Current Account Balance (Or Why It's No Longer a Unipolar World) & The Fraudulent Panic on Wall Street

Is Scarah gone yet? I'm counting down the days. And not only I, but several prominent Rethugs are also crossing their fingers that she will disappear from the ticket.

Trust me when I tell you that you don't want to look at the Current Account Balance as of September 2008 for the countries of the world. And particularly, you don't want to look down at the bottom of the list (Number 188, folks!) to notice where the U.S. reigns at (da da!) $ -738,600,000,000. (Notice how it approximates the amount that Paulson is extorting for the first round of "Bail My Friends and Me Out and We'll Allow You a Few Exorbitantly High-Interest Loans in the Future (Maybe)" except that it has a minus sign in front of it?)

But wait. That's only for up until the end of 2007, (and you know that the (multiple) wars' debts are not included there (because no one knows exactly how much is already rung up on that cash register)). What must it be for 2008, up to this weekend's "The End of the World (or Financial World, at least) As We Have Known (Thought, anyway) It?"

It should pain the "Freedom Fries" set to know that France, Italy and even the UK are behind us on the "going out of business" list (the UK is the closest, lucky them, and they can thank Tony Blair, man of the hour!). The best part for those Unipolar-World-with-the-U.S.-as-#1 believers is that China (on the list) is #1 with $360,700,000,000 (Yes, that's in the Plus Column), Japan #2 with $212,800,000,000 , Germany #3 with $185,000,000,000, Saudia Arabia #4 with $100,800,000,000, and I won't bore you with #5's plus figure (Russia!). How did this happen? (And I am feigning ignorance here.) Don't worry. No one's asking yet. And the money men are far too busy figuring out the next neato plan to extort the money required to start the next new bubble from the ignorant Americans to give interviews (and they never will until they are under subpoena). Party on, Garth! And don't let Greg Palast (our "American" British reporter) spoil the party with his latest exposé that Rover boy has already stolen the 2008 election. There's also a fine bit of reporting on the missing Rove emails (he's got 500 of them) and the plan (written in Houston by a Jim Baker concern) for Iraq's oil. Please take a few moments and watch or read it. I guarantee you it is worth your while. ________________________________________ Jeff Randall has written a pithy essay in The Telegraph about the "Economic Chain Gang." In not trusting the perpetrators of the fraud to fix it by pretending to tighten regulations again, he says "We do not need more regulation, but more appropriate regulation."

"To preserve their [the people's] independence, we must not let our rulers load us with perpetual debt. We must make our selection between economy and liberty, or profusion and servitude" - Thomas Jefferson There was a time, early in America's history, when its leaders believed in financial discipline. No more. Perpetual debt, which Jefferson feared would enslave future generations, is clamped on Uncle Sam's undercarriage like a ball and chain. US public borrowing is $9.8 trillion - and rising. Jefferson, America's third president (1801-09), is widely regarded as the White House's most intellectually gifted occupant. He believed that "banking institutions are more dangerous to our liberties than standing armies", and that "the principle of spending money to be paid by posterity … is but swindling futurity on a large scale." If Congress approves the Treasury Secretary's $700 billion bail-out of dysfunctional banks, it would be hard to invent a better example of what Jefferson foresaw: authorised "swindling". Tomorrow's Americans and those who come after them will pay and pay for the grotesque excesses and self-indulgence of today's flim-flam merchants. As Jefferson put it: "If we run into such debt, as we must be taxed in our meat and in our drink, in our necessaries and our comforts … [we will have] no means of calling our mis-managers to account but be glad to obtain subsistence by hiring ourselves to rivet their chains on the necks of our fellow sufferers." Having failed to deliver victory in the War on Terror, President Bush is hoping for better luck in the War on Error. His goal is to limit damage from the egregious mistakes of sub-prime mortgages; his tactics are to carpet-bomb the banking system with federal funds. The upshot, in Jeffersonian terms, is that US taxpayers are about to be enrolled in an economic chain gang. The prospect is unappealing, but, we are told, there's no alternative. Hank Paulson's plan offers fewer details than his weekly milk bill, but now, it seems, is no time for nit-picking. Having collected sacks of gold at Goldman Sachs, this former champion of free markets wants to nationalise assets at a pace not seen since Che Guevara was lighting cigars with Batista's legacy. No wonder so many Congressmen look queasy. They must persuade constituents, many of whom are losing jobs and homes in the credit crunch, that it is a bright idea to rescue those who profited hugely from the creation of dark instruments. Not for the first time, Wall Street is bilking Main Street. For those who work in the fast lane of finance, the speed of decline has been ear-popping. Less than a year ago, America's investment banks were wallowing in record bonuses, totalling almost $38 billion. Yes, billion. Their pool of monopoly money was greater than the GDP of Bulgaria. Split among 186,000 workers at Goldman Sachs, Morgan Stanley, Merrill Lynch, Lehman Brothers and Bear Stearns, it equated to an average of more than $200,000 per person, about four times the median US household income. Goldman's chairman, Lloyd Blankfein set a new standard in executive gluttony, collecting $68 million (about one third in cash), but at least his bank is still standing. Richard Fuld, Lehman's chief executive, trousered $41 million. Nice work, except that he took the lot in the bank's shares. Nine months later, when Lehman went bust, Fuld's bonus joined his reputation, in the trash-can. Banking's bacchanalia has morphed into a therapy group for manic depressives. Those still in work look around the room and wonder how many will be flipping burgers by Christmas. In an interview with Fortune magazine, Mr Paulson admits: "Raw capitalism is a dead end. I've seen it." Now I have heard it all. What next?

Read the rest here. _____________________________________________ Remember Ralph Nader? How could you forget this most enigmatic (charismatic?) progressive thinker and writer? If you're a fan, you're gonna love this interview with Juan Gonzalez, Amy Goodman and Arun Gupta at Democracy Now, "Why Is There Need for a Bailout?" and even if you aren't, you might have to admit that he makes some very compelling arguments. Oh, and any time you catch Bush or anyone in his administration saying "I truly do," take a breath and realize that they very truly do not. (Emphasis marks and some editing are mine.)

As the Bush administration intensifies its pressure for Congress to quickly approve a $700 billion bailout of the financial industry, we get reaction from Independent presidential candidate and consumer advocate Ralph Nader. Nader calls Democratic claims of White House concessions “wish fulfillment” and says the bailout might not be needed in the first place. Real Video Stream - Real Audio Stream - MP3 Download JUAN GONZALEZ: The Bush administration is intensifying its pressure on Congress to quickly approve a $700 billion bailout of the financial industry, despite warnings from economists and some governmental officials that the bailout could worsen the financial crisis. Last night, President Bush held a prime-time address to warn the nation’s entire economy is in danger if the bailout is not approved as soon as possible. PRESIDENT GEORGE W. BUSH: The government’s top economic experts warn that without immediate action by Congress, America could slip into a financial panic, and a distressing scenario would unfold. More banks could fail, including some in your community. The stock market would drop even more, which would reduce the value of your retirement account. The value of your home could plummet. Foreclosures would rise dramatically. And if you own a business or a farm, you would find it harder and more expensive to get credit. More businesses would close their doors, and millions of Americans could lose their jobs. Even if you have good credit history, it would be more difficult for you to get the loans you need to buy a car or send your children to college. And ultimately, our country could experience a long and painful recession. Fellow citizens, we must not let this happen. JUAN GONZALEZ: [Wednesday] night’s address was the first time in his presidency that Bush delivered a prime-time speech devoted exclusively to the economy. His dire scenario about the state of the economy stood in stark contrast to his comments at his last press conference two months ago. PRESIDENT GEORGE W. BUSH: I think the system basically is sound. I truly do. And I understand there’s a lot of nervousness, and—but the economy is growing, productivity is high, trade’s up. People are working. It’s not as good as we would like, but—and to the extent that we find weakness, we’ll move. That’s one thing about this administration: we’re not afraid to making tough decisions. AMY GOODMAN: Today, the President is holding an emergency summit at the White House with both John McCain and Barack Obama, as well as top leaders for Congress. The Wall Street Journal reports Democratic leaders are hoping to nail down details of the bailout measure early today. On Wednesday, McCain said he would suspend his campaign to deal with the financial crisis. He called on Obama to postpone their debate Friday night, saying he would only attend if Congress approves a bailout package before then. Obama said the debate in Oxford, Mississippi at Ole Miss should go on as planned. We’re joined on the phone right now by a presidential candidate who was not invited to Friday’s debate, Independent candidate Ralph Nader. The longtime consumer advocate has been a vocal critic of the Wall Street bailout. Ralph Nader, welcome to Democracy Now! First, let’s start off with John McCain announcing that he is going to suspend his campaign and wants the debate cancelled. RALPH NADER: Well, I think Senator McCain is showboating. I mean, what’s going on in Washington and Congress now is the Bush administration is trying to pull the Constitution out by its roots and demand that Congress give it a blank check, without any criteria, without any accountability, for (a) $700 billion bailout of Wall Street. It’s not dependent on whether John McCain returns to Washington other than to vote. I think he’s turning his back on over 50 million American voters who expect him to show up in Ole Miss with Barack Obama and who have made arrangements to do so. He talks a lot about honor and commitment. I think he ought to change his mind and get down to Ole Miss. JUAN GONZALEZ: Ralph, the Democrats are claiming that they’ve been able to get some key concessions from the administration on its original plan. They say now they’re going to be — they’re going to cap CEO pay for those who participate in this bailout and that they’re going to get some kind of government participation or investment in these firms, so that if they make profits later on, that — or these securities make profits later on, that the government will be able to participate. But your sense — are these real substantive changes, or is this basically cosmetics on a plan that shouldn’t be in place in the first place? RALPH NADER: Well, so far, it’s wish fulfillment. If you watch what Barney Frank, the chairman of the House Banking Committee, said yesterday, nothing has really been decided. And also, it’s not clear at all why a bailout is needed. That’s part of the stampede in the pack and the panic that Bush and Paulson and Bernanke are pushing Congress toward. You know, it’s eerily reminiscent, when you listen to Bush yesterday, of how he stampeded the Congress and the country into the criminal war invasion of Iraq in 2003. I mean, look at all his statements: this could do this, this would do that, farms failing, small business, tada, tada. The first question we have to ask as citizens is, why is there a need for a bailout? The only conceivable purpose of Treasury intervention, said Roger Lowenstein in The New Republic recently, quote, "is to buoy the market using taxpayer funds by paying higher-than-market prices. After all, if the government merely intended to match the market, what would be the point?” end-quote. In other words, if these mortgage-backed securities are distressed, well, they’re going to fetch a lower price. There’s huge amount of money on the sidelines in Wall Street, everybody admits that. So, as a hedge fund manager basically said, look, if the price comes down lower than what the government is trying to keep elevated, we’ll buy this paper. Warren Buffett put $5 billion into Goldman Sachs this week. There’s a lot of money to go around. It’s quite interesting how the Bush regime is creating its own panic. When the government keeps saying Chicken Little, Chicken Little, the market is going to react in a very nervous manner. It’s a reversal of what the government usually does, which is to counsel stability and patience, etc. So, the first question Congress should ask in detailed hearings, which aren’t occurring, is simply, why is there need for a bailout? Second is, if there is a need for a bailout, why $700 billion? And third, if there is a need for a bailout, what kind of bailout? Taxpayer equity? So the taxpayer can recover if these companies make a profit, they can recover surplus, perhaps the way they did on the taxpayer bailout in 1979 with Chrysler, where Jimmy Carter demanded that Chrysler issue stock warrants to the Treasury, and Chrysler turned around, and the Treasury sold the warrants for a $400 million profit. AMY GOODMAN: We’re talking to Independent presidential candidate Ralph Nader. We’ll come back to this discussion. We’ll also be joined by Arun Gupta, who is the editor of The Indypendent and put out a letter on the internet that has just set the internet on fire, calling for a major protest today on Wall Street. It has gained steam. Many groups have signed on. JUAN GONZALEZ: Ralph, you mention how the Democrats themselves are being stampeded at this point by the Bush administration. In my column in the Daily News yesterday, I raised how another Democratic leader and another Democratic Congress handled a situation, even a more dire situation, in 1933, on the two days after Franklin Delano Roosevelt was inaugurated as president, with thousands of banks crashing at that point, and he immediately shut down all the banks on his second day in office, called Congress into an emergency session and, over the next hundred days, adopted incredible legislation, including the Glass-Steagall Act, that we’ve mentioned quite often, on federal deposit insurance, aid to homeowners, farm subsidies, created the Tennessee Valley Authority, all in the midst of a crisis, probably the most progressive amount of legislation in the nation’s history, in any period. That’s a quite different approach. And he specifically criticized the banks and Wall Street as being at the root of the crisis. RALPH NADER: That’s right. In those days, they had a serious solvency problem for these banks, which they don’t have, by and large, today. And that was admitted by Bernanke yesterday. Basically, Bernanke is saying, “Well, we’re doing this because the banks are contracting their credit, and this is affecting the economy.” Well, you can deal with that problem in a far better way than an ill-defined $700 billion bailout with total authority to the Treasury Secretary, with no judicial review, with no criteria and no reforms. In other words, the Democrats should say, if they’re going to concede this bailout, is to say, “Well, we want comprehensive regulation and disclosure of the financial industry to make sure this doesn’t happen again. We want criminal prosecution of the crooks on Wall Street and disgorgement of their ill-gotten gains. We want a securities derivative tax and higher margin requirements to make speculators use their money, more of their money than other people’s money, like worker pension funds, to keep down speculation, as well as to produce revenues, which might lighten the tax load on working families. And we want to give shareholders control over the corporations they own.” And they’re not even talking about these kinds of reforms. And this is the best time to get these reforms, because this is called a must bill on Congress—in Congress, and if Bush wants his package, he’s going to have to sign them. So, there’s no reciprocity here. It’s the usual fairly good questions by the Democrats at the hearings, but because they don’t follow through, they don’t have adequate leadership, it becomes a kind of posturing. It’s just maddening to watch how vague Bernanke and Paulson are in answering one question after another. It’s just an evasion, where they keep saying, “We need to do it. We need to do it.” And their Chicken Little material is conducted in closed session with Harry Reid and Nancy Pelosi and the Republican leadership. It’s always in closed session.

Read the rest here. _________________________________________ And don't forget this little news item:

Pre-election Militarization of the North American Homeland. US Combat Troops in Iraq repatriated to "help with civil unrest" by Michel Chossudovsky The Army Times reports that the 3rd Infantry’s 1st Brigade Combat Team is returning from Iraq to defend the Homeland, as "an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks." The BCT unit has been attached to US Army North, the Army's component of US Northern Command (USNORTHCOM). (See Gina Cavallaro, Brigade homeland tours start Oct. 1, Army Times, September 8, 2008). "Beginning Oct. 1 for 12 months, the 1st BCT will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks." It is not the first time an active-duty unit has been tapped to help at home. ... But this new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities. After 1st BCT finishes its dwell-time mission, expectations are that another, as yet unnamed, active-duty brigade will take over and that the mission will be a permanent one.

And the American sheeple just LET IT HAPPEN. Batten down the hatches for Black Tuesday! Suzan