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No Requiem for the Useless

By Ethel Peterson
Opinion | April 18, 2011

man-counting-money-300px-best-size.gifDODGE CITY, Kan. - Let me make this very clear. I am not planning to memorialize somebody or something I never believed in at all. I will not praise "Old Middle of the Road." I never liked him anyway. I am glad if he is really as dead as they say he is.

"Good Riddance!" I say. Our wise Texan friend, Jim Hightower, always says there is nothing in the middle of the road except yellow stripes and dead armadillos anyway. Nevertheless, if one more person tells me that what we need nowadays is more central thinking, less radical left or radical right, I may scream.

What I believe we need is a stronger voice that shouts loudly of the causes we espouse on behalf of people! The center has been so thoroughly moved to the right that anything not spoken with high regard for corporations is now considered "left-wing." It is time to bring back the debate so once again OUR voices can be heard.

The majority of our people apparently believe the lie that this nation is broke; that we have no money. Therefore, we must make slashing cuts in all our "entitlement" programs.

This nation is not broke! Our money is simply in the wrong place - in the pockets of corporations and their billionaire CEOs. Can we prove it? Of course we can. If we read and share the information that is plentiful from dedicated research. Here is my first case in point...

I challenge you to read Matt Taibbi's excellent article, The Real Housewives of Wall Street, in the newest Rolling Stone magazine concerning how the Federal Reserve folks sloshed out the money in the follow-up to the bailouts. We have obviously been conned, and nobody knew until the U.S. Senate finally insisted on having the names of those who received the largess from the taxpayers.

It actually took an act of Congress to force the Fed to release the names to the public. Staffers from the House and the Senate are now examining over 21,000 transactions in the Fed's "shadow budget."

Incredible as it sounds, the Fed sent billions in bailout aid to banks in Mexico, Bahrain, and Bavaria. The Fed made massive purchases of securities in foreign automakers such as Honda, BMW, Volkswagen, Nissan, etc. One might assume that this was to help the US plants of those companies; except for the fact that we were bailing out Chrysler and GM in the US. Does it make sense to aid their competitors?

Also, Muammar Qaddafi received more than 70 loans from the Federal Reserve. The Bahrain bank we sent money to, is owned (59% of it) by the Central Bank of Libya. The US Treasury invoked economic sanctions against Libya, but granted a special exemption to the Central Bank of Libya to keep its assets from being frozen.

Are you outraged yet?

Well, here's another fact. Two women, without any known experience in financial business, became the chief investors in a company called Waterfall TALF Opportunity. They received low interest loans in the amount of 220 million dollars for the purpose of buying up student loans and commercial mortgages. These were supposedly "bad" loans that needed to be taken off the market. But they were the kind of loans, where the government assumes 90% of any loss and the company is liable for the remaining 10%. If there is any gain, the company gets 100%.

Interestingly enough, one of the women was the wife of John Mack, the chairman of Morgan Stanley. The other was her friend, the widow of Peter Karches, the previous president of Morgan Stanley's investment banking division.

As bad as those examples are, the following seem worse. When the "great recession" was happening, there were many people who had overdue mortgages, credit card bills, car loans, etc. Our government was cautioned by the R's not to help them out because that would be socialism. Heaven forbid!

So what did they do instead? They encouraged banks and investment companies to buy up the bad loans and the government would now help the bankers. Apparently that wasn't socialism. Then we developed non-recourse loans. This meant that the government would guarantee the repayment of the loans if the banks would loan to people who needed access to money.

Our government offered interest free loans to the banks and investment companies for that very purpose. Some of them used the money to purchase treasury notes from the government at higher rates of interest. Two senators (Bernie Sanders and Charles Grassley) have requested the names of, and amounts given out in this manner, but so far the Fed has manged to stonewall this information.

With all this, perhaps you'll understand why I think we need to be loud, adamant, and determined to insist that our government is not broke.

We CAN afford to fund Medicare, Social Security, Head Start, higher education, and all the other people programs we seem so hell-bent on destroying.

We can insist that we have a right, indeed a duty, to speak up and demand that we quit this endless welfare for the rich. Let's go back to the great nation we can be --- where our people are our most important product!


Ethel ! You are close to being an embarrassment to the bureaucracy! Keep it up!

When people blame the government programs for the failure of banks, Fannie Mae, etc., they don't acknowledge the fact that those unworkable loans were made and guaranteed by people in the system who didn't follow the intended application of the programs. The lack of regulation and oversight authority is where the problem actually is. What side of the political aisle is deregulating and under funding oversight?

An example: my friend told about the sale of his mother's home.. The lending agency allowed the papers to show $20,000.00 more on the actual amount his mother received. They made it appear that it was a downpayment. That is fraud by the entity that facilitated the loan, not a part of the legitimate regulations of the program. This allowed the purchaser to secure 100% financing for the true cost of the house. The lending agency had a guarantee from the government that protected them on a loan that was backed by fraudulent documentation. Who should be prosecuted and made liable? Should all those involved (seller, buyer, and financer) be held accountable if default is made on the loan, requiring government bailout of the lender? It certainly should not be the taxpayers (rich or poor).

Lack of oversight and accountability is the problem. Neither of our major political parties are aggressively addressing this problem. Could it be because the ultimate beneficiaries (banks and lending companies) are funding the campaigns? The absolute fact is that your $5 campaign contribution, or the $5,000 campaign contribution is buying influence. Are we funding campaigns from a level playing field?

Amen, Ethel. According to this morning's Eagle reporting on a poll, most Americans agree with you. So what's keeping us from fixing this problem?

Wonderfully worded. "For the People, By the People", not "For the Rich, by the Rich". Hey, I might be middle class (one of the few left) but I have rights too!

Ethel- I would challenge everyone to read anything Matt Taibbi writes in Rolling Stone. His articles on the financial bailout and the Tea Party were fascinating, and infuriating. Great post.

This nation is not broke?

(Editors Note: Jonathan, we have deleted most of you comment here because you chose to make your comments too personal - that is - you are criticizing the writer and not the issue. At this site, we do not engage in personal attacks of any kind against writers. Jonathan, please watch this and stick to the issues, avoiding any remarks that could be construed as petty and personal attacks. For more about our commenting policies, Jonathan, please see our FAQ page here.)

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