Comment: Sadly its the US Senate that continues to prop up this criminal activity. Citizens and state legislators need to wake up to the destructive nature of the 17th Amendment as demonstrated by this financial debacle as well as every financial crisis since 1913.
Congressmen, listen up!
Catherine Austin Fitts offers a unique perspective on the global financial system and on the political economy. Her background includes Managing Director and member of the Board of Wall Street investment bank Dillon Read & Co. Inc., Assistant Secretary of Housing - Federal Housing Commissioner in the first Bush Administration and President of Hamilton Securities Group, a Washington DC investment bank. And she opposes the bailout for these reasons, which I am taking the liberty to reproduce in full* from her blog:
(1) Crime that pays is crime that stays.
There is reason to believe that Wall Street and those they represent are holding loans without collateral, multiple loans secured by the same properties, and other fraudulent instruments among the “troubled assets.” Based on the secret “Treasury Conference Call” with 800 Wall Street insiders, we know the deal proposed to be passed by Congress isn’t the real deal promised to Wall Street.
(2) This smells like obstruction of justice.
Bail-out without due diligence of so called “troubled assets” is a perfect way to hide documentation of financial crimes. It is also a perfect means to launder both the past ill-gotten gains and new federal money spent recklessly and without necessary safeguards and oversight mechanisms. Be very suspicious when they tell you “we just can’t tell what’s in these troubled assets.” We can assure you that the federal government has field offices all across the country that deal with significant amounts of real estate and mortgage assets on a daily basis. If Treasury refuses for more than a decade to comply with the laws, with approximately $4 trillion missing (and counting), it is not competent to manage $700 billion of taxpayer money while its arm is twisted by Wall Street.
(3) Wall Street owes the federal government
We need to get stolen money back from the banks that served as depositories for the US government (including trillions for which the Pentagon and HUD could not account) and punish them, not create another opportunity for them to game the system and engage in criminal enterprises to rob consumers. To the extent there has been regulatory wrong-doing, let’s not let the miscreants leave town with the evidence.
(4) Good guys are shut out.
A bail-out provides no way for honest leaders to come to the fore and use their creativity and expertise to restore balance and integrity to the system or for unproductive and poorly-managed banks that contribute to current over-capacity in the banking system to die a dignified death.
(5) This results in more investment in the “bubble economy.” Spending massive amounts on non-productive uses (“buying” worthless credit default swaps, mortgages with no collateral and derivatives, which could even include the derivatives used to manipulate the precious metals markets) as opposed to productive uses (repairing infrastructure, creating alternative energy systems, supporting inventing and production of “green” products) is inflationary.
This bail-out will drive prices of food, water and energy up for the people who can least afford it.
(6) Bail-out does not result in capital circulating in healthy ways.
The bail-out of Wall Street and too-big-to-fail banks and insurance companies that are getting bigger by the minute by swallowing up other failing financial institutions (and creating more institutions that are “too big to fail”) does not result in trickle-down to those whose money was stolen in recent swindles (S&L, dot.com, current housing crisis), i.e., the taxpayers/middle class and working poor.
(7) These arrangements will result in more
Centralized “fixes” are sure to result in black holes, no-bid contracts and other scandals.**
(8) The bail-out drains the real economy, rather than invests in the real economy.
The US economy can’t be productive or grow if consumers don’t have jobs and can’t afford to purchase goods and services. Real stimulation of Main Street is accomplished through productive investment, not
bail-outs that shift money to unproductive sectors. We should use all of our precious resources to reinvest in our people in the real economy.
(9) It props up sectors that need to downsize and
There is significant overcapacity in the financial and banking sectors. Brainpower and talent needs to stop blowing financial bubbles and shift to economic activities that create real value.
(10) It is a temporary “fix” to keep Wall Street afloat until after the election.
Our resources are better invested in permanent, long-term solutions. This bail-out will not fix anything. Rather, it will help the perpetrators get away and ensure that the ultimate day of reckoning is worse.
The Administration wants to drain the real economy to bail out Wall Street. It seems to us that the more appropriate plan would be to require Wall Street to return the $4 trillion plus that is missing and use that to rebuild the real economy.
We think the time has come to reverse the flow. Go to any business school in the country. That is what they teach. Money should move out of unproductive sectors into productive sectors. The bail-out does just the opposite.
“Just say NO!”
The "sweeteners" (the increase in the FDIC coverage on deposits to $250,000 and tax cuts) do not address the problem. Congressmen, listen to Ms. Fitts: "Just say NO!" And while you're at it, abolish the Federal Reserve!
Virtual buckeye to Ed.
* I ask Ms. Fitts' forgiveness for this. I have copied it because of the urgency of the situation we are all trying to address, and the need to add authoritative arguments opposing the "bailout".
** Have we forgotten the corruption involved with Iraq's "reconstruction" already?
The 17th and 16th Amendments along with the Federal Reserve Act are all connected. This tri-component is the tap root of the strangling vine causing our downward spiral in the global financial and business markets. We are being milked dry and we are being destroyed.