. In fact, "little guy" investors - like Chalkie - generally lost a shirt or
two in the economic downturn (although gold seems to have been safe). "Investors" as defined
by Wall Street brokers didn't exactly suffer and the Main Street "investors" took it in the shorts.
The surge in stock prices is encouraging for all investors, large and small, but where are the
investment dollars that should be going to the "businesses to start, to grow, to take risks, to
create jobs and goods and services that are the substance of the economy."??? And Chalkie,
hasn't the value of gold reached the level where buying more is a poor investment???
I only have a certain amount of Gold, and i'm about the only person who never lost a cent in the downturn, my investment philosophy actually turned out pretty good, my Broker was very impressed, the only thing that went down were our two properties, but, we own one outright and the other is a relatively low mortgage given it's value in the NYC Marketplace...
Sent via Twitter by @chalkperson

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Re: Global corporate elite seeks to destroy democracy

Post by DavidRoss » Thu Apr 22, 2010 6:44 pm

HoustonDavid wrote:I'm not unaware of "basic" economics, David. My post was intended as a rather cynical view of
that very same economy. In fact, "little guy" investors - like Chalkie - generally lost a shirt or
two in the economic downturn (although gold seems to have been safe). "Investors" as defined
by Wall Street brokers didn't exactly suffer and the Main Street "investors" took it in the shorts.
The surge in stock prices is encouraging for all investors, large and small, but where are the
investment dollars that should be going to the "businesses to start, to grow, to take risks, to
create jobs and goods and services that are the substance of the economy."??? And Chalkie,
hasn't the value of gold reached the level where buying more is a poor investment???
Obama/Pelosi/Reid's focus on "stimulus" pork and health care "reform" and threats to raise taxes have kept the investment climate pretty damned iffy and have kept credit tight.
"Most men, including those at ease with problems of the greatest complexity, can seldom accept even the simplest and most obvious truth if it would oblige them to admit the falsity of conclusions which they have delighted in explaining to colleagues, which they have proudly taught to others, and which they have woven, thread by thread, into the fabric of their lives." ~Leo Tolstoy

"It is the highest form of self-respect to admit our errors and mistakes and make amends for them. To make a mistake is only an error in judgment, but to adhere to it when it is discovered shows infirmity of character." ~Dale Turner

"Anyone who doesn't take truth seriously in small matters cannot be trusted in large ones either." ~Albert Einstein
"Truth is incontrovertible; malice may attack it and ignorance may deride it; but, in the end, there it is." ~Winston Churchill

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HoustonDavid
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Re: Global corporate elite seeks to destroy democracy

Post by HoustonDavid » Thu Apr 22, 2010 11:40 pm

It must be nice to take home millions in bonuses from your bank and Wall Street employers
and laugh at the peons asking for credit because you're are afraid of new taxes on your wealth,
stimulus dollars you might not have to repay, and a few million people getting health care for
the first time without having to use the emergency room.
"May You be born in interesting (maybe confusing?) times" - Chinese Proverb (or Curse)

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Re: Global corporate elite seeks to destroy democracy

Post by DavidRoss » Fri Apr 23, 2010 7:34 am

HoustonDavid wrote:It must be nice to take home millions in bonuses from your bank and Wall Street employers and laugh at the peons asking for credit because you're are afraid of new taxes on your wealth, stimulus dollars you might not have to repay, and a few million people getting health care for the first time without having to use the emergency room.
Government, regardless of the majority party, works for the ruling class. The ruling class enriches itself at the expense of the lower classes. Government is the instrument that effects and protects this transfer of wealth.

Both major political parties use populist rhetoric to con the electorate into believing they serve "the people" rather than the rich and powerful. They do not.

The sheep can best protect themselves from the predators by restricting their power. That means restricting the power of government to serve the predators' interests at the public's expense.

Furthermore, if government is not kept on a restrictive diet, such as the one prescribed in the U.S. Constitution, it grows fat. It becomes a parasite, sucking as much blood from the body politic as possible without killing its host. Rather than solving problems, it perpetuates them, by "managing" them for the sake of its own self-serving interest and the interests of the ruling class whom it really serves.

Just because politicians are adept at the rhetoric of class warfare does not mean they really serve the interests of those whose hatred they seek to mobilize at the polls. Remember, confidence games depend on the suckers believing the con artists' sweet-sounding but false promises. And remember the time-tested strategy of "divide and conquer."

What follows is an earlier post of mine quoted verbatim from another thread:
DavidRoss wrote:Well, in the 2008 elections, Goldman Sachs gave $4,463,766 to Democrats (including nearly $1 million to Obama) and $1,459,961 to Republicans (nearly a quarter of a million to McCain). http://www.opensecrets.org/orgs/summary ... D000000085 (http://www.opensecrets.org/pres08/contr ... cycle=2008)

And, of course, a noted Obama administration appointee was Goldman Sachs lobbyist Mark Patterson, named by Tim Geitner as his chief of Staff at Treasury. http://www.whorunsgov.com/Profiles/Mark_Patterson

And as BigNewsBiz reported last June:
Goldman Sachs Gets Multi-Billion Dollar Payback for Backing Obama

So what is the best investment in America? Buy a president. Just ask Goldman Sachs who secretly decided long before last year's election that the one candidate who could keep them from bankruptcy, who would allow them to cover up billions of dollars in bad mortgage loans and ignore oil price manipulation was the promising junior senator from Illinois.

As reported over and over the past three years in this paper, Goldman met secretly with Obama long before the election and decided Obama was the one. They helped raise millions of dollars for Obama and guided him throughout the campaign planting former Goldman executives throughout the Obama campaign and new Administration to help assure they got what they wanted.
http://www.bignews.biz/?id=804337&keys= ... nipulation

Even The Huffington Post's Bob Ostertag is a little upset by the coziness between Goldman (and other Wall Street firms) and the man who promised to change Washington business as usual:
Bob Ostertag for The Huffington Post wrote: When Barack Obama pulled out of public campaign financing, I wrote a column about his money machine, noting that despite all the small Internet donors, his campaign is still mostly funded in the most traditional of ways. Numerous readers taking offense at my characterization of Obama's fundraising as dominated by "fat cats." In light of new details on Obama's fundraising which have become available, now would be a good time to revisit this issue.

I noted that that, by the end of June, Wall Street had already given Obama $9.5 million, that four out of his top five contributors are employees of financial industry giants, with Goldman Sachs at the top of the list. Even conservative New York Times columnist David Brooks was appalled: "Over the past few years, people from Goldman Sachs have assumed control over large parts of the federal government. Over the next few they might just take over the whole darn thing."

The reader response was overwhelmingly negative. The debate was over which was more significant: the half of Obama's money that came in small Internet contributions, or the half that came from big corporate money. I argued that:

adding a layer of small Internet donations (45% of Obama's money) on top of all the traditional campaign money (55% of Obama's money) does not change the game of politics and money. It just adds another layer to the same old cake. To really change the game, one would need to replace all that traditional money with small Internet donations. ... Just think through the basics: if on one side you have over a million people giving you little donations that make up 45% of your budget, and on the other side you have a handful of people giving you big donations that make up 55% of your budget, whose telephone calls are you going to take?
http://www.huffingtonpost.com/bob-oster ... 77611.html

If Henry's right, the new broom has suddenly decided it's in his interest to bite the hand that feeds it. Of course, the broom understands quite well that in some respects, perception is everything.
"Most men, including those at ease with problems of the greatest complexity, can seldom accept even the simplest and most obvious truth if it would oblige them to admit the falsity of conclusions which they have delighted in explaining to colleagues, which they have proudly taught to others, and which they have woven, thread by thread, into the fabric of their lives." ~Leo Tolstoy

"It is the highest form of self-respect to admit our errors and mistakes and make amends for them. To make a mistake is only an error in judgment, but to adhere to it when it is discovered shows infirmity of character." ~Dale Turner

"Anyone who doesn't take truth seriously in small matters cannot be trusted in large ones either." ~Albert Einstein
"Truth is incontrovertible; malice may attack it and ignorance may deride it; but, in the end, there it is." ~Winston Churchill

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DavidRoss
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Re: Global corporate elite seeks to destroy democracy

Post by DavidRoss » Fri Apr 23, 2010 7:44 am

Last night on PBS News Hour, Jeffrey Brown and Judy Woodruff interviewed Larry Summers (Director of Obama's National Economic Council) and Robert Kelly (CEO of BNY Mellon) about regulatory reform of the finance industry. Both interviews were interesting and informative.

Video and transcripts here:

Brown/Summers: http://www.pbs.org/newshour/bb/business ... 04-22.html

Woodruff/Kelly: http://www.pbs.org/newshour/bb/business ... 04-22.html

Although I generally respect Summers, I was dismayed by how he ducked Brown's tough and pointed question about the role he played for then President Clinton in deregulating the derivatives market, a major contributing factor in the meltdown. The following excerpt from the wikipedia article on Summers addresses that matter:
Wikipedia wrote:Summers' role in the deregulation of derivatives contracts

On May 7, 1998, the Commodity Futures Trading Commission (CFTC) issued a Concept Release soliciting input from regulators, academics, and practitioners to determine "how best to maintain adequate regulatory safeguards without impairing the ability of the OTC (Over-the-counter) derivatives market to grow and the ability of U.S. entities to remain competitive in the global financial marketplace." [18] On July 30, 1998, then-Deputy Secretary of the Treasury Summers testified before congress that "the parties to these kinds of contract are largely sophisticated financial institutions that would appear to be eminently capable of protecting themselves from fraud and counterparty insolvencies." Summers, like Greenspan and Rubin who also opposed the concept release, offered no proof that the contracts would not be misused by financial institutions. Instead, Summers stated that "to date there has been no clear evidence of a need for additional regulation of the institutional OTC derivatives market, and we would submit that proponents of such regulation must bear the burden of demonstrating that need." [19] This argument suggests that the default position in the disagreement was that Summers, Greenspan, and Rubin were right, and that anyone (i.e., Brooksley Born) who disagreed with them bore the burden of proving their position. In fact, subsequent events have proven that Summers, Rubin, and Greenspan misjudged the dangers posed by derivatives contracts.

The lack of regulation that allowed A.I.G. to sell hundreds of billions of dollars in credit default swaps on mortgage-backed securities was a direct result of efforts by the Treasury (first under Rubin and then under Summers), the Federal Reserve (under Greenspan), and the Securities and Exchange Commission (under Arthur Levitt) to deregulate the derivatives markets. The first response to the CFTC Concept Release was issued as a joint statement from Rubin, Greenspan, and Levitt who stated that they "have grave concerns about this action and its possible consequences." [20] Levitt and Greenspan have admitted that their views on this issue were mistaken. Levitt told WGBH in Boston that "I could have done much better. I could have made a difference." Greenspan told a congressional hearing that "I found a flaw ... in the model that I perceived is the critical functioning structure that defines how the world works." [21] [22] When George Stephanopoulos asked Summers about the financial crisis and in an ABC interview on March 15, 2009 Summers replied that "there are a lot of terrible things that have happened in the last eighteen months, but what’s happened at A.I.G. ... the way it was not regulated, the way no one was watching ... is outrageous." http://en.wikipedia.org/wiki/Lawrence_Summers
Of interest also was Robert Kelly's dismissal of derivative deregulation as the major cause of the meltdown. Instead, he claimed (correctly) that:
Robert Kelly wrote:...the single biggest problem that happened in the United States is not being dealt with in this package [of proposed reforms]. The single biggest problem was the residential mortgage product in the United States and the role of Fannie and Freddie in the GSEs.

We have a mortgage system that's completely broken in the United States, and that's not scheduled to be dealt with until next year.
"Most men, including those at ease with problems of the greatest complexity, can seldom accept even the simplest and most obvious truth if it would oblige them to admit the falsity of conclusions which they have delighted in explaining to colleagues, which they have proudly taught to others, and which they have woven, thread by thread, into the fabric of their lives." ~Leo Tolstoy

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