Sunday, February 14, 2010

Who Needs Terrorists?

With all the blather on the airwaves about terrorism and how the United States faces its “greatest strategic threat today” from nuclear or biological attack by terrorists (Dick Cheney said that on Sunday), one would think that unnamed (read Arab or Muslim) fanatics really were about to sink our republic. The truth, though, is that we don’t really need terrorists for that. We’ve got our own homegrown terrorists deep in the heart of our system. They are the well-dressed white guys we call bankers and brokers and the assorted masters of economic warfare who have recently, and continue today, to bring our nation to ruin.

Consider the latest report on Goldman Sachs—that greatest of brokerage houses which has recently reported record profits in the past year (an 81% rise in pay and bonuses for 2009), a year when the entire economy nearly collapsed. PBS’ News Hour did a multi-segment report on Goldman recently, and revealed several shockers. Among them, that Goldman Sachs was on the brink of bankruptcy in 2008, but managed to get the feds to do several things: in September 2008, “Goldman sought and received approval to become a bank holding company,” and a bit later, a financial holding company. This allowed it to do many things, but perhaps the most piratical is this: Goldman was, as a bank, able to borrow money from the Federal Reserve at the bankers’ rate of virtually 0% interest, and then turn right around and buy Federal securities which pay 3% or so. You get the picture. It is taking from taxpayers with one hand, and deriving an instant profit from them with the other, without having to lift a finger. And this is legal, folks. It’s legal from the brokerage/bank that had a hand in the worst of the subprime lending excesses (financing New Century Financial, First Franklin, and Long Beach Mortgage) and then betting on its own on the collapse of the very subprime market it was pumping up. With its former CEO Hank Paulson in charge of the TARP program, of course, it also took some $63 billion in bailout funds, including tens of billions indirectly via the AIG bailout, which, through credit default swaps, bailed Goldman out of potentially huge losses and its own bankruptcy. Now, according to a report on SEIU’s website, Goldman is right back in the mortgage securitization business “repackaging the mortgages that have been stuck on their books since the housing bubble burst and now selling them as a new product. Known as "re-remics", they simply pull out the worst of the bonds to boost the credit rating to make the sale, kind of like what brought on the financial crisis in the first place.” This isn’t the half of it, but you get the picture. Goldman Sachs is, in my view, essentially a financial terrorist, using its money and influence to fleece the United States government, and, in the process, nearly breaking the world financial system. As redemption, it first claims its work is “God’s work,” and then promises to give a billion to charity—meanwhile paying its executives criminal salaries and bonuses amounting to $20 billion or so, stocking the federal government with its ex-employees, and lobbying to keep from having any new regulations passed that might cramp its style.

Goldman Sachs isn’t alone, of course. There are other investment bankers and insurance companies like AIG, all of whom subscribe to the same theory of economics: use every barely legal trick and form of influence available to make as much profit as fast as possible, get the government to bail you out if you fail, and don’t worry about the suckers who might suffer from rifling the public treasury. It’s called “free market capitalism,” and it’s the honorable way, the American way. What’s even more honorable is to blame the government when things go wrong, blame the bureaucrats you have in your hip pocket, and make sure you finance both sides of the political spectrum to ensure against any regulation that might curb your criminal tendencies.

It should go without saying that the major corporations—many of whom make their profit from government contracts, especially fat contracts to supply military hardware (Lockheed-Martin, Northrup-Grumman, Boeing, General Dynamics, etc.), military services (KBR/ Halliburton, Blackwater, Health Net, et al.) and all the rest of the material and personnel to support our imperial ventures (needed to protect these corporations’ foreign plunder)—operate on the very same principles. The only difference is that the latter supply a tangible—goods and services—instead of the mathematical illusions supplied by the financial pirates. But the compensation is similarly bloated and inflated beyond all reasonable measure. Other corporations like Wal-Mart and its cronies in the apparel business, the corporate food business, and the health-care business, game the system in similar ways. What they have had in common in the last decades has been the practice of offshoring—finding cheap labor in countries such as China, Mexico, India, Haiti, and beyond who will supply goods and services at costs so far below what American workers could provide that most of what Americans used to make at home is now made abroad. Idle factories throughout the land stand in mute testimony to this, as has the disappearance of even jobs that used to be considered export-proof: answering phones, providing tech support for internet and other services, and so on. Indeed, though it would seem that hospital care should be export-proof, it is becoming more and more common for Americans to schedule operations in foreign countries whose doctors and hospitals can perform them at a fraction of the cost. Can it be long before Blue Cross and Blue Shield begin requiring their customers to go to Thailand for their surgeries?

In short, the American way of business and finance has become the world’s foremost breeding ground for terrorist organization. With the American treasury going bankrupt, with China threatening to pull the plug on American credit, with financial organizations scheming to find ever more sophisticated ways to bleed the treasury and American taxpayers, this form of economic terrorism is accomplishing what Osama bin Laden could only dream of.

Do we even need al Quaeda anymore?

Lawrence DiStasi

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