Uppity Wisconsin

Wasn't that an old Pete Seeger song?

Five minutes with the front page of the NY Times this morning produced two gems:

"I am very excited that there is no oil in the Gulf of Mexico." -- Kent Wells, a BP senior vice president, after announcing BP has capped its leaking well, at least temporarily.  (We'd all be excited if that were only true.)

and

“This settlement is a stark lesson to Wall Street firms that no product is too complex, and no investor too sophisticated, to avoid a heavy price if a firm violates the fundamental principles of honest treatment and fair dealing." said Robert S. Khuzami, Securities and Exchange Commission's director of enforcement, on a $55-million settlement with Goldman Sachs.   

From the same story:...  it would represent only a small financial dent for Goldman, which reported $13.39 billion in profit last year.

News of the settlement sent Goldman’s shares 5 percent higher in after-hours trading, adding far more to the firm’s market value than the amount it will have to pay in the settlement.

It’s part two of our “Netroots Nation Goes To Vegas Piano Bar Extravaganza”, and in keeping with tradition that means we are again taking a story request.

This time we won’t be talking about energy security or “climate security”; instead, we’ll discuss retirement security, keeping your money for yourself instead of paying it out in “mystery fees”, and how one of the “usual suspects” is at it again.

And if all that wasn’t enough...we also have pie.

William Greiter of The Nation has exposed yet another scam, an alarming one regarding Social Security.  Some highlights:

"Governing elites in Washington and Wall Street have devised a fiendishly clever "grand bargain" they want President Obama to embrace in the name of "fiscal responsibility." The government, they argue, having spent billions on bailing out the banks, can recover its costs by looting the Social Security system. They are also targeting Medicare and Medicaid."

".....These players are promoting a tricky way to whack Social Security benefits, but to do it behind closed doors so the public cannot see what's happening or figure out which politicians to blame. The essential transaction would amount to misappropriating the trillions in Social Security taxes that workers have paid to finance their retirement benefits. This swindle is portrayed as "fiscal reform." In fact, it's the political equivalent of bait-and-switch fraud."

Forget the $770 billion taxpayer bailout for Wall Street. As one top economist with the Atlanta Federal Reserve has said, we got snookered.

The real money game has been quietly taking place through 11 programs established by the current administration and the Federal Reserve Bank over the past 15 months to guarantee more than $7 trillion of U.S. taxpayer-backed loans to banks. Which banks? And what type of collateral is being offered to guarantee these loans? That's none of your fracking business, little taxpayer person!

This is pretty stunning to think about in full:

However well-intentioned it was, the catastrophic and unpopular intervention in Iraq has served in some parts of the world to discredit the very idea of western democracy.

The recent collapse of the banking system, and the humiliating resort to semi-socialist solutions, has done a great deal to discredit - in some people's eyes - the idea of free-market capitalism.

Democracy and capitalism are the two great pillars of the American idea.

To have rocked one of those pillars may be regarded as a misfortune.

To have damaged the reputation of both, at home and abroad, is a pretty stunning achievement for an American president.

- Boris Johnson, Mayor of London

The promotion of failure apparently knows no bounds.

Where else can you receive welfare from the working class, more than $1 trillion worth, give a big assist in bankrupting the global economy, and still get bonuses to the tune of $70 billion in the same year?

Talking Points Memo has a great breakdown of what top economists are saying about the Wall Street bailout. It's a darn good, insightful, and concise read. You'll learn a thing or two.

Maybe we will also get answers to some hard questions. Like:

--Why was the CEO of Goldman Sachs in the room when government officials decided to bailout the insurer AIG, especially since Goldman has about $20 billion, half of its shareholder equity, at risk on AIG? Keep in mind that Treasury Secretary Paulson is the immediate former CEO of Goldman.

--Why was Lehman Brothers, a Goldman competitor, the only Wall Street firm in trouble so far left to collapse on its own? The Wall Street Journal reports today that it was the collapse of Lehman (which because of its structure may not have been an attractive firm for purchase) that "triggered cash crunch around the globe."

--Has Treasury obtained from every bank the amount of its illiquid assets, which would tell us if the problems are concentrated at a few banks or are pervasive?

Update II: Congress, Bush team OK bailout terms; Stocks sink
Update: From ThinkProgress: Question: In 1999, you were one of the senators who helped pass deregulation of Wall Street. Do you regret that now?
McCAIN: No. I think the deregulation was probably helpful to the growth of our economy

Why is that every time bad investments made by private institutions go belly up, the U.S. taxpayers are called upon to socialize the financial risk? WHY?

Why is it that suddenly, government isn't the problem, it's the solution?

Democrats and Republican lawmakers are to blame for the current mortgage and investment banking crisis. From a legislative perspective, they saw this coming years ago and did nothing to stop it. This has happened before. Remember when taxpayers were called upon to bailout the Resolution Trust Corporation and the S&L crisis in the 1990s?

When will we hold politicians and powerbrokers in this country responsible for believing risk should be socialized, but wealth must be privatized?