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Taxpayer fleecing must be stopped

12 Comments
By Ed Koch

Apparently, even under a forward looking, honest, able and liberal president, the forces of government are such that the public -- like sheep meeting the shears -- is being fleeced again.

The average citizen is terrified about the future and does not fully comprehend the implications of all of the bailout money - trillions of dollars - that is being handed out to the business institutions. Those in charge of the carnage are telling the American people that we do not have the right to know how or where those trillions will end up. Because of public outrage over AIG, which has received $170 billion in bailout funds, this week AIG released a partial list of the companies receiving TARP money, a list that includes Goldman Sachs, Merrill Lynch, Citigroup, Bank of America and Wachovia. While the payments are apparently legitimate, the attempted cover-up was infuriating.

Remember the phrase from the Nixon years and Watergate - follow the money. Well, it still applies. Prior to the release of the partial list of names, the Secretary of the Treasury and the Chairman of the Federal Reserve, who knew where the money was going, told us that it is "proprietary information" and not publicly available. Only the proprietor - the owner - should have that information.

When banks lend money to you, the consumer, they can and do put restrictions on what you can do with it. What is worse, in this case, is that as a result of our pushing money into the coffers of institutions like AIG, the American public have become the real owners of those companies, and we have a right to know. We were promised transparency by the Obama administration.

The New York Times this week reported on another outrage relating to AIG. That company which has now, according to the Times of March 15, "received more than $170 billion in taxpayer bailout money from the Treasury and Federal Reserve, plans to pay about $165 million in bonuses by Sunday to 400 executives in the same business unit that brought the company to the brink of collapse last year."

Treasury Secretary Tim Geithner "told the firm they were unacceptable and demanded they be renegotiated, a senior administration official said. But the bonuses will go forward because lawyers said the firm was contractually obligated to pay them." Adding to the insult to the public is the revelation that "The payments to AIG's troubled financial products division are in addition to $121 million in previously scheduled bonuses for the company's senior executives and 6,400 employees across the sprawling corporation."

These are the very reasons AIG should have been forced into bankruptcy before the bailout. No bankruptcy court would have permitted the bonuses to be paid or those granted bailout payments protected with anonymity. Remember who now owns AIG. According to the Times "AIG, nearly 80% of which is now owned by the government..." and the new chairman, Edward M Liddy, is "government-appointed" In effect, a government owned and operated private sector company is giving out government tax dollars like there is no tomorrow, while trying to bar transparency.

The Times editorial of March 15 on the subject points out, "The bailouts of American International Group are also rescues of its trading partners - banks and other financial firms - that would have lost out if the insurer had been allowed to fail. But even after four bailouts between last September and this March, no one knows with certainty who those partners are or how much of the bailout money, now totaling $160 billion, has gone to make them whole." As a result of that editorial, we now have been given a partial list by AIG.

The Watchmen - Geithner and Bernanke - have sought to prevent transparency. President Obama trumpets transparency, even promising that the wonders of the Internet will be available for taxpayers to follow all government transactions involving the expenditure of taxpayer money.

Congresswoman Carolyn Maloney plaintively expressed taxpayer concerns when, in response to being told that information concerning the identity of TARP recipients is proprietary information and not available to the Congress, she said, "They have told others it is proprietary information. But we are the proprietors now. Taxpayers own the store, and we should be able to see the books." Indeed.

Where are all the blowhards in Congress who tell us they are protecting the public? Why don't we have a committee comparable to the committee that examined and publicly reported on 9-11? The devastation to the U.S. economy and individual Americans is enormous. Surely this self-inflicted debacle requires an honest reporting on how it happened and who was and is responsible in public office and in the private sector.

A non-Congressional blue ribbon panel should be appointed by the president forthwith while memories are fresh. TIME magazine recently identified 25 people who the magazine believes bear culpability. I have no doubt there are many times that number who, at the very least, deserve public identification and some who should end up in prison. Let's hold the thieves and their enablers accountable.

© RealClearPolitics

©2024 GPlusMedia Inc.

12 Comments
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Nothing new.

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lets not get carried away here....irrespective of the negative image that these legally bound bonuses are attracting, the important issue is that institutions such as AIG and other govn't (state) majority owned firms should be forced to change their bonus practice from this day forward. lets just take this unfortunate bonus story as one of inevitable fall-outs of the behaviours that brought the financial markets down to its knees. Its another part of the learning lesson

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Its another part of the learning lesson

Yes, class, today our topic is Economic Pain 101. Our lesson for today: We have government by the politicians, for the bankers and against the people... In other words,thieves in high places of the lowest caliber. Any questions class?

Q: Yes, I've lost my job and over half my retirement savings in the stock market, what should I do?

T: What ever made you think your money was SAFE in the stock market? Who told you that? What to do for retirement? Take a number, get in line and fill out applications for McDonalds and Wal-Mart. ...Next?

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I thought this was Japan Today..............

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Maybe they are not being transparent because they, uh, can't be. AIG sold over 500 billion worth of credit default swaps. Do the math, if they have to pay out on a big chunk of that insurance, how many trillions are they (they now meaning the USA) on the hook for? How many banks will be able to survive if they don't get their insurance money and have to write-off their AIG backed assets? Geithner and Bernanke seem to be just trying to buy time and hoping for a miracle, they just don't want anybody to know that that is their "strategy".

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With fleecing like that-Who needs a monarchy or dictatorship these days? God save the Queen.

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Jeez... when will the people wake up and realize that they're duping themselves? Taxes are taken by force! We have zero say in how the money is used. And yet some will try to convince me that I am wrong. People, we go straight to the slammer for avoiding one penny in taxes. What on earth makes us so dumb as to believe that we actually have a right to yap about what the fleecer has done with what he fleeced from us? You didn't put up a fight when the grim reaper came collecting, sure as hell you're half witted if you actually think you have a right to tell him how to squander his loot.

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The largest business connection to AIG is said to be Goldman Sachs. That's why they could not allow it to become insolvent before settling CDS (credit default swaps).

But who owns 54 trillion dollars worth of CDS insured by hedge funds? How could they pay hundred times as much as what AIG could not? Geithner and Bernanke have yet to seek to prevent transparency or clear view of the whole spectrum. Otherwise the banks, Central banks and even the states in the world would go bankrupt.

Bailout or not, however, 600 to 700 trillion yens of precious savings of the Japanese people that were entrusted to fund managers of foreign-affiliated financial companies to be invested in New York are now vanishing and will never be returned.

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****This whole story is out of control, is it about

The average citizen is terrified about the future and does not fully comprehend the implications of all of the bailout money - trillions of dollars - that is being handed out to the business institutions.

Or the concern of the AIG Execs doing the right thing to give up thier multi-million dollar bonus's to bailout the company thaey have a contract with?

If the politicians recalled their US history, the crash of 1929 mirror our modern day econmy CRISIS. Between 1921 and 1929, the stock market increased about 300% in value peaking as it did last year. Previously before the crash, investors saw the writing on the wall and began massive sales of stocks and profit taking (executive bonus's).

Sound Familiar yet?

Oct 1929, we enjoyed a big party on Black Friday with the total breakdown of the stock market, banking institutions and the car manufactures. Even the car manufactures knew it was going to happen over a year out due to slumping car sales.

An attempt at recovery of the US economy was started with the New Deal and in particular the National Industrial Recovery Act of 1933, but a relapse happened in 1937. The only way the country came out of its delima was the entry of the United States in the Second world war in 1941.

The market indexes had shown values comparable with those preceding the 1929 only twenty-five years after the crisis.

I dont recall what the government did as a bailout for the banks or major manufacturers, but it may not have been as drastic as what is happening now. The United States will fix itself as time passes. It will not disappear in the bowls of the earth because of the greed of the big companies. And the greed of the speculative investors dumping money they cant afford in stocks, housing, land, etc. The only difference between back then and now is the amount of suicides that occurred because of the way we communicate through media for information.

Final words "Yes We Can"

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Whoops, sorry, one last thing, I dont recall the government buying out the companies to be principle shareholders in the history books. For example, Citi-bank and bank of America, the govt bailed them out because they are the creditt card holders of the government community. Imagine if the US had no interest in those two banks?

Enough said.

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ZZZZZZZZzzzzzzzzzzz..........

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Ultra, I agree, ZZZZZZzzzzzzz........

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